[Senate Hearing 105-429]
[From the U.S. Government Publishing Office]


                                                        S. Hrg. 105-429


 
 DEPARTMENT OF TRANSPORTATION 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. 2169/S. 1048

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

                               __________

                      Department of Transportation
                       General Accounting Office
            National Railroad Passenger Corporation (Amtrak)
                  National Transportation Safety Board
                       Nondepartmental witnesses
                    Office of Management and Budget
                       Railroad Retirement Board
                      Surface Transportation Board

                               __________

         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
 39-864 cc                   WASHINGTON : 1998
_______________________________________________________________________
            For sale by the U.S. Government Printing Office
Superintendent of Documents, Congressional Sales Office, Washington, DC 20402
                           ISBN 0-16-056437-9



                      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 Transportation and Related Agencies

                  RICHARD C. SHELBY, Alabama, Chairman
PETE V. DOMENICI, New Mexico         FRANK R. LAUTENBERG, New Jersey
ARLEN SPECTER, Pennsylvania          ROBERT C. BYRD, West Virginia
CHRISTOPHER S. BOND, Missouri        BARBARA A. MIKULSKI, Maryland
SLADE GORTON, Washington             HARRY REID, Nevada
ROBERT F. BENNETT, Utah              HERB KOHL, Wisconsin
LAUCH FAIRCLOTH, North Carolina      PATTY MURRAY, Washington
TED STEVENS, Alaska
  ex officio
                           Professional Staff
                             Wally Burnett
                              Reid Cavnar
                             Anne M. Miano
                             Joyce C. Rose
                        Peter Rogoff (Minority)


                            C O N T E N T S

                              ----------                              

                        Thursday, March 6, 1997

                                                                   Page
Department of Transportation.....................................     1

                        Thursday, April 10, 1997

Department of Transportation:
    Federal Highway Administration...............................   123
    National Highway Traffic Safety Administration...............   144
    Federal Transit Administration...............................   146
Nondepartmental witnesses........................................   225
Material submitted subsequent to conclusion of hearing...........   267

                       Wednesday, April 16, 1997

National Transportation Safety Board.............................   287
Department of Transportation: Federal Aviation Administration....   317

                         Wednesday, May 7, 1997

Department of Transportation.....................................   355
General Accounting Office........................................   355
Department of Transportation: Federal Railroad Administration....   391
National Railroad Passenger Corporation (Amtrak).................   391
General Accounting Office........................................   391

                        Thursday, June 12, 1997

Congressional witnesses..........................................   461
Nondepartmental witnesses........................................
  461, 487, 531..................................................
Department of Transportation: Federal Aviation Administration....   487

                        Thursday, July 17, 1997

Department of Labor: Railroad Retirement Board...................   561
Department of Transportation.....................................   573
Office of Management and Budget..................................   573
National Railroad Passenger Corporation (Amtrak).................   573

    Material Submitted by Agencies Not Appearing for Formal Hearings

Department of Transportation:
    Federal Highway Administration...............................   591
    Federal Railroad Administration..............................   784
    National Highway Traffic Safety Administration...............   878
    Research and Special Programs Administration.................   945
    St. Lawrence Seaway Development Corporation..................  1033
Related agency: Surface Transportation Board.....................  1051
Nondepartmental witnesses........................................  1079



 DEPARTMENT OF TRANSPORTATION AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 1998

                              ----------                              


                        THURSDAY, MARCH 6, 1997

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10:02 a.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Richard C. Shelby (chairman) 
presiding.
    Present: Senators Shelby, Domenici, Specter, Bond, Bennett, 
Faircloth, Stevens, Lautenberg, Byrd, Mikulski, and Murray.

                      DEPARTMENT OF TRANSPORTATION

STATEMENT OF HON. RODNEY SLATER, SECRETARY
ACCOMPANIED BY LOUISE FRANKEL STOLL, ASSISTANT SECRETARY FOR BUDGET AND 
            PROGRAMS/CHIEF FINANCIAL OFFICER

                            Opening Remarks

    Senator Shelby. The subcommittee will come to order.
    Mr. Secretary, we appreciate your joining us today.
    Secretary Slater. Thank you, sir.
    Senator Shelby. We will get into some of the specifics of 
the President's budget request in a few minutes, Mr. Secretary, 
but I am going to be looking to you to help me better 
understand the criteria by which the administration evaluates 
the cost effectiveness of some of your programs.
    In the current budget environment, it is critical that we 
do all we can to make sure that we focus our limited Federal 
resources on projects that create jobs, create opportunities, 
create economic activity, and improve mobility in this country. 
As we put this year's bill together, I have asked the staff to 
focus on some of the large-dollar highway, transit, and 
aviation projects to make sure that we are being wise stewards 
of our limited transportation dollars.
    In turn, I am committed to doing what I can to bring more 
private money to building transportation infrastructure by 
utilizing innovative financing and establishing a business-
friendly environment. I will also try to identify any money we 
are currently spending on potentially unnecessary 
transportation studies into spending on real projects that 
bring value to real people.
    Increasingly, this subcommittee performs a balancing act, 
juggling resources among a host of worthwhile priorities 
competing for the same Federal dollar. There are no easy 
choices. Pressure to fund new initiatives and to maintain and 
expand current discretionary programs continues, while there 
are fewer options and less consensus on where offsetting cuts 
should be taken.
    In turn, I am dedicated to continuing the search for more 
efficient, less costly ways to deliver essential transportation 
services, to consolidate and to reform programs to increase 
flexibility over the use of limited Federal dollars, to 
question the merit of Federal expenditures, and to shift funds 
from lower to higher priority activities. However, I believe, 
Mr. Secretary, we must recognize that if the total amount 
available for transportation appropriations is frozen, we must 
weigh the future consequences of continuing to defer needed 
capital investments.
    I probably bring a little different perspective to this 
subcommittee than some of the past two chairmen, who are 
friends of mine. Like every State in the Union, my home State 
of Alabama has substantial transportation needs, but our needs 
are primarily to improve and expand our highway system. I am 
very sensitive to the varied transportation needs of the States 
represented by other members of the subcommittee, the 
Appropriations Committee, and the Senate, and I commit to them 
and to you, Mr. Secretary, that I will do everything possible 
to help them find the tools and the flexibility to address 
their individual State's transportation needs. I strongly 
believe that all solutions involve a reexamination of the 
Federal commitment to investing in transportation 
infrastructure and a renewed commitment to ensuring that all 
States and regions receive adequate consideration of their 
transportation needs.
    Finally, Mr. Secretary, I want to reiterate my commitment 
to preserving and promoting transportation safety. I want to 
work with you to create a better understanding of how safety 
cuts across modal lines. While we need to strive for continued 
improvements in transportation safety, we must be mindful that 
the cost of safety improvements in one mode of transportation 
may influence transportation choices by the traveling public.
    I look forward to our discussion today and to working with 
you on the many challenges facing our transportation system.
    Senator Lautenberg.

                    STATEMENT OF SENATOR LAUTENBERG

    Senator Lautenberg. Thanks very much, Mr. Chairman. Let me 
first congratulate you on being named chairman of the 
Transportation Subcommittee. I can speak with authority it is a 
very good job. You will find it fulfilling. You can make a 
difference, and I am glad that we both have significant 
transportation interests and hopefully we will be able to 
satisfy our mutual interests with the appropriate amounts of 
funding and interest on our part.
    Never in the 14 years that I have been in the Senate--and I 
have served on this subcommittee for a long time. I am thankful 
to Senator Byrd, our distinguished ranking member and past 
chairman, for encouraging my appointment to the Subcommittee on 
Transportation.
    Never, though, have we had so many historic decisions 
related to transportation in the same year that we were 
charting the course and will continue to chart the course of 
our national transportation policy.
    In the coming year, we are going to be debating proposals 
to convert the entire Federal aviation system to a user-based 
fee. It will, however, not be enough to simply enact financial 
reform for the FAA. We will need to monitor its progress to 
ensure that taxpayers and the flying public actually enjoy the 
benefits of true reform.
    While we have already granted the FAA far-reaching 
personnel reform, we continue to see unacceptable delays in 
getting an adequate number of fully trained staff into some of 
the busiest air traffic control facilities in the country.
    While we have granted the FAA far-reaching procurement 
reforms, we still see difficulties and delays in getting state-
of-the-art traffic control equipment deployed to the field. 
Just 1 week ago this day, we saw an equipment failure at Newark 
Airport, one of the busiest airports in the world, which caused 
the radar screens in the air traffic control tower to go blank. 
Thankfully, all systems were fully operational within 9 minutes 
and no passengers were put at risk and there were hardly any 
departure or landing delays.
    But I, like all Senators, find such incidents to be 
intolerable. We cannot and should not wait 1 day more than is 
necessary to replace aging equipment with modern and fully 
reliable systems. We have added hundreds of millions of dollars 
to the FAA's budget to address critical deficiencies in the 
areas of safety and security. Yet, we continue to see holes in 
the safety net that require immediate attention.
    This subcommittee can easily spend all of its energies this 
year on ensuring that our aviation system remains the safest in 
the world, but we are simultaneously charged with focusing on 
the reauthorization of the Intermodal Surface Transportation 
Efficiency Act--ISTEA as it used to be called in the old days--
and I understand we might even have a new name.
    As we approach reauthorization of ISTEA, we will continue 
to advance the balance of the agenda, balance of flexibility 
that was the centerpiece of that landmark legislation. Or will 
we retrench to our previous one-dimensional policy that would 
exacerbate rather than mitigate congestion?
    Will we face the fact that Amtrak is a critical part of our 
national transportation network, or will we deprive the 
railroad of the kind of capital that is necessary to improve 
its performance to the level of a high-speed railroad that this 
country so rightly deserves?
    And what about the safety agenda? After years of steady 
improvement, we are now seeing a tragic increase in fatalities 
that are associated with drunk driving. As a result of 
Congress' ill-advised repeal of the national maximum speed 
limit, we are now seeing increased carnage on our highways, 
especially increasing fatalities resulting from high-speed 
crashes. Will we use ISTEA II to insist on improvements in the 
safety of our highways and railroads, or will we continue to 
simply deregulate, abdicating our Federal leadership on safety?
    If these challenges were not enough, the President's budget 
asks us to address still other challenges: improving the 
ability to move welfare recipients to work and increasing the 
Coast Guard efforts to keep drugs off our shores. And the 
President's budget asks us to address all these challenges 
within a very tight funding envelope, a budget that is 
consistent with the goal of balancing the budget but leaves no 
room for redundancy or waste.
    While we may wish that we had the opportunity to address 
each of these challenges 1 year at a time, we are required to 
address them all and address them now. There will be no hiatus 
for the new chairman of the subcommittee, just as there will be 
no hiatus for our new Secretary of Transportation.
    Now, fortunately, we have in Secretary Slater a proven 
executive with years of experience at DOT. This, Mr. Secretary, 
is your first appearance before the subcommittee in your 
capacity as Secretary, but hardly your first appearance before 
those of us at the table.
    The ease with which Mr. Slater was confirmed by the Senate 
serves as testimony to his performance as our Federal Highway 
Administrator, as well as the confidence that we place in him 
in his new role. And I want to welcome you this morning, Mr. 
Secretary. I look forward to your presentation of the 
administration's budget.
    And I thank you, Mr. Chairman.
    Senator Shelby. Senator Bennett.

                      STATEMENT OF SENATOR BENNETT

    Senator Bennett. Thank you, Mr. Chairman.
    Mr. Secretary, first let me apologize to you for having 
been out of town during the final vote on your confirmation and 
make the record clear that had I been able to be there, I would 
have cast a very enthusiastic aye in favor of your 
confirmation. I am delighted with the President's decision that 
you are the man for this position.
    If I may be allowed a personal reaction to your testimony, 
which I have glanced through, I am delighted that you are 
quoting my old boss, John Volpe. I entered the Nixon 
administration in 1969 as the chief lobbyist for the Department 
of Transportation. We do not call them that. We call them 
congressional relations and congressional affairs and that kind 
of thing, but I have always liked to call a spade a spade. I 
was in charge of the lobbying effort of a very new, fragmented 
cabinet level department that was less than 2 years old.
    If I may say so, I have my fingerprints very, very lightly, 
to be sure, but I was involved in convincing the Congress to 
pass the Airport Airways Act creating the airport airways trust 
fund, the Urban Mass Transit Act laying down the legislative 
structure for that administration and, Senator Lautenberg, 
Amtrak.
    One of the last things I did before I left the 
administration to go to private practice was convince Mike 
Mansfield that if we did indeed run a train to Yellowstone Park 
through Montana, he would allow that bill to pass out of the 
Senate and become law. Some of the folks at Amtrak were not 
understanding how important it was that we got Mike Mansfield's 
support. They said, he is just another Senator. I was able to 
add my expertise, which was not very expert, to say that if you 
do not have Mike Mansfield with you, you are probably not going 
to get this piece of legislation.
    They showed the same obtuseness toward Harley Staggers in 
West Virginia. They did not understand why the chairman of the 
House committee had to have a train running to the universities 
in West Virginia in order to make sure that the whole system 
would pass congressional muster.
    But I have a great affection for your Department, having 
served there and learned many things there, and welcome you to 
this position. If there is any position that I would personally 
lust after in an administration, it might be yours. I make it 
very clear I am not available, however, because I like the one 
I have a lot better. [Laughter.]
    References have been made by the other Senators to their 
own States, and that is appropriate and fairly standard in 
these circumstances. I will not go on at length but simply 
point out that, which I am sure you already know and I know the 
people in the Department already know, in addition to all of 
the standard kinds of transportation challenges faced by the 
State of Utah, we are acting as host for the Olympic games in 
the year 2002. That puts an absolute deadline that cannot be 
stretched on our finishing some of our projects and it will not 
look good--which is a very mild understatement--to have the 
television cameras of the world focus on Utah in the winter of 
2002 and have us say, well, the highway that would connect you 
to the venues where all of these events are going to take place 
was to be finished 6 months ago, but we have had a few delays 
and you will be able to get there by summer. Do not worry about 
it. The Olympic games do not give us the luxury of waiting on 
that, and I know you understand that and your people in your 
Department understand that.
    I look forward to working with you in ways to see that Utah 
meets its deadlines. I am not asking for anything that is 
untoward. I am not saying that Utah should get any favoritism 
above and beyond other States just because of the Olympics, but 
I think all of us as a nation recognize that we have an 
obligation, having made a commitment that something will be 
done by x date, in this case to make sure that date is met. Or, 
to take out of context another phrase, the whole world will be 
watching, and I am sure none of us want that to happen.
    So, I welcome you to the committee and to your assignment. 
My congratulations to you in your assignment. I look forward to 
the balance of your testimony.
    Senator Shelby. Senator Byrd.

                       STATEMENT OF SENATOR BYRD

    Senator Byrd. Thank you, Mr. Chairman. First I congratulate 
you on the occasion of your first hearing as chairman of the 
Transportation Subcommittee. I am pleased to have a chairman of 
the subcommittee who is sympathetic for the need for highways 
in this country and who in this particular instance has some 
unfinished Appalachian corridors in his State.
    I also look forward to continuing to work with our very 
capable former chairman, now the ranking member of the 
subcommittee, Mr. Lautenberg, on the many responsibilities that 
we face in this extremely important, in some ways, most 
important subcommittee. I say this because this subcommittee 
provides funding for the Nation's transportation 
infrastructure, its 953,000 miles of Federal-aid highways and 
its 296,000 bridges, together with the Nation's mass transit 
systems, Amtrak, and all the Nation's airports.
    In addition, the subcommittee must address critical safety 
issues in all of these transportation modes, whether the issue 
is airbags, air traffic control, rail highway crossings, 
oilspills, or curtailing drunk driving.
    I join the subcommittee in welcoming Secretary Slater. I 
congratulate you, Mr. Slater, on having been promoted to the 
position of Secretary of Transportation after serving the 
Nation very ably as the Federal Highway Administrator. I have 
had several occasions over the past 4 years to work closely 
with our new Secretary. He was a very forthcoming and capable 
Administrator, and I look forward to continuing my close 
cooperative relationship with him in this new capacity.
    Mr. Chairman, never are we reminded more quickly of the 
importance of our highways than at times of disaster. Secretary 
Slater has just returned from Arkansas where he witnessed 
firsthand the devastation from the tornadoes that cut a deadly 
path across his home State.
    My State is also suffering at the present time, for the 
umpteenth time, suffering from the effects of yet another spate 
of floods that have taken the property and not the spirit of so 
many families. I know that the members of this subcommittee 
join me in saying to the Secretary that we intend to move as 
rapidly as possible on any funding requests that the President 
puts forward to address the needs arising from this recent rash 
of disasters, the floods and heavy snows in the West and 
Midwest, the tornadoes and floods in the South, as well as the 
floods affecting the States of Ohio, West Virginia, Kentucky, 
and other States.
    As Secretary Slater knows, I have grave concerns regarding 
our decades-long disinvestment in our Nation's infrastructure. 
Our national investment in our infrastructure as a percentage 
of our gross domestic product has been cut almost in half since 
1980, from roughly 1.2 percent to 0.6 percent. This trend has 
taken a severe toll on the viability and the safety of our 
National Highway System.
    In his last full year as highway Administrator, Mr. Slater 
published a comprehensive report on the conditions of our 
National Highway System, showing that we are developing a 
larger and larger backlog in the funding necessary to maintain 
even an adequate system of highways and bridges.
    Unfortunately, we are faced with a budget request from the 
administration that calls on this subcommittee to effectively 
freeze the annual obligation limitation on the Federal Highway 
Program at its current level for each of the next 6 years. 
Secretary Slater's statement makes some mention of a few 
encouraging signs that indicate that we may be witnessing a 
turning point in the continuing deterioration of our National 
Highway System, but there is no question that if we freeze 
highway spending at the current level, this perceived 
stabilization in our highway system's performance will be 
short-lived indeed.
    The current level of spending certainly will not allow us 
to address the millions of hours and billions of dollars that 
our economy loses every year due to constrained capacity and 
traffic congestion not only in the Nation's major metropolitan 
areas, but also in many rural and suburban areas as well.
    Plus we must simultaneously remember that highway use is on 
the rise. The vehicle miles traveled by our citizens have grown 
more than 40 percent in just the last decade and this trend is 
expected to continue.
    According to the Secretary's formal statement--and I quote 
him--``The Department is committed to a long-term 
infrastructure investment program and seeks the highest levels 
of investment within the balanced budget context.''
    Well, the Secretary knows that it is with great respect and 
fondness that I'm required to disagree with the notion that a 
freeze on highway funding is the best that we can do. We must 
do better, and I am hopeful that we in Congress can find a way 
to increase substantially the levels of funding for the 
programs covered in ISTEA over the next 6 years, while 
simultaneously finding a way to balance the budget over that 
same period.
    While I cannot agree with the overall funding levels 
assumed for our highway programs in the administration's 
budget, I can and do agree with many of the priorities that the 
administration has highlighted in its ISTEA reauthorization 
proposal.
    For this Senator, the brightest spot in the President's 
proposal is his $2.19 billion authorization of direct contract 
authority toward the completion of the Appalachian Development 
Highway System. A total of $200 million is requested in 
contract and obligational authority for this initiative in 
fiscal year 1998. That is only a portion of what is needed.
    I have introduced a bill, S. 182, the Appalachian 
Development Highway System Completion Act. Senator Sessions has 
joined me in sponsoring this legislation. I know that the 
chairman of this subcommittee is very sympathetic with this 
legislation.
    My bill will provide sufficient funding over the next 6 
years to complete the 725 unfinished miles in the 13 
Appalachian States, the people of which have been promised now 
for more than 30 years this highway system.
    I discussed my proposal with a number of my colleagues who 
have direct responsibility over the ISTEA legislation, and I 
received favorable reactions from the Senators with whom I have 
spoken.
    While the Interstate Highway System is now almost 100 
percent complete, the Appalachian Highway System remains only 
76 percent complete throughout the region and only 74 percent 
complete in the State of West Virginia, even though its 
completion was promised in law, as I say, some 32 years ago. 
And I was here at the time that we made that promise, as I was 
here at the time we made the promise concerning the Interstate 
Highway System during the administration of President 
Eisenhower.
    Mr. Chairman, our region has waited long enough for the 
Federal Government to meet its responsibility to complete this 
essential part of our National Highway System. So, I again want 
to compliment Secretary Slater and the President for proposing 
an excellent first step toward that end.
    In conclusion, let me again congratulate you, Mr. Slater, 
and assure you that this subcommittee stands ready to do its 
part in achieving what you described as your goal, namely, the 
highest levels of investment to a long-term infrastructure 
investment program within the balanced budget context.
    And as the last word of the New Testament of the Bible is 
amen, let me say that also in closing my statement. Amen.
    Senator Shelby. Senator Murray.

                      STATEMENT OF SENATOR MURRAY

    Senator Murray. Well, thank you, Mr. Chairman. It is a 
delight to be on this committee, working with you as one of the 
newer members. Congratulations on your assignment and I look 
forward to working with you.
    Secretary Slater, it is good to see you again on your side 
of the world. The Secretary and I have met several times now in 
the past several months, both of them in my home State, the 
first time when our State had severe flooding and disaster 
about 1\1/2\ months ago, and the Secretary came out and met 
with some of the people who were firsthand experiencing some of 
the dramatic impacts of what weather can do to them and their 
roads. I appreciated your being out there.
    The second time was in a very tragic circumstance when we 
lost three young Coast Guardsmen who were trying to save a 
sailboat off the northernmost corner of my State and the 
Secretary was most kind in coming out with Commandant Kramek, 
traveling all the way across the country to be at that funeral 
service in a very remote community of La Push in the State of 
Washington. I want you to know that your words and your being 
there really meant a lot to those young Coast Guardsmen and the 
community and the Quillayute Indian Tribe who is such a 
tremendously important part of that community. We very much 
appreciated your being there.
    That community is continuing to try and deal with that 
tragedy, the first Coast Guardsmen that we have lost in this 
country in a number of years, and I just wanted to tell you how 
much we appreciate your personal interest in them and in that 
community.
    I am looking forward to your remarks in just a few minutes, 
but I just wanted to touch on a few issues that I am going to 
be following on this committee.
    As you traveled to La Push, you had the opportunity to fly 
over the Olympic Peninsula in my State and saw what a beautiful 
natural area that is, tremendously large. It is a regional 
interest for cyclists who come there from all over the country 
now. They do not mix well with logging trucks, and we have had 
a number of accidents. So, we have been working with seven 
different communities out there on a voluntary basis to put 
together a bike trail, a 360-mile bike trail, around the 
Olympic Peninsula and hope we can work with you further to be 
flexible with some of our funds so that we can meet some of 
these safety issues on those logging roads.
    Second, I just wanted to quickly mention the regional 
transit plan that was just passed by Puget Sound with a 50-50 
match. They are very excited about this opportunity, 
particularly in Bellevue. We have a crowded I-405 that is 
becoming a real congestion problem. My constituents are 
concerned that as the Federal budget declines, that they will 
not be able to see this get off the drawing board, and they 
want some information back on whether these new projects will 
be able to have Federal matching dollars as they push forward.
    Finally, just let me mention the Airport Improvement 
Program. I noticed that it is being targeted a cut of nearly 
one-half of a billion dollars. Many of our airports are 
suffering. Infrastructure is old, needs replacing. Our traffic 
is greatly increasing. Particularly in rural areas, people 
depend on the AIP funds for survival and safety, and we want to 
hear from you how we are going to be able to absorb some of 
these cuts.
    So, with that, Mr. Secretary, I welcome you and thank you 
for all your great work and I look forward to working with this 
committee.
    Senator Shelby. Senator Bond. I understand it's your 
birthday. Is this the day?

                       STATEMENT OF SENATOR BOND

    Senator Bond. Yes, sir; thank you. I appreciate that. I am 
at that stage where one is delighted to be here to celebrate 
one. [Laughter.]
    We do not worry about the number of years that have 
gathered.
    Mr. Secretary, I welcome you.
    And I also congratulate our new chairman and I certainly 
look forward to working with you, Mr. Chairman, and with our 
good friend, Rodney Slater, with whom we've worked on many, 
many important issues.
    I can certainly sympathize with Senator Byrd and others who 
are having the problems of flooding. You well know how serious 
an impact the floods of this magnitude can have on the entire 
transportation system, and it is absolutely essential to have 
someone as responsive as you have been, Mr. Slater, in these 
efforts.
    I also want to join with the Senator from Washington, 
expressing our thanks for the concern you showed for the Coast 
Guardsmen. One of those brave, young men who was lost was from 
southeast Missouri, and I know that the family and all of the 
friends in that area appreciated your concern.
    But speaking of safety, I have to tell you, again to go 
along with what Senator Byrd said, that the lack of adequate 
funding for transportation, for highways in particular, was 
really brought home to me this past weekend. We had the funeral 
for one of my very good friends from Chillicothe, MO, who was 
killed in a head-on collision on a narrow, two-lane highway 
which is in the process but is not yet upgraded because it 
carries traffic for a four-lane.
    The evening after his funeral, I attended an event in 
Festus, MO, where the mayor had just buried his wife, who also 
was killed in a head-on collision on a two-lane road that now 
has been upgraded to a priority for improvement.
    The funds that we need for highways, roads, and bridges, 
all transportation needs, are overwhelming. Yesterday, with 
Senator Chafee, I introduced a measure to change the budget 
scoring so that the highway trust fund moneys, collected one 
year would be paid out the next year--the Highway Trust Fund 
Integrity Act. I think that the people of America who pay into 
that fund, when they gas up their cars, want to know that these 
funds are going for transportation purposes, and I hope we can 
obtain support both from your side and from my fellow Members 
of the Senate for that.
    I am not going to be able to stay for the full hearing. I 
have some other obligations, but there is one issue that I did 
want to call to your attention.
    You have been most generous and helpful in dealing with our 
bridge problems. We have stood side by side in Hannibal, MO, at 
the Chouteau Bridge and at Cape Girardeau where there's a 
bridge named for my dear friend, the late Congressman Bill 
Emerson.
    It was initially rumored that the administration's ISTEA 
bill would not include a bridge discretionary program. However, 
my good friend and Missouri colleague, the widow of Bill 
Emerson, JoAnn Emerson, brought this up in a House hearing last 
week. You mentioned that the Department was in the process of 
reconsidering that position but was unable to make any specific 
recommendations. I applaud your reconsideration and ask for 
your careful attention as you give thought to this vitally 
important program.
    Something has to be done. I think the statistics showed 
that in 1995, the Department reported that 25 percent of the 
Nation's interstate bridges were classified as deficient or in 
poor condition, and 28 percent of 130,000 bridges on all other 
arterial systems were deficient. According to your Department, 
my State of Missouri has the dubious distinction of being sixth 
from the bottom in condition of bridges. We are sixth highest 
in total number of bridges, something to do with the Missouri 
and the Mississippi Rivers, I believe. Over 10,000 bridges in 
my State are in need of some kind of repair and replacement.
    We certainly do not want to be talking about attending any 
more funerals if a bridge collapses. So, I would hope that you 
would be able to inform this committee and our House 
counterparts and also the authorizing committees what your 
position will be on the bridge discretionary program.
    Thank you very much, Mr. Chairman.
    Senator Shelby. Senator Domenici. Oh, excuse me. I did not 
see. Senator Faircloth.
    Senator Faircloth. Go ahead, Pete.
    Senator Domenici. Oh, no.
    Senator Shelby. You were sitting back Senator Faircloth.

                     STATEMENT OF SENATOR FAIRCLOTH

    Senator Faircloth. Thank you, Mr. Chairman.
    Mr. Slater, delighted to see you here this morning.
    I am new to the subcommittee but spent about 8 years as 
chairman of the North Carolina Highway Department. Just as an 
aside, Mr. Chairman, it is the largest in the Nation. We have 
close to 78,000 miles of highway. North Carolina has very few 
city streets and no county roads. They are all under one 
unified system, and it works extremely well.
    I recently had some conversation with Secretary Slater, and 
he was most helpful in saving air service to two communities 
and I want to thank you.
    Secretary Slater. Thank you, sir.
    Senator Faircloth. Mr. Chairman, one of the most 
contentious transportation issues in this Congress will be 
surface transportation and the reauthorization of the bill. I 
am glad that we have scheduled a hearing to do it.
    This subcommittee is also going to have to address some 
very important issues this year. We face critical issues in 
subcommittee with aviation safety as well as highways. So, I am 
eager to start working on the program.
    North Carolina has been rapidly growing, particularly in 
the Raleigh-Durham and Charlotte areas. Our State in the late 
1940's built the most complex farm-to-market road system of any 
State in the Nation, literally tens of thousands of miles of 
it. Now, along those same roads, instead of farms, are 
microelectronics plants and high-technology industry. We simply 
are going to need much upgrading to maintain and to look after 
the traffic that is created.
    But one thing that was unheard of, or would have been 
unheard of, even 10, 15 years ago in North Carolina--we are 
going to have to go in many of our highly congested areas to 
some sort of light rail transportation, and I look forward to 
working with you on that and look forward to the rest of the 
hearing.
    Thank you, Mr. Chairman.
    Senator Shelby. Senator Domenici, now.

                     STATEMENT OF SENATOR DOMENICI

    Senator Domenici. Well, Mr. Chairman, thank you.
    I would ask your permission, before you close this record, 
to put in the record the 5-year budget requests of the 
President on transportation.
    Senator Shelby. Without objection, it is so ordered.
    Senator Domenici. Frankly, it is nice to be here, all 
talking like things are rosy because we have this wonderful 
Secretary before us, but the truth of the matter is, the 
President's budget cuts transportation over the next 5 years. 
Actually I think it is pretty obvious that the administration 
does not believe that is what is going to happen.
    But just so people know, it is kind of difficult to put 
budgets together when everybody wants to cut more and more out 
of the appropriated accounts and the President sends us a 
budget in an area that is least probable to get cut. When 
everybody is asking for more, the President asked for less. In 
the fifth year, there is less transportation funding than there 
is in the first year, according to what my staff tells me.
    So, I just think we ought to make the point that it is not 
going to be easy. The chairman does not know what amount he is 
going to get to spend yet from the distinguished chairman and 
ranking member of the full committee when funding is allocated.
    But I want you to know, members of the committee--and I 
have already said it publicly--while we do not direct the 
spending in the budget, I clearly am not going to produce a 
budget that has less transportation money over the next 5 
years, but rather more. I am just struggling with how much 
more. My ranking member, Senator Lautenberg, while we do not 
see eye to eye on some budget issues--I am hopeful on this one 
we will see eye to eye and put more money in transportation 
rather than less.
    I am absolutely convinced that people are talking about 
alternate modes of transportation and that is a great idea, but 
for many, many, many parts of America, there is no alternative. 
It is a road or no transportation, a safe road or a dangerous 
road, and there is nothing in between. That need is growing, 
not diminishing.
    Thank you very much.
    Senator Shelby. Senator Stevens.

                      STATEMENT OF SENATOR STEVENS

    Senator Stevens. Thank you, Mr. Chairman. I am delighted to 
have a chance to stop by. I see my colleague from West Virginia 
is here. Mr. Slater, I think we are both here to welcome you to 
one of the most difficult portions of the budgets that we 
oversee. I do not want to prolong this because I know my 
colleagues want to hear from you.
    But I join with the chairman of the Budget Committee in 
indicating I think there is no alternative but to fund the 
moneys that are needed for highways and for the modernization 
and replacement of our bridges.
    We do have a study, Mr. Slater, going on to determine the 
number of bridges that are really critical. I know your 
Department has already addressed that, but clearly we are going 
to have to have some reconsideration on how this money is 
allocated because of the safety considerations of many of these 
bridges. And one is right here in the District of Columbia.
    Now, I do have some questions, Mr. Chairman, I would like 
to submit.
    Mr. Slater, the question about the commuter rule is very 
critical to my State, and I do request that once you have 
addressed that, that we see if we cannot get together with you 
and with the head of the FAA because the application of this 
rule has already reduced the fleet of commuter airlines in my 
State, which I might say, Senator Faircloth, does not have 
10,000 miles of roads despite the fact we are one-fifth the 
size of the United States. It has reduced the commuter fleet by 
one-half. We have one-half the transportation now for rural 
areas of Alaska that we had 2 years ago because of the 
application of this rule to a State for which it was not 
intended.
    So, once you have read that question, I urge that you give 
us a chance to come visit with you and see if we cannot restore 
really the basic backbone of transportation in my State and 
that is the commuter airlines.
    Mr. Chairman, I thank you very much. I look forward to 
working with you, and I am sure my colleague does, as we get 
the bill to the full committee.
    Senator Shelby. Secretary Slater.
    Senator Domenici. Mr. Chairman.
    Senator Shelby. Senator Domenici.
    Senator Domenici. Could I just give you three outlay 
numbers so I will not burden the record?
    Senator Shelby. Go ahead.
    Senator Domenici. Highways from 1998 to 2002 are down $3.9 
billion, a 3.8-percent reduction. FAA is down 3 percent, a $1.4 
billion reduction, and transit is down 7 percent, a $1.5 
billion reduction. So, I will not put anything in the record. 
Those are the summary numbers.
    Senator Shelby. Senator Domenici, we thank you for those 
numbers, though.
    Secretary Slater, your entire written statement will be 
made part of the record, and if you will just briefly sum up 
the highlights of it, and this will give us some opportunities 
to question you. Thank you.

                     Statement of Secretary Slater

    Secretary Slater. Thank you, Mr. Chairman and members of 
the committee. At the outset, I would like to thank you for the 
opportunity to testify in support of the fiscal year 1998 
budget of the Department of Transportation as submitted by the 
administration.

                        Departmental Priorities

    Let me say at the outset, just in summary, in response to 
all of the concerns raised, with priorities, three in 
particular, during my tenure as Secretary--with safety as the 
No. 1 priority, dealing with transportation and its 
relationship to the economy, and also bringing a commonsense 
approach to our operations as servants of the American people--
with you in partnership and in partnership with the private 
sector, I think we can address effectively many, many of the 
issues that you have raised.
    It is noted that I have a longer statement that I would 
like to submit for the record, Mr. Chairman, outlining some of 
the specific particulars of the administration's commitment to 
invest $38.4 billion next year in our transportation 
infrastructure.
    The President, in his State of the Union Address, noted 
that, ``Over the last 4 years we have brought new economic 
growth by investing in our people, expanding our exports, 
cutting the deficit, and creating over 11 million jobs, a 4-
year record. Now we must keep our economy the strongest in the 
world.'' And clearly, transportation is central to all of that.
    Under President Clinton, we have tried to make good--and I 
believe we have made good--on the promise of ISTEA, landmark 
legislation that the Congress will be reauthorizing this year. 
With the Congress, we have increased transportation 
infrastructure investment to record levels. These investments 
have paid off in substantial improvements in the condition and 
the performance of our highways and mass transit systems.
    The President's budget includes $38.4 billion for our 
Nation's transportation system and key national transportation 
priorities which invest in both our people and our economy. 
Foremost among these priorities is to make the Nation's 
transportation system even safer for the American people.
    When George Washington saw the mountain terrain, separating 
the seaboard cities of the United States from the settlements 
along the Ohio River, he noted that we have to open a wide door 
to connect those markets.
    Well, over the last few years, we have worked to continue 
to open that wide door with an effective intermodal 
transportation system, allowing new businesses, express 
packages, to move in just-in-time delivery practices and 
procedures where items move almost seamlessly through the 
system, whether on land, water, or air.
    Thirty years ago, we started the Department of 
Transportation, committed to a vision. Today we work 
continuously to make that vision a reality, investing in people 
and investing in safety.
    As you know, I believe transportation is about more than 
concrete, asphalt, and steel. This budget proposes many 
critical investments in the quality of life concerns of the 
American people.

                                 Safety

    First, as relates to safety, we propose in 1998 raising the 
direct safety spending for highways, aviation, rail, and 
maritime by $200 million to a total of $2.9 billion, a record 
7.5 percent of our total budget. And all of you have mentioned 
safety as a top priority, whether on a two-lane highway or as 
it relates to aviation.
    Also I would like to note that this administration has 
tried to work with the National Transportation Safety Board to 
respond speedily to all of its recommendations. One of the 
first meetings I held, even before being confirmed, was with 
Jim Hall, the Chair of the National Transportation Safety Board 
[NTSB]. Approximately 88 percent of the recommendations offered 
by the NTSB have been closed, and of the 758 open 
recommendations, over 86 percent have been classified by the 
NTSB as open with acceptable action underway. So, clearly 
safety is a priority.

                          Strategic Investment

    As relates to jobs, one of the key provisions that we will 
have in our proposal is to improve our transportation system 
for people whether they live in rural, urban, or suburban 
areas, and a critical part of that will be a new $100 million 
program to deal with questions concerning welfare-to-work 
initiatives.
    Strategic transportation investment in infrastructure aids 
the economy. Beyond improving the quality of life, the 
transportation system of the 21st century must provide 
Americans with the ability to compete and win in a truly global 
marketplace. Working with the Congress over the past 4 years, 
we have increased Federal investment in highways, transit 
systems, and other infrastructure to an average $25.5 billion, 
more than 20 percent higher than the 4 preceding years.
    These investments are producing results. The conditions of 
bridges--and that has been noted time and time again--as well 
as the pavements of our system, have improved significantly. We 
have financed nearly 26,000 buses and almost 600 railcars for 
State and local transit systems as well, and we are doing a lot 
along the Northeast corridor.
    I believe, like you, that our transportation must be a part 
of our overall economic system but that it must be consistent 
with our commitment to balance the budget by the year 2002. So, 
as Senator Byrd has noted, our proposal is to get the highest 
level of funding possible within that context.
    Let me close by making a couple of commitments and also 
comments regarding aviation operations. Just as the interstate 
system expanded our national economy in this century, I believe 
that aviation will expand our global economy in the 21st 
century. I assure you that I will use the leverage provided by 
all of the innovative decisions made over the last year or so 
to give the FAA improved legislation as it relates to 
procurement reform and personnel reform. We will work hard to 
deal with the question of long-term economic investment.

                         Commonsense Government

    On the issue of commonsense Government, let me note that 
we, too, Mr. Chairman, will make an effort to work with you to 
bring private sector dollars to the financing of transportation 
infrastructure investment. We hope to do that through our State 
infrastructure bank initiative, as well as through the 
establishment of a $100 million new Federal credit program 
designed to deal with big-ticket items.
    In closing, I would like to say that as we work to create 
the transportation system for the 21st century, we must also 
work to build a critical mass of professional wherewithal and 
skill to man and to provide the human resources to make that 
system work.
    And I would like to ask the Congress to work with me in 
establishing a Garrett A. Morgan technology and transportation 
futures program designed to bring 1 million young people across 
our country into the transportation industry. Giving them 
access to the technological advancements of our transportation 
system of tomorrow will be just the kind of inspiration they 
need, I believe, to find this profession rewarding.
    In closing, let me just say that I look forward to working 
with all of you to ensure that our best days as a Nation are 
yet ahead of us, and in doing so, we have to make sure that we 
have a quality transportation system to sustain and to buttress 
the economic activity that we know will come from our efforts 
to improve and stimulate our economy.
    Thank you, Mr. Chairman.

                           Prepared Statement

    Senator Shelby. Thank you, Mr. Secretary. We have your 
complete statement and it will be made part of the record.
    [The statement follows:]
                 Prepared Statement of Rodney E. Slater
    Mr. Chairman, Members of the Subcommittee. Thank you for the 
opportunity to testify in support of the fiscal year 1998 budget 
proposals for the Department of Transportation.
                                overview
    President Clinton said in his State of the Union address: ``Over 
the last four years we have brought new economic growth by investing in 
our people, expanding our exports, cutting our deficits, creating over 
11 million jobs, a four-year record. Now we must keep our economy the 
strongest in the world.'' Under President Clinton, we have made good on 
the promise of the Intermodal Surface Transportation Efficiency Act of 
1991--ISTEA, the landmark legislation that Congress will be 
reauthorizing this year. Working with Congress, we have increased 
transportation infrastructure investment to record levels. These 
investments have paid off in substantial improvements to the condition 
and performance of our highways and mass transit systems.
    Four weeks ago, President Clinton presented the details of the 
Administration's fiscal year 1998 budget. Included in that budget is 
proposed funding of $38.4 billion for our Nation's transportation 
system and key national transportation priorities, which both invest in 
our people and in our economy. First and foremost among these 
priorities is to maintain the safety of the nation's transportation 
system and to make that system even safer for the American public, 
whether they travel by land, water or air.
    Transportation is critical to economic growth and for providing our 
citizens with the mobility on which they have come to rely to sustain 
their quality of life.
    This is as true today as it was at the beginning of our nation, 
when George Washington saw that the mountain barrier separating the 
seaboard cities of the new United States from the settlements along the 
Ohio River must be overcome or the settlements would be pulled into 
economic alliances with the British in Canada and the Spanish along the 
Mississippi River. The solution that was in the young nation's clearest 
interests was to: ``open a wide door, and make a smooth way for the 
produce of that Country to pass to our Markets before the trade may get 
into another channel.''
    Today, just think of the wide doors that have been opened, the new 
businesses and innovations in the last twenty years that have arisen 
because of our effective intermodal transportation systems--express 
packages, just-in-time delivery--where items move almost seamlessly 
from land, whether by highway or rail, to water or air and then back to 
land. These innovations are not just transportation change--they 
support whole new ways of doing business.
    Former Transportation Secretary John Volpe discussed the objectives 
of the Department almost thirty years ago and his remarks are quite 
remarkably pertinent today, as we near celebration of the 30th 
anniversary of the Department. ``Our objectives range over improvements 
in the overall efficiency of transportation, ensuring that the 
unemployed have access to employment * * * that there be joint planning 
of transport corridors in the hearts of our cities, that we upgrade the 
safety of all modes, and most important for those who will come after 
us--that we safeguard our priceless heritage of natural wonders, 
historic sites and places of recreation.''
    Even though transportation improvements over the last 30 years have 
been astounding--for example, the ability of businesses to minimize 
inventories because of the reliability and efficiency of the nation's 
transportation system--the challenge that we face today sounds 
remarkably similar to John Volpe's assessment. Today we must improve 
our transportation system to meet the needs of the 21st century. We 
must continue to invest in improving the safety of our people. We must 
maintain critical infrastructure investment to meet the needs of our 
economy. And we must do that in a way that protects our environment, 
our neighborhoods and our national heritage.
                        investing in our people
    The Department's budget proposes many critical investments in the 
quality of life of the American people. I would like to highlight three 
of these.
    (1) Improving the safety of the transportation system, to save even 
more lives so that the heartbreak that we see everyday due to 
transportation is reduced. As you may know, in the past few weeks the 
Department of Transportation experienced this heartbreak directly 
within its family--two Maritime Administration employees were killed 
when coming back to the office from lunch and three Coast Guardsmen's 
lives were lost as they were trying to save others in rough seas.
    (2) Ensuring that those going from welfare to work are not stymied 
by lack of transportation. Transportation is one of the three major 
challenges faced by welfare recipients, along with day care and skills 
training.
    (3) Interdicting illegal drugs, which continue to threaten the 
well-being, safety and security of all American citizens, including the 
children in our schools.
Safety
    Our most important investment in the quality of life of the 
American people and our highest priority--as always--is improving our 
transportation system's safety and security.
    Although it's already the safest in the world, much of what we do 
is aimed at making it safer, as travel continues to grow. That's why 
the President's fiscal year 1998 budget proposes to raise Department of 
Transportation direct safety spending by $200 million--to $2.9 billion, 
a record 7\1/2\ percent of our total budget.
    A major focus in our safety effort will be highway crashes, which 
account for more than nine out of every ten transportation fatalities. 
About 41,500 travelers died in highway crashes last year, a slight 
reduction from 1995. That's notable because it turned around a three-
year trend of increasing highway deaths. But, unless we also begin 
again to lower the fatality rate, the growth in travel created by our 
expanding economy will begin increasing the number of deaths once 
again.
    To cut the fatality rate, we have to focus not only on safer cars 
and safer roads, but also on affecting the human factor. To do that, we 
need measures such as increased education and law enforcement, and so 
we propose raising NHTSA's safety spending by 11 percent--to $333 
million. That includes:
  --$9 million for a new occupant protection grant program to promote 
        safety belt use, the best way to protect travelers;
  --a $9 million increase to support states in passing tough drunk 
        driving laws;
  --$8 million for a new research and education program to reduce air 
        bag risks for children and small adults, while still preserving 
        the benefits of air bags for all motorists; and,
  --$2 million for a pre-license drug-testing pilot program, the first 
        step in launching the President's new initiative to combat 
        drug-impaired driving.
    We're also increasing funding for important safety programs in 
aviation, rail and maritime safety.
  --Aviation safety spending would increase 12 percent to $839 million, 
        enabling the FAA to hire 273 safety inspectors and 
        certification staffers. It also funds the work of the new 
        National Certification Team, which inspects start-up airlines.
  --Railroad safety spending would increase by 12 percent, to $57 
        million, with funds going to speed up new safety rules and to 
        buy an automated track inspection vehicle.
  --Finally, we're proposing to increase maritime safety funding to 
        $797 million--including Coast Guard programs to improve vessel 
        and recreational boating safety.
Access to Jobs
    Transportation empowers our neighborhoods by providing access to 
jobs, to markets, to education and to health care for all Americans, 
whether they live in rural, urban or suburban areas. But this budget, 
in addition to working for all Americans, is directing resources to one 
group that needs special assistance: we are proposing the creation of a 
new $100 million program to provide access to jobs and training, 
administered by the Federal Transit Administration and cooperatively 
supported by the Federal Highway Administration. This new initiative 
will elevate the transportation contribution to welfare reform. We hope 
this program will act as a catalyst, uniting local governments, mass 
transportation providers, and social service providers in working 
toward a common goal of helping people who do not own cars improve 
their lives not only by finding a job, but by being able to get 
regularly to that job.
    As President Clinton said in his State of the Union address: ``Over 
the last four years we moved a record 2\1/4\ million people off the 
welfare rolls. Then last year Congress enacted landmark legislation 
demanding that all able-bodied recipients assume the responsibilities 
of moving from welfare to work. Now each and every one of us has to 
fulfill our responsibility, indeed our moral obligation, to make sure 
that people who now must work can work.'' One part of the President's 
three-part plan to accomplish this goal is to provide training, 
transportation and child care to help people go to work.
    Our proposed new $100 million program would offer welfare 
recipients the access to jobs, training, and support services that they 
need to make the transition to the working world. This program would 
promote flexible, innovative transportation alternatives--such as 
vanpools--that get people to where the jobs are. It also would promote 
family-friendly transportation, such as day care centers at bus and 
rail stations.
    In addition, DOT's ISTEA reauthorization proposal contains several 
provisions designed to strengthen existing programs allowing states to 
utilize Federal-aid funds for training.
Drug Interdiction
    And third, the work of the Coast Guard not only directly supports 
the safety and security of our people, but also is a direct investment 
in the future of our country through its role in interdicting illegal 
drugs before they get to America's streets and young people. We're 
proposing to increase the Coast Guard's drug law enforcement budget--by 
15 percent--to $389 million. That includes $53 million in additional 
funding for surveillance technology, improved intelligence capabilities 
and increased operations as part of the President's effort to stop 
illegal drugs from entering our country.
                        investing in our economy
    In the 21st century Americans will compete in a truly global 
marketplace. This marketplace will be fiercely competitive and our 
success as a nation will be determined on how safely, reliably and 
cost-effectively we can move people, goods and information. 
Transportation expenses now account for eleven percent of the United 
States gross domestic product--a greater share of the economy than 
health care or defense--and will affect our country's global 
competitiveness in the future.
    As he again made clear when he met with the nation's governors last 
month, President Clinton recognizes the contribution of sound 
infrastructure to increasing America's prosperity and its international 
competitiveness. That's why he's worked on increasing infrastructure 
spending even as he's reduced the budget deficit.
Infrastructure Investment
    Working with this Subcommittee and the entire Congress, over the 
past four years (fiscal years 1994-97) we've increased Federal 
investment in highways, transit systems, and other infrastructure to an 
average of $25.5 billion, more than 20 percent higher than the previous 
four years. The Department is committed to a long-term infrastructure 
investment program and seeks the highest levels of investment within 
the balanced budget context.
    Our investment is producing results, even with many of these 
projects still under construction. For example, the latest data on the 
National Highway System shows us that the condition of bridges and 
pavement has improved significantly. System performance--as measured by 
peak hour congestion, which had been deteriorating--has now stabilized.
    This success extends to transit. In the last four years we've 
financed nearly 26,000 buses and almost 600 rail cars for state and 
local transit agencies. With 19 new full-funding grant agreements, 
we've also financed more than 100 miles of new transit lines, serving 
more than 100 stations. Meanwhile since 1993, Amtrak has either taken 
delivery of or placed orders for 236 new rail passenger cars, 191 new 
locomotives and 18 high speed train sets, making dramatic improvements 
in the age and condition of its fleet and enabling 150 mph service in 
the Northeast Corridor by the turn of the century.
    The fiscal year 1998 proposal of $25.6 billion for infrastructure--
actually above the average of the past four years--would sustain the 
investment that's produced these results. And I want to emphasize 
that--by proposing even higher ISTEA reauthorization levels--we're 
leaving room for additional investment in the future as economic 
conditions and our deficit reduction efforts warrant.
    For next year's federal-aid highway program, we're proposing an 
$18.17 billion obligation limit, just a shade below this year's $18.19 
billion.
    We also propose a supplemental request for 1997 to increase the 
obligation limit by $318 million. This would be distributed to states 
that received lower-than-expected obligation authority this year 
because of the Treasury Department's correction of an accounting 
problem in crediting prior-year tax receipts to the Highway Trust Fund.
    We're proposing $4.2 billion for transit capital this year, a $390 
million increase. Transit operating assistance for communities with 
more than 200,000 people would no longer be available. But increased 
capital funding would be made available to them, and, as an added 
measure of support for them and for communities of all sizes, we're 
proposing to broaden the definition of ``capital'' to include 
preventive maintenance of capital investment. Smaller communities--
which are the ones most dependent on federal aid--could use transit 
formula grants for either capital or operating expenses.
    Our efforts in the coming months will be largely devoted to 
ensuring that an ISTEA reauthorization bill gets passed in a manner 
that does not result in increases in the budget deficit, but also 
provides states and localities with much needed flexibility and funding 
in a timely manner. I know that you share that same goal. For the past 
year, Congress and the Department have been engaged in reaching out to 
groups and individuals across the country to gather ideas for 
reauthorization of ISTEA. What has emerged is a consensus that ISTEA 
works. The goal upon which our ISTEA reauthorization proposal is based 
is to build on ISTEA, not abandon it.
Maritime
    While not under this Committee's jurisdiction, I would also like to 
mention that the Department's maritime programs have at their center 
the strengthening of our national and economic security. They 
accomplish this through genuine partnership with other government 
agencies and absolute reliance on the private sector to accomplish two 
goals: making our maritime transportation system the most modern, 
competitive and efficient in the world and providing strategically 
critical sea-lift capacity to support our national security needs.
Aviation Operations
    Just as the Interstate highway system expanded the potential of our 
national economy in this century, so aviation is tying us to an 
expanded global economy as we enter the 21st century. Aviation has not 
only brought Americans closer to each other, it has brought us closer 
to the rest of the world. Our aviation system is vital to our domestic 
economy and to our nation's global economic competitiveness. I can 
assure you that I will use the leverage provided by access to the vast 
United States market to urge our aviation partners to adopt more open 
markets--and to ensure expanded access to their markets for United 
States carriers.
    The FAA's air traffic control system enables the safe travel of 
1\1/2\ million passengers every day, and its inspections ensure that 
aircraft, pilots, and aircraft operations meet the highest safety 
standards. We're requesting an 8.7 percent increase, a notable amount 
in an era of budget freezes, to the FAA's operating budget, up to a 
record $5.4 billion. In addition to more safety inspectors, that will 
let the FAA add 500 air traffic controllers and 173 security personnel 
to carry out the Gore Commission's recommendations. The personnel and 
procurement reform authority provided in our fiscal year 1996 
Appropriations Act will enable FAA to hire the best people possible in 
the most effective way, as well as to accelerate modernization of 
critical equipment.
    One area in which tough budget choices resulted in our proposing 
lower investment is airport grants, for which we're proposing $1 
billion. We've chosen this course because large airports can obtain 
funding more easily than can other types of infrastructure; in fact, 
most already use other sources--such as aircraft landing fees, 
concession revenue, and passenger facility charges--for most of their 
capital financing. We plan to mitigate the impact on small airports--
which are especially dependent on federal aid--by proposing that their 
formula grants continue at current levels.
    Financing all of our aviation system's needs--airports, airway 
facilities, security, and FAA operations--is a critical priority for 
us. I want to commend the Congress for its prompt action in renewing 
expired aviation taxes and crediting receipts to the Trust Fund. We are 
grateful for this quick action, which will avoid a serious, short-term 
financing crisis.
    We also want to work with Congress to establish a reliable, long-
term funding base so that the FAA can provide the services our aviation 
system needs. As an interim measure until comprehensive financial 
reform is achieved, we're proposing $300 million in new user fees. 
We're looking forward to appointing the new National Civil Aviation 
Review Commission--which will analyze aviation budget requirements and 
ways to fund them--and help us to reach a consensus on what course to 
take.
                          proactive leadership
    As I said in my confirmation hearing, I will continue to bring 
common sense government to the Department of Transportation in order to 
provide the people we serve with a Department that works better and 
costs less. I will encourage more flexible, innovative funding to 
leverage federal dollars for infrastructure investment, technology use 
to improve the performance of our transportation system, and 
transportation policies that are sensitive to environmental concerns.
Innovative Financing
    The fiscal year 1998 budget expands the efforts the Department has 
made in innovative financing by providing another $150 million in seed 
money for State Infrastructure Banks (SIB's) and $100 million for a new 
Federal Credit Program, both to be included in our proposal for ISTEA's 
reauthorization.
    The Federal Credit Program will be similar to the SIB's in its 
support of innovative financing, but it will fill a different need--the 
support of projects which, by virtue of their size or their multistate 
benefits, are nationally significant but which might not fit into the 
programs of individual states. That will enable us to make loans and 
apply other financing arrangements for these vital investments, much as 
we did with California's Alameda Corridor project.
Technology
    Technology is particularly essential to the health of our 
transportation system. Innovations in transportation technology 
contribute to America's global competitiveness and national security, 
enhance the capacity of our infrastructure, our environment and local 
communities, and perhaps most importantly, save lives and reduce the 
risk of accidents and injuries. That's why we propose to increase 
investment in technology research and development by nine percent, to 
$1 billion.
    This total includes $250 million for Intelligent Transportation 
Systems, which apply advanced computer and communications technologies 
to travel. This will help improve information to drivers in order to 
increase transportation efficiency. About $150 million will fund ITS 
research and technology development, and $100 million is to encourage 
state and local governments to invest in electronic infrastructure such 
as travel information programs and automated traffic signals to enhance 
infrastructure performance.
    The budget also requests funding to complete all six prototypes and 
conduct testing of the Advanced Technology Transit Bus. This bus was 
developed using proven, advanced technologies from the aerospace 
industry and is a lightweight, low-floor, low-emission alternative to 
current buses.
    Other efforts in the technology area are geared at helping the 
Department target its resources to address critical problems. For 
example, the FAA's technology budget includes funding for an aviation 
safety risk analysis program. This program is designed to improve FAA 
and industry measurement of and accountability for safety performance. 
The analytical techniques to be developed will focus on more 
effectively and efficiently using information contained in FAA and 
industry databases.
Protecting the Environment
    Transportation, like all human activity, affects the environment, 
and we have an obligation to mitigate its impacts. That's why we're 
proposing a five percent increase in environmental funding--to $1.53 
billion.
    Much of this would be for the successful Congestion Mitigation and 
Air Quality Improvement Program, which state and local governments use 
to cut pollution through transit projects, traffic flow improvements 
and alternatives such as ridesharing. CMAQ funds would be authorized at 
$1.3 billion a year, up 30 percent from their level under ISTEA.
    The Coast Guard's marine environmental protection program, which 
promotes and enforces an aggressive approach to pollution prevention, 
preparedness, and response, along with oil spill cleanup programs, 
would increase seven percent, to $326 million.
                               conclusion
    As the President has said, when times change, so government must 
change. And so, as I look to the next four years, I believe we in the 
Department of Transportation must set high goals and must be architects 
of change, but also build a new balance in our relations with state and 
local governments. We must ensure our success in the 21st century by 
recognizing the crossroads we are at today--recognizing the need not 
only to invest in our current infrastructure, but to take full 
advantage of technology and leave a more efficient, safer 
transportation system and environment than we have today. I hope that I 
can help us reach not just for the easy and the quick, but for the 
solutions that will make a difference in the long run, for the 
solutions that appear, but are not really, just beyond our reach.
    As President Clinton said in Putting People First, ``Just as 
interstate highway construction in the 1950's ushered in two decades of 
unparalleled growth, investing in the pathways of the future will put 
Americans back to work and spur economic growth.'' The Department's 
fiscal year 1998 budget proposes strategic investments in two important 
pathways: people and infrastructure. It also does its part to balance 
the federal budget by 2002. I stand ready to be your partner as you 
develop a DOT appropriations bill that is consistent with our national 
commitment to reach a balanced budget by 2002 and with our commitment 
to ensure that critical national transportation needs are met so that 
Americans can maintain their mobility and our economy can continue to 
prosper. I also stand ready to work with the Congress as it develops a 
long-term ISTEA reauthorization bill that address the issues of this 
fiscal year and the 21st century.

                   Proposed Highway Obligation Levels

    Senator Shelby. Mr. Secretary, the administration's ISTEA 
proposal in the President's fiscal year 1998 budget, as Senator 
Domenici referred to, appeared to set a highway obligation 
limitation significantly below the contract authority level. 
Effectively, the obligation limitation envisioned in the 1998 
budget request in the administration's ISTEA proposal has been 
frozen below the 1997 appropriated level. The administration 
proposes, as I understand, a higher contract authority level 
but without--but without--the accompanying obligation 
limitation.
    That simply raises false expectations among my colleagues, 
the States, the transportation constituency, and the American 
public.
    Why, Mr. Secretary, are you proposing higher contract 
authority numbers in the budget than your proposed obligation 
limitation?
    Secretary Slater. Mr. Chairman, what we are trying to do is 
to exercise a policy that really is evident in ISTEA where you 
have higher contract authority than obligation authority, but 
with the robust economy, we have actually been able to fund 
approximately 96 percent of the authorized levels in ISTEA. 
Under our current scenario, it provides for a contract 
authority that is at the highest level possible and an 
obligation authority at the highest level possible within the 
context of our overall budget goal of balancing the budget by 
the year 2002.
    But with a multiyear program, it is our hope that as much 
as we have been able to do in ISTEA in its full-funding effort, 
we will be able to do the same as we look at the outyears of 
our proposal.
    Currently the obligation limitation would limit us to 
about, I guess, 86 percent on the dollar of the moneys coming 
into the trust fund. But again, we had a similar situation with 
ISTEA. Over time, because we were able to provide record-level 
investment over the last 4 years, we were able to provide 96 
percent of the funds coming into the trust fund during this 
period. We believe that the same will hold true as we look 
forward to a robust economy in the coming years.

                           Transit New Starts

    Senator Shelby. Mr. Secretary, the President's proposed 
1998 budget would cut transit new starts by $126 million from 
the current enacted level of $760 million.
    There are now 13 new starts with full funding grant 
agreements in the funding pipeline, and two more are awaiting 
FFGA's. These 15 projects will cost $3.7 billion to complete. 
There are about 100 other projects already in various 
preliminary stages, totaling about $10 to $20 billion to 
complete. The San Francisco BART subway extension to the San 
Francisco airport is awaiting approval of a new $750 million 
Federal full funding grant agreement, and Sacramento is 
awaiting one for about $100 million.
    Some new start projects have encountered serious 
construction problems, notably in Los Angeles, where concerns 
have been raised about whether improved bus service is a 
cheaper and a better option.
    Should, Mr. Secretary, the administration be entering into 
new funding grant agreements when the new starts program is 
already at least oversubscribed?
    Secretary Slater. Well, Senator, your point is well taken 
in that we have recently moved rather aggressively as it 
relates to new starts, really, 13 major new starts, but on 
average I think we had about 20 or so over the last 4 years, a 
considerable investment.
    I think it responds to the challenges of the moment. I 
found it quite interesting that Senator Faircloth from North 
Carolina would make mention of the importance of light rail, a 
southern State, a State clearly dependent on highways, as he 
noted, with the largest system in the country, but because of 
the capacity needs of this age and the future, States are 
beginning to diversify their system much more, even in the 
South, a region that we both hail from.
    It is the opinion of the administration that through the 
planning process, working with local and State officials, we 
will be able to bring about better transportation decisions so 
as to bring more transit projects on line, but to do so in a 
way that recognizes our limited dollars, our limited ability to 
play at the Federal level, but to also encourage and stimulate 
activity at both the local and State levels and even from the 
private sector. We are finding that these arrangements can be 
put together as we work as a team and bring commonsense 
approaches to these kinds of decisions.
    Senator Shelby. Mr. Secretary, is the administration 
interested in working with new starts project sponsors to help 
reduce the size of the Federal commitment to these expensive 
projects?
    Secretary Slater. I think we have to continue to work with 
our partners to do that.
    Clearly, State and local governments are strong and 
actually majority participants in all transportation 
infrastructure investments. I think we have moved past the day 
when the Federal Government is the total pocketbook when it 
comes to these kinds of major investments. We also have to test 
the private markets, and many of you have spoken to that.
    But that is not to say that we can shirk our responsibility 
as a Federal Government in providing much needed resources and 
in carrying our part of the load, and I do believe we are going 
to work through this process as we go forward as a nation into 
a new era.
    Senator Shelby. Thank you.
    Senator Lautenberg.

                           Safety Regulations

    Senator Lautenberg. Thanks very much, Mr. Chairman.
    Thank you, Mr. Slater, for an excellent presentation.
    Mr. Slater, I was opposed to the passage of the National 
Highway System bill, and I asked the President to veto the 
bill. The bill, in my opinion, went just too far in undermining 
our Federal role in ensuring safety on our highways. The law 
repealed Federal mandates regarding speed limits, as well as 
use of seatbelts and motorcycle helmets.
    Now, I hear that some interests want to use the 
reauthorization of ISTEA to force more rollbacks and 
deregulation in the safety area, including allowing longer and 
heavier trucks on our highways and eliminating mandates on the 
minimum drinking age.
    Can you tell me what the administration's position is going 
to be regarding the effort to roll back the existing safety 
mandates in current law?
    Secretary Slater. Senator, I do not think that those kinds 
of rollbacks can be tolerated, frankly. As you know, the 
administration fought vigorously to make the case for a 
national speed limit law, for the helmet law, and the like. It 
was a battle that we lost.
    We also made a strong case for the importance of the 
National Highway System. This is a system that is but 4 percent 
of all the roadways in the country, but it carries 45 percent 
of all the highway traffic, 75 percent of the truck traffic, 80 
percent of the tourist traffic. It is on this system that we 
hope to make the kinds of improvements that will make less 
likely the kinds of accidents that we have heard about even 
this morning.
    Because of that, because of the focus on intermodal 
connectors that will hopefully take us closer to the 
establishment of a national intermodal system where all of the 
modes of transportation play the roles that they play best, it 
was my suggestion, along with Secretary Pena, to the President 
that he sign the bill, knowing that many of our key supporters 
were on a different side.
    We also then made a commitment to establish a strong and 
aggressive safety action plan that we are yet in the process of 
moving forward on implementing, and I assure you, Mr. Chairman, 
that as Secretary I will make safety not only my No. 1 priority 
in rhetoric, but it will be the North Star by which we will be 
guided and also a commitment by which we will be judged. I am 
committed to following through on this commitment.

                       Driving While Intoxicated

    Senator Lautenberg. I am pleased to hear that, Mr. 
Secretary. We cannot expose our passengers on the highways to 
ever more danger and ignore what is taking place.
    I was the author of the provision that sanctioned State 
highway funds for failing to adopt the 21-year-old drinking age 
bill.
    Secretary Slater. Yes.
    Senator Lautenberg. I am pleased to say that as I look back 
on my work here, one of the things that pleased me most was the 
fact that it is estimated somewhere around 14,000 young people 
did not die on the highways because of our legislation. I think 
it is also assumed that if the law was enforced more 
rigorously, that we would have a substantially higher number 
that would have escaped death and injury on the highway.
    The NHS bill included an initiative that Senator Byrd had 
to sanction State highway funds if they did not prosecute 
drivers under the age of 21 with any amount of alcohol in their 
system.
    Have these sanction programs served their purpose?
    Secretary Slater. They have, Senator. Actually we have a 
commitment to the Congress to respond with a report dealing 
with what have been the effects of some of the other safety 
provisions, and at that time, we will have better data as 
relates to the success of this particular program.
    But, again, I do think that it underscores the fact that 
there were safety components of the NHS bill that really made 
it worthy of the President's signature, and you have just noted 
the commendable effort on the part of Senator Byrd in that 
regard. And I might add that that was a provision that passed 
overwhelmingly in the Congress and also by numbers comparable 
to the numbers by which some of the other provisions were 
actually removed from our national policy.
    So, I do believe that the Congress is ready and willing to 
ensure that we have laws on the books that make safety our No. 
1 priority in transportation.
    Senator Lautenberg. We are happy to hear your commitment 
and to test whether or not the Congress is determined to do 
what it can to prevent this carnage when it comes to 
determining blood alcohol levels for prosecuting drunk drivers. 
NHTSA has determined that drivers become significantly impaired 
at .08 BAC. They also found that the risk of being in a crash 
rises gradually as the BAC level increases, but then rises very 
rapidly after a driver reaches or exceeds .08 blood alcohol 
content.
    Do you think we ought to take a more aggressive stance to 
get the States to adopt .08 for prosecuting drunk drivers?
    Secretary Slater. Let me just say that that is clearly an 
issue to be considered.
    What I would really like to note, though, is I do believe 
NHTSA is doing quality work. One area where we are focusing a 
great majority of our attention is in the seatbelt area. So, 
this, as well as other initiatives, can be considered as a part 
of an overall toolbox from which States, locales can select 
those programs, policies, and procedures that best relate to 
the transportation and safety challenges that they face at the 
State and local level.

                             Amtrak Funding

    Senator Lautenberg. Mr. Secretary, under your view of 
things, your ISTEA proposal assumes that Amtrak will be funded 
from the highway trust fund, but it is not at all clear that 
Amtrak will see any sizable increase in capital funding under 
your request. Will your ISTEA proposal provide Amtrak with 
sufficient capital dollars to eliminate the need for operating 
subsidies and be able to provide first-class service? Because 
that is what is going to determine the success of the railroad.
    Secretary Slater. I understand. Senator, I know that the 
issue of Amtrak is one that is very important to you and many 
Senators clearly in the Northeast corridor, but I have heard 
from a number of Members really across the country, Senator 
Lott in particular from Mississippi and others, who are in some 
of the more rural areas of the country, who also value the 
importance of Amtrak.
    I can tell you that it is my personal desire that Amtrak 
has to be a part of the 21st-century transportation system. The 
challenge before us is to determine how to best fund it, how to 
best make it self-sustaining. The people within Amtrak, the 
leadership, Tom Downs and others, I think have made a very 
strong case in that regard, but we do have a long ways to go.
    I would hope that when we unveil our proposal in the first 
instance, that Amtrak could be a part of it. I have to tell you 
that because we are trying to come to grips with how to best 
fund it, that may or may not be the case, but it would again 
then be my hope that before we move through the entire 
reauthorization process, that we would be able to come to some 
consensus, find some common ground as to how to make Amtrak 
more viable and self-sustaining.
    Senator Lautenberg. It needs leadership, Mr. Secretary, and 
Amtrak, when presented as an asset in a State or a community, 
is very much sought after by people here, the Members. I am 
sure the distinguished Senator from Utah would like to see that 
Amtrak is there in 2002 carrying all those people, bringing all 
that money, getting----
    Senator Bennett. I think it has a better role to play in 
the Northeast corridor than it does in Utah, and I support it 
in the Northeast corridor.
    Senator Lautenberg. Well, I am willing to share the 
admiration for Amtrak. [Laughter.]
    Well, can you guarantee now in front of this subcommittee, 
Mr. Secretary, that Amtrak will not have to terminate more 
routes under the funding levels that are being proposed?
    Secretary Slater. What I would like to do, Senator, is to 
just make a firm, unequivocal commitment that the Department 
will work with the Congress, with the Amtrak team, both 
management and labor and its leadership, and State and local 
governments, to find common ground and to ensure that we do not 
lose any more service and actually that we build on the service 
that we currently have. My objective would be to see Amtrak as 
a viable part of a transportation system for the 21st century.
    Senator Lautenberg. You will convey that to Majority Leader 
Lott, please?
    Secretary Slater. I will.

                     FAA Facility in Atlantic City

    Senator Lautenberg. Mr. Secretary, the Coopers & Lybrand 
accounting firm evaluation of the FAA's financial needs was 
released just this Friday, and as you know, this report 
included a recommendation that the FAA look into consolidating 
the Hughes Technical Center, which is in Atlantic City, NJ, 
into a facility in Oklahoma City, OK. They justify this 
recommendation largely based on the value of the land they say 
could be sold if FAA moved from its present location.
    Well, it is mysterious to those of us who know the area, 
because it is an established fact that there is a reversionary 
clause that says this property that FAA is on must be sold to 
the Southern New Jersey Transportation Authority for only 
$55,000. The estimate on it is, I think, a couple of hundred 
million dollars. And there is no way that that is going to 
redound as a bonus to the Federal Government.
    The Hughes Technical Center is also, unfortunately, a Super 
Fund site, and it is going to require some very expensive 
environmental remediation.
    It functions, however, in its present form to continue the 
pursuit of explosive detection equipment, of ways to thwart 
terrorists, of ways to reduce the damage that comes from bomb 
explosions, hardened containers. They do some wonderful, 
wonderful work down there.
    To uproot this infrastructure of intellectually trained 
people, I think, would be a travesty, and I hope that, based on 
the facts, that you will be able to assure us that the Atlantic 
City technical center will continue to operate to provide 
safety to the traveling public and to deal with our expanding 
need.
    As we all know, aviation is scheduled for growth. Mr. 
Chairman, I think it could almost double in the next 20 years.
    So, I would like to have your word, Mr. Secretary, that you 
will look very closely at that and make sure that we do not 
lose this asset.
    Secretary Slater. Yes; Mr. Chairman, what we are doing now 
is analyzing the study of which you speak. Our objective will 
be to pass it on to the National Civil Aviation Review 
Commission that will be established soon for full consideration 
and for the implementation of those parts of the study that we 
would find worthy of implementation.
    I can tell you, speaking specifically about your concern, 
that the cost of land should be a factor, but not the sole 
determining factor, when it comes to this issue. Clearly the 
issues that you have raised here and that we will likely 
discuss as we go forward will be taken into account.
    Senator Lautenberg. Thank you very much. Thank you, Mr. 
Chairman.
    Senator Shelby. We have been joined by Senator Mikulski. Do 
you have any opening statement?
    Senator Mikulski. I will be happy to wait for my turn for 
questions, and I am very happy to welcome Secretary Slater to 
this committee.
    Secretary Slater. Thank you.
    Senator Shelby. Senator Bennett.

                       Transit New Starts Funding

    Senator Bennett. Thank you, Mr. Chairman. I realize I did 
not do my manners properly by congratulating you in my opening 
statement for your assumption of this chairmanship.
    Senator Shelby. Thank you.
    Senator Bennett. I am delighted to have you there and to 
join you as a new member of the committee.
    I want to follow up on the chairman's comment about full 
funding grant agreements. I am not sure I heard quite what I 
wanted to hear in the answer, and it may be my faulty hearing.
    But once you get a full-funding grant agreement in place 
and a new start underway, filling up the pipeline with other 
full funding grant agreements behind it that end up diluting 
what you are doing on existing projects can have the effect of 
slowing down what is there on the projects in progress, which 
ultimately drives up the costs.
    I think the issue that the chairman raised about the BART 
extension in San Francisco and the extra hundred million in 
Sacramento is one that has to be looked at in terms of its 
impact on the FFGA's that are already in place.
    Would you address that again for me? As I say, I may not 
have got it properly from your comment. How do you react to 
that?
    Secretary Slater. Sure. Senator, clearly as we deal with 
those two proposals, we will take into account those projects 
that are currently in the pipeline. Your point is well taken 
there. When we talk about our priority of bringing a 
commonsense approach to Government, I think that that would 
mandate that kind of analysis and review.
    I can tell you that the way we have been able to handle 
these projects thus far is to continue to monitor the progress 
of the projects in the pipeline and, where in an instance a 
project is not moving as effectively, efficiently, as we would 
like, we make decisions about the resources. I can tell you 
that the Los Angeles Red Line is a project in point dealing 
with that particular issue.
    So, I think that your point is well taken, and I assure you 
that that is the kind of thoughtful consideration that will go 
into the way we address these new proposals that are yet before 
us and how they relate to the projects that are currently in 
the pipeline.

                        Spending of Trust Funds

    Senator Bennett. Thank you. I appreciate that 
clarification.
    Reference was made earlier to spending the money that is in 
the trust fund. If I may again go back to my history, we 
naively thought in the Department of Transportation in the late 
1960's when we created the airport airways trust fund, we were 
guaranteeing that FAA would have sufficient funds, independent 
of the ups and downs of budget cycles, to see to it that the 
airport airways system would be properly funded.
    We did not recognize that Presidents, regardless of party--
the Presidents of my party have been just as guilty of this as 
the Presidents of yours have been--could find ways to thwart 
the effect of creating a trust fund for both airport airways 
and highways. The money that is put in both those trust funds 
piles up on paper so that the funds have huge, wonderful 
surpluses, but in effect in the unified budget, the impact is 
to say we have lowered the deficit elsewhere because we are not 
appropriating those funds.
    Talking about safety, I heard a report of someone who 
looked into the issues of hackers breaking into the computer 
systems of the Federal Government and whether or not they would 
be able to render serious mischief in the Federal Government 
and was told the one place where a hacker cannot create damage 
in the Federal Government system is in the FAA airport airways 
computer system because it is so obsolete, there is not a 
hacker anywhere in the world that is capable of penetrating it. 
That is not a really reassuring kind of safety circumstance.
    I support the notion that the money that is in the highway 
trust fund should be spent on highways and not sequestered for 
a budget effect later on, and I support the notion that the 
money that is in the airport airways trust fund should be spent 
on bringing the airport airways computer system up to the point 
where hackers can at least understand it.
    I would like your reaction to that. I know I am putting you 
and the chairman of the Budget Committee in something of a box 
with this, but I do go back to the days when the trust funds 
were created as trust funds and I have seen the budgeters of 
both parties get around that congressional intent and would 
like just a comment.

                          Aviation Trust Fund

    Secretary Slater. Well, first of all, let me commend you 
for raising really an important question, even though it is 
difficult to grapple with.
    But let me also commend the Senate and the Congress as a 
whole for the prompt action taken on the reinstatement of the 
aviation excise tax, because our trust fund was almost in 
bankruptcy status, and I very much appreciate, and I know that 
the entire administration appreciates, the prompt action taken 
there.
    Also let me say, as relates to the issue of equipment and 
the other needs of the aviation industry, because that is what 
is really underlying the question and the strength and power 
and force of it--Senator Lautenberg mentioned earlier the fact 
that there was the equipment failure at an airport in his 
State, and that has happened probably all too often in 
districts and States around the country.
    I think that the Congress, working with the administration, 
has acted to give us the most powerful tools we have ever had 
to deal effectively and forthrightly with these issues. I speak 
of it from the vantage point of my work as Federal Highway 
Administrator. I think coming into the office and having the 
ability to make ISTEA real, with all of the planning and 
flexibility and innovative potential there, was a treat for 
someone who really wanted to make a difference, as was noted 
earlier by Senator Lautenberg in reference to Chairman Shelby 
and the opportunity he has now serving as chairman.
    I think today the aviation industry, FAA, has the same 
opportunity we had in highways with the enactment of ISTEA to 
really make a difference, to turn the curve, to deal with these 
issues of personnel reform, procurement reform, and then with 
the advent of the National Civil Aviation Review Commission and 
the work that it will do in dealing with the long-term funding 
needs to put aviation on a path, a flight path if you will, 
that will ensure that it will give us what we need in the first 
half of the 21st century when it must play the role that the 
Interstate System played in the last half of the 20th century, 
helping us to develop a national economy, the Interstate 
System, but the aviation industry helping us to compete 
effectively and forcefully and win on the international stage.
    And all of these funding questions underlie that, and so I 
would like to, in offering my response, make the point that I 
do understand the issue. I think that you raise it--even though 
uncomfortable--you raise it as it should be raised, and we just 
have to work over the coming year to answer this very difficult 
question and to find common ground in doing so.
    Senator, as one who would not see any Senator as just 
another Senator, I very much appreciate you for having raised 
this very, very important issue.
    Senator Bennett. Thank you. Thank you, Mr. Chairman.
    Senator Shelby. We have been joined by Senator Specter. Do 
you have any opening statement, Senator Specter?

                      STATEMENT OF SENATOR SPECTER

    Senator Specter. Well, thank you very much, Mr. Chairman. I 
am delighted to join others in welcoming the new Secretary of 
Transportation. It is a job of enormous importance.
    I am very much concerned about the funding for mass 
transit, for operating expenses. The impact of cuts is very, 
very hard on not only the big cities but in the rural areas. 
People do not understand that mass transit affects small 
counties in my State like Monroe County and Schuylkill County, 
and in the big cities it is indispensable in order to take 
people from the inner city to jobs in the suburbs. I think we 
have to do better on that subject.
    On the ISTEA issue, I am hopeful that we will be able to 
find the money to take care of America's infrastructure. I know 
that in the House of Representatives, Chairman Shuster is 
taking the position that the highway trust fund ought to spend 
all the money on highways. It has some very substantial 
opponents, as I understand it, Senator Domenici, among others.
    But I think we need to get to the day where we will have 
the trust funds carry out the purpose for which they were 
intended. They really are trust funds.
    When I was district attorney in Philadelphia, I indicted 
people who invaded trust funds because that is a fraudulent 
conversion, and the Federal Government, regrettably, can get 
away with it.
    One other point that I would like to comment on, as we move 
forward to ISTEA, I think it was very important that we 
maintain adequate funding for mass transit. We have a very 
delicate situation with the supply of oil from the Mideast. 
This is something I saw in some detail working on the problems 
of terrorism in Saudi Arabia, the difficulties we have seen 
with Iran, and while we do not like to think about it or talk 
about it, we have to face up to the fact that the government in 
Saudi Arabia is on a thin thread and that if we had a problem 
with Saudi oil, we would be in very, very deep trouble, the 
entire Western World and Japan. So, we ought to be moving 
toward independence from Mideast oil.
    I know Senator Byrd and I and others have worked years on 
the subject of clean coal. We have hydrocarbons in our country 
which would go a long way for independence from Mideast oil. 
That is a very bitter pill we might have to face, but we can do 
a little something about it on ISTEA if we look more to mass 
transit.
    Thank you very much, Mr. Chairman.
    Senator Shelby. Senator Byrd.
    Senator Domenici. Senator Byrd, would you yield one moment 
to me?
    Senator Byrd. Certainly. I would be glad to.
    Senator Domenici. Thank you. I cannot stay because of 
another engagement.
    I have several questions, which I am going to submit for 
the record, Mr. Chairman.
    Senator Shelby. Submit them for the record.
    Senator Domenici. I very much would appreciate as early an 
answer as you can give us.
    Secretary Slater. Yes, sir.

                        Spending of Trust Funds

    Senator Domenici. Let me just make one quick observation 
about trust funds. What we are trying to do is make sure the 
Appropriations Committee maintains some power over how the 
trust fund moneys are spent, just to be honest with you. 
Frankly, just because you have an airport trust fund did not 
mean that the expenditure from that trust fund to build a new 
computer system was right. Had somebody been looking at it, 
they might have said we do not want to spend the money. It 
turned out to be a botched project.
    So, I am trying to find a balance between a trust fund and 
making sure somebody has some real oversight and some ability 
to say that this year we are not going to spend all the money 
in the trust fund because the program is not right.
    Now, I am sure, even in your capacity as district attorney, 
that the judge would understand that I am acting in good faith. 
So, I would urge that you not seriously consider taking any 
action against the chairman of the Budget Committee. 
[Laughter.]
    Senator Specter. Mr. Chairman, just one comment. I would 
confess error if there was any error to confess about 
implicating the distinguished chairman of the Budget Committee. 
I am not saying that you have to spend all the money in the 
trust fund. What I am saying is that the money in the trust 
fund ought to be spent for the purpose for which it is 
intended.
    Thank you.
    Senator Shelby. Senator Byrd.
    Senator Domenici. Thank you, Senator Byrd.

                  Status of Appalachian Highway System

    Senator Byrd. The Senator is welcome.
    Mr. Secretary, as I indicated in my opening statement, I am 
very encouraged by the President's request for $2.19 billion in 
contract authority and obligational authority for the 
Appalachian Highway System. I think it is an excellent first 
step toward ensuring the system's completion.
    Question.
    Secretary Slater. Yes, sir.
    Senator Byrd. Even though you are not able to request the 
adequate funding in the next 6 years to complete the system, is 
the administration committed to its eventual completion as soon 
as possible?
    Secretary Slater. Senator, we are committed to that end.
    Senator Byrd. Based on the funding stream that you have 
recommended for the next 6 years, when do you estimate that 
construction of the system will be completed?
    Secretary Slater. We anticipate that--well, first of all, 
we are doing an update of the estimate. I believe the last was 
done in 1992. At that time we anticipated that the cost to 
complete was probably in the neighborhood of about $7 billion 
or so. We were asked by the Appalachian Regional Commission to 
do an update. We hope to have that update completed by the 
middle of the year. I would say summer. I think we are looking 
at May. At that time we will have a better handle on what the 
challenge is. We anticipate that it will again be in the 
neighborhood of about $7 billion or so.
    When you consider what we were able to offer as a result of 
this reauthorization proposal--that will become public fairly 
soon--of around $2.19 billion, it is anticipated that it will 
probably require that we go beyond the 6-year period of 
reauthorization. So, I would assume and hope that over the next 
decade or so, maybe a little longer, we can complete the 
funding of this very important program.
    I do understand that many are a bit frustrated. This was an 
effort that started more than 30 years ago, and you do have the 
commitment of this administration to work with you in 
partnership to see that the work is done and is done as timely 
as possible.
    Senator Byrd. I appreciate your answer, Mr. Secretary. I 
was a little bit concerned by the words that you used. Perhaps 
you did not choose them with design.
    Secretary Slater. Yes, sir.
    Senator Byrd. But you said, within the next decade or so, 
possibly a little longer.
    Secretary Slater. Yes, sir.
    Senator Byrd. I would hope that we would complete this 
system in 12 years, which would give ISTEA--two highway bills--
certainly no longer than 3, which would be 18 years.
    Secretary Slater. I understand. I can tell you that as I 
was thinking about the next decade or so, I was thinking 
basically two evolutions of reauthorization.
    Senator Byrd. Yes.
    Secretary Slater. But since those bills can sometimes be 6 
years, 5 years, I just did not want to be too specific there, 
but we are going to do the best we can this time around.
    Senator Byrd. Well, you cannot be too specific. I think we 
are on the same wavelength and I appreciate your understanding 
of our needs, those of us who represent the Appalachian States.
    Secretary Slater. Yes, sir.
    Senator Byrd. Will the Appalachian highway funding that you 
are proposing in your ISTEA proposal also grant the necessary 
obligational authority so that the States do not have to choose 
between funding the Appalachian highways and addressing their 
other highway needs?
    Secretary Slater. That is correct, sir. There will be no 
impact on the obligation authority that is normally given to 
the States through the formula program.

                        Alcohol-impaired Driving

    Senator Byrd. Mr. Secretary, I have been concerned for many 
years about the dangers of alcohol-impaired driving.
    Let me say, incidentally, we have witnessed a great crusade 
in this country against smoking and it is being fairly 
successful, I think. I am not critical of that crusade, but 
what I cannot understand is why this Government of ours is not 
equally concerned about alcohol. Why do we not have a crusade 
against drinking, not just drinking while driving but against 
drinking, period?
    Now, it may not be very politically correct--God help us if 
we ever succumb to that term--to mention drinking.
    I see the smoker as maybe killing himself, but I see the 
driver who is drinking as killing other persons, innocent 
people, my wife, your wife, our children, our grandchildren, 
and so on, and likely not killing himself.
    As I have noticed most of these collisions that involve 
drunken drivers, it seems to me that they get off with a few 
bruises in most instances, but it is the person who was not 
drinking who is killed.
    I just hope that this administration will take up the 
crusade against this evil. Smoking does not break up homes. 
Smoking does not cause divorces. Smoking does not cause 
absenteeism from the job, from the work place, but it is Old 
John Barleycorn, that evil we call booze. We need to effectuate 
a crusade in that regard.
    Now, that is neither here nor there as far as your 
questions and answers are concerned, but it leads me at least 
to this question.
    Are the fiscal year 1998 requested amounts for these types 
of programs sufficient to deal effectively with the problems 
associated with drunk driving, particularly given the fact that 
in 1995 alcohol-related fatalities rose for the first time in a 
decade to 17,274 deaths?
    I am alluding to the request for the alcohol-impaired 
driving incentive grants for which NHTSA has requested $34 
million, an increase of $8.5 million from fiscal year 1997.
    I am also referring to the impaired driving research or 
section 403. NHTSA is asking for $1.6 million, the same amount 
as fiscal year 1997.
    For the State and community formula grant program, NHTSA 
has requested $140.2 million, $34.1 million of which is 
approximately spent on alcohol safety programs. The fiscal year 
1998 funding is at the same level as fiscal year 1997.
    So, again, are these requested amounts for these types of 
programs sufficient, in your judgment, to deal effectively with 
the growing problems associated with drunk driving?
    Secretary Slater. Senator, first of all, let me say that 
the increase in the number of accidents involving alcohol-
impaired drivers was not a figure that went unnoticed by those 
of us within the Department. We are committed to safety as the 
No. 1 priority, more than just through rhetoric. That kind of 
reality is what has caused us to make a significant increase in 
our request for funding to really provide more incentive to 
States to respond to these kinds of issues.
    As relates to the alcohol-impaired driving program, we do 
request an additional $9 million. That is a significant 
increase, but I would like to note that overall, as it relates 
to all of the NHTSA programs, we are requesting an 11-percent 
increase in those programs.
    So, again, to give States a toolbox from which to select 
those initiatives that best meet their particular challenges, 
we are asking for total funding in the amount of $333 million 
for NHTSA for these types of programs.
    We are also beginning to focus more and more on driver 
behavior as an area on which to provide additional resources 
and focus to deal with this particular issue. We have made 
significant contributions on the infrastructure side, dealing 
with pavements and the like, also as it relates to vehicle 
safety, but we do believe we can do more in the area of human 
factors and that is where we are going to focus a lot of 
attention and effort in the coming years.
    Senator Byrd. Mr. Secretary, I compliment you on your 
response.
    I hope that you will be more aggressive, very aggressive in 
pushing the States in this direction.
    Secretary Slater. Yes, sir.

                Safety of Washington, DC, Area Parkways

    Senator Byrd. The life you save may be mine, and I am 
thinking of the George Washington Parkway.
    Secretary Slater. Oh, yes.
    Senator Byrd. Recently we have seen some terrible, most 
tragic accidents occur on that road, and it was my 
understanding in watching the TV that $16 million would be 
needed to install structural divides between the road going 
east and the highway going west.
    Secretary Slater. Yes, sir; your divides.
    Senator Byrd. Those median strips are so very narrow in so 
many places.
    Do you have any comment?
    Secretary Slater. Yes; I do, sir. This is something that we 
have followed very closely. I might also add that the 
Baltimore-Washington Parkway, about which I know Senator 
Mikulski is very interested--we have looked at these and we 
have really tried to work with the Park Service to make the 
necessary improvements. I might add, though, that our figure is 
more in the area of about $10 million for the improvement, but 
I am willing to be mistaken on that point.
    The only point I want to make is we will work with the Park 
Service in partnership to make sure that the necessary 
improvements are made. We are expediting the process to provide 
for some temporary structural improvement over the next few 
months, and then we will move forward with the kind of 
resources and initiative necessary to provide for the permanent 
barriers.
    But if I may, Senator, let me just say that I saw a very 
interesting editorial in the Washington Post dealing with this 
issue, which noted that these parkways were not built to 
interstate standards, nor were they built with their use to be 
in the same way as the interstates are used.
    In the final analysis, I think we have to seek the 
assistance and the support of the driving public that will use 
this facility and know that it is constructed in the way that 
it is constructed so as to accentuate the pristine beauty of 
the roadway and the landscape, as well as to provide a 
transportation service. We just all have to be considerate of 
the individuals with whom we share the road. So, I think 
enforcement is also a part of the answer, and that is really 
what I am getting to.
    Senator Byrd. Mr. Chairman, I know my time is up. May I ask 
one question of the Secretary with regard to the funding that 
is needed in regard to the problem that we just indicated?
    Would this be funding that would come through this 
subcommittee or would it come through the Interior 
Appropriations Subcommittee which has jurisdiction over the 
parks?
    Secretary Slater. It is going to come from our Federal 
Lands Program, which is a part of our overall DOT program. So, 
this committee would have a lot to say about those resources 
and how they are expended.
    Senator Byrd. Mr. Chairman, I hope we will do something 
about this.
    I thank the chairman and thank the Secretary.
    Senator Shelby. Senator Faircloth.

                 Mileage of Appalachian Highway System

    Senator Faircloth. Thank you, Mr. Chairman.
    I also share an interest with Senator Byrd on the 
Appalachian Highway System. I was 8 years working with it.
    Have we added additional miles to it? Have there been miles 
added since the inception--what? Thirty years ago?
    Senator Byrd. Over 30; 32 years.
    Senator Faircloth. Have there been additional miles added 
to that system or is it a locked-in mileage? If we have 
continued to add mileage to the system, then there is some 
reason for not having completed it in 30 years, so are we still 
adding? That is my question.
    Secretary Slater. Yes; I understand the nature of the 
question.
    Let me just say that I do not know personally whether miles 
have been added. I would say this, that most of the costs and 
the increase that we have determined are really based on other 
factors, the need to ensure that the roadways are compatible 
with the environment and a lot of our clean air 
responsibilities that have come into existence in the ensuing 
years. But that represents the increase in the costs more so 
than the addition of miles.
    I have just gotten a note that no new miles have been 
added.
    Senator Faircloth. No new miles.
    Senator Byrd. It seems to me, if the Senator would yield, 
that there have been some new miles added from what they were 
in the very beginning.
    Secretary Slater. OK. Let me just say that what I would 
like to do is to look into it. I know that the system is pretty 
much consistent with the way we have looked at the Interstate 
System where originally it was about 42,000 miles, if I 
understand correctly. Then over time, because of changes in 
demographics, there were some roadways that were added, and we 
have got a system now that is about 45,000 miles. I would not 
be surprised if a few miles have been added to the system.
    But the point that I want to underscore is that the 
increase in the cost is primarily based on inflation and based 
on other responsibilities that we have to meet that go beyond 
just the laying of the concrete, the asphalt, and the steel, 
many of them environmental considerations. We are taking those 
into account appropriately so, and our objective is to complete 
the system as soon as possible at a cost as low as possible.
    Senator Byrd. Mr. Chairman, would the Senator yield again?
    Senator Faircloth. Sure.
    Senator Byrd. I wonder if the Secretary--and perhaps I am 
the one who is confused--is talking about the interstate 
mileage system when I believe the Senator is talking about the 
Appalachian corridor.
    Secretary Slater. Yes; I was talking about Appalachian. But 
my point is I would not be surprised that some miles were 
added. We are going to confirm that.
    But then I went on to use the interstate as an analogy. 
Originally it was laid out actually during the Roosevelt 
administration, and then during the Eisenhower administration, 
we were able to put together--Senator, you noted your presence 
at the time--not only the concept but also the funding 
mechanism. Then over time, because of some demographic changes, 
we did add miles here, miles there. We are talking about I-73/
74 right now. So, those kinds of additions have been made over 
time, but it has not resulted in a large addition. We started 
at about 42,000 miles. We are now at roughly 45,000. That is 
not a significant addition with a system of that size, and I 
would think that the same would hold true with the Appalachian 
development highway program.
    [The information follows:]

    No corridors have been added to the system since 1978. 
However, Congress amended the 1965 Appalachian Development Act 
to increase the original 2,350-mile Appalachian system in 1967 
to 2,700 miles, in 1975 to 2,900 miles, and finally in 1978 to 
its present size of 3,025 miles.

                   Varied Uses of Highway Trust Fund

    Senator Faircloth. Thank you.
    Secretary Slater, the administration has expanded the use 
of highway trust funds in many, many areas. When we added a 4.3 
cents per gallon tax increase on gasoline, it simply went to 
the general revenues. And now the President has proposed that 
funding for Amtrak come from the trust fund, which it did not 
in the past. Additional funds for the National Highway Traffic 
Safety Administration come out of the trust fund.
    If we keep bleeding the highway trust fund--and that is 
what we are doing with every program that comes up--do not we 
at least need to give the States additional flexibility in the 
use of their transportation funds?
    And if we need to fund Amtrak, do you favor an additional 
one-half cent per gallon as they have wanted, and is that the 
direction we are headed in?
    Secretary Slater. First of all, let me just deal with the 
issue involving Amtrak. We are engaged in ongoing discussions 
internally about how to best fund Amtrak. Once we are clear as 
to our thinking, we will then, as we always have to do, come to 
the Congress for your consideration of that proposal, and 
hopefully in the process, we can find some common ground there.
    What I have said is that, as Secretary of Transportation, I 
do view Amtrak as being central to our transportation system 
for the 21st century. Now, the issue of how we fund it is a 
matter that is open to discussion and to debate.
    On the question of the use of the trust fund for purposes 
that go beyond, say, the hard side of transportation, meaning 
the investment in the concrete, asphalt, and steel, with the 
highway trust fund, let me just say that with our 
reauthorization proposal that will become clearer as we unveil 
it and roll it out. The focus will be on the preservation 
primarily of the system as it exists, with over 80 percent of 
the resources going toward the NHS system, interstate 
maintenance----
    Senator Faircloth. Excuse me.
    Secretary Slater. Yes, sir.
    Senator Faircloth. Maintenance of the Interstate System?
    Secretary Slater. The NHS which includes the interstate; 
yes, sir.
    Senator Faircloth. Just the maintenance, not expansion.
    Secretary Slater. Well, also expansion.
    Senator Faircloth. But primarily maintenance.
    Secretary Slater. Primarily maintenance because most of the 
system is in place.
    And I want to get to that question of flexibility because 
that is exactly what we are doing. We are giving the States the 
option. They are not being forced to do anything. They are 
going to have the flexibility to use the resources to make the 
decisions that they think best, clearly after having gone 
through the planning process.
    But the point I want to make is that, with the 
reauthorization proposal, we are going to focus primarily on 
preserving the system that we have, and that could include 
expansion. But the NHS, which includes the Interstate System, 
the interstate maintenance portion of the NHS, the bridge 
program--many have mentioned bridges here today--and then the 
Surface Transportation Program [STP], which is almost like a 
grant program that provides maximum flexibility to States and 
local governments to deal with their transportation needs. 
Eighty percent of all the funds will go toward that kind of an 
investment.
    When you compare apples to apples, meaning ISTEA and our 
program, the total amount for ISTEA is about $157 billion. For 
our program, again apples to apples, those things in our 
program that are in ISTEA, our total is about $169 billion, 
which is still a considerable increase, I think about 8 
percent.
    Then you get to the additions that take our total program 
to roughly $175 billion. But again, most of the program goes 
exactly as you have expressed in your comment, toward the core 
system, the core programs.
    But we do offer a proposal to include other things, for 
instance, the welfare-to-work portion of our effort, at $100 
million. That is a part of our initiative to ensure that all 
Americans, wherever they find themselves, whether in urban, 
suburban, or rural America, have the benefits of our 
transportation system and also have really the skills that make 
them viable players in our society, individuals able to make a 
difference. But it is only a small portion of the bigger pie.
    Then we also hope to make that pie even bigger through our 
innovative financing initiatives, again the State 
infrastructure banks and also the Federal credit program that 
we hope to finance at about $100 million per year. That is the 
way we hope to deal with the important issues that you have 
raised, Senator.
    Senator Faircloth. Are we going to see this flexibility in 
the administration's ISTEA proposal that is coming up?
    Secretary Slater. Yes, sir; we hope to provide even greater 
flexibility.
    An example, the ITS technologies, intelligent 
transportation technologies. We want to make those kinds of 
expenditures eligible for all of the major programs, but we 
want to give that flexibility again to the States and to 
locales.
    Senator, I too have had the honor of serving as a 
commissioner in my State, you serving as the head of your 
program in North Carolina. I know that from that vantage point, 
you want as much flexibility as possible when it comes to 
dealing with too many projects with too little money, and with 
that flexibility, you can be strategic and you can put the 
moneys to the greatest use. We hope to make that the norm 
rather than the exception.

                 Aviation Computer Systems Procurement

    Senator Faircloth. Secretary Slater, my time is running out 
but I have one question that bothers me, and we talked on it 
briefly in my office the other day.
    Secretary Slater. Yes, sir.
    Senator Faircloth. I understand it was not of your doing 
and you were not even there. But the $1 billion that was put 
into an utterly failed computer system is a great source of 
bother to me and a lot of other Senators that I have heard 
mention it. I understand that some of the overall project might 
be salvageable for something.
    But has any investigation internally been pursued about how 
they could spend $1 billion--and I think that was the figure--
on a total failure? And not only did it waste the $1 billion 
plus, we went 12 years with a deteriorating system for the FAA. 
We are operating with an absolutely antiquated system. Has 
there been any investigation as to who created this fiasco?
    Secretary Slater. Well, let me just say that I do believe 
that there have been some investigations. What I would like to 
do is to follow up with more detailed information on that.
    [The information follows:]

    There were several investigations in the form of studies on 
the AAS program and the problems that surrounded it. Studies 
were conducted by the National Volpe Transportation Systems 
Center, Center for Naval Analysis, Lincoln Labs, the Software 
Engineering Institute, and a team of independent FAA experts. 
Those investigations concluded that there were multiple reasons 
that resulted from the actions of numerous organizations for 
the failure of AAS. Subsequent to these studies, the program 
was rescoped, top-level management of the program was changed, 
major improvements were made in the way major acquisitions are 
managed, and the resulting programs are fully on track.

    Secretary Slater. What I would like to do, if I may, is to 
say that this sort of thing cannot be tolerated, that we have 
limited resources, and as good stewards, we have to ensure that 
those resources are expended in such a way as to bring about 
the best and the greatest good for the American people.
    It is true that we had a very detailed conversation about 
this long before I was confirmed, and I made a commitment to 
you then that we would move forth aggressively and with 
dispatch to fully implement all of the laws that the Congress 
has given us to deal with acquisition reform, to deal with 
personnel reform, and hopefully in the next few months to a 
year, to get the tools that we need to deal with the long-term 
funding needs of aviation. But your point is well taken.
    I would also like to note that Secretary Pena and 
Administrator Hinson and also Deputy Administrator Daschle, 
upon getting into office and getting a sense of this issue, did 
revive the approach to dealing with this concern, and I think 
we have had a pretty good record since that time. But it is a 
record that we want to make better. In partnership with you, 
Senator, and others who I know are concerned about this issue, 
I know we can.
    Senator Faircloth. Could you have someone in your office 
send me the background on this?
    Secretary Slater. We will do that.
    Senator Faircloth. And somewhat of a litany of how the 
fiasco developed.
    Secretary Slater. Yes, sir; we will do that.
    Senator Faircloth. I understand we are going to have 
another hearing later on with the FAA people. I would like to 
have that report as soon as possible and before the hearing.
    Secretary Slater. Yes, sir; we will get that for you.
    Senator Shelby. Senator Mikulski.

                   Transportation Issues for Maryland

    Senator Mikulski. Mr. Chairman, thank you very much. I too 
would like to congratulate you on assuming the chairmanship and 
stewardship of this subcommittee. We have worked together in 
the House on Energy and Commerce where we did a lot of the 
railroad legislation in those days and also worked with the 
chairman on Treasury/Post Office where you showed us so many 
courtesies, for which we were appreciative. I look forward to 
working with you on this committee.
    Mr. Slater, let me just talk about a few things. First, my 
opening statement is in the record, but transportation is vital 
to Maryland. We are in both the interstate and rail corridor 
from Massachusetts down all the way through the South into the 
Carolinas, and of course are part of the hub.
    We are also in many ways part of the regional hub for the 
capital of the United States of America. So, it tends to be 
that our subway system, our highway system are very important 
to that.
    Of course, we are on the Chesapeake Bay and the Coast Guard 
is so crucial to us.
    So, we could go through all of those, but I would like to 
get to a few top priorities.
    Your agency is truly where the rubber meets the road, and 
the American people really count on you for safety. I am not 
going to reiterate what my colleagues have said, but I really 
want to offer the strongest and amplified voice that our 
safety, particularly in rail and aviation and highway, really 
be affirmed, whether it is the behavior of drivers, the fitness 
for duty of FAA, and also of our rail.
    Senator Byrd has left, but this time last year we were just 
about attending the funeral for some wonderful Job Corps kids 
who were killed in a most ghoulish accident in the MARC train 
in Silver Spring.
    So, we are really safety obsessed and count on you to 
really be able to move on that. Often air safety captures the 
imagination of people, but everything from driver's education 
to switches now are yours.

                         Woodrow Wilson Bridge

    Let me, though, go on to what I think is another safety 
issue and it does affect the capital area, and that is the 
Woodrow Wilson Bridge. I know this might be seen as a Maryland 
or Virginia project, but it is a national project because it is 
a bridge over the Potomac that is one of the key links in the 
I-95 Interstate.
    As you know, the Woodrow Wilson Bridge is, No. 1, 30 years 
old. No. 2, it was designed to serve 70,000 people. It now 
currently serves one-quarter of a million people a day and 
projections increase.
    The bridge is outmoded. It is of questionable safety as it 
goes on.
    I wonder what the administration's timetable is and plans 
are for the Woodrow Wilson Bridge. I note a $40 million item in 
the budget. That is about 4 percent of what is estimated. So, I 
would like to hear from you your plans for the Woodrow Wilson.
    Secretary Slater. First of all, we recognize the importance 
of this structure to the overall transportation system of the 
country, especially the interstate. This is the only bridge on 
the interstate that is owned by the Federal Government, and 
because of that fact, we also understand the important role 
that we must shoulder and must carry in dealing with this very 
important transportation safety challenge.
    Let me just say that the $40 million that is in the budget, 
the 1998 budget, is for continued design purposes, as well as I 
think about $10 million for rehabilitation purposes, to just 
extend the life of the structure.
    But we do know that we are working on a short fuse here and 
we have got to deal with this issue as quickly and as 
expeditiously as possible. In that spirit, we are working with 
the Woodrow Wilson Bridge Commission that has worked tirelessly 
to come up with a design that I think has received at least 
positive response. It is a design that has a price tag in 
excess of $1 billion.
    We have made the comment in the President's budget that we 
see ourselves as clearly having a $400 million or so obligation 
as relates to the structure, because that is the amount that it 
would take to rebuild the structure to current standards, if we 
were merely replacing it as is.
    But we understand the concerns of both the State of 
Maryland and the State of Virginia, as well as the District, 
when it comes to dealing with this issue and want to come to 
some closure on it and look forward to working with you in that 
regard.
    Senator Mikulski. So, you anticipate, from what you see, 
that the Federal Government's obligation would be one-half of 
what is estimated that the project would cost to rehabilitate 
the current bridge.
    Secretary Slater. That is correct.
    Senator Mikulski. Therefore, your current thinking is that 
the other one-half would come from Maryland and Virginia.
    Secretary Slater. Well, clearly that is our current 
thinking, but I can tell you that we have gotten strong vibes 
from both Maryland and Virginia that it is their belief that 
since it is a bridge that is owned by the Federal Government, 
that our responsibility is much greater. We are taking those 
comments into account.
    Senator Mikulski. This requires further conversation.
    Secretary Slater. Sure.
    Senator Mikulski. I have gotten more than vibes from 
Governor Glendening. I have gotten vibrations from Governor 
Glendening [Laughter.]
    Secretary Slater. I understand.
    Senator Mikulski. And the Maryland General Assembly, 
concern about exactly how we would do this.
    What do you think would be a process by which we should go 
in order to be able to resolve what we are going to do and how 
we are going to pay for it so we really do move expeditiously 
on this project? Do you have suggestions on that?
    Secretary Slater. I do.
    First of all, let me say that I have gotten more than vibes 
as well from Governor Glendening. We have talked directly about 
the matter and I do understand his position on it.
    I think that there are a number of ways to approach it.
    First of all, there has been significant coordination among 
the States and the District, the State leadership, the 
congressional leadership, and our Department on this matter. 
Also, I do think that there is a recognition clearly that we 
have a responsibility to play a substantial role when it comes 
to financing this project. One of our employees was actually 
the Chair of the Woodrow Wilson Bridge Replacement Committee.
    Senator Mikulski. My time is going to run out. So, what do 
you think we should do?
    Secretary Slater. Yes; this is what I think we should do: 
Not lose the opportunity to take full advantage of 
reauthorization. It is a 6-year bill. It gives us an 
opportunity to deal with the money responsibilities over a 
period of time. Look at all innovative financing opportunities 
available to us, whether it is the State infrastructure bank 
[SIB] initiative or the credit program that we are going to 
bring on line to deal with large multistate projects, and to 
just stay engaged. I think we can come to some common ground on 
the matter.
    There are many funding strategies to be taken into account, 
and we should explore them all. But I want to assure you that 
we understand our obligation to play a substantial role in 
dealing with this matter.
    Senator Mikulski. Is it your intent within the next few 
months to meet with the Governors of the two States, their 
secretaries of transportation?
    Secretary Slater. Yes; that is my goal.
    Senator Mikulski. I can say this on behalf of Senators 
Warner and Robb, Senator Sarbanes and myself, we are very eager 
to resolve this and I think we would look forward to any type 
of collegial consultation process in which we then would bring 
our Governor or our secretaries of transportation in for a 
meeting and almost like a little workshop on this to resolve 
this.
    Secretary Slater. Yes.

                   Transportation-related Employment

    Senator Mikulski. I know my time is moving along. Let me 
just ask two things about jobs because you help people get to 
work. I have two questions on that.
    No. 1, my concern is that I would like the United States to 
be a leader in manufacturing of transportation. Right now we 
are the world's leader in the manufacture of airplanes, but we 
are not the leader in manufacturing of buses and railcars. What 
is happening is we buy all of this stuff and it is not from 
America.
    Now, this is not jingoism. I agree we believe in a global 
economy, but we spend all this money, Federal level, State 
level, on buses and railroad cars, freight as well as 
passenger. I wonder if you have thoughts on--not a Government 
program; we are not looking for a comrade five-point program 
here--but what we could do to strengthen the Buy American 
provision, not shackle the Government or private sector. But, 
boy, I wish when we were spending this money, we were back in 
the transportation business.
    This is no fault of our cousins from Canada, who are 
wonderful neighbors, but we have got a little $20 million 
subway system running around this capitol, and we bought it 
from Canada. Well, I did not know if we had to spend $20 
million and I did not know if we had to spend it in Canada. 
Maybe we did, and it is no fault of Canada. But, my gosh, every 
time I see a bus and a railroad car, I wish it was made by UAW 
workers or their equivalent somewhere.
    Do you have thoughts on that?
    Secretary Slater. I do. Senator, first of all, I believe as 
well in the made-in-America spirit. I think that has been 
manifested in the Department of late with the significant 
rebound that has occurred on the aviation front, but I would 
also mention the shipbuilding industry as well. We, through the 
support of the Congress, have a Maritime Administration that is 
moving, moving forth aggressively, confidently, and I am sure 
will be a major player in the years to come.
    There is a lot of talk about how we are moving from an 
industrial society to an information-based, technology-based 
society. We still need to build things and our people are 
capable of building things to be used in the 21st century. I 
think transportation provides an ideal arena in which to 
explore this kind of initiative.
    One thing that I mentioned in my opening statement was a 
desire to have the support of the Congress, this committee in 
particular, as I move toward the implementation of what I am 
calling the Garrett A. Morgan Technology and Transportation 
Futures Program to focus on those transportation needs of the 
coming century and to work now to build a work force of 
visionary and vigilant individuals who can make real that 
dream.
    I would like to bring in 1 million young people in that 
kind of effort, working with management and labor, and I have 
spoken to President Sweeney about this. I have spoken to CEO's, 
CAO's of some of the major companies, and I have also had 
conversations with many of you. I look forward to making this a 
reality.
    Senator Mikulski. Well, I think that is a good step.
    Would you also support strengthening Buy American 
provisions in both the authorization and appropriations?
    Secretary Slater. Oh, yes; yes, I would.

                   Transportation and Welfare Reform

    Senator Mikulski. Thank you.
    Mr. Chairman, my time is up. I just want to wrap up by 
saying I really support your initiative of welfare to work. I 
think transportation is one of the biggest deterrents, 
particularly in rural parts of my State, of people being able 
to move back into the market force. I think by that initiative, 
we will truly get welfare reform moving literally and 
figuratively, and I look forward to working with you.
    Secretary Slater. Thank you. Thank you, Senator.

   Status of Administration's Surface Transportation Reauthorization

    Senator Shelby. Mr. Secretary, when is ISTEA coming up?
    Secretary Slater. Well, we hope to have our bill soon, Mr. 
Chairman. You know I had two committee hearings last week. One 
of them went a little better than the other, and I think it is 
because I was more specific. I made a commitment then that we 
would have our proposal ready within 7 to 10 days. We are 
nearing that 10-day period, and I am committed to fulfilling 
that commitment.

                      Airport Improvement Funding

    Senator Shelby. AIP funding is at an alltime low in recent 
history, and in the 1998 budget request you have requested an 
obligation ceiling of only $1 billion. In the past 4 years, Mr. 
Secretary, annual airline passenger enplanements have increased 
16 percent and investment in airport development has decreased 
23 percent. That is before the $460 million decrease in airport 
investment envisioned in the President's budget.
    I have been informed that the FAA has pending applications 
for over 3 billion dollars' worth of airport improvement 
projects ready to go. The FAA cites 22 airports that are 
seriously congested and estimates, Mr. Secretary, that number 
growing up to 32--in other words, another 10--in the next 
several years.
    Delays, as you well know, associated with congestion cost 
the airlines over $500 million a year directly, and the total 
cost to the national economy is many times greater, if you 
consider the time lost to passengers and businesses in doing 
it.
    Yet, your budget request here requests the historically low 
airport improvement funding level that I mentioned earlier of 
$1 billion, lower than the AIP ceiling has been in 10 years.
    Mr. Secretary, have we been spending too much on airports 
or is the President's budget underfunding our airport needs? 
And has the Department done any research on the economic impact 
of funds spent on new airports and airport improvements?
    Secretary Slater. On the latter question about the 
research, let me just say that we have ongoing research dealing 
with the overall impact of transportation on the economy and we 
are studying it from all vantage points. So, clearly, we are 
looking at it from the vantage point of investments in 
airports.
    Let me also say that I do not think that we in the past 
have been spending too much on airport infrastructure 
improvements, but I also say that as we offer a budget in this 
environment, that I do not think, as we have reasoned, that we 
will be spending too little in this instance, because it is our 
belief that the larger airports have many, many opportunities 
to access resources for improvements on and improvements to the 
system.
    It is your smaller airports that really, really rely on the 
Airport Improvement Program, and if we can continue to address 
their concerns and in innovative ways encourage the larger 
airports to try to leverage private sector dollars or to 
utilize public sector dollars in more innovative ways, then I 
think we can bridge the gap, if you will. But it is going to be 
difficult.
    In a nutshell, this proposal is merely reflective of our 
desire to have as much investment as possible but within the 
context of a balanced budget goal, shared by both the 
administration and the Congress.

                        Regulation of Golf Cars

    Senator Shelby. I want to get into the regulation of golf 
cars, whatever that is. I was intrigued, Mr. Secretary, to 
learn that the National Highway Traffic Safety Administration 
is proposing to regulate the safety of golf carts. Evidently 
golf carts whose speeds do not exceed 15 miles per hour would 
be excluded. However, faster golf carts whose speeds are over 
15 miles per hour but under 25 miles per hour would be 
regulated as golf cars.
    Golf cars, I understand, would be required to have 
headlights, turn signals, taillights, reflectors, mirrors, 
parking brakes, windshields--windshields--and seatbelts. They 
would also have to post warning stickers that state, ``This 
vehicle must not be operated on the public roads at a speed 
more than 25 miles per hour.''
    I know that the NHTSA has important responsibilities to 
deal with to reduce the number of deaths and injuries resulting 
from highway traffic accidents. However, I am not aware myself 
of any deaths or accidents dealing with these.
    I would like for you to explain.
    Secretary Slater. Well, if I may, Mr. Chairman, I have been 
on the job now for a couple of weeks.
    Senator Shelby. Is this a surprise for you as well?
    Secretary Slater. And during my confirmation preparation 
and hearings, this is an issue that never came up.
    Senator Shelby. Would you look into it?
    Secretary Slater. I will definitely look into this.
    I will say this. We are serious when we say we are going to 
take a commonsense approach to Government.
    Senator Shelby. Just common sense.
    Secretary Slater. Common sense. We will review this 
particular action.
    Senator Shelby. I hope you will. I do not have a golf cart. 
I do not ride in one, but I do not know how you make a car out 
of it.
    Secretary Slater. I understand.
    [The information follows:]

    There appears to be a growing demand, especially around 
retirement communities, for small, light-weight, low-speed 
vehicles as alternatives to the traditional passenger car for 
short, in-town trips. Part of this demand will be met by 
``Neighborhood Electric Vehicles'' (NEV's), which are small, 
electric passenger cars manufactured for on-road use, but 
capable of being used on golf courses. Part of this demand will 
be met by golf carts, because States have begun to amend their 
laws to allow golf carts to use the public roads with other 
heavier forms of traffic at speeds up to 25 miles per hour.
    The National Highway Traffic Safety Administration (NHTSA) 
has jurisdiction over vehicles used on the public roads. At the 
present time, any on-road vehicle capable of a speed of 25 
miles per hour is subject to the full range of Federal motor 
vehicle safety standards. It does not appear practicable or 
necessary for NEV's, on-road golf carts, or other small, low-
speed vehicles to meet current Federal motor vehicle safety 
standards, which, in the absence of further NHTSA action, they 
would be required to do. After studying the regulations of the 
City of Palm Desert, California, which has a golf cart safety 
program in force for golf carts registered for use on the city 
roads, NHTSA decided to propose creation of a new class of 
vehicle, called ``Low-Speed Vehicles'' (LSV's). All LSV's, 
whether fast golf carts or NEV's, would be required to have the 
safety equipment that Palm Desert has found to meet the needs 
for safety of that community. In addition, a warning label 
would be required advising that the LSV is not to be operated 
at speeds in excess of 25 miles per hour.
    NHTSA is currently evaluating comments on the proposed 
regulation. The Senator is correct that there are no reported 
deaths and injuries concerning on-road golf carts. That is 
attributable in part to their scarcity. The possibility of 
accident involvement is bound to increase with their numbers. 
In addition, there is no assurance that Palm Desert's system of 
road zoning and restriction of LSV use to daylight hours--
factors contributing to golf cart safety--will be adopted by 
other municipalities permitting the use of golf carts and NEV's 
on their streets.

                       Traffic Safety Terminology

    Senator Shelby. One other thing. The NHTSA has been in the 
news also for pushing a new policy that its employees are not 
to use the word ``accident'' in any official communication from 
the agency. Instead, the word ``crash'' is to be used. Do you 
believe that the NHTSA should be spending valuable resources--
you know, we are having money problems--and time on initiatives 
such as changing the vocabulary of its employees? Is it 
reasonable to think that the Federal Government has a role in 
removing the word ``accident'' from our common language, common 
parlance? Would you look into that?
    Secretary Slater. I will look into it, but let me offer 
this.
    Senator Shelby. Everything is not a crash.
    Secretary Slater. I understand.
    Senator Shelby. I would think a crash would entail 
something really big.
    Secretary Slater. I understand. I will look into it.
    Let me just say that for the second time in the history of 
NHTSA we have a physician at the helm, and there are within the 
medical profession terms of art. This effort is only to bring 
greater clarity to actions that can be prevented. Thus, they 
are actions that are not perceived as accidents.
    But, now, I do not want to get into a long discussion of 
it. What I would like to do is just follow up with a detailed 
explanation and then look forward to discussing with the 
chairman and other interested parties why this is the approach 
that is being discussed internally. But no final action has 
been taken on this particular initiative.
    [The information follows:]

    NHTSA is promoting use of the word ``crash'' in lieu of 
``accident'' because motor vehicle crashes and injuries are 
predictable, preventable events. Continued use of the word 
accident promotes the concept that these events are outside 
human influence or control. In fact, they are predictable 
results of specific actions. NHTSA can identify their causes 
and take action to avoid them.

                          Submitted Questions

    Senator Shelby. Thank you. We do have a number of questions 
for the record that we will be submitting to you. I will have 
some. Senator Domenici had a number and other members, Mr. 
Secretary.
    [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 Shelby
                      essential air service (eas)
    Question. The FAA Reauthorization Act of 1996 provides a $50 
million annual set-aside for EAS, funded by FAA ``overflight'' user 
fees. Will FAA realize $50 million in overflight fees in fiscal year 
1997? Can this level be anticipated in 1998?
    Answer. The FAA issued its rulemaking establishing the specifics of 
the overflight fee schedule on March 20, 1997. The charges will take 
effect 60 days after issuance of the rule, on May 19, 1997. As a 
result, fees will be collected for only about four and one-half months 
of fiscal year 1997, and are expected to be well under $50 million. EAS 
does not have access to these funds during fiscal year 1997 until 
collected revenues exceed $75 million; thus, no funds from the 
overflight fees will go to the EAS program in fiscal year 1997. The 
Department expects that the overflight fees will generate about $90 
million per year in fiscal year 1998 and beyond.
    Question. In fiscal year 1997, EAS is funded at $25.9 million. Is a 
$50 million annual program level necessary? Currently, are eligible 
communities not receiving EAS service because of funding constraints?
    Answer. The $50 million funding level for EAS and rural airport 
safety was established by Congress last year. In our fiscal year 1995 
appropriations act, the EAS program was reduced by one-third and the 
Department was directed to implement service and subsidy reductions 
across-the-board (except in Alaska), but to keep at least some air 
service at all communities. In order to do so and stay within the 
budget, the Department had to reduce subsidy levels below even the 
statutory minimum service guarantees. The Department would now propose 
to restore service levels at all of the subsidized communities to at 
least the minimum statutory guarantees.
    There are now nine EAS communities that have no air service as a 
result of the budget cuts: Kearney and Hastings, NE; Fergus Falls, 
Mankato, and Fairmont, MN; Brookings and Mitchell, SD; Goodland, KS; 
and Lamar, CO. As a result of the one-third, across-the-board budget 
cut, one of the major EAS airlines serving about 20 communities, Mesa 
Air, announced that it would suspend service at six communities. The 
Department issued an order prohibiting that suspension, as required by 
statute. Mesa took the issue to court claiming that the Federal 
Government had breached its contract by unilaterally reducing EAS 
subsidies. Mesa prevailed in a unanimous decision in which the Court 
ruled that Mesa, and by extension all EAS carriers, could suspend 
service where their subsidies had been cut, leaving affected 
communities with a hiatus in service.
                 fiscal year 1997 supplemental request
    Question. Currently, there are only two components to DOT's fiscal 
year 1997 supplemental request: $318 million to correct a Treasury 
Department error that affected States' highway allocations, and $4 
million to cover a military cost of living adjustment for Coast Guard 
retired pay. Will you request a supplemental for highway funds to 
repair damage from the January floods in the Northwest, and, even more 
recently, from the damage stemming from tornadoes in your home State of 
Arkansas and flooding throughout the Ohio Valley? How much will you 
request? Will these be classified as ``emergency relief'' funds?
    Answer. Yes, on March 19th the administration requested a 
supplemental appropriation in the amount of $291 million for emergency 
needs due to flooding. Of this amount, $276 million is needed for 
additional emergency relief funding due to floods in the Winter of 1996 
affecting the States of California, Idaho, Nevada, Oregon, Washington 
and Montana. Many of these States required emergency relief funding 
under both their Federal-aid and the Federal roads programs. The 
remaining $15 million is requested as contingency funding, for the 
emergency requirements in the Midwestern and Mid-Atlantic States.
    Question. Are there any other pending or possible DOT supplemental 
requests for fiscal year 1997?
    Answer. No, there are none anticipated at this time.
              office of aviation and international affairs
    Question. OST's office of aviation and international affairs 
utilizes airline traffic and financial data to support its statutory 
responsibilities in aviation programs. Some of these responsibilities 
include: developing the U.S. position in aviation bilateral 
negotiations with foreign countries; deciding carrier selection cases 
and making international route awards; resolving international route 
transfer issues; reviewing the antitrust implications of carrier 
acquisition and merger proposals; setting international and intra-
Alaska mail rates; and determining the essential air service needs of 
small communities and establishing appropriate subsidy rates for such 
services. The data and statistics that OST utilizes in all these areas 
is provided by the Bureau of Transportation Statistics office of 
airline information (OAI). In return for this data, does OST support 
OAI through annual reimbursable agreements? If so, at what level? If 
not, why not?
    Answer. At times in the past, OST has supported the Office of 
Aviation Information (OAI) through annual reimbursable agreements when 
it was a part of the Research and Special Programs Administration. More 
recently, it was decided that all funds for OAI would be provided more 
effectively through the modal administration's authorizations. In the 
current fiscal year, OST does not have any reimbursable agreements with 
OAI.
                  timely availability of aviation data
    Question. Please discuss any problems OST has encountered in the 
last two years with timely availability of airline data from OAI. Have 
these problems been resolved? If not, please outline some possible 
solutions.
    Answer. Aviation data frequently are not available on a timely 
basis, particularly, the Passenger Origin and Destination Survey data 
and the monthly segment and market data that the airlines file on Form 
41, Schedule T-100.
    It is clear that timeliness, accuracy, availability and 
accessibility of aviation data are important for proper analysis. One 
possible example of a solution is our ongoing effort to replace the 
Passenger Origin and Destination Survey with a database built on data 
from computer reservations systems. If this effort proves feasible, we 
should have an excellent database for the future that could serve many 
purposes and would not be a major burden for the airlines or OAI staff 
to administer.
                    transportation safety priorities
    Question. Given the relative differences in fatality and accident 
rates on our nation's highways, in the air, on rail lines, and on 
waterways, are the Department's efforts adequately balanced to address 
the relative incidence in each mode of transportation? Does the 
Department conduct any cross-modal safety analyses?
    Answer. Ensuring the overall safety of our transportation system 
requires us to focus our efforts on a diverse array of transportation 
activities involving the movement of both passengers and freight, some 
of it commercial, but most by private citizens. The magnitude of the 
Department's programs in each mode is also determined by the role that 
Congress has given to the various operating administrations. The FAA 
budget reflects the fact that it directly operates a massive and 
complex safety system, which requires the public's full confidence that 
it is extremely safe. NHTSA, in contrast, can use its regulatory power 
to set motor vehicle safety standards, but these automobiles are then 
operated independently by individuals. Other programs in NHTSA, as well 
as those of FHWA, must use their funding to form partnerships with the 
States and local governments that have the police and safety 
enforcement authorities.
    All the modal administrations within the Department utilize a 
cooperative and leveraged approach to achieve continuous improvements 
in the safety of each mode of transportation. The Department's recently 
announced NEXTEA proposal reflects an increased emphasis on programs 
that address the single largest source of transportation-related 
fatalities (94 percent) and injuries (99 percent), the operation of 
motor vehicles, particularly passenger cars and light trucks and vans.
    Cross modal safety analyses are conducted in the Office of the 
Secretary, primarily in the comparison of relative statistics and 
development of common measures, and to assure that safety approaches 
that prove successful in one mode are applied, where feasible, in 
others.
                 surface transportation infrastructure
    Question. Congress will take up the reauthorization of ISTEA this 
year. With continuing budget deficit reduction goals, increasing 
spending for transportation programs is difficult. Our infrastructure 
is deteriorating, and congestion clogs our cities. Total public 
spending on the capital needs for highways and bridges was about $40 
billion in 1993, the most recent year for which data are available. 
However, DOT estimates that as a nation, we are about $16 billion short 
on an annual basis, just to maintain our existing highway and bridge 
infrastructure at the 1993 level. Issues at the forefront of the 
reauthorization debate are how Federal funds will be distributed, and 
what the Federal role will be. Are we currently getting the most bang 
for the Federal dollars we invest in our surface transportation 
infrastructure? Are we directing Federal funds to those programs that 
can produce results?
    Answer. One of the key factors in the success of the ISTEA 
legislation over the past six years has been the flexibility it allowed 
for States and local governments to distribute funding to their top-
priority transportation needs. The National Economic Crossroads 
Transportation Efficiency Act of 1997 (NEXTEA) continues this approach 
and responds to our core program infrastructure needs while helping us 
move toward a balanced budget. It would authorize about $175 billion 
for surface transportation programs from fiscal year 1998 through 
fiscal year 2003, and increases funding for core highway programs such 
as the National Highway System, maintenance of the interstate system, 
and the Surface Transportation Program by 30 percent. It continues the 
commitment to cities in terms of mass transit, helping them get more 
capacity from existing systems, and allows rural areas to play a 
greater role in protecting planning and in determining which projects 
get done first. NEXTEA would give State and local officials greater 
flexibility to target funds toward projects that best meet community 
needs. It also increases the tools available to State and local 
officials by making intelligent transportation systems eligible under 
all major program categories and by expanding innovative finance 
strategies to cut red tape and leverage private and non-Federal public 
resources.
                             intermodalism
    Question. What actions will you take to further encourage the 
integration of surface modes of transportation to enhance the mobility 
of people and transport of goods? How will you address the conflict 
between continuing to fund modally-based programs while attempting to 
foster an intermodal approach to transportation decision making?
    Answer. Although DOT's funding programs continue to be modally-
based, they are significantly adaptable to local needs. To a much 
greater extent than previous surface transportation legislation, ISTEA 
allows State and metropolitan areas to spend their apportioned Federal 
funds based on thorough and inclusive planning rather than restrictive 
program categories. Specifically, almost 60 percent of the funds 
authorized by ISTEA have been available, at the initiative of State and 
local officials, for almost any type of surface transportation 
projects.
    The administration's proposal for reauthorization--the National 
Economic Crossroads Transportation Efficiency Act, or NEXTEA--continues 
these ISTEA programs that have given State and local officials the 
freedom to spend Federal dollars on an expanded set of transportation 
solutions.
    NEXTEA would retain the enhanced flexibility and eligibility 
provisions of three programs introduced by ISTEA: the National Highway 
System (NHS), the Surface Transportation Program (STP) and the 
Congestion Mitigation and Air Quality (CMAQ) program. Through these 
programs, $3 billion in five years has been transferred at local 
request from the FHWA to the FTA for delivery to its grantees. Without 
any administrative transfers, however, the STP and CMAQ programs 
support many projects that directly benefit multiple transportation 
modes. In addition to preserving this flexibility, NEXTEA would extend 
eligibility within certain programs to intercity bus and rail service 
and publicly owned freight rail service.
                    collocation of dot field offices
    Question. Please provide a detailed plan of how DOT will collocate 
and/or consolidate the Department's surface transportation field 
offices (that now number more than 150) to best serve transportation 
needs in a cost-effective manner.
    Answer. In June 1996, the Department chartered a co-location task 
force to review the field office structure and prepare a report.
    To date, the restructuring effort has focused on six major areas: 
planning, safety, co-location, administrative resource sharing, program 
management and the establishment of metropolitan offices.
    The task force identified approximately 160 offices (including CG, 
RSPA and FAA) that appeared to offer co-location opportunities. It is 
the goal of the Department to co-locate offices and consolidate 
services wherever reasonable in order to provide enhanced customer 
service, reduce costs and operate more efficiently. Currently, 
additional analysis is underway to determine the feasibility and costs 
associated with such a consolidation.
    Because of the major costs associated with such a major co-
location, the task force has recommended that the initiatives be 
undertaken as leases are due to expire or other restructures are about 
to be undertaken which would advance the consolidation. Presently, 
there are field work groups developing localized plans for their 
respective areas. Last November the first of many anticipated co-
locations occurred when NHTSA moved into space occupied by FHWA in 
Region III. In this one case, we were able to reduce 2,096 square feet, 
which will result in overall rent savings of $37,854.
                           dot sick building
    Question. What have been the total costs through fiscal year 1997 
associated with cleanup of the ``sick'' Nassif Building? (Please 
display each year's associated costs, and a total to date.) Are any 
fiscal year 1998 costs anticipated?
    Answer. As of February 28, 1997, the total costs associated with 
the cleanup and repair of the Nassif Building that have been incurred 
by the Government is approximately $6,389,000. The General Services 
Administration has picked up these costs for DOT. At this point in 
time, costs in fiscal year 1998 are not anticipated.

----------------------------------------------------------------------------------------------------------------
                                                                           Fiscal year--                        
                                                                 --------------------------------      Total    
                                                                       1996            1997                     
----------------------------------------------------------------------------------------------------------------
Environmental testing/health assessments........................        $941,875        $565,125      $1,507,000
Project management..............................................         591,000       1,104,000       1,695,000
Swing space rent................................................         276,000       1,568,000       1,844,000
Moving expenses.................................................          97,000         116,000         213,000
Swing space set-up                                                     1,130,000  ..............       1,130,000
                                                                 -----------------------------------------------
      Total.....................................................       3,035,875       3,353,125       6,389,000
----------------------------------------------------------------------------------------------------------------

                     fra vacating the dot building
    Question. It is our understanding that some FRA offices have 
declined to move back to the Nassif Building, though the affected 
floors have undergone cleanup. Why? What additional costs will be 
incurred by this decision?
    Answer. The Federal Railroad Administration (FRA) began relocating 
some employees shortly after air quality problems began to affect their 
work space in October 1995. As time passed, more and more employees 
were relocated to space outside the Nassif Building due to symptoms 
that employees believed were caused by the building's indoor 
environment. The sheer number of FRA employees working in different 
locations caused disruption to the organization. As a result, in August 
1996, the entire FRA headquarters organization was relocated to a 
single location, with plans to remain there until the cleaning and 
repair program of the Nassif building is completed.
    The FRA organization is now operating without disruption and would 
like to avoid the disruption of a major move back to the Nassif 
Building until the Department consolidates its headquarter operations 
following expiration of the lease on the Nassif building. The 
Department supports this request, since we are able to consolidate 
other elements of the Department from higher-cost space in downtown 
Washington into the vacated area of the Nassif Building.
                              new programs
    Question. If Congress authorizes and appropriates funds for the 
Transportation Infrastructure credit program ($100 million requested); 
the Intelligent Transportation System infrastructure integration 
program ($100 million requested); and the ``access to jobs and 
training'' transit grant program ($100 million requested), how quickly 
do you envision these programs spending out in fiscal year 1998 (and 
the outyears)?
    Answer. For each of these three new programs, the administration is 
proposing $100 million for each of the 6 years of NEXTEA.
    The Transportation Infrastructure Credit Program is expected to 
outlay 50 percent in the first year, 25 percent in the second year, and 
25 percent in the third year.
    The ITS deployment incentives program is expected to be fully 
obligated each year. It will be within the category of the Federal-aid 
program. Overall spend-out rates for the Federal-aid program are 
estimated at 15 percent in the first year, 53 percent in the second 
year, 16 percent in the third year, 5 percent in the fourth year, 3 
percent in the fifth year, 3 percent in the sixth year, 2 percent in 
the seventh year, 2 percent in the eighth year, and 1 percent in the 
ninth year.
    The Access to Jobs and Training grant program is projected to have 
an outlay rate similar to that of the existing Urban Capital formula 
program: 5 percent in the first year, 20 percent in the second year, 30 
percent in the third year, 20 percent in the fourth year, 20 percent in 
the fifth year, and 5 percent in the sixth year.
                       credit program versus sibs
    Question. Please describe the differences between the 
Transportation Infrastructure credit program and the current State 
Infrastructure Banks program.
    Answer. The National Highway System Designation Act of 1995 
authorized DOT to establish the State Infrastructure Bank (SIB) Pilot 
Program. SIBs are State-level investment funds capitalized in part with 
Federal grants. They are intended to complement traditional 
transportation programs and provide States with increased flexibility 
to offer many types of assistance, including low-interest loans, loan 
guarantees, and standby lines of credit. However, Federal 
capitalization grants for SIBs currently are limited to 10 percent of 
most categories of a State's annual apportionments for fiscal years 
1996 and 1997 and $150 million of ``new money'' to be shared among the 
participating States. Moreover, Federal legislation limits the annual 
disbursement of these funds, thus reducing the capacity of the SIBs to 
provide large amounts of credit assistance directly in the near term. 
SIBs will require a number of years to build up sufficient financial 
resources to gain access to external funding beyond their own 
contributed capital. Consequently, SIBs, like other startup credit 
intermediaries, are best suited to assist portfolios of smaller, 
relatively homogenous, shorter-term projects that are regional or local 
in scope.
    A Federal credit enhancement program would complement existing 
financing techniques, including SIBs, by directing resources to areas 
of critical national importance--such as intermodal facilities, 
expansion of existing highways, border infrastructure, trade corridors, 
and other investments with national benefits--that otherwise might be 
delayed or not constructed at all because of risk or scope. Federal 
credit assistance would encourage more private-sector and non-Federal 
participation, address important public needs in a more budget-
effective way, and take advantage of the public's willingness to pay 
user fees to receive the benefits and services of transportation 
infrastructure sooner than would be possible under traditional, grant-
based financing. Essentially, providing direct credit assistance would 
be a more efficient and effective way for the Federal Government to 
help advance a limited number of nationally significant projects than 
increasing outlays for regular grant reimbursement programs or even 
SIBs.
                 its infrastructure integration program
    Question. Please provide a detailed description of the proposed ITS 
infrastructure integration program.
    Answer. The ITS infrastructure integration program is an initiative 
to foster the uniform national deployment of a computer and 
communications infrastructure in our surface transportation system, 
both inside and outside metropolitan areas.
    In 1991, the Department initiated the Intelligent Transportation 
Systems program, through the Intermodal Surface Transportation 
Efficiency Act, to research, operationally test and promote the 
application of computer and communications technology to our surface 
transportation system, in part to address the growing gridlock in our 
nation. Over the past five years, we have learned through our research 
efforts that an intelligent transportation infrastructure applied to 
our surface transportation can improve efficiency, productivity, and 
safety. Such an infrastructure consists of a series of ``elements,'' 
such as smart traffic signals, advanced traffic management systems, and 
more, that allow the public to travel more efficiently and safely. This 
system works best when the components are interoperable, or can ``talk 
to one another.'' ITS is an important option in an era when we can no 
longer depend on building our way out of congestion.
    We are proposing a one-time incentive to last through the next five 
years. Its purpose is to jump start State and local government 
involvement in deploying ITS in a coordinated manner, consistent with 
standards and within the bounds of the national ITS architecture. This 
deployment incentive focuses on:
  --Integrating existing intelligent transportation infrastructure 
        elements in metropolitan areas, including those elements 
        installed with other Federal-aid funds.
  --Installing, as well as integrating, the various elements of an 
        intelligent transportation infrastructure for commercial 
        vehicle projects and projects outside metropolitan areas, such 
        as rural areas.
    The priorities are as follows:
  --At least 25 percent of the funds made available would allow 
        eligible State or local entities to implement commercial 
        vehicle information systems and networks, and international 
        border crossing improvements.
  --At least 10 percent of the funding would be made available for the 
        intelligent transportation infrastructure deployment outside 
        metropolitan areas (in rural areas).
  --The Federal share payable to the project cost is 50 percent. The 
        matching funds can include funds from other Federal sources.
    The projects are to accelerate the deployment and commercialization 
of ITS; realize the benefits of regionally integrated, intermodal 
applications, including commercial vehicle operations and electronic 
border crossing applications; and demonstrate innovative approaches to 
overcoming nontechnical constraints.
    Projects chosen for funding within the intelligent transportation 
infrastructure deployment incentives program would, in general terms, 
have to meet the following criteria:
  --Help meet the national goals of the ITS program;
  --Demonstrate public-private partnerships;
  --Aim to achieve integration with the architecture and standards;
  --Be a part of State and metropolitan plans for transportation and 
        air quality implementation;
  --Catalyze private sector investment and minimize Federal 
        contributions;
  --Include a sound financial plan for long-term operations and 
        maintenance; and
  --Demonstrate the ability to operate and maintain the systems.
    This program will build upon prior efforts. We have already 
identified a core intelligent transportation infrastructure and set a 
national goal for deployment of this infrastructure across the United 
States over the next decade. We are facilitating model deployments that 
will serve as showcases for operators and users of the system. They 
also will show both State and local transportation officials and 
citizens how to envision ITS deployment in their communities. In 1996, 
four metropolitan areas were chosen: Seattle, Phoenix, San Antonio, and 
New York. We have also established eight model deployments of the 
Commercial Vehicle Information Systems and Networks (CVISN) to be 
operational by the end of 1997, in Connecticut, Kentucky, Michigan, 
Minnesota, Colorado, Washington, Oregon, and California. These model 
deployments will perform the same function for other State officials in 
helping them to envision the fully integrated system and to understand 
the benefits.
    A deployment incentives program is needed to alleviate a hardening 
or ``stove-piping'' of the existing fragmented infrastructure. Timing 
of deployment is critical. At the moment, elements of the intelligent 
transportation infrastructure are being deployed piece by piece with no 
guarantee of interoperability. State and local governments will then 
have to live with a ``stove-piped infrastructure,'' one in which 
components do not form a system and are not necessarily efficient.
    This program gives State and local governments an incentive to 
cooperate with agencies, jurisdictions, and the private sector, to 
achieve fully integrated ITS deployment in accordance with the national 
ITS architecture and established ITS standards and protocols. This 
commitment will be shown through the signing of Memorandums of 
Understanding that clearly define the responsibilities and the 
relationship of all parties to a partnership agreement which outlines 
the institutional relationships and the financial agreements to ensure 
continued, long-term operations and maintenance for the project.
    We're providing the incentive, but are also limiting the Federal 
share payable to 50 percent of the project cost and requiring a 
financial plan for long-term operation and maintenance. We're asking 
State and local governments to be creative, to use their own funding, 
other Federal-aid monies, and to leverage the private sector's 
involvement. This is a minimal Federal role. In short, after this five-
year period, the incentive program will not be up for additional 
Federal funding in the future; it's a one-shot deal.
                      access to jobs and training
    Question. Why is the FTA a more appropriate provider agency for the 
proposed ``access to jobs and training'' program than Health and Human 
Services?
    Answer. Transportation is one of the three major challenges faced 
by welfare recipients, along with day care and skills training.
    Welfare recipients rarely own cars. Furthermore, studies show that 
existing public transit frequently does not provide realistic 
connections to the locations where entry-level jobs are concentrated. 
The need for off-peak time service and multiple stops for activities 
such as day care complicate further the problem of access to jobs.
    DOT's Access to Jobs Initiative will enable State and local 
governments to provide the transportation services that welfare 
recipients need within the framework of the existing transportation 
planning process--an important factor in sustaining their delivery. But 
collaboration with the human service agencies is a key element of the 
proposed program. The criteria in the proposed program call for a 
coordinated planning process, a financial partnership and a 50/50 (FTA/
non-FTA) match to ensure that transportation providers and human 
services providers are working closely to ensure that those Americans 
who have to go to work can get there.
                          highway trust funds
    Question. I note that the President's Budget request would have 
Amtrak and FTA funded from the Highway Trust Fund, rather than general 
funds. Under your budget, the total percentage of highway trust funds 
in the transportation appropriations bill increases from 78 to 85 
percent. What is the rationale for shifting the number of DOT programs 
from being funded by general funds to highway funds?
    Answer. The administration proposes to use the Highway Trust Fund 
for all highway safety research and agency operations (parts of NHTSA 
are currently funded from the general fund), as well as the transit 
program and Amtrak.
    The rationale for these shifts is that the programs to be funded 
from the trust fund are directly associated with highway construction 
or preservation, or are associated with providing alternative 
transportation services that contribute to reducing the demands placed 
on our highways, thereby improving service to the users of highways.
    Question. What will the Highway Trust Fund balance be at the end of 
the current ISTEA authorization period, as envisioned by the 
administration's pending reauthorization proposal?
    Answer. We project cash balances of $14.8 billion in the Highway 
Trust Fund and $9.6 billion in the Mass Transit Account at the end of 
fiscal year 1997.
               flexibility in state use of federal funds
    Question. This approach of having different modes drawing on the 
Highway Trust Fund would seem to me to argue for increasing the States' 
flexibility in the use of their transportation funds. Do you share that 
view?
    Answer. Yes. Under NEXTEA, State and local officials would have 
greater flexibility to target funds toward projects that best meet 
community needs, including Amtrak and intermodal terminals. It also 
increases the tools available to State and local officials by making 
Intelligent Transportation Systems eligible under all major program 
categories.
                     highway trust fund off-budget
    Question. What is the administration's official position on the 
proposal to move transportation trust funds off-budget?
    Answer. The administration opposes taking the transportation trust 
funds off-budget. We should not redefine the deficit calculation to 
exclude certain programs or to exempt programs from appropriate budget 
controls. That would mean either a larger real deficit or a larger 
burden for deficit reduction on other critical programs in DOT or 
elsewhere in the Federal Government. Either outcome would be 
inconsistent with the joint commitment by the President and Congress to 
balance the Federal budget.
                         woodrow wilson bridge
    Question. I understand that the administration was prepared to 
transfer the Woodrow Wilson Bridge to the States of Maryland and 
Virginia and the District of Columbia back in 1990 and 1991. Why didn't 
this transfer take place? Why is this the only non-defense interstate 
bridge still under Federal jurisdiction?
    Answer. The bridge has been the subject of three agreements. The 
December 18, 1961, agreement was simply a detailed contractual 
arrangement between the three jurisdictions (FHWA was not a party) as 
to the rights and responsibilities of each jurisdiction in the 
operation and maintenance of the bridge. It was the result of Federal 
legislation (Public Law 87-358, October 4, 1961).
    A June 28, 1982, agreement was signed by the three jurisdictions 
and the FHWA. Again, this agreement was the result of Federal 
legislation (Public Law 97-134, December 28, 1981) that provided $60 
million for 4R work on the bridge, and spelled out more details as to 
each jurisdiction's operation and maintenance duties, and provided that 
the ``* * * three jurisdictions shall submit to FHWA within 6 months of 
the date of the agreement proposed reasonable terms and conditions upon 
which they would be willing to accept title to the Woodrow Wilson 
Memorial Bridge.'' This agreement was never fully implemented.
    The last signed agreement between the two States, the District of 
Columbia, and FHWA was on April 19, 1985. The 1985 agreement required 
the jurisdictions to accept the bridge once rehabilitation of the 
bridge was complete, e.g. upon ``completion and final acceptance of the 
construction work * * * which will include rehabilitation for the 
bridge bascule span and minor substructure rehabilitation.'' Although 
the $60 million provided under the 1981 legislation was used for the 
bridge--most of it for 4R work and some for a study on long-term 
needs--the District and the States declined to take over responsibility 
for the bridge because of the cost of continued maintenance.
    Question. What is the traffic mix on the bridge between local 
commuters and through traffic?
    Answer. Local commuters comprise between 85 to 90 percent, and 
through traffic 10 to 15 percent, depending on the time of year.
    Question. What is the justification for the President's Budget 
request of $400 million?
    Answer. The fiscal year 1998 budget includes $40 million for the 
Wilson Bridge project: $30 million is needed for the continued design 
(and construction) of a new bridge, and $10 million is needed for 
necessary interim repairs and rehabilitation work on the existing 
bridge.
    The Department has been working closely with the Woodrow Wilson 
Bridge Coordination Committee on options for replacing the existing 
bridge. The Committee has selected the current alignment, with side-by-
side drawbridges having a 70-foot navigational clearance, as the 
preferred alternative for replacing the bridge. There would be a total 
of 12 lanes: 8 general purpose lanes, 2 merge/auxiliary lanes, and 2 
HOV/express bus/transit lanes. The current estimated cost for this 
alternative is $1.56 billion.
    $400 million is the cost to replace the existing structure. The NHS 
Designation Act of 1995 provides a framework for determining the 
Federal contribution of the cost to replace the existing 6-lane bridge 
with a replacement structure. The Woodrow Wilson Bridge Coordination 
Committee estimated that this would cost approximately $400 million.
    Question. Since initial construction, how much has the Federal 
Government spent on the Woodrow Wilson Bridge?
    Answer. A total of $168.9 million in Federal funds has been 
allocated since 1954; $163.9 million was at a 100-percent Federal 
share, and $5.0 million was at an 80-percent Federal share.
    Question. Given that the Woodrow Wilson bridge alternatives being 
considered are all significantly in excess of the President's Budget 
request, is this bridge a reasonable candidate for the proposed new 
credit program in ISTEA reauthorization or another innovative financing 
approach?
    Answer. The bridge likely would be eligible for a credit program or 
other innovative financing approaches; the project would also be 
eligible for regular Federal-aid apportionments. The bridge could be 
funded through a combination of a direct Federal contribution ($400 
million) and some form of credit.
                            alameda corridor
    Question. FHWA officials have cited the Alameda Corridor's Federal 
loan as a precedent for future finance efforts. Officials noted that 
FHWA used the project as a model in the agency's effort this year to 
create a new $100 million Transportation Infrastructure Credit Program. 
The program is intended to leverage Federal funds and provide credit to 
assist nationally significant projects, particularly large, multimodal, 
and revenue generating projects. However, since the Alameda Corridor 
project is in its early stages, there are a number of unanswered 
questions concerning the risk to the Federal Government if other 
funding sources are not realized and the success of this type of 
Federal loan at leveraging other funding. How important was the Federal 
loan to the project?
    Answer. The Federal loan, which was signed January 17, 1997, is a 
vital part of the project's financial package. The $2 billion project 
is a public-private venture involving the ports and cities of Los 
Angeles and Long Beach, the regional transportation authority, the 
railroads using the corridor, and the Federal Government. The Alameda 
Corridor Transportation Authority (ACTA) is a joint-powers public 
agency established by Los Angeles and Long Beach to develop, finance, 
build, and operate the project. The two ports have already contributed 
$400 million for rights-of-way along the corridor, and the Metropolitan 
Transportation Authority (Los Angeles County's metropolitan planning 
organization) will provide nearly $350 million of its Federal, State, 
and local grant funds. Project revenues--user charges paid by the 
railroads and other income of the ports--will be used to repay 
approximately $735 million in revenue bonds and the $400 million 
Federal loan.
    The Federal loan offers permanent financing with flexible payment 
features that should alleviate market concerns and promote efficient 
use of private capital by positioning the government as a patient 
investor in the project with a long-term horizon and no liquidity 
requirements. Those features include: (1) structuring flexible 
repayment schedules with deferrable interest and principal to match 
realized project revenues; (2) facilitating the project's access to 
private capital by enhancing the capital markets debt coverage, 
lowering interest rates, and reducing reserve requirements; and (3) 
leveraging substantial private financing by limiting Federal 
participation to 20 percent of total project costs. At a budgetary cost 
of only $59 million (to cover the subsidy or risk of non-repayment), 
the Federal Government is providing a $400 million loan that will help 
advance a $2 billion project with significant local, regional, and 
national benefits.
    Question. How will the loan be used? Could you expand on how the 
Federal loan will be spent?
    Answer. Under the terms of the January 17 loan agreement signed by 
DOT and the Alameda Corridor Transportation Authority, the Federal loan 
can be used for any costs related to: (1) acquisition, design and 
construction of the project, including legal, administrative, 
engineering, planning, design, insurance and financing costs; (2) debt 
service, capitalized interest, contingency, or capital reserve funds, 
(3) debt service payments; and (4) costs of equipment and supplies and 
initial working capital.
    Question. In the loan agreement, why was the Federal loan repayment 
made subordinate to the repayment of revenue bonds?
    Answer. Given the uncertainty of the projected revenue stream and 
operating costs associated with large startup transportation 
facilities, investors and rating agencies typically require that the 
project revenue bonds have a relatively high coverage margin. Coverage 
is the annual surplus of net revenues after payment of operating 
expenses and debt service. A high coverage factor (such as 1.75 times) 
constrains the permitted level of annual debt service, reducing the 
amount of debt that can be supported and leaving a funding gap.
    While project sponsors could seek to raise additional debt proceeds 
with a thinner coverage margin (such as 1.10 times), such debt likely 
would be rated sub-investment grade. The major capital market funding 
source for debt financing of infrastructure--the municipal bond 
market--is generally risk averse, and there is only a limited market 
for non-investment grade obligations. The situation defines the need 
for a flexible debt instrument that can be payable out of the coverage 
factor after the senior bonds' debt service. The Federal loan addresses 
this market gap and promotes the efficient use of capital by 
positioning the Government as a patient investor with a longer-term 
time horizon and no liquidity requirements.
    Question. How much would the Federal Government lose if the project 
goes into default? How much would the Federal Government gain if the 
loan is paid back?
    Answer. The Fiscal Year 1997 Omnibus Consolidated Appropriations 
Act (Public Law 104-208) provides $59 million for the Department of 
Transportation to pay the subsidy costs associated with making a direct 
loan not to exceed $400 million to ACTA for the Alameda Corridor 
project. If the loan is repaid in full, the subsidy budget authority of 
$59 million will be returned to the General Fund. In a worst-case 
scenario, none of the $400 million loan would be repaid, and the 
Federal Government would lose $400 million. However, such a scenario is 
unlikely. If project bonds are not issued to construct the project or 
an alternative source for funding the remainder of the project's costs 
is not put into place by December 31, 2005, the loan will still be 
repaid by ACTA from rental income from the partially built project and 
other port revenues. And if the project is fully constructed as 
planned, the flexible terms and rate covenants included in the loan 
agreement offer the Federal Government additional security.
    Question. How much of the corridor's financing is based on Federal 
funding, including both direct and indirect Federal funds, both with 
and without the Federal loan?
    Answer. The $2 billion project is a public-private venture among 
the ports and cities of Los Angeles and Long Beach, the regional 
transportation authority, the railroads using the corridor, and the 
Federal Government. Direct Federal contributions to the project include 
$45 million in ISTEA demonstration funds (USDOT), $2 million in 
Economic Development Administration funds (Commerce), and the $400 
million direct Federal loan. Thus, the project will receive $447 
million ($47 million without the Federal loan) in direct Federal 
funding.
    In addition, the Metropolitan Transportation Authority (MTA) will 
provide another $329 million of apportioned Federal-aid highway funds. 
Total Federal funding for the project (including indirect Federal-aid 
highway funds passed through the Los Angeles County MTA) equals $776 
million ($376 without the Federal loan).
    Question. Will the revenue bonds be fully or partially tax-exempt? 
How could that affect the Federal loan?
    Answer. Under current law, without special legislative authority, 
ACTA believes that a portion of its revenue bonds could be issued as 
tax-exempt debt (relating to public use/public purpose). The amount of 
the tax-exempt debt ultimately issued for the project should not affect 
the security of the Federal Government's investment, as the budgetary 
cost of the Federal loan was ``scored'' based on the assumption of all 
revenue bonds being taxable.
    Question. Is the Alameda Corridor Federal loan being seen as a 
promising way to finance other projects? If so, why?
    Answer. The Alameda Corridor Federal loan was a unique, ad hoc 
response to a specific project. The administration is seeking in NEXTEA 
a somewhat different approach. The Transportation Infrastructure Credit 
Enhancement Program would provide grants (up to 20 percent of total 
cost) to assist in the funding of nationally significant transportation 
projects that otherwise might be delayed or not constructed at all 
because of their size and uncertainty over timing of revenues. After 
projects are selected by the Secretary, grants are made to capitalize 
revenue stabilization funds. A revenue stabilization fund could be 
drawn upon if needed to pay debt service on the project's debt 
obligations in the event of revenue shortfalls. The stabilization fund 
may also be used to secure junior lien debt or other obligations 
requiring credit enhancement. Limiting the use of the revenue 
stabilization fund to these types of obligations is designed to 
maximize the project's ability to leverage private capital, and assist 
it in obtaining investment grade ratings on senior debt. The program's 
goal is to encourage the development of large, capital-intensive 
facilities through public-private partnerships consisting of State or 
local governments with private business.
              transportation infrastructure credit program
    Question. How will the Transportation Infrastructure Credit Program 
affect the trust fund balance, since the program calls for more money 
up front and for payment out of the highway trust fund?
    Answer. The new transportation infrastructure credit enhancement 
program is funded at $100 million. This level of funding would have a 
minimal impact on the highway account balance, which is projected to be 
about $15 billion at the end of fiscal year 1997.
    Question. How will DOT assess the economic benefits of a project? 
Will it just consider future revenue streams or will it consider 
pollution reduction, congestion relief and other indirect benefits?
    Answer. Projects selected for this program will have to demonstrate 
the ability to generate broad economic benefits, support international 
commerce, or otherwise enhance the Nation's transportation system and 
economy. Specific factors would include the extent to which the 
project: (1) advances high-priority corridors (NAFTA, trade corridors), 
intermodal connectors and border facilities, or otherwise promotes 
regional, interstate or international commerce; (2) enables U.S. 
manufacturers to deliver their goods to domestic and foreign markets in 
a more timely, cost-effective manner; (3) stimulates new economic 
activity and job creation; (4) reduces traffic congestion, thereby 
reducing shipping delays and increasing workforce productivity; and (5) 
protects the environment by enhancing air quality through the reduction 
of congestion and decreased fuel and oil consumption.
    Question. Who will be able to apply for funding--private 
organizations, cities, States, metropolitan planning organizations, 
etc.?
    Answer. The sponsor of a project eligible for assistance under the 
credit enhancement program must be a State, local government, or other 
public agency, or the project must be publicly owned and publicly 
sponsored, meaning it satisfies the Statewide and metropolitan planning 
requirements of Title 23, U.S.C., and the application is submitted by a 
State, local government, or other public agency. Therefore, the 
applicant could be a corporation, partnership, joint venture, trust, or 
governmental entity.
    Question. Since the Department will not directly oversee the 
project, how will it assure that the Federal money will be used 
efficiently and effectively?
    Answer. As with other projects funded in part through Federal 
transportation programs, the Department will work with its State and 
local partners to ensure that Federal funds are used effectively and 
efficiently in accordance with relevant laws and regulations. Recipient 
projects will be treated like ``regular Title 23'' projects in that 
they must be advanced by a State or local government (or agency 
thereof), satisfy the usual planning requirements, and be eligible for 
Federal assistance under Title 23 or chapter 53 of Title 49, U.S.C. In 
addition, the usual Federal requirements that apply to funds and 
projects under titles 23 and 49 shall also apply to revenue 
stabilization funds and projects receiving them under the new credit 
enhancement program. The Secretary of Transportation will consult with 
the Secretary of the Treasury to ensure that any grants made to 
capitalize revenue stabilization funds under the new program shall 
contain appropriate terms and limitations to ensure that Federal funds 
are used prudently in leveraging private capital to advance important 
national transportation investments.
    Question. Given that the Department has had limited experience with 
loan guarantee projects such as the Alameda Corridor, should more 
experience be gained before establishing a nationwide program?
    Answer. The need for and efficacy of Federal assistance (whether 
direct loans, loan guarantees, or credit enhancement) for large 
revenue-generating projects of national significance is already being 
demonstrated by the TCA toll roads (through Federal lines of credit) 
and Alameda Corridor ( a Federal direct loan). Establishing a Federal 
credit enhancement program provides the benefits of being able to 
clearly set forth prudent and consistent policy guidelines and fiscal 
parameters that will advance vital national transportation goals while 
maximizing efficiency and minimizing risk. Without a programmatic 
structure, such Federal credit assistance provided on an ad-hoc basis 
may not have the desired level of efficiency, equity, and 
effectiveness.
    Also, we believe any Federal credit enhancement program should be 
limited in scope, targeted to a relatively small number of projects of 
national significance. Each project will be one-of-a-kind, evaluated 
according to a unique set of benefit and cost factors. It is not 
expected that the Federal Government will or should generate a large 
portfolio of such project financings. The program should rely on the 
discipline and credit evaluation expertise of the private capital 
markets. One measure of the program's success might be the extent to 
which it demonstrates the feasibility of long-term infrastructure 
investments to the private capital markets and can eventually be phased 
out.
    Question. If this program is established, will the Boston Central 
Artery/Tunnel Project qualify for funds under this program? Does it 
meet the criteria for a project with a revenue stream? Has there been 
any discussion about using this program to help fund the suggested 
freight tunnel beneath New York Harbor?
    Answer. The new Transportation Infrastructure Credit Enhancement 
Program is intended to help advance projects of national significance 
that require Federal assistance to secure financing and begin 
construction. Based on the proposed eligibility criteria (national 
significance, planning requirements, need for financial assistance, 
State/local support, size, and existence of revenue sources), the 
Central Artery project could be eligible for assistance. However, the 
project's current finance plan does not contemplate additional Federal 
assistance outside the State's regularly apportioned Federal-aid 
funding. Also, any project determined to be eligible for assistance 
would have to be assessed against various selection criteria.
    To our knowledge, no proponents of the suggested freight tunnel 
beneath New York Harbor have approached the Department about seeking 
assistance under the Transportation Infrastructure Credit Enhancement 
Program. If the project satisfied the eligibility criteria set forth in 
NEXTEA, it could seek funding under this program. Its application would 
be evaluated along with those of other applicants.
                       state infrastructure banks
    Question. To what extent are SIBs expected to leverage new, non-
Federal money? Do any of the ten pilot States plan to try and attract 
private financing? If yes, how?
    Answer. The extent to which SIBs will leverage non-Federal money 
will depend on a number of factors, such as the amount of non-Federal 
matching funds (State and private) contributed to the SIB; the type of 
assistance offered by the SIB, including the extent to which any 
assistance is subsidized; and whether the SIB is able to leverage 
itself, i.e., issue debt or provide credit enhancement in excess of its 
own contributed capital.
    The Environmental Protection Agency's State Revolving Funds (SRFs) 
for wastewater treatment facilities have, on average, a leveraging 
ratio of about 1:2 (Federal grant contributions to total credit 
assistance provided). We believe SIBs are likely to have a higher 
leveraging ratio because they will be able to leverage funds through 
projects--by contributing only a portion of required assistance in 
conjunction with significant private and other non-Federal capital--as 
well as by issuing debt against their contributed capital. For example, 
a SIB loan of $10 million might be part of a total financing package 
for a project costing $100 million. Also, SIBs have a much larger and 
more diverse pool of potential recipient projects.
    Three loans have been made by the initial ten States participating 
in the SIB pilot, and all three loans will support bond issuances by 
localities. In these cases, the loans will help the localities access 
the capital markets by raising their ratings and thus lowering the 
interest that the bonds will require when repaid.
    Question. How does DOT plan to choose and allocate the $150 million 
in new SIB money for fiscal year 1997 and, if passed, DOT's request for 
$150 million in fiscal year 1998?
    Answer. We are currently reviewing the new SIB applications, and 
approvals should be made soon. After this is completed, decisions will 
be made on allocation of the $150 million.
    Question. Will the selection criteria DOT chooses affect the type 
of projects States submit in their applications? For example, will DOT 
likely target States with several projects as a State, or will DOT 
consider States submitting only one project for SIB funding?
    Answer. The number of projects a State submitted in its application 
will probably not be a factor for selection. We hope the SIBs will be 
able to assist many projects, but we believe that more projects will be 
identified as a State implements its SIB.
    Question. Why have SIBs been slow in getting projects underway?
    Answer. A number of actions are required before a project can be 
funded from a SIB. After DOT approved the first 10 States in 1996, 
cooperative agreements had to be executed. Most of the agreements were 
signed at the end of fiscal year 1996. States had to establish a SIB 
structure and develop procedures. Once a SIB is in place, projects must 
be selected and financial assistance negotiated. A number of other 
project actions may be needed before a project is ready to receive 
funds from a SIB.
    Another factor involves the Federal capitalization of SIBs. The 
legislation requires that SIBs be funded at the traditional highway and 
transit outlay rates, which means that Federal deposits into SIBs are 
made over several years. Therefore, the amount of Federal funds 
currently available to a State is considerably less than 10 percent of 
its apportionments--the limit a State may transfer to the SIB.
                     central artery/tunnel project
    Question. In FHWA's opinion, are the State of Massachusetts 
projections of savings on the insurance program realistic?
    Answer. We understand that the GAO is concerned about the degree of 
certainty that can be assumed for the large savings that have been 
reported for the Owner Controlled Insurance Program (OCIP or Wrap-Up 
Insurance). Given the fact that the project is entering the heaviest 
phase of construction over the next several years, GAO is concerned 
that the level of savings trended for the OCIP may not occur. While we 
understand the cautionary tone reflected in GAO's comments, the FHWA 
continues to believe that, as in a number of other areas on the CA/T 
project, an appropriate management and oversight strategy for the OCIP 
is to set clear and measurable objectives or milestones regarding 
project costs and schedules. Then FHWA's and the Project's performance 
can be clearly measured against meeting these objectives or milestones. 
Given this recommended oversight strategy, the OCIP is an excellent 
example of one of the more readily trackable programs. The Project 
Management Monthly Report tracks the Insurance Program's measures on a 
monthly basis, giving early indications of any positive or adverse 
trends. The structure of the insurance program now reflects and 
benefits from that trackability in its use of a retrospective approach 
that allows for adjustments in the cost of the program based on how 
claims have occurred during a preceding year. The extraordinary success 
of the Insurance Program can be reported as very real, given the 
established track record of safety programs and insurance claims on the 
project during the last four years, a period that certainly contained 
its share of heavy construction in sensitive areas. Each year that 
successes occur in very measurable and actuarial aspects of the 
insurance program, the Project is more and more able to report a 
firming up of the expected performance of the program in the future. 
Likewise, given the retrospective adjustments based on year-by-year 
performance, the Project will have early indicators of any trends that 
may be developing. Finally, the Project continues to proactively 
explore ways to further improve the excellent safety record. Therefore, 
in summary, FHWA has accepted and believes that the State's projected 
savings on the insurance program are realistic.
    Question. Does FHWA believe the project's cost can be kept to $10.4 
billion?
    Answer. The Central Artery/Tunnel (CA/T) Project (the Massachusetts 
Highway Department--MHD--& FHWA) is aggressively managing to the $10.4 
billion total cost through the implementation of strategies to meet 
cost containment goals for design and construction. The CA/T Project 
recognizes this estimate as achievable, and FHWA supports this 
management strategy that involves setting measurable milestones 
regarding cost and schedule and measuring the CA/T Project performance 
against these milestones. The CA/T Project uses trend analyses and 
early indicators that allow the management process to be dynamic and 
adjust to deviations in schedule and cost. As long as this aggressive 
management is maintained, the current budget is viewed by FHWA as 
achievable.
    Question. What is FHWA doing to review and scrutinize project 
costs? What does FHWA think the cost of the project is?
    Answer. The FHWA is actively involved with the MHD CA/T staff in 
scrutinizing and controlling total project costs, and in developing a 
variety of cost saving strategies. The unprecedented allocation of 
resources to staffing in the Massachusetts Division Office, with 
assistance from both Region and Headquarters Offices, has enabled the 
FHWA to provide a program of both comprehensive and tailored oversight 
regarding cost, schedule and quality. The FHWA engineering and 
technical staff provide a range of project- or contract-specific design 
and construction monitoring based upon a geographic assignment of 
responsibility. Each area engineer is specifically responsible for 
monitoring all Federal-aid work within this assigned area, reviewing 
designs to ensure that components are both economical and cost-
effective. This design review also ensures compliance with necessary 
standards. Area engineers are also responsible for monitoring costs and 
quality for their area during construction, monitoring construction 
procedures and the administration of change orders as necessary. A 
variety of technical experts are available from the division, the 
regional and headquarters levels of FHWA to provide special expertise 
to the area engineers as needed during both design and construction. 
This expertise is especially valuable in bench marking design or 
construction procedures and cost-effectiveness in areas such as 
specialty tunnel areas or environmental mitigation.
    Besides contract-specific monitoring, the Division Office, 
supplemented with assistance from the Region and Headquarters, also 
provides programmatic oversight through a variety of task team, peer 
review, and/or process review activities. These activities insure that 
design and construction processes are designed or re-engineered to 
provide streamlined and cost-effective outcomes. To give two examples 
from 1996, task team/process reviews were conducted on the wrap-up 
insurance program and the geotechnical instrumentation. Cost saving 
strategies were identified in each review. The Division Office also 
participates in a number of MHD CA/T committees that have been charged 
with managing costs on the project. Examples of these activities 
include the Cost Containment Committee (generating innovative 
approaches such as the Design-to-Cost program, an approach that 
controls growth of design estimates) and the Project Contingency 
Allowance Committee (controlling costs associated with such issues in 
construction as changed site conditions). Through further participation 
on value engineering teams and through construction partnering, 
Division Office representatives ensure that cost-effective functional 
designs are provided and moved to construction in a fashion where 
costly litigation or dispute resolution is avoided through 
collaboration with the contracting industry. Total costs and cost 
trends are closely monitored by the FHWA upper management at all levels 
by proactive involvement in Project Management Monthly reporting and 
through quarterly briefing of FHWA's highest management. These review 
activities include monitoring and periodic validation of macro-level 
Finance Plan assumptions or trends in areas such as inflation and 
bidding results.
    In regard to the second question, as reported in an earlier 
question and as has been reported in the September 30, 1996 Financial 
Plan, FHWA has accepted the State's total cost as $10.4 billion.
    Question. Does FHWA believe it is time for Massachusetts to revise 
its cost estimate to be more realistic? Why or why not?
    Answer. The cost estimate for the Central Artery/Tunnel is 
validated monthly. This has been done for approximately a year now as 
part of the Project Monthly Management report that tracks the actual 
project cost and schedule, gives early indication of potential cost 
increases or decreases, compares it to the Cost/Schedule Update 6 (Rev 
6) and previous forecast, and develops a new forecast for the remaining 
cost and schedule. The report also shows the changes from the previous 
month for actual versus planned costs and schedule time. The result is 
a current cost-to-go and total cost, and a current schedule on a 
monthly basis. Assumptions used for Rev 6 are also being tracked. While 
some of the assumptions are tracking better than others, the overall 
project cost is staying within budget. As part of the next Finance Plan 
Update, currently planned for October 1, 1997, we will assess the need 
to revise these assumptions.
    Question. Does FHWA believe that the financing strategies outlined 
in the consultant's study are viable? Has FHWA conveyed these views to 
the State?
    Answer. Massachusetts' Metropolitan Highway System (MHS) Financial 
Feasibility Study, while legislated by Massachusetts itself, is a key 
part of the State's plan to finance the Central Artery/Tunnel. FHWA's 
acceptance of the State's CA/T Finance Plan was conditioned upon the 
State's completion of the MHS Study and implementing legislation. The 
MHS Study was completed in December 1996 and contained numerous 
scenarios, the majority related to increasing existing tolls, to 
identify State funding for the CA/T, and MHS operation, and still allow 
a $400 Million (Federal and State) Statewide Program exclusive of the 
CA/T.
    The Executive Office of Transportation and Construction's December 
5, 1996, submittal to the Legislature and Governor contained specific 
recommendations primarily related to raising existing tolls for the 
tunnels and bridge in downtown Boston. Implementing MHS (State) 
legislation was introduced on January 6, 1997; two public hearings were 
held, at the first of which FHWA's Massachusetts Division Administrator 
answered questions as requested. The legislation has moved through the 
Legislature and was signed by the Governor on March 20, 1997. The 
existing legislation does not set toll levels, but does enable the 
Massachusetts Turnpike Authority to adjust tolls to meet the needs to 
complete the CA/T and operate the MHS and maintain a $400 million 
Statewide program.
    While FHWA believes that the assessment of the options in the MHS 
Study is a State and local responsibility, we believe the study did a 
good job of identifying options that would meet both the State's needs 
and conditions as relate to the completion of the CA/T, maintaining a 
$400 million Statewide Program, and operating the MHS. FHWA also 
believes the existing legislation is feasible and will meet both the 
State's and our needs. FHWA has conveyed these views to the State both 
informally and in answering questions in a State legislative hearing.
    Question. Is the use of grant anticipation notes to leverage future 
Federal funds a feasible strategy for financing $1 billion or more of a 
project's costs? What experience has FHWA had with these kinds of 
instruments?
    Answer. In general, we believe that the use of grant anticipation 
notes (GANs) is a prudent and effective way to cover the timing gap 
between a project's up-front cash flow requirements for construction 
and the receipt of future anticipated Federal aid. The amount that can 
be financed through GANs depends on the size of the cash flow 
shortfall, the term of the notes, and the predictability of the future 
Federal grants to be used to repay the GANs.
    GANs have been used extensively in connection with other Federal 
aid programs (notably FTA and EPA) but only occasionally with FHWA 
receivables. We believe the reason for this is that most States 
historically have had sufficient cash balances in their highway 
programs to internally finance the timing gap, thus avoiding the need 
to borrow externally through GANs. However, for large projects (such as 
the Central Artery) it may be necessary to consider using GANs to meet 
cash flow needs.
    Question. What actions does FHWA plan to take if legislation is not 
enacted by the State to implement the study's recommendations?
    Answer. On March 20, 1997, Governor Weld signed the Metropolitan 
Highway System (MHS) legislation into law, thus implementing the 
recommendations of the Executive Office of Transportation and 
Construction from the MHS Financial Feasibility Study. Given the 
enactment of the required legislation, FHWA will not have to withhold 
authority or take other actions in regard to this issue.
    Question. Does FHWA believe that the shortfall estimates are 
accurate? How much will these estimates go up if costs increase?
    Answer. Yes, the annual shortfall estimates (cash flow needs) are 
believed to be accurate for the scenario(s) used in the CA/T Finance 
Plan, and recognizing that the actual Federal funding levels for post-
ISTEA are still unknown. The effect of cost changes, even assuming the 
same scenario(s) for unknown post-ISTEA Federal funding levels, would 
depend on what year the associated changes were built and needed to be 
paid. That is, a design change or construction change could be known 
today, but its effect would depend on whether the actual billing for 
the resultant work occurred in a peak cash flow year or afterward when 
cash flow needs are not as great.
    Question. What fallback position is available to the State if the 
strategies outlined in the consultant's report are not sufficient to 
meet the funding gaps?
    Answer. The Metropolitan Highway System (MHS) Financial Feasibility 
Study contained several options for the State share of costs associated 
with the CA/T interim cash flow needs, total CA/T project cost needs, 
and also operating expenses for the MHS. The options included revenue 
bonds backed by toll increases, interim borrowing backed by anticipated 
Federal funds, increased gas tax, toll increases, and/or other State 
sources. The Executive Office of Transportation and Construction 
requested legislation, which passed both houses of the State 
legislature and which has been recently signed by the Governor, turning 
the construction of the CA/T, and operation of the MHS (including the 
CA/T) over to the Massachusetts Turnpike Authority (MTA). The 
legislation also indicates the amount of State share to be paid by the 
Massachusetts Port Authority (MassPort or MPA), MTA, and the 
Massachusetts Highway Department. It also enables them to adjust tolls 
as needed to cover such costs. The State would have the option of 
covering funding needs by such tolls or short-term borrowing, or if 
necessary could consider a gas tax. The latter is not considered 
necessary by the State at this time.
                           transit new starts
    Question. The President's proposed fiscal year 1998 budget would 
cut transit new starts by $126 million from the current enacted level 
of $760 million. There are now 13 new starts with full funding grant 
agreements in the funding ``pipeline'' and two more awaiting FFGAs. 
These 15 projects will cost $3.7 billion to complete. There are about 
100 other projects already in various preliminary stages, totaling 
about $10 billion to $20 billion to complete. Should the administration 
be entering into new full funding grant agreements when the new starts 
program is already oversubscribed?
    Answer. The fiscal year 1998 budget proposes funding for 15 
projects for which FFGAs are in place or pending. Our 1998 funding 
request reflects budgetary pressure, and while it is not the annual 
amount for fiscal year 1998 in the FFGAs, our proposed outyear funding 
is sufficient to cover funding requirements for these 15 projects. 
Furthermore, our reauthorization proposal includes an even higher level 
of contract authority that could become available dependent upon future 
Federal budget decisions. Therefore, our current plans to sign two new 
FFGAs are within our long-term budget plan.
    Question. Why is the administration asking for a cut in transit new 
starts at the same time that it is poised to approve $850 million in 
new commitments?
    Answer. The request for Major Capital Investments (new starts) 
funding in fiscal year 1998 represents the funding necessary to enable 
those projects recommended for funding to proceed at a reasonable pace.
    The ``$850 million in new commitments'' (actually $853 million) 
represents the administration's planned Federal commitment through 
multi-year Full Funding Grant Agreements for two projects: the BART 
Extension to San Francisco Airport ($750 million) and the Sacramento 
light rail extension ($103 million). Through fiscal year 1997, $84 
million has already been appropriated toward the total $853 million 
planned Federal commitment to these projects. Our request for fiscal 
year 1998 includes another $75 million for the two projects, leaving 
outyear requirements of $694 million in Federal funding. Our proposed 
outyear funding levels are sufficient to cover these funding 
requirements.
    Question. Is the administration interested in working with new 
starts project sponsors to help reduce the size of the Federal 
commitment to these expensive projects?
    Answer. There are already provisions in law that encourage project 
sponsors to do this, and FTA actively encourages their use.
    Title 49, U.S.C., Section 5309(h) establishes the level of Federal 
participation in new starts projects at 80 percent of the net project 
cost, unless the grant recipient requests a lower percentage. There are 
at least two reasons why a project sponsor may want to reduce the 
percentage of Federal participation. First, project sponsors seeking 
discretionary funds for less than one third of the total cost of the 
project, or less than a total of $25 million in discretionary new 
starts funds, are exempt by statute from evaluation under the project 
justification criteria established in 49 U.S.C. Section 5309(e).
    Second, the statutory project justification criteria themselves 
require an evaluation of local financial commitment. One indicator of 
this commitment would be a higher share of project costs from State 
and/or local sources. Therefore, a project with a proposed Federal 
share of 50 percent, for example, might be rated higher than a similar 
project proposed for 80 percent Federal funding (provided, of course, 
that FTA's analysis of the financing plan confirms its viability). This 
may speed the project with the smaller Federal share through the new 
starts funding process.
    A number of project sponsors have taken advantage of these 
provisions in recent years. In Los Angeles, the Metro Red Line is being 
constructed with 50 percent of the project costs from Federal new 
starts funding. The Federal proportion of funding for the Houston 
Regional Bus plan, which evolved as a cost-effective alternative to a 
proposed monorail system, is slightly less than 60 percent. Light rail 
extensions in Baltimore and an extension of the BART system to San 
Francisco International Airport are being constructed as part of 
regional transit improvement programs, of which the Federal share will 
be less than one-third overall.
                         aviation excise taxes
    Question. The aviation excise taxes were recently reinstated by the 
Congress, and went back into effect March 7th. Are there any critical 
FAA capital needs that will go unfunded because of the lapse in the 
aviation excise taxes?
    Answer. No, the recent reinstatement of the excise taxes will fund 
the FAA's capital requirements for the balance of fiscal year 1997. 
However, according to the current legislation, the excise taxes will 
lapse again on September 30, 1997. Unless there are alternative 
financing plans in place, the FAA would not be able to proceed with the 
capital programs in fiscal year 1998.
    Question. If so, are you planning to submit a supplemental request 
to fill urgent safety needs?
    Answer. Since the excise taxes were reinstated, the FAA is 
proceeding with the capital programs and does not foresee a need for a 
supplemental in fiscal year 1997.
                           faa administrator
    Question. How is the administration progressing on the appointment 
of a new FAA administrator?
    Answer. Candidates have been identified and we are in the final 
stages of preparing a nomination. We expect to finish our internal 
processes shortly.
                 faa financial and personnel management
    Question. The recent Coopers & Lybrand study is critical of the 
FAA's financial management of large procurement projects, and the 
agency's personnel management. There seems to be a continuing drumbeat 
of experts who have studied the FAA and all come to the conclusion that 
the agency must fundamentally change the way it makes decisions, 
approaches personnel costs, and transitions from older technology to 
new technology. These are not new challenges, but they are challenges 
that continue to frustrate the FAA and the Congress. It is especially 
frustrating in light of the fact that this Committee has been 
responsive to the department's requests for flexibility in the 
personnel and procurement areas. In the fiscal year 1996 bill, FAA was 
given unprecedented personnel and procurement reform tools, which the 
Coopers & Lybrand study points out that they have yet to effectively 
use. Why does the FAA fail to include any estimated savings from 
personnel and procurement reform in its five-year business plan?
    Answer. Cost containment and potential cost savings for the agency 
in the longer term are basic tenets of personnel and acquisition 
reform.
    Since the advent of personnel reform in April 1996, FAA has made 
significant accomplishments in implementing an initial phase of new 
personnel policies and processes. However, development of new personnel 
programs to replace the existing systems that have been in place for 
decades must be done in a thorough, systematic manner to ensure that 
the new programs support the underlying objectives, properly address 
problems with the existing systems, and ensure fiscal responsibility. 
Until we have made specific decisions on what the major components of 
our new human resource systems will look like, we cannot identify 
specific cost savings that might result from the new programs.
    Under acquisition reform, our goal is to reduce costs of new 
acquisitions by 20 percent and reduce the time it takes to make an 
award by 50 percent by April 1999. At this time, it is too early to 
estimate specific future cost savings resulting from the new system. 
Only five or six new programs have been awarded since April 1996 when 
procurement reform went into effect. However, we do know that 
procurements have been awarded faster, and time is money.
    FAA is developing metrics and will conduct annual internal 
evaluations that will build the infrastructure to calibrate and project 
savings that we can expect in the future. In addition, FAA will provide 
for independent evaluations of the acquisition management system later 
this year and in April 1999 as directed by the Appropriations and 
Authorization Committees.
    Question. What savings have been realized from the procurement and 
personnel reforms? What savings are projected for fiscal years 1997, 
1998, and the outyears?
    Answer. While it is too early to assess the full benefits of the 
new acquisition management system (AMS), we know there have been 
successes and we must continue to work to ensure complete success. 
However, there have been numerous lessons learned under the AMS that 
indicate time savings for both the FAA and industry.
    As an example, the STARS procurement was awarded in 6 months (with 
no protest) under reform; award under the previous system could have 
been up to 18 months. The time and resource savings experienced under 
this procurement is 12 months, not including any time and resources 
which would have been expended in the event of a challenge to the 
award. Another example is the procurement handled by the newly formed 
Security Integrated Product Team (IPT). This team used the reform 
flexibility and authority to make an award within a six-week period and 
saved valuable time and resources.
    While many procurements have been handled in less time and with 
less resources, another factor that cannot be overlooked under reform 
is the culture change. An example of this culture change is the 
Computer Based Instruction procurement. Historically this action would 
have been handled as a single-source procurement. However, the IPT made 
the decision to compete the requirement. The IPT was able to award to a 
new contractor and save $3 million over the incumbent's prices, as well 
as obtain state-of-the-art equipment.
    There have been many procurements of lesser dollar value that have 
been awarded in shorter time frames than would have been under the 
previous system. The reason for these shorter time frames is that the 
response times are tailored to the requirement, there is more 
discussion with industry to obtain a better understanding of the 
requirement (therefore less time and resources spent on numerous 
proposal submissions), and the decision-making process is within the 
IPT.
    We anticipate that there will be similar savings in the future. Our 
goal is to reduce costs by 20 percent and reduce the time it takes to 
make an award by 50 percent by April 1999.
    Question. Why should Congress be expected to take seriously FAA's 
estimates of offsetting collections from user fees, if the agency can't 
accurately lay out the FAA's costs that are associated with the 
services for which they plan to charge the fees?
    Answer. The FAA is implementing a cost accounting system that will 
permit the allocation of costs to users of FAA services. This system is 
to be fully operational by October 1, 1998. Until information from this 
system is available, an independent financial assessment conducted by 
Coopers & Lybrand, Inc., determined that a cost allocation study 
conducted by GRA Inc., which was recently finalized, provided an 
acceptable interim basis for attributing FAA costs to broad categories 
of users and could be used for fee setting.
                        faa's acquisition system
    Question. In 1995, Congress gave FAA unique authority among Federal 
agencies to establish its own procurement system. In response, FAA 
replaced the extensive set of procurement rules with a 100-page 
document, entitled Acquisition Management System. GAO has reported that 
elements of the new system are a promising first step in improving 
acquisitions, but has expressed caution. How complex and difficult to 
address do you consider FAA's acquisition problems to be? What are the 
major issues that need to be addressed to solve the problems?
    Answer. The problems are complex and difficult, especially 
considering the rapidly growing demand for air traffic management and 
infrastructure. Prior to the Acquisition Management System (AMS), a 
rigid set of acquisition laws, regulations, internal rules, and 
overlapping approvals contributed to costs and delays in fielding and 
maintaining systems. Excessive time to field systems often led to those 
systems containing obsolete technology. Also, there was no coordinated, 
corporate-level view of acquisition programs. Rigorous mission needs 
determinations, analyses of alternatives, and affordability decisions 
were not always focused at a corporate level.
    The new AMS addresses the problems of excessive time and cost, 
unnecessary oversight, and burdensome processes. The AMS promotes time 
and cost savings by allowing streamlined processes, decision-making at 
a level appropriate for the circumstances, integration of all 
disciplines responsible for an acquisition into product teams, and 
innovation. All elements of acquisition are integrated by the AMS, from 
determining mission need to disposal. The AMS also requires the FAA to 
prioritize mission needs and make investment decisions based on those 
needs. In summary, the AMS will allow the FAA to buy what it needs, 
when it needs it, at the best deal, and will allow for changes.
                            airport funding
    Question. AIP funding is at an all-time low in recent history. And 
in the fiscal year 1998 budget request, you have requested an 
obligation ceiling of only $1 billion. In the past four years, annual 
airline passenger enplanements have increased 16 percent and investment 
in airport development has decreased 23 percent--and that is before the 
$460 million decrease in airport investment envisioned in the 
President's Budget. I'm informed that the FAA has pending applications 
for over $3 billion worth of airport improvement projects ready to go.
    The FAA cites 22 airports that are seriously congested, and 
estimates that number growing to 32 in the next several years. Delays 
associated with congestion cost the airlines over $500 million a year 
directly, and the total cost to the national economy is many times 
greater, if you consider the lost time to passengers and businesses. 
Yet your budget requests the historically low airport improvement 
funding level of $1 billion--lower than the AIP ceiling has been in 10 
years.
    Have we been spending too much on airports, or is the President's 
Budget underfunding our airport needs?
    Answer. Like many other Federal programs, the requested AIP level 
has been reviewed carefully to help the administration and Congress 
balance the Federal budget. Airports, particularly large ones, are able 
to raise capital for airport development in the private market. Also, 
the ability to collect and use Passenger Facility Charge funds will 
continue to provide an important supplement to Federal grant funds. We 
hope the newly authorized demonstration program for innovative 
financing will help airports do more with the Federal funds that are 
made available to them.
    We are optimistic that the work of the National Civil Aviation 
Review Commission will produce recommendations for long-term funding of 
airport infrastructure, as well as other aviation programs.
    Question. Has the Department done any research on the economic 
impact of funds spent on new airports and airport improvements? If so, 
please provide an executive summary of the results of this research for 
the record.
    Answer. FAA has not conducted research into the broad impact of 
airport improvements on the economy of the surrounding area. FAA has 
conducted benefit/cost analyses of specific proposals for large airport 
capacity improvements to be funded in part through the Airport 
Improvement Program. These analyses were conducted within FAA and did 
not result in formal reports. We have included economic impact analysis 
as an element of the master planning process, and have developed a 
suggested methodology for use by airports.
                     white house commission report
    Question. On page 11 of the Gore Commission report, the Commission 
concludes that ``Cost alone should not become dispositive in deciding 
aviation safety and security rulemaking issues'' and that ``non-
quantifiable safety and security benefits should be included in the 
analysis of proposals.'' What are some of the factors in this ``non-
quantifiable'' category? Are these just factors that we'll know when we 
see them?
    Answer. The White House Commission recommendation that cost alone 
not become dispositive in regulatory cost/benefit analysis is 
consistent with current FAA practice and with Executive Order 12866 
(Regulatory Planning and Review), which recognizes that some 
significant costs and benefits are difficult to quantify. With respect 
to U.S. aviation safety and security, examples of difficult to quantify 
benefits include estimates of the value of public confidence in the 
safety of air travel, the value of trying to achieve 100 percent risk 
reduction with the use of redundant systems or procedures, and safety 
measures instituted as a result of risk analysis rather than a record 
of actual accidents. In regulatory actions where these difficult to 
quantify benefits or costs are included, the specific issues are 
identified and discussed so the reader is aware that they have been 
included in the analysis.
                   weather-related aviation research
    Question. Weather is a contributing factor in over one-third of 
aircraft accidents. In the report, the Commission sets the goal of 
reducing ``the fatal accident rate by a factor of five within ten years 
and conduct safety research to support that goal.'' I note that the 
President's Budget request for aviation weather research has been 
reduced by over 60 percent below current levels (from $13 million to $6 
million). Is enough money committed to weather research, or is this an 
area that deserves greater attention by the FAA?
    Answer. Research and development project funding varies 
considerably from year to year, depending on the phase of research. The 
FAA's Aviation Weather Research program is in a phase where several 
components have completed the capital intensive portions and are now in 
a less costly period of analysis. We are studying how to implement the 
recommendations of the White House Commission Report, and can shift 
resources, as necessary, to fund any additional weather research.
                          nasa safety program
    Question. I've heard that in response to the Gore Commission 
report, NASA has started planning a $300 million a year safety program. 
Is NASA the appropriate agency to lead on aviation safety, and what 
type of safety initiatives would you anticipate that NASA is best 
suited to contribute?
    Answer. The FAA is working in partnership with NASA in an endeavor 
to reduce the aviation fatal accident rate by a factor of five within 
ten years. NASA has pledged to contribute one-half billion dollars over 
the next five years to support the safety research. The initiative, now 
named the Aeronautical Safety Investment Strategy Team (ASIST), was 
kicked off by an FAA and NASA workshop February 18-21, 1997. Subsequent 
ASIST workshops were held March 6-7 and March 25-28, 1997. The groups 
used facilities provided by Boeing and worked on a process for 
prioritizing safety research. Subgroups are preparing a comprehensive 
list of research projects being done by FAA and NASA to identify those 
projects with the most immediate impact. Long range research is also 
being examined in those areas expected to have a major impact on 
accident rates. The next workshop will be held April 17-19.
    While aviation safety is the responsibility of the FAA, the 
agencies have worked in partnership for over ten years on several 
safety research initiatives that contribute to the overall goal of 
reducing accident rates. Current FAA/NASA cooperative research programs 
include aging aircraft studies, Advanced General Aviation Transport 
Experiments (AGATE) to include the General Aviation Propulsion Program 
(GAP), and new situation awareness methods such as the Aviation 
Performance Measuring System (APMS) program.
    The research roles of the two agencies are complimentary in that 
the FAA's research program is focused on applied research with results 
expected within two to five years, while the NASA research programs 
tend to be longer term. Working in partnership will ensure that the 
research performed by NASA can be applied by the FAA in its advisory 
material and rules.
    Question. I note that the Gore Commission Report mentions the need 
for a ``new long-term financing mechanism to ensure that modernization 
occurs on an acceptable schedule, and that the resulting safety and 
efficiency benefits are realized faster.'' and that ``Replacing the 
traditional system to excise taxes with user fees offers the potential 
to correlate revenues and spending more closely.`` What is the 
Department's view of what a user-financed regime might look like? I 
know that this is the task for the National Civil Aviation Review 
Commission, but can you give the subcommittee a sneak preview of what 
you expect the administration to favor for user fees, fuel taxes, 
ticket taxes, or other financing mechanisms?
    Answer. User fees should cover the full costs of operating FAA. 
Ideally, the fees would be derived by determining the full costs of 
providing specific services such as air traffic control services to 
aviation users and relating the fees to those costs. Recommendations 
for specific types of changes and types of services subject to charge 
will be heavily influenced by the findings of the National Civil 
Aviation Review Commission.
                       passenger facility charges
    Question. To augment funding from the AIP grants, in 1990 the 
Congress established the Passenger Facility Charge (PFC) program. Under 
the program, commercial service airports can charge each airline 
passenger $1, $2, or $3 per trip segment up to a maximum of four 
segments per round trip. After determining which projects to fund with 
PFCs, an airport must apply to FAA for approval of the PFC. In 1996, 
PFC collections totaled over $1 billion. Generally, PFCs can only be 
spent on the same types of airport development projects that can be 
funded with AIP grants. However, in 1996, the Congress extended the use 
of PFCs to include relocating air traffic control towers and 
navigational aids as part of an approved project, and meeting Federal 
mandates. Have any airports as yet requested to use PFC's to relocate a 
tower or navigation aid? If so, what was the PFC contribution to the 
total project cost?
    Answer. Yes, the Albany County Airport Authority in Albany, New 
York, has an approved project to relocate the air traffic control at 
the airport. The Albany County Airport was approved to impose and use 
$8,521,093 in PFCs toward the total project cost of $15,496,956. Also, 
numerous public agencies have been approved for the imposition and use 
of PFCs for runway projects of various types at airports they control. 
However, it is not known which, or if any, of these projects contained 
navigational aids as a construction element.
    Question. Have any airports as yet requested to use PFCs to meet 
Federal mandates? If so, could you provide an example of the type of 
mandate and the PFC contribution to the total project cost?
    Answer. Yes, many public agencies have had projects approved that 
were federally mandated or had projects that contained construction 
elements that were federally mandated. Examples of these mandates are: 
airfield signage; terminal security; projects to comply with the 
Americans With Disabilities Act (ADA) requirements; and clean air and 
water projects. Many of these mandates are carried out as elements of 
other major construction projects. For example, many ADA projects are 
contained within terminal rehabilitation projects. The FAA has approved 
over $15.2 million in terminal ADA projects and $16.4 million in 
airfield signage projects.
    Also, Dayton, Ohio; Indianapolis, Indiana; Syracuse, New York; and 
Tulsa and Oklahoma City, Oklahoma, have environmental clean water 
projects totaling over $41.8 million approved or pending approval.
                        faa's funding shortfall
    Question. In its fiscal year 1998 budget, FAA projects a $6 billion 
shortfall between its existing requirements and projected funding 
levels through 2002. In addition, the cost of the Gore Commission's 
proposal to accelerate improvements in aviation safety and security 
will increase this shortfall by over $2 billion, placing an additional 
burden on FAA's resources. What cost containment efforts have you 
implemented to address these escalating costs?
    Answer. The FAA has taken numerous steps in the last three years to 
reduce personnel costs and reduce FTE levels, as called for by the 
National Performance Review. Through the end of fiscal year 1996, the 
agency has been able to reduce overall FTE usage by 11.7 percent or 
6,324 FTE. Cumulative savings as a result of FAA's downsizing exceed $1 
billion through fiscal year 1996, with fiscal year 1996 savings 
estimated at over $400 million.
    Since over 62 percent of the agency's work force is part of what is 
referred to as the ``safety work force,'' the downsizing has been 
concentrated in the non-safety areas. The non-safety work force has 
been reduced by 18 percent through fiscal year 1996.
    Some examples of efforts by the agency to streamline and achieve 
cost savings are as follows:
  --Contracting Out of Level 1 Towers
    --85 Towers contracted out
    --Additional savings anticipated in fiscal year 1998
    --Supported by the NPR
  --Airway Facilities (AF) Realignment
    --Reduced levels of AF organization in regions and field from 5 to 
            3
    --Nearly 900 supervisory positions eliminated
  --Human Resource Management (HRM) Streamlining
    --HRM staffing reduced by over 400 positions since fiscal year 1993
    --Supervisory ratio increased from 1:5 to 1:15
    The FAA is currently in the process of an integrated review of the 
agency's structure, processes, and restructuring plans. Contrary to 
previous studies that have concentrated on specific areas (e.g. 
regional structure, administrative services, etc.), the integrated 
review now in process will incorporate plans already in place in the 
lines of business as well as a corporate review of the FAA mission, 
processes, and structure.
    Question. How has the FAA's investment in ATC modernization 
increased controller and workforce productivity? Could you discuss how 
this investment has reduced or contained personnel staffing levels?
    Answer. The ATC modernization has not specifically reduced or 
contained air traffic staffing. An increase in controller productivity 
may be a by-product of our efforts to adopt new technologies. We hold 
technologies we pursue up to the standard of the agency mission: Safe, 
Orderly and Expeditious flow of Air Traffic. In the Standard Terminal 
Automation Replacement System (STARS) program, for instance, we have 
required only the capability to replicate our current functionality. In 
the pre-planned product improvement area of STARS, we require the 
contractor to give us a platform within which additional functionality 
can be readily accommodated.
    The Display System Replacement (DSR), like the STARS program, has 
kept the system as functionally close to today's system as possible. 
This was done intentionally to reduce schedule risk and transition and 
training impact to the facilities. The system will provide a platform 
that has open system architecture and will allow us to integrate new 
ATC technologies when they are available.
    Among the expected additional functions are data link 
communications, surveillance enhancements, surface separation, improved 
weather display, Terminal Air Traffic Control Automation (TATCA), 
Enhanced Traffic Management System (ETMS), medium-range conflict probe 
and others. The benefits will accrue to FAA customers as a function of 
increased performance of the system, a large part of which is enhanced 
by controller productivity improvements resulting from better tools.
    Question. How will FAA fund Gore Commission recommendations 
relating to the acceleration of ATC modernization and improvements to 
airport security?
    Answer. The White House Commission recommendations are 
interrelated. The FFA's ability to accelerate ATC modernization and 
improve security will depend upon congressional action on the 
recommendation to implement user fees. These fees will provide the 
resources needed to address these two areas.
    We are currently identifying those specific programs that need to 
be accelerated to meet full modernization by 2005. We are considering 
not only existing programs, but also identifying possible changes in 
how the FAA provides necessary services.
    Some modernization efforts are already underway and budgeted, 
including development of data link, DSR, STARS, and some of the traffic 
management decision support tools. By late April 1997, the FAA expects 
to have schedules identified for each program element and refined cost 
data to share with the National Civil Aviation Review Commission. The 
White House Commission deferred to this body to help define the 
alternative financing mechanisms necessary to reach the 2005 goal. The 
planning to support full ATC modernization is heavily dependent on the 
users equipped with avionics that produce both user and FAA benefits. 
Their input to this planning is critical for success and will occur 
prior to the July 15, 1997, deadline recommended in the White House 
Commission report.
                      domestic airline competition
    Question. Nearly 20 years ago, Congress phased out control of 
domestic airline service and relied on market forces to decide fares 
and levels of service. Last year the GAO reported that, overall, air 
fares have decreased and service has improved since airline 
deregulation. However, GAO emphasized that several ``pockets of pain'' 
exist--that is, a number of smaller communities, particularly in the 
Southeast and upper Midwest, have higher fares and worse service today 
than under Federal regulation. What steps, if any, can the Department 
of Transportation take to ensure that the benefits of deregulation 
reach these areas of the country?
    Answer. The GAO report identified some small-and medium-sized 
communities that had not benefited from deregulation, and they did find 
a few that they clearly identified as worse off today. They stated, 
``these pockets of higher fares and worse service stem largely from 
both a lack of competition and comparatively slow growth over the past 
two decades''.
    Geography and the size of the local economy are major factors that 
determine whether a community can support competitive service. If a 
city is relatively small and is located within a reasonable driving 
distance from one or more major cities, some of the population that 
would normally use the local airport will drive to the larger airports. 
This is particularly true if low-fare service is available at the 
larger nearby airports. To date, none of the low-fare carriers has 
entered a non-hub airport (defined by the FAA as enplaning fewer than 
0.05 percent of domestic passengers or 263,028 per year) and only a 
handful have entered small FAA hubs.
    Under deregulation, the Department does not regulate prices or 
service. These decisions are made by the airlines in the marketplace. 
However, a DOT study last year showed that the low-cost carriers were 
beginning to move into ever smaller markets, and if the growth of low-
cost service resumes its pattern of a year ago, there might be some 
low-fare service to smaller cities over time. Another new development 
that could change the fortunes of the cities noted in the GAO study is 
the spread of the new 50-seat jets that are just beginning to come into 
the market. With these new aircraft, it will be feasible to offer jet 
service to smaller cities.
    Question. What steps can local communities take to improve the 
quality of their air service?
    Answer. At a round-table discussion about market-based solutions to 
local air service problems held in Chattanooga, TN, on February 7, 
1997, two important local self-help measures were developed. First, was 
consumer education. Because of the importance of affordable air service 
to local economic development, local leaders should become more 
aggressive in educating consumers about competitive issues facing the 
local aviation marketplace. Second, local financial incentives were 
discussed. Such incentives can encourage market entry by guaranteeing a 
particular level of revenue or providing direct promotional support. In 
partnership with local airport authorities, corporations can make 
contractual or preferential agreements with interested new entrants or 
the most responsive incumbent carriers, steering business toward these 
airlines.
    Question. GAO also reported last year that barriers to entry 
continue to limit competition at several key airports, such as Chicago 
O'Hare and New York LaGuardia, to an extent not anticipated by Congress 
when it deregulated the industry. The result, according to the GAO, has 
been significantly higher air fares at these airports. Do you agree 
with GAO's finding and conclusions? If so, what specific actions do you 
think are necessary to address these barriers to market entry?
    Answer. We do not agree completely with GAO's conclusions. While 
fares may be higher in some markets out of these specific slot-
controlled airports, our analysis of fares in Chicago and New York 
suggests that average fares for local passengers are not significantly 
higher because both cities have alternative airports that are not slot-
controlled: Midway in Chicago and Newark in the New York area. We know, 
for example, that fares in the Baltimore-O'Hare market are disciplined 
by Southwest's service in the Baltimore-Midway market.
    Nevertheless, in response to GAO's report, the Department announced 
that it would consider the impact on competition in responding to 
requests for exemptions from the slot rule by new entrants. This 
represents a new policy that should enable the Department to encourage 
new competitive service.
    Question. A key barrier to entry that GAO identified was the 
artificial limits set by DOT on the number of takeoffs and landings 
that can occur at Chicago O'Hare, New York LaGuardia and Kennedy, and 
Washington National. Many in the airline industry believe that these 
slot controls, established in 1969, are no longer necessary. Do you 
plan on re-examining the need for slot controls at these airports 
during your tenure?
    Answer. Less than two years ago, the Department completed an 
exhaustive study of whether slot controls should be eliminated. We sent 
that study to Congress for its review. Based on that study, no changes 
were made to the slot rule. Because this was studied so recently, we 
have no active plan to revisit this issue.
    Question. GAO has also identified the perimeter rule at 
Washington's National Airport as a barrier to entry. GAO suggested that 
Congress consider giving DOT the authority to grant waivers from the 
perimeter rule where it could promote competition. What are the 
Department's views on this issue?
    Answer. The perimeter rule at Washington National was created by 
Congress in its oversight capacity over Washington's two local 
airports. The Department appreciates arguments for and against 
modification of the perimeter rule, and takes no position on whether it 
should be modified.
    Question. Given that capacity in the air traffic control system and 
in the national airport system is available in some sectors and at some 
airports, while the system operates at or above capacity (at 
significant expense) in others, is there merit in considering a 
structure of user fees tied to peak-time pricing concepts on capacity-
constrained airports or sectors on non-origin/destination travelers, to 
encourage greater utilization of system capacity by airlines?
    Answer. The development of a user fee system will have to take into 
account many complicated factors, including peaking issues. DOT at this 
point is looking to the recently named National Civil Aviation Review 
Commission to sift through the data and arguments in developing a sound 
recommendation on user fees.
                         international aviation
    Question. Over the past several years, DOT has been successful in 
reaching liberal agreements with other countries that dramatically 
increase U.S. airlines' access to those countries' markets. 
Unfortunately, DOT has made little progress with our two largest 
aviation trading partners overseas--the United Kingdom and Japan. Will 
DOT take a different approach toward the British and the Japanese under 
Secretary Slater than was taken by his predecessor? If so, how would 
the approach differ?
    Answer. The goals for our aviation relationships with the British 
and the Japanese have not changed. In both cases, the Department is 
committed to eliminating the restrictions that limit the ability of 
U.S. carriers to structure their services in response to market 
demands. With respect to the United Kingdom, the proposed alliance 
between American Airlines and British Airways, for which the airlines 
are seeking antitrust immunity, has given the British an incentive to 
liberalize the air services relationship, and talks to establish an 
open-skies aviation regime have begun. Although the pace of 
negotiations to establish the new regime has been slow, progress is 
being made--most significantly, the British have accepted that the 
restrictions on entry to London's Heathrow Airport must be eliminated. 
However, further action is unlikely until after the British general 
election, which is scheduled for May 1.
    With regard to Japan, we have been holding high-level exploratory 
discussions aimed at reaching a framework for resuming formal 
negotiations. Since the Japanese indicated they were not prepared to 
accept implementation of a fully liberal regime at this time, we have 
proposed that such a regime be phased in over a reasonable period. We 
are continuing to discuss this concept with Japanese officials.
    Question. DOT policy has been that the grant of antitrust immunity 
to international airline alliances is contingent upon an ``open skies'' 
agreement removing all restrictions on air travel between the United 
States and the other country. During negotiations with other countries, 
DOT has used antitrust immunity as a carrot to obtain open skies 
accords. Does the current administration agree with this approach?
    Answer. The possibility of securing antitrust immunity for an 
alliance in which their national carrier participated has provided an 
incentive for some U.S. bilateral partners to agree to ``open-skies'' 
aviation regimes. However, U.S. negotiators have made clear to foreign 
partners that an open-skies agreement is a necessary, but not 
sufficient, condition for the grant of antitrust immunity. Each of the 
immunized alliances was also subjected to in-depth competitive reviews 
by both DOT and the Department of Justice. These reviews were conducted 
separately from the open-skies negotiations, and as appropriate, 
conditions were imposed on the alliance to address competitive 
concerns. This approach has yielded valuable new opportunities for U.S. 
aviation interests and will be continued.
    Question. Two of the world's largest airlines--American Airlines 
and British Airways--propose forming a strategic alliance and have 
applied to DOT for immunity from U.S. antitrust laws. If the United 
States and the United Kingdom are eventually able to reach an agreement 
that opens up aviation trade between the two countries and antitrust 
immunity is granted to the American/British Airways alliance, do you 
believe that other actions will be necessary to ensure adequate 
competition? If so, what would those actions be?
    Answer. It is the Department's position that an ``open-skies'' 
agreement with the British is a prerequisite for any decision to grant 
antitrust immunity to the proposed American Airlines/British Airways 
alliance. Moreover, the agreement must be accompanied by a 
competitively effective presence of U.S. carriers at London's Heathrow 
Airport. Since the application for immunity is pending before the 
Department, it would not be appropriate to comment on how any 
competitive concerns might be handled. However, an in-depth review of 
the competitive implications of the request for antitrust immunity will 
be undertaken by both the Transportation and Justice Departments. That 
review will be conducted separately from U.S. and British Government 
discussions on open skies.
                          coast guard mission
    Question. The Coast Guard makes a great deal of the multi-mission 
environment in which they operate. In light of budgeting constraints 
and the increasing mission demands placed on the Coast Guard in drug 
interdiction, search and rescue and maritime safety, is a reassessment 
of the Coast Guard's workload necessary?
    Answer. No, a reassessment of mission workload is not necessary. 
The Coast Guard uses the same people and platforms to efficiently and 
effectively perform a broad spectrum of missions. The Coast Guard's 
authority to move assets between and among missions to meet emerging 
and differing national priorities while retaining a core maritime 
competence in marine safety, environmental protection, law enforcement 
and national defense, makes the Coast Guard a model for efficient 
government operations.
    Question. Is the Coast Guard overextended? Should consideration be 
given to transferring some missions to the private sector?
    Answer. No, the Coast Guard is not overextended. The fiscal year 
1998 budget request marks the effective completion of the Coast Guard's 
Streamlining Plan, which is on track and has reduced the size of the 
Coast Guard without reducing services to the public. Over the past four 
years, the Coast Guard has saved the American taxpayer nearly $400 
million and has reduced approximately 3,500 personnel to the smallest 
work force size since 1967. These savings have been achieved by 
restructuring, divesting inefficient assets, eliminating expensive 
infrastructure, and leveraging technology to reduce administrative 
overhead.
    There are currently no plans to change or transfer any of the Coast 
Guard's primary mission areas of maritime safety, maritime law 
enforcement, marine environmental protection, and national defense.
    Over the years, Coast Guard missions have evolved and grown through 
the addition of new missions that leverage the Coast Guard's core 
attributes and multi-mission capabilities against new national 
challenges. The Coast Guard is uniquely positioned as a military 
service with law enforcement authority as the lead agency for maritime 
drug and migrant interdiction and as the lead agency for environmental 
protection to advance the President's priorities in the marine 
environment, in national security, and environmental protection. The 
Coast Guard is constantly reviewing its goals, soliciting feedback from 
customers, and evaluating the cost of services as part of a quality 
approach to government services.
                      streamlining the coast guard
    Question. For the past several years, the Coast Guard has engaged 
in a streamlining effort--how is the plan proceeding?
    Answer. The Coast Guard's National Streamlining Plan is proceeding 
on schedule and accomplishing projected savings. Coast Guard 
Headquarters was reorganized and downsized by 600 people. Coast Guard 
District staffs have dropped from 12 to nine, with field command and 
control staffing reduced by 374 personnel. Twelve Integrated Support 
Commands have been established, allowing operational commanders to 
focus on external customer delivery and facilitating field Command and 
Control reductions. Four activities prototypes have been established to 
test various concepts for greater integration of operations management. 
Most Coast Guard functions have moved off Governors Island, New York. 
Remaining work is on schedule to place Governors Island's 170 acres and 
225 structures in caretaker status by September 30, 1997. Training is 
being enhanced by the newly established Performance Technology Center 
in Yorktown, VA, and work continues for co-locating and integrating a 
Coast Guard-wide Leadership Development Center at the Coast Guard 
Academy by the summer of 1998. The Coast Guard has established a number 
of Centers of Excellence, including restructuring the Coast Guard's R&D 
Program and merging the Civilian Personnel servicing ``hub'' with the 
Coast Guard Personnel Command. Finally, work is progressing with the 
realignment of specialized command, control and communication (C3); 
IRM; and electronics engineering support functions, which are being 
relocated from the Electronics Engineering Center, Wildwood, NJ, by the 
summer of 1997.
                      streamlining savings update
    Question. In anticipation of possible budget cuts beginning in 
fiscal year 1997, the Coast Guard developed a national streamlining 
plan. The plan focused on reducing headquarters organizational units 
and personnel, consolidating field command and control and support, 
enhancing training, closing Governors Island, and creating centers of 
excellence. When the plan is fully implemented in fiscal year 2000, the 
Coast Guard expects to save between $63 million and $80 million a year 
and reduce its staffing by 1,300 positions. Conversely, the Coast Guard 
anticipates spending approximately $97 million in one-time relocation 
and construction costs to implement the streamlining plan's specific 
actions. For fiscal year 1997, the Coast Guard estimated eliminating 
838 positions (555 military and 283 civilians) and saving $36.5 million 
in personnel and operations and maintenance costs as a result of 
streamlining. Is the estimate of $36.5 million savings in fiscal year 
1997, due to actions taken as a result of the national streamlining 
plan, still accurate?
    Answer. The Coast Guard's fiscal year 1997 budget request 
identified the elimination of 838 positions (555 military and 283 
civilians) and $30.7 million in savings associated with the National 
Plan for Streamlining the Coast Guard (reference pages 2, 5 and 86 of 
the Coast Guard's fiscal year 1997 budget request). There was also 
$701,000 in annualized savings in the fiscal year 1997 budget request 
from the consolidation of civilian personnel offices portion of the 
national streamlining plan (reference page 92 of the Coast Guard's 
fiscal year 1997 budget request).
    In addition, to reduce the negative impact on direct operational 
services of the $7 million congressional ``general reduction'' to the 
Operating Expenses account in fiscal year 1997, the Coast Guard 
accelerated portions of the national streamlining plan, resulting in 
the elimination of an additional 93 military positions, which provided 
an additional savings of $3.8 million that was originally planned to be 
taken in fiscal year 1998. Therefore, total on-budget national 
streamlining plan actions in fiscal year 1997 will result in the 
elimination of 931 positions (648 military and 283 civilian), saving 
$35.1 million.
    An additional $7.9 million in national streamlining plan savings 
was reinvested to fund civilian pay raises, thereby bringing the gross 
savings to $43.0 million in fiscal year 1997 (reference page 29 of the 
Coast Guard's fiscal year 1997 budget request).
    The following table summarizes the fiscal year 1997 streamlining 
savings:

------------------------------------------------------------------------
               Initiative                       FTP           Savings   
------------------------------------------------------------------------
Annualized fiscal year 1996 actions.....  ..............        $700,000
Initial fiscal year 1997 actions........             838      30,700,000
Accelerated fiscal year 1998 actions....              93       3,800,000
                                         -------------------------------
      Total net savings.................         \1\ 931      35,100,000
------------------------------------------------------------------------
\1\ The Coast Guard expects to achieve a gross reduction of 931         
  positions in the Operating Expenses (OE) account as a result of its   
  national streamlining plan and an additional 218 positions from other 
  actions in fiscal year 1997. At the same time, the Coast Guard was    
  required to add some positions in order to staff new and ongoing      
  projects (e.g., new buoy tenders, Aids to Navigation Team Red River,  
  Differential Global Positioning System Maintenance Engineering        
  Facility, Afloat Tactical System project, and Communications Station  
  Honolulu Transmitter project (reference pages 88-89 and 128-133 of the
  Coast Guard's fiscal year 1997 budget request).                       

    Overall, for fiscal year 1997 (in all accounts), the Coast Guard 
expects to achieve a net reduction of 910 positions.
                  coast guard streamlining reductions
    Question. Does the Coast Guard expect to achieve a reduction of 838 
positions by the end of fiscal year 1997.
    Answer. The Coast Guard expects to achieve a reduction of 931 
positions (FTP) in the Operating Expenses (OE) account by the end of 
fiscal year 1997 as a result of the National Plan for Streamlining the 
United States Coast Guard. The Coast Guard expects to achieve total net 
reductions of 910 positions (FTP) for all accounts by the end of fiscal 
year 1997, indicated as follows:

------------------------------------------------------------------------
                                            Total work      Cumulative  
               Fiscal year                     force        work force  
------------------------------------------------------------------------
1994....................................            -886            -886
1995....................................            -953          -1,839
1996....................................            -818          -2,657
1997....................................            -910          -3,567
1998....................................             +90          -3,477
------------------------------------------------------------------------
Notes:                                                                  
I. 1993 fiscal year baseline: 45,836 FTP                                
II. The fiscal year 1998 budget request eliminates 508 FTP from         
  streamlining and other actions, and adds back 598 FTP (net increase of
  90 FTP) for drug/LE initiatives, quality of life initiatives, crews   
  for the new buoy tenders scheduled to be commissioned in fiscal year  
  1998, and pre-commissioning personnel for the polar icebreaker HEALY. 

            coast guard streamlining--fiscal year 1998 costs
    Question. Of the $97 million in one-time relocation and 
construction costs, how much has already been expended and how much is 
expected to be expended in fiscal year 1998?
    Answer. When the Coast Guard published its National Plan for 
Streamlining the United States Coast Guard in 1995, it estimated these 
costs at $107 million for fiscal years 1995 through 1999. On page 947 
of last year's hearing record, the Coast Guard updated its estimate of 
fiscal year 1995 through 1997 streamlining exit costs at $103-$110 
million. (Actual costs of $108 million for these fiscal years are in 
line with this updated estimate.) Over the next two years, the 
remaining streamlining costs are forecasted at $24-$26 million in 
fiscal year 1998 and $1.0-$1.5 million for fiscal year 1999. This would 
place the total cost of streamlining at $133 million to $136 million. 
Significant fiscal year 1998 and 1999 streamlining estimates include 
caretaker costs for Governors Island; pier improvements required due to 
unavailability of leased piers in Bayonne, NJ; remaining environmental 
remediation; and berthing improvements required at the Leadership 
Development Center.
                     streamlining savings estimates
    Question. Given the savings estimates of $63 to $80 million were 
made in 1996, can you provide a more precise savings estimate now?
    Answer. The current estimate for net savings associated with the 
National Plan for Streamlining the Coast Guard is approximately $76.8 
million, as follows:

----------------------------------------------------------------------------------------------------------------
                           Fiscal year                              Net savings    Reinvestments   Gross savings
----------------------------------------------------------------------------------------------------------------
1996............................................................      $2,100,000  ..............      $2,100,000
1997............................................................      35,100,000  \1\ $7,900,000      43,000,000
1998............................................................      30,200,000   \2\ 2,100,000      32,300,000
1999............................................................       9,400,000         ( \3\ )       9,400,000
                                                                 -----------------------------------------------
      Total.....................................................      76,800,000      10,000,000      86,800,000
----------------------------------------------------------------------------------------------------------------
\1\ In fiscal year 1997, $7.9 million in national streamlining plan savings was reinvested to fund civilian pay 
  raises, bringing the fiscal year 1997 savings total to $43.0 million.                                         
\2\ In fiscal year 1998, $2.1 million in national streamlining plan savings was reinvested to provide funding   
  for the Leadership Development Center (LDC) in New London, CT, bringing the gross fiscal year 1998 savings    
  total to $32.3 million.                                                                                       
\3\ Fiscal year 1999 reflects annualized savings from closing Governors Island.                                 

                    coast guard streamlining savings
    Question. What have been the total savings to date? (Please display 
by fiscal year, with a total). Are there savings anticipated because of 
the effort in fiscal year 1998? What are the next steps in this effort?
    Answer. From fiscal year 1994 up to and including the fiscal year 
1998 budget request, the Coast Guard will have saved $378.1 million 
(current year dollars) in gross Operating Expenses (OE) reductions. 
This includes approximately $67 million in savings to date from the 
National Plan for Streamlining the Coast Guard, and all other Coast 
Guard-wide streamlining initiatives and programmatic reductions. The 
total savings are not adjusted for inflation. Assuming a 2.5-percent 
yearly inflation rate, the Coast Guard will have saved $397.5 million 
in constant fiscal year 1998 dollars.
    In fiscal year 1998, the Coast Guard estimates that it will save 
approximately $55 million in OE reductions (including approximately $30 
million from the national streamlining plan). The fiscal year 1998 
budget request marks the effective completion of the Coast Guard's 
streamlining plan, which is on track and has reduced the size of the 
Coast Guard by approximately 3,477 people without reducing services to 
the American public.

                                              [Dollars in millions]                                             
----------------------------------------------------------------------------------------------------------------
                                                    Additional      Total gross      Operating                  
                                    Coast Guard      operating        annual         expenses       Cumulative  
           Fiscal year               operating       expenses        operating        savings        operating  
                                     expenses         enacted        expenses      adjusted for      expenses   
                                    reductions      reductions        savings      inflation \1\    savings \2\ 
----------------------------------------------------------------------------------------------------------------
1994............................         ($42.4)         ($18.0)         ($60.4)         ($66.7)         ($66.7)
1995............................          (42.6)          (23.0)          (65.6)          (70.6)         (137.3)
1996............................          (81.6)          (41.2)         (122.8)         (129.0)         (266.3)
1997............................          (54.3)          (20.2)          (74.5)          (76.4)         (342.7)
1998 Request....................          (54.8)  ..............          (54.8)          (54.8)         (397.5)
                                 -------------------------------------------------------------------------------
      Total.....................         (275.7)         (102.4)         (378.1)         (397.5)       (1,210.5)
----------------------------------------------------------------------------------------------------------------
\1\ Inflation-Adjusted Savings = Constant fiscal year 1998 dollars at 2.5-percent inflation rate.               
\2\ Savings reflects gross Operating Expenses (OE) only.                                                        

                        coast guard real assets
    Question. Please provide a comprehensive listing of all Coast Guard 
real assets in the Federal inventory.
    Answer. The following table identifies the Coast Guard's assets by 
Civil Engineering Unit (CEU) and Headquarters (HQ) Unit. Information 
provided for the CEUs includes all buildings and structures within 
their area of responsibility.

----------------------------------------------------------------------------------------------------------------
                                                                                                     Value of   
                                                                     Number of       Building      buildings and
                              Unit                                 buildings and    square feet     structures  
                                                                    structures      (thousands)       ($000)    
----------------------------------------------------------------------------------------------------------------
CEU Cleveland...................................................           9,547           4,133       1,302,452
CEU Miami.......................................................           3,001           4,289       1,275,857
CEU Providence..................................................           7,952           7,757       1,308,048
CEU Oakland.....................................................           4,911           5,301       1,047,677
CEU Honolulu....................................................             763             989         271,619
CEU Juneau......................................................           2,146           3,087       1,683,615
HQ Units:                                                                                                       
    Academy.....................................................             117           1,315         208,643
    TISCOM......................................................              62             128          18,998
    Petaluma....................................................             235             767         169,271
    Yorktown....................................................             285             717         109,306
    Mobile......................................................             104             367          75,658
    Cape May....................................................             227           1,009         166,637
    Yard........................................................             287             985         173,278
                                                                 -----------------------------------------------
      Totals....................................................          29,637          30,844       7,811,059
----------------------------------------------------------------------------------------------------------------

    In the above table, ``value'' means ``plant replacement value'' and 
is derived by a formula. A listing of Coast Guard-owned properties to 
show acreage will be compiled; several months will be required to 
complete the task.
                    sale of coast guard real assets
    Question. The Coast Guard fiscal year 1998 request for its 
Acquisition, Construction, and Improvements (AC&I) account is $379 
million. Of this amount, $9 million is expected to result from the sale 
of selected surplus Coast Guard properties. In developing its budget, 
the Coast Guard presented the Office of Management and Budget (OMB) 
with a list of 29 properties that the Coast Guard expected to be 
surplus in fiscal years 1997, 1998, and 1999. The Coast Guard estimated 
the fair market value of these properties to be $19.9 million. Which 
specific properties were selected by OMB to be sold to obtain the $9 
million to supplement the AC&I account and how were these properties 
selected?
    Answer. No specific properties were selected. The $9 million level 
was established based on forecasts of potential total proceeds, and in 
recognition that some properties on the list would eventually be 
unavailable for sale. No-cost transfers (from the federally-mandated 
screening process) could reduce the proceeds or delay disposal.
   coast guard real assets impact of not selling $9 million of real 
                                property
    Question. If the Coast Guard falls short of selling the properties 
for $9 million, will the Coast Guard reduce its AC&I spending 
accordingly or does the Coast Guard expect to spend $379 million for 
AC&I whether or not any of the properties are sold?
    Answer. The Coast Guard plans on new Budget Authority in fiscal 
year 1998 of $379,000,000 for Acquisition, Construction, and 
Improvements (AC&I) whether or not any of the properties are sold.
               environmental cleanup of excess properties
    Question. What environmental cleanup issues has the Coast Guard 
identified with the $9 million of properties, selected by OMB, and what 
are the expected costs of cleaning up those properties?
    Answer. The Coast Guard has evaluated the condition of the 
properties forecasted for sale in 1997. Two of these sites have been 
identified as having environmental cleanup issues. Both are included in 
the Coast Guard's fiscal year 1998 Environmental Compliance and 
Restoration (EC&R) budget under ``Various Projects under $500,000 
each'' (page 338). Cleanup has been essentially completed at LORAN 
Station Dana, Indiana. Closure of the site has been requested from the 
State of Indiana. Because some additional sampling may be required for 
this site, $50,000 has been requested in fiscal year 1998.
    At Electronics Shop Major Telephones (ESMT) Portsmouth, NH, $65,000 
has been requested to initiate site investigation. Any follow-on 
environmental cleanups at this facility depend upon the results of the 
site investigation and will likely be budgeted in a future fiscal year.
    As of the date of this response, the Coast Guard has not identified 
any environmental cleanup issues for the remaining 1997 properties, and 
is evaluating potential environmental issues in the properties proposed 
for sale in 1998 and 1999.
                 coast guard real assets--gsa reporting
    Question. When does the Coast Guard intend to report the $9 million 
in properties to be sold to the General Services Administration to 
begin the Federal screening process? What is the process for disposing 
of selected surplus property from current status?
    Answer. The following table provides the dates when the Coast Guard 
expects to report the 1997 properties to GSA. Report dates for 
properties to be sold in 1998 and 1999 are being determined.

                                                                        
                     1997 property                    Est. date to GSA  
                                                                        
Eatons Neck--GRP Long Isl Sound, NY..............  Jan 98               
Sta Rockaway, NY.................................  Oct 97               
Housing--Loran Sta Dana, IN......................  Feb 97               
ESMT Manasquan, NJ...............................  Sept 97              
Marblehead Lt--Ant Huron, OH.....................  July 96              
Comsta Boston--Marshfield, MA....................  Aug 97               
ESMT Portsmouth, NH..............................  Sept 97              
Housing--Ft Crockett, TX.........................  Sept 96              
Highland Light, MA...............................  Dec 96               
Nahant Rec Facility, MA..........................  Aug 97               
Housing--Hyde Park, MA...........................  Dec 97               
Moorings/Land/Bldg--Petersburg, AK...............  June 97              
Radar Site--Port Orford, OR......................  Nov 96               
                                                                        

    Once the Coast Guard declares the property excess to its needs, a 
formal Report of Excess is provided to the GSA, which acts as the Coast 
Guard's disposal agent. GSA completes the federally mandated screening 
of potential government and homeless reuse. If not reused for these 
purposes, GSA markets and sells the property for the Coast Guard. The 
sale proceeds, less GSA costs, are returned to the Coast Guard.
                    coast guard real asset reporting
    Question. Why is the Coast Guard not reporting all 29 properties to 
the General Services Administration as surplus?
    Answer. It is anticipated 25 of the 29 properties will be reported 
to the General Services Administration as excess. The remaining four 
properties are:
  --Housing--Wakefield, MA
  --Housing--Randolph, MA
  --Housing--Nahant, MA
  --Air Station--Brooklyn, NY
    After further study, the Coast Guard will retain the three family 
housing areas to ensure adequate housing for Coast Guard personnel in 
the Boston area.
    Air Station Brooklyn will be transferred to the Federal Aviation 
Administration.
                coast guard real assets--operating costs
    Question. What is the estimated operations and maintenance costs 
for fiscal years 1998 and 1999 for all 29 of the identified surplus 
properties?
    Answer. The fiscal year 1998 operations and maintenance cost for 
the 29 properties is approximately $2,675,000. It is highly probable 
that 13 of the 29 properties will be disposed of prior to fiscal year 
1999. Of the remaining 16 properties, 3 family housing areas will be 
removed from the surplus list and retained by the Coast Guard. The 
fiscal year 1999 operations and maintenance cost for the remaining 13 
properties is approximately $1,414,000.
               coast guard real assets--governors island
    Question. What is the current status of removing Governors Island 
from the Coast Guard's real property inventory?
    Answer. The Coast Guard is required to maintain Governors Island on 
its real property inventory until the property is transferred or sold. 
Title 41 CFR 101-47.402-1 states that the holding agency (Department of 
Transportation) shall retain custody and accountability for excess and 
surplus real property pending its transfer to another Federal agency or 
its disposal.
    The Coast Guard and the General Services Administration (GSA) have 
held quarterly partnership meetings to identify the various tasks that 
need to be accomplished in an effort to dispose of the island. This is 
not a typical disposal, due to the size, historicity, and value of the 
facility. The Coast Guard plans to submit the Report of Excess to GSA 
in July 1997.
        streamlining--maintenance and logistics commands (mlcs)
    Question. To develop its national streamlining plan the Coast Guard 
established two teams to assess potential organizational consolidations 
and training infrastructure modifications. The teams' objectives were 
to identify recurring budget savings of $100 million without reducing 
services to the public. They identified a variety of options to 
streamline the agency. The Coast Guard selected several of the options 
which made up the Coast Guard's national streamlining plan. Some of the 
options not included in the national streamlining plan were to replace 
the Coast Guard's current field structure with a regional structure, 
eliminate the two Maintenance and Logistics Commands (centralized 
support commands), eliminate one of the two Maintenance and Logistics 
Commands by merging them together, and close one of the three training 
centers (Training Center, Petaluma, CA) to consolidate training. Why 
did the Coast Guard decide not to eliminate the two Maintenance and 
Logistics Commands or merge them together?
    Answer. Currently, two Maintenance and Logistics Commands (MLCs) 
directly support the two Area commands. The following factors 
contributed to maintaining the status quo as the most desired 
organization:
    (1) The Coast Guard relies heavily on its MLCs for technical and 
administrative support of operational assets and crews. The disruption 
or inefficiencies of consolidation could affect front-line readiness 
and degrade vital services the Coast Guard provides the public. 
Consolidating both MLCs into one would have created a situation where 
the single MLC would have an over-extended span of control and reduced 
customer focus, thereby adversely impacting operational capabilities.
    (2) Maintaining two MLCs retains the existing strengths of the 
current organization. Each has adapted to the unique operational and 
support needs of differing geographic regions, and each MLC has a 
strong customer focus and familiarity.
    (3) The Area/MLC combination links the delivery of support with 
operations in each Area. The current alignment maintains unity of 
command within each Area.
    (4) Maintaining the two-MLC concept provides needed stability in 
order to establish the new Integrated Support Commands (ISCs) for 
decentralized support delivery. These new ISCs were designed to more 
efficiently and effectively provide frontline customer support while 
relying on their respective MLCs for resource, technical, and 
administrative support. In this sense, the MLCs and their ISCs are an 
integrated support system. Eliminating one MLC would necessitate 
additional staff for the new ISCs and pose a digression away from one 
major Streamlining objective--refining operations and support 
activities as core expertise.
                       streamlining savings--mlcs
    Question. What was the estimated savings of (a) eliminating the two 
Maintenance and Logistics Commands and (b) merging them together?
    Answer. The savings that would have resulted from consolidating the 
two Maintenance and Logistics Commands (MLCs) was estimated at 83 full-
time equivalents (FTE). Eliminating both MLCs and distributing their 
functions to other organizations was less efficient and had savings 
estimated at 64 FTE. In neither case was the level of estimated savings 
sufficient to offset the anticipated negative impacts discussed in the 
response to the previous question.
                     streamlining--training centers
    Question. Why did the Coast Guard decide not to close one of the 
training centers?
    Answer. There were three main reasons why the Coast Guard decided 
not to close one of its training centers. First, the up-front costs to 
close a training center and consolidate functions at other training 
centers were substantial. The least-cost option would have required an 
additional $20 million to $26 million in Acquisition, Construction, and 
Improvements (AC&I) funding to accommodate construction requirements. 
Second, the significant changes caused by streamlining initiatives 
required additional training, not less. Stability in the training 
system was imperative to successful streamlining. Finally, the Coast 
Guard had concern for the economic impact of closure on the local 
community in Petaluma, CA, particularly in view of other significant 
downsizing actions.
                excess capacity at uscg training centers
    Question. How much excess capacity (classrooms, sleeping areas) 
currently exists at each of the three training centers?
    Answer. The following table shows utilization rates of the three 
major training centers in fiscal year 1996 as measured by berthing. In 
general, student capacity and classroom utilization are driven by total 
beds available for use. It is generally recognized with the training 
community that 80-percent loading is an achievable target capacity for 
training centers. This achievable level is based on the need for 
maintenance, male/female berthing limitations, and berthing constraints 
based on rank and/or seniority.

                                                      Average Percentage
                                                        Utilization Rate
        Training Center                                 fiscal year 1996
Yorktown..........................................................    88
Petaluma..........................................................    58
Cape May \1\......................................................    64

\1\ Recruit Training Center Cape May training load is seasonal. Cape May 
reaches a utilization rate in excess of 80 percent during the summer, 
with substantially lower loading during the winter when recruiting is 
more difficult. Total student load at Cape May ranged from a low of 
2,355 in fiscal year 1994 to an estimated 4,395 in fiscal year 1997. 
Cape May is the Coast Guard's only recruit training center, and as such, 
the Coast Guard needs the capacity to handle fluctuating recruiting 
demands from year to year.
---------------------------------------------------------------------------
             coast guard capital needs--funding strategies
    Question. Over the next ten years, the Coast Guard faces the 
prospect of having to replace billions of dollars of assets, 
particularly vessels. What are some potential strategies for the agency 
and the Department to obtain the necessary funds?
    Answer. The Coast Guard has faced similar recapitalization 
challenges in previous years. In each case, the Coast Guard provided 
sufficient justification to the administration and Congress to support 
replacing assets that were essential to maintaining the Coast Guard's 
national security capabilities. For example, in fiscal year 1990, when 
the Coast Guard needed to replace its polar icebreaking capability and 
its aging patrol boats, Congress provided $847 million in Acquisition, 
Construction, and Improvements (AC&I) funding. Likewise, in fiscal 
years 1986 and 1987, when the Coast Guard needed to replace the HH-3F 
helicopter with the HH-60, and renovate the 210-foot Medium Endurance 
Cutters, Congress provided AC&I funding at a level of about $550 
million each year.
    In the next few years, the Coast Guard will face similar 
recapitalization needs as its long-range cutters and aircraft approach 
the end of their service lives. The Coast Guard expects to be able to 
provide sufficient justification to support funding an appropriate 
level of assets that serve such vital national interests as stopping 
the flow of illegal drugs (FRONTIER SHIELD); interdicting alien 
migrants (Haiti/Cuba); responding to national security crises (Cuban 
shootdown of U. S. civilian aircraft, TWA 800 disaster) and natural 
disasters (west coast flood relief); and responding to oil spills 
(Rhode Island).
    The Coast Guard intends to work with the administration and 
Congress to support funding for outyear investment in Coast Guard 
assets that serve the national interest.
         coast guard capital needs--savings from ac&i projects
    Question. The Coast Guard's current fiscal situation may be 
worsened by its need to replace an aging fleet of ships, planes and 
other assets. The Coast Guard estimates that the total capital 
requirements for current and new acquisition projects will increase to 
as much as $1.2 billion in fiscal year 2002. This is more than three 
times the $370 million the Coast Guard received for capital projects in 
fiscal year 1997 and greatly exceeds OMB targets for the agency's 
capital needs through 2002. According to Coast Guard managers, their 
cost estimates represent the upper limit of future capital needs 
because they assume a one-for-one replacement ratio for ships and 
planes. Recent acquisitions of such equipment as buoy tenders have 
shown that the replacement ratio could be substantially less than this, 
however, due to improvements in technological capability. In addition, 
alternatives to replacement, such as renovating old assets, using DOD 
resources, or leasing rather than buying may also be considered.
    Can you give any estimates of the yearly savings through 2002 which 
should be achieved because of your AC&I projects? If additional AC&I 
funding were identified, are savings possible by virtue of increasing 
the size of the buy quantity?
    Answer. One of the cornerstones of the Coast Guard's streamlining 
philosophy has been to ``invest in Acquisition, Construction, and 
Improvements (AC&I) to achieve outyear Operating Expenses (OE) 
savings.'' That investment strategy is paying more than $5 million in 
dividends in the fiscal year 1998 budget. The following 
recapitalization projects will save recurring dollars in the OE base 
through fiscal year 2002 and beyond. All projects with the exception of 
the Seagoing Buoy Tender will be completed and fully operational by 
2002.
    A. The combined Seagoing/Coastal Buoy Tender projects will reduce 
fleet size from 37 to 30 ships and save 500 billets, which will be part 
of a total anticipated recurring savings of approximately $12 million 
when all of the old ships are replaced with new ones. Project 
completion was scheduled for approximately 2002, but has been extended 
to 2004-2006 due to funding constraints.
    B. The HC-130 Engine Conversion, which replaces old, fuel 
inefficient engines that are prone to explosion with safer, more 
efficient ones, will save $1.3 million per year when all engines are 
converted.
    C. The Aviation Logistics Management Information System, which 
integrates two separate aviation inventory management systems, is 
projected to save 20 billets and yield additional yet-to-be determined 
OE savings.
    D. The Fleet Logistics System, which will provide an information 
system for managing vessel logistics, is projected to save more than $9 
million per year in efficiencies and reduced inventory costs when the 
system is fully operational.
    E. The Finance Center computer consolidation, which replaced 
outdated information systems with one fully integrated system, is 
projected to save 10 billets and approximately $150 thousand per year 
when it becomes operational.
    F. Communications System 2000, which converts 8 fully-staffed 
communications stations to 2 master stations, 5 remote sites, and 1 
stand-alone station, will save approximately $2 million per year when 
completed.
    G. The Personnel Management Information System/Joint Military Pay 
System will save approximately 190 billets and yield yet-to-be 
determined OE savings associated with integrating and centralizing the 
previously separate pay and personnel systems.
    H. Local Notice to Mariners automation, which will integrate 4 non-
compatible aids to navigation information systems into a single 
integrated system, is projected to save approximately 12 billets and 
yield yet-to-be determined OE savings due to efficiencies gained by the 
elimination of redundant processes and reduction of printing and 
mailing costs.
    If additional AC&I funding was identified, the Coast Guard could 
accelerate some of these projects, such as the Seagoing Buoy Tender and 
HC-130 Engine Conversion, to achieve savings sooner. For example, the 
Coast Guard intends to award a full production contract for 11 Seagoing 
Buoy Tenders in fiscal year 1998. The initial strategy was to buy four 
ships the first year, four ships the second year, and three ships the 
third year. Due to funding constraints, funds were appropriated for 
just one ship in fiscal year 1997, and the fiscal year 1998 budget also 
includes funds for just one ship. If the Coast Guard had funds to buy 
these ships faster, OE savings could be achieved sooner by completing 
the project earlier. Cost avoidance would chiefly result from 
minimizing inflation costs and reducing the time project management 
staff and project resident office personnel remain on the AC&I payroll.
    Accelerating other capital investments not mentioned above could 
also achieve acquisition savings by increasing the size of the option 
awards. For instance, both the Coastal Patrol Boat and Motor Lifeboat 
acquisitions have minimum and maximum option quantities offered under 
the contract. Were the Coast Guard to purchase the maximum versus the 
minimum quantities, these acquisitions could both have been completed 
one to two years earlier, saving costs associated with inflation and 
personnel required to manage the acquisitions.
          coast guard capital needs--actual ac&i needs in 2002
    Question. Since your current AC&I estimated needs assume a one-for-
one replacement and, therefore, are probably significantly inflated, 
can you estimate what your actual needs might be in 2002?
    Answer. The Coast Guard's Capital Investment Plan currently 
presumes one-for-one replacement of existing assets for which mission 
analysis has not yet been completed. Without a completed mission 
analysis, this is the most logical data upon which to base projected 
replacement requirements. However, the Coast Guard makes every effort 
to reduce acquisition costs through use of mission analysis and by 
leveraging technology. The combined Seagoing/Coastal Buoy Tender 
acquisitions are good examples where the use of mission analysis/
technology resulted in less than one-for-one replacement. In these 
projects, 37 old ships will be replaced with just 30 new ones--a 
reduction in combined fleet size of almost 20 percent. However, each 
acquisition has independent characteristics, so the 20-percent 
reduction cannot be unilaterally applied to every ship construction 
project. For example, the Motor Lifeboat project will probably result 
in close to one-for-one replacement of the 100 old boats.
    The Coast Guard's greatest capital investment need in fiscal year 
2002 will be the replacement of its long-range cutters and aircraft. 
Mission analysis for this project is complete, and fiscal year 1998 
funds are being requested for the concept exploration phase of the 
major systems acquisition to replace these vital national assets. Using 
fiscal year 1998 funds, the Coast Guard intends to award contracts to 
industry and government entities to propose integrated systems to 
replace its long-range assets. These integrated systems are intended to 
minimize quantity and maximize effectiveness and efficiency of the 
Coast Guard's long-range assets. Once the Coast Guard has a better idea 
of what and how many assets will be required, acquisition strategies 
can be developed to minimize budgetary impact.
    Until concept exploration for the long-range cutters and aircraft 
replacement is completed, scheduled for the end of fiscal year 1999, 
the Coast Guard is unable to give a more accurate estimate of actual 
AC&I needs in fiscal year 2002.
   coast guard capital needs--impact of flatlined ac&i appropriation
    Question. What would the impact be both on costs and on program 
performance if AC&I appropriations were flatlined at $370 million 
through 2002?
    Answer. Capital investments would be deferred, as would resultant 
Operating Expenses (OE) savings. For example, the Seagoing Buoy Tender 
project would have to be extended, which would further delay the 
projected recurring savings of approximately $14 million. This would 
also require the extended operation of buoy tenders already 50 years 
old. Likewise, the Coast Guard expects to replace its long-range 
cutters and aircraft with fewer units, which should result in lower 
operating costs. Potential operating savings from this project would 
also have to be deferred. Concurrently, as Coast Guard assets age, 
particularly the long-range cutters and aircraft, they cost more to 
maintain. For example, the cost of each subsequent overhaul of one of 
the Coast Guard's oldest HC-130 aircraft increases by $500 thousand. As 
new acquisitions are pushed further into the future, their cost will be 
higher as a result of inflation.
    The Coast Guard is an operating agency that relies upon capable, 
dependable assets to carry out its services to the Nation and the 
public. As these assets age, their availability becomes less certain as 
the ratio of maintenance to operations increases. For example, the 
seagoing buoy tenders are already over 50 years old and the 82-foot 
patrol boats are over 30 years old.
    The most significant adverse impact would be on the future mission 
performance of our long-range cutters and aircraft. Some of the HC-130 
aircraft are 20 years old, and the 378-foot high-endurance cutters are 
approaching 30 years of age and have already been overhauled once.
                    coast guard capital needs--ac&i
    Question. What actions would you have to take to continue 
operations if the AC&I appropriation was not increased through 2002?
    Answer. The impact of a flatlined AC&I appropriation would fall 
heaviest on the largest recapitalization projects--the Seagoing Buoy 
Tender replacement, the Coastal Patrol Boat, the National Distress 
System (short-range distress communications network), and the Deepwater 
Capability replacement (long-range cutters and aircraft). If these 
projects were stopped or slowed down through fiscal year 2002, the 
Coast Guard would have to perform its missions for 5 or more years 
using aging assets at or near the end of their service lives.
 coast guard capital needs--acquisition/research & development program 
                                  link
    Question. How is your AC&I technology improvement project linked to 
your research, development, testing, and evaluation projects?
    Answer. The Coast Guard's Research, Development, Test, and 
Evaluation (RDT&E) program addresses potential for AC&I technology 
improvements in two ways.
    The first involves project work that is specifically directed at 
acquisition-related technology improvement issues. In fiscal year 1998, 
RDT&E's Future Technology Assessment efforts include support for the 
Coastal Zone Mission Analysis now being conducted to examine all 
missions performed by the Coast Guard in the coastal zone (shoreline to 
50 miles offshore). Once current needs in the coastal zone are assessed 
and future requirements projected, gaps in capability will be 
identified. RDT&E can then provide the technical expertise to conduct 
an emerging technology assessment to determine ways to close the gaps 
through leveraging technology, uncovering information, techniques, and 
alternatives to support appropriate AC&I technology improvement 
efforts. If the AC&I technology improvement is a major systems 
acquisition, the RDT&E program may also be called upon to assist with 
the concept exploration phase.
    The second leverages the core expertise and technical knowledge of 
the RDT&E personnel to develop new or alternative methodologies for 
performing mission analysis using state-of-the-art operations research, 
modeling, statistical analysis, and other related techniques. This was 
used in the pre-acquisition phase of the Coast Guard's new project to 
replace its long-range cutters and aircraft. In fiscal year 1998, RDT&E 
personnel will participate as members of acquisition matrix teams 
engaged in the concept exploration phase of the long-range cutters and 
aircraft replacement project. The RDT&E program will also review 
requirements provided by acquisition matrix teams and perform focused 
technology assessments.
               coast guard vts technical solutions study
    Question. Last year, Congress cut the funding for the Vessel 
Traffic Service (VTS) program and provided $1 million for a study of 
available technical solutions which minimize complexity and cost in any 
follow-on VTS programs. The President's Budget requests $5.5 million 
for PAWSS (Ports and Waterways Safety System), a follow-on to VTS 2000, 
to transition from ``requirements development to acquiring an initial 
off-the-shelf system component.'' How is the VTS technical solutions 
study proceeding, and when might we expect the delivery of a report?
    Answer. In response to last year's direction from Congress, the 
Coast Guard has held national and local-level public forums to gather 
user input on VTS requirements, and hosted technical symposiums to 
gather information on off-the-shelf technical solutions. Through this 
deliberate process, the Coast Guard and the users are partnering to 
define the problem, develop requirements to address the problem, and 
devise a mutually-agreed-upon solution. This evaluation process is the 
core of the Ports and Waterways Safety System project.
    In March 1997, members of the national maritime community provided 
input on defining the elements that should constitute a basic VTS. A 
users forum in New Orleans is expected to deliver their local 
requirements by May 1, 1997.
    The Coast Guard held a Technical Symposium in February 1997, where 
vendors presented information on commercially available equipment for 
use in VTS. The Coast Guard, with the assistance of the Radio Technical 
Commission for the Maritime Services, will hold a second symposium 
April 28-29, 1997, to allow vendors to demonstrate their equipment.
    Using input from these various sources, the Coast Guard will be 
able to propose a viable new production program to Congress by October 
1, 1997. The input gathered will also be used to define user 
requirements and develop a technical specification for acquiring an 
initial system in fiscal year 1998.
                     funding needed for vts program
    Question. The Department does not envision the need for the $5.5 
million requested in the President's Budget until the study of 
available technical solutions is completed, does it?
    Answer. The development of VTS requirements is being accomplished 
in consultation with the maritime community. The $5.5 million to 
initiate installation of VTSs based on the new requirements will be 
required once consensus is reached on a VTS solution that realistically 
addresses the users' needs and meets the Coast Guard's duty to ensure 
waterway safety. Based on the positive progress of consultations at 
national and local levels, the Coast Guard fully expects consensus will 
be reached in the near future, and that funds will be required in 
fiscal year 1998.
                       domestic icebreaking fees
    Question. The Coast Guard provides domestic icebreaking services in 
the Great Lakes region and on the East Coast, primarily to assist 
commercial shippers and fisherman. These services (particularly in the 
Great Lakes) are considered by the shipping community to be essential 
services that the Coast Guard provides as part of its mandate to 
facilitate commerce. A recent study by the Volpe National 
Transportation System Center calculated a cost-benefit analysis for 
icebreaking in the Great Lakes region. In this analysis, the cost of 
providing icebreaking services in the Great Lakes region was estimated 
at $8.8 million per year while the benefit to shippers was estimated at 
$78.1 million per year. In light of this significant benefit received 
by shippers, and the budgetary constraints facing the Coast Guard, some 
investigation of alternative icebreaking options may be warranted. The 
Coast Guard is currently studying alternatives to providing icebreaking 
services in the Great Lakes region. What conclusions have been reached 
in the Coast Guard's analysis?
    Answer. While the Volpe study did not provide any formal 
recommendations, the economic data presented indicated Coast Guard 
services were a vital part of the shipping infrastructure in the Great 
Lakes. Consequently, the Coast Guard is currently preparing the Mission 
Analysis Report (MAR) and Mission Needs Statements (MNS) for Great 
Lakes Icebreaking Capability. This is the process that formally defines 
the performance goals, standards, and requirements for the Great Lakes 
icebreaking mission. It is being prepared with stakeholder involvement 
and is expected to be completed in early summer 1997. This document 
does not address ``solutions,'' but does serve as the critical 
precursor to the formal, multi-year acquisition process that would then 
explore solutions and costs for Great Lakes Icebreaking Capability in 
accordance with the formal A-109 Acquisition Process. In the interim, 
the Coast Guard has committed to the continued operation of the CGC 
MACKINAW.
                   domestic icebreaking fees criteria
    Question. The President's fiscal year 1998 budget indicates that 
legislation will be proposed to assess and collect fees from commercial 
maritime carriers to recover the Coast Guard's cost of providing 
domestic icebreaking services beginning in fiscal year 1999. What would 
be the most reasonable and equitable means of charging user fees? What 
are the difficulties associated with identifying users and collecting 
fees?
    Answer. The administration is preparing proposed legislation to 
allow the assessment of user fees beginning in fiscal year 1999 for 
icebreaking services provided by the Coast Guard. The proposed fee 
would be assessed to commercial activities consistent with other 
applications of user fees, including those for highway, air, and rail. 
The fee would not apply to recreational vessels, fishing vessels, fish 
processing vessels, fish tender vessels, passenger vessels, ferries, 
public vessels, or vessels not traveling to or from a U.S. port.
    The proposed user fee legislation establishes a fee level based on 
tonnage of cargo that is transported during the ice season through 
areas requiring Coast Guard icebreaking services. Since the proposed 
legislation specifies those vessels subject to the user fee, as well as 
the collection mechanism, no significant difficulties are expected in 
identifying commercial users or collecting the user fees.
                 domestic icebreaking fee alternatives
    Question. What alternatives exist to the Coast Guard providing 
icebreaking services in the Great Lakes?
    Answer. One of the important highlights of the Volpe study was the 
clarification that the commercial shipping infrastructure is geared to 
a 42-week shipping season. Of those 42 weeks, at least 8 weeks require 
icebreaking services provided by the Coast Guard.
    For industry and commercial shipping, the least-cost alternative to 
icebreaking services is increased stockpiling, at a cost of $78.1 
million. The second-least-cost alternative was shipment by rail, with a 
projected industry cost of $192.02 million. The Volpe study states that 
the cost of shipping by rail would be $22.26 per ton, as compared with 
current shipping at $6.00 per ton. The third alternative evaluated in 
the study was pre-positioning inventory at a Great Lakes location below 
the Soo Locks (i.e. Escanaba, MI). The Volpe study states that the pre-
positioning alternative is only feasible when the locks are closed and 
the pre-positioning location is still accessible. However, absent the 
availability of local icebreaking capability, pre-positioning is not 
feasible. Therefore, this is not a viable alternative to icebreaking.
    Until such time as industry and commercial shipping can modify 
their infrastructure to operate in a shortened season, approximately 34 
weeks each year, Coast Guard icebreaking services will be required. 
Industry and commercial shipping do not have the icebreaking resources 
to facilitate the movement of ships during the ice season.
     authorization for inspections of foreign-flagged cruise ships
    Question. The multi-billion-dollar passenger cruise market in the 
United States is almost exclusively served by foreign-flagged vessels. 
There are only two oceangoing U.S.-flagged cruise vessels of any 
substantial size. Access to the U.S. market is therefore a very 
lucrative privilege, which is made even more so because the vessels and 
their crews pay virtually no corporate or personal U.S. income tax. To 
ensure adequate shoreside facilities, the safety of U.S. passengers and 
property, and enforcement of immigration laws, the Federal Government 
has enacted laws and dispersed responsibility for their administration 
and enforcement throughout several departments and agencies of the 
Federal Government. This raises the question of whether the foreign-
flagged cruise vessels, which are enjoying substantial profits as a 
result of their monopoly, are paying their fair share of the cost to 
the Federal Government of ensuring that this extremely valuable U.S. 
market operates safely and in accordance with our laws and regulations. 
In 1996, the Congress authorized the Coast Guard to begin collecting 
fees for its inspection services. What is the status of the rulemaking 
to implement the authorization to charge user fees for the Coast 
Guard's inspection of foreign-flagged cruise ships?
    Answer. The rule to set fees for foreign-flagged cruise ships is 
still in the conceptual stage. The Coast Guard is currently developing 
a work plan that establishes the critical activities and milestones 
necessary for this regulatory initiative. The Coast Guard currently 
expects to publish a rule by the end of 1998.
                 fees from foreign-flagged cruise ships
    Question. How much does the Coast Guard estimate it will collect 
annually for its inspections? How will the collections be made?
    Answer. The Coast Guard expects to collect approximately $616,000 
per year from the inspection of foreign-flagged cruise ships. This 
figure is based on an annual charge per vessel of $4,896 and a foreign-
flag passenger vessel fleet of 126 ships. Fees would be collected in 
the same manner as foreign tank vessel examination fees, with fees due 
prior to performance of the initial or annual examination. These fees 
would cover initial and annual examinations, and subsequent 
reexaminations. An average of four examinations/reexaminations are 
conducted per year for most vessels.
         other potential fees from foreign-flagged cruise ships
    Question. Are there any other services provided by the Coast Guard 
to foreign-flagged cruise ships for which fees could also be charged?
    Answer. There are no other services provided by the Coast Guard to 
foreign-flagged cruise ships for which user fees could reasonably be 
charged. The Coast Guard was tasked with establishing user fees for 
services provided under Subtitle II--Vessels and Seamen--of Title 46 
U.S.C. by the Omnibus Budget Reconciliation Act of 1990. The Coast 
Guard Authorization Act of 1996 amended Title 46 U.S.C. and removed 
prohibitions to the collection of user fees for foreign-flagged 
passenger vessel inspections.
      drug tonnage reduction under fiscal year 1998 budget request
    Question. According to statistics from the Office of National Drug 
Control Policy, over 400 metric tons of cocaine enter the U.S. every 
year--which far exceeds the estimated annual consumption of cocaine in 
the country. The Coast Guard is requesting an additional $34.3 million 
to support its anti-drug activities in fiscal year 1998. The Coast 
Guard's fiscal year Budget in Brief states that the additional funds 
will be used to increase coastal border protection by increasing the 
number of hours that cutters patrol maritime areas, increase aviation 
capability by reactivating two HU-25Cs, improve training, increase 
intelligence, and international treaty support. How large a reduction 
in the entry of illegal drugs into the U.S. do you anticipate will 
result from the additional money requested by the Coast Guard? What is 
the basis for your response?
    Answer. The Coast Guard estimates that once all additional assets 
requested in the fiscal year 1998 budget are on line, approximately 52 
fewer tons of cocaine--an estimated 472 million ``hits'' of cocaine--
will be prevented from entering the U.S. each year. (See pages 454 and 
455 of the Coast Guard's fiscal year 1998 budget request.) The 1998 
budget request, however, is the first step in a multi-year strategy to 
increase maritime interdiction effectiveness in support of the National 
Drug Control Strategy. The basis for the Coast Guard's analysis is a 
1989 Rockwell International Study, ``Measuring Deterrence.'' Deterrence 
is a major component of the Coast Guard's counterdrug effectiveness.
    The Rockwell study indicated that when potential smugglers perceive 
a 40-percent probability of interdiction, 80 percent will be deterred 
from smuggling. The Coast Guard has used this study as a starting point 
for its law enforcement program standards. A deterrence model, based on 
these standards, has been used to project effectiveness and formulate 
optimal resource requirements included in the 1998 budget request.
    Based on a recommendation from The Interdiction Committee, the 
Office of National Drug Control Policy is forming a working group to 
further investigate the effects of deterrence, and how it can be used 
in planning.
                results of coast guard anti-drug efforts
    Question. What have been the results of the Coast Guard's anti-drug 
efforts? How much has been deterred? How much has been interdicted?
    Answer. The Coast Guard's transit zone drug interdiction program is 
the first and, in many cases, only line of defense against drug traffic 
that threatens to enter the United States through maritime routes. The 
security of our maritime borders is dependent on the depth and 
effectiveness of interdiction resources operating in the transit and 
arrival zones.
    Based on the analysis cited in the preceding question, the Coast 
Guard estimates law enforcement resources deterred an estimated 24 
percent of drug traffickers from using maritime routes in the transit 
zone last year. This deterrence rate translates to an average of more 
than 100 tons of cocaine deterred from maritime routes each year. 
Deterrence rates are higher in areas where law enforcement activity is 
concentrated, such as the Eastern Caribbean.
    In addition, over the past 3 years, Coast Guard law enforcement 
resources have seized an annual average of nearly 36 tons of cocaine 
and marijuana. Moreover, interdiction forces have disrupted, through 
jettisons and aborts, a substantial number of smuggling operations that 
further reduce success rates for drug traffickers attempting to export 
their illicit cargo to American shores.
    In fiscal year 1997, the Coast Guard initiated Operation FRONTIER 
SHIELD in the Eastern Caribbean to demonstrate that smuggling routes 
could effectively be denied to traffickers by increasing resources 
committed to drug law enforcement. In the first quarter alone, nearly 
14,000 pounds of cocaine were seized and an estimated 17,000 pounds of 
cocaine were lost at sea or thrown overboard by traffickers to avoid 
arrest. The resources included in the fiscal year 1998 request will 
allow the Coast Guard to institutionalize capabilities and strategies 
that have proven effective in FRONTIER SHIELD. As a result, the Coast 
Guard expects increased seizure totals, disruptions, and deterrence if 
funded at the fiscal year 1998 budget request level.
       additional personnel and hours with fiscal year 1998 funds
    Question. Where will the additional personnel and assets be 
deployed? How many additional staff will the additional funds pay for? 
How many additional hours will assets be deployed with the additional 
funds?
    Answer. Coast Guard's fiscal year 1998 budget request contains an 
additional 251 full-time positions (FTP) for increased drug law 
enforcement. Of these, 30 FTP are required to operate two additional 
HU-25 Falcon aircraft that will deploy to sites throughout the transit 
zone. One HU-25C will be based out of Air Station Miami, and the home 
base for the second will be determined by the Atlantic Area Commander.
    An additional 105 FTP are necessary to increase C-130 Hercules 
aircraft flight hours by 1,600, increase H-65 Dolphin aircraft flight 
hours by 1,240, and improve H-60J helicopter deployment capability. 
These personnel will be assigned to Coast Guard air stations that 
support drug law enforcement.
    For cutter initiatives, 24 FTP are intended to establish 
Maintenance Augmentation Teams (MATs) in Miami and Puerto Rico to 
support 110-foot patrol boats operating in these areas.
    Of the 43 FTP intended for increased intelligence collection, 
analysis and dissemination, 20 of the intelligence related positions 
will be Coast Guard Investigative Service special agents assigned to 
existing Organized Crime Drug Enforcement Task Forces (OCDETFs), High 
Intensity Drug Trafficking Areas (HIDTAs), and regional Coast Guard 
Investigative Service offices. Two positions would support Defense 
human source intelligence programs in locations outside the United 
States. The remaining 21 FTP would augment intelligence collection 
analysis and dissemination at existing intelligence facilities, such as 
the Intelligence Coordination Center (ICC), El Paso Intelligence Center 
(EPIC), and Coast Guard area intelligence staffs.
    International Training will be increased by 28 FTP to provide 
expanded deployable training teams. Coast Guard training teams provide 
experience and expertise to developing nations' maritime forces to make 
them better partners in counter-drug efforts. Three more FTP will be 
added to the Coast Guard Reserve Training Center to train additional 
boarding officers. The Reserve Training Center and International 
Training Detachment are located in Yorktown, VA.
    Finally, 18 FTP are requested for law enforcement command and 
control positions. They will be assigned to Coast Guard units involved 
in drug law enforcement to permit more focused strategic and tactical 
planning, inter-agency coordination, and execution of the law 
enforcement mission. (Please see pages 200-215 of the Coast Guard's 
fiscal year 1998 budget request for a detailed description of the drug/
law enforcement initiatives.)
                    coast guard personnel positions
    Question. To what extent could Coast Guard personnel working in 
off-line positions be reassigned to on-line positions so that cutters 
and aircraft could be deployed a greater number of hours?
    Answer. Every position in the Coast Guard contributes to the 
overall mission effectiveness of the organization. As such, the Coast 
Guard makes no distinction between ``on-line'' and ``off-line'' 
personnel. The ability of Coast Guard cutters to deploy for the period 
of time they do, and for aircraft to fly their program hours, is 
contingent on the maintenance, logistics, and administrative support 
provided by other entities within the organization.
    Coast Guard streamlining, which began in fiscal year 1994, has 
eliminated nearly 3,500 positions, and in the process has made the 
Coast Guard a much leaner and efficient organization. The Coast Guard 
has a diminished ability to surge in support of one mission without 
soon affecting the performance of another mission.
    Increasing the deployment of existing resources is not simply a 
matter of buying more fuel and spare parts for cutters and aircraft. 
Resources are acquired, staffed, and funded to provide a specific level 
of service over a finite projected service life. Operating assets above 
their programmed standard will require more personnel and increased 
operations and maintenance funding.
             oil spill prevention and response--post-opa 90
    Question. The Exxon Valdez oil spill in 1989 highlighted many of 
this Nation's weaknesses in the areas of preventing and cleaning up oil 
spills. Over the recent years, the Coast Guard, along with several 
other agencies, has been implementing the Oil Pollution Act of 1990 
(OPA 90), which the Congress passed to improve oil spill prevention and 
clean-up. The recent oil spill in Japan, however, demonstrates once 
again the risk associated with the maritime transportation of oil. It 
underscores the continuing need to be vigilant to prevent such 
occurrences and the difficulty in cleaning up an oil spill. How 
confident are you that measures developed as a result of OPA 90 will 
avoid another large oil spill, like the Exxon Valdez spill, or mitigate 
the environmental loss if one does occur?
    Answer. The Coast Guard is confident that a significant discharge 
of oil is less likely to occur now that the spill prevention mandates 
of the Oil Pollution Act of 1990 (OPA 90) have been implemented. This 
is based on a marked drop in the number of medium (less than 10,000 
gallons) and major (greater than 100,000 gallons) oil spills per 
billion tons of oil shipped since the passage of OPA 90.
    The Coast Guard's two-pronged approach to pollution mitigation is 
prevention and, if an incident does occur, a successful response. The 
multi-disciplined approach to prevention includes double hulls for tank 
vessels, operational measures to reduce spills, more vessel traffic 
systems, improvements for vessel navigation, and international and 
domestic efforts to improve crew competency and qualifications. These 
measures, coupled with the Coast Guard's partnerships with industry 
organizations such as the American Waterways Operators, the U.S. 
Chamber of Shipping, and the American Petroleum Institute, have 
increased industry awareness and greatly reduced the chances of a 
significant discharge into the marine environment.
    If a significant discharge were to occur, the Coast Guard is highly 
confident that the OPA 90-driven response and preparedness initiatives 
would ensure a rapid response and a successful mitigation of the 
spill's environment impacts. Successful responses in Rhode Island, 
Texas, and Maine are recent examples of more effective, post-OPA 90 
mitigations and cleanups.
    The Coast Guard's and the industry's preparedness levels were 
greatly increased with the development of vessel and facility response 
plans in conjunction with Area Contingency Plans (ACPs). Vessel and 
facility operators are required to ``think through'' their response 
activities in advance and contract with response resources. The ACPs, 
created by local Area Committees, form the shoreside complement to the 
vessel plans and provide the mechanism for the necessary advance 
coordination and cooperation among the response community, governments, 
agencies, industry, and environmental groups.
    In addition to increased preparedness, OPA 90 had a positive effect 
on Coast Guard and industry response capabilities and resources. An 
additional Coast Guard Strike Team, pre-positioned oil spill equipment, 
Vessel of Opportunity Skimming Systems (VOSS), and an OPA 90-fostered 
growth in the commercial response industry have increased the overall 
effectiveness of the public and private sectors to bring appropriate 
resources to the scene.
    Additionally, the Coast Guard has attained a more robust response 
posture with the adoption of the Incident Command System (ICS) as its 
response management structure. ICS has been embraced by other Federal 
agencies, State agencies and the industry. The Incident Command System 
fosters cooperation, communication, and concurrence on important 
issues. ICS has proven to be the most flexible and responsive way to 
incorporate the multiple governments, agencies, and private entities, 
to mobilize and respond effectively to an incident.
       additional actions to prevent or mitigate large oil spills
    Question. What other actions, beyond the safeguards imposed by OPA 
90, would significantly reduce the risk of a large oil spill occurring 
or mitigate its effects if one does occur?
    Answer. Beyond OPA 90, the Coast Guard is pursuing the application 
of advanced technology, increased cooperation with international 
maritime interests, and drawing focus on the elimination of human error 
to improve mission performance and increase the overall effectiveness 
of the prevention and oil spill response programs.
    The Coast Guard is actively researching and testing digital-based 
charting and computer-assisted waterways management systems. The Coast 
Guard has implemented a computer-based decision-support tool, complete 
with oil weathering models, dispersant application planners, and a 
geographic information system. The Coast Guard has acquired hand-held 
infrared cameras to complement its aircraft-deployed Side-Looking 
Airborne Radar and Forward-Looking Infrared systems. A command and 
control information management system is under development that will 
greatly increase the ability to receive, display, analyze, and manage 
the large amount of information and data that accompanies a major oil 
spill response. Oil spill trajectory models and real-time imagery of 
oil spills are part of this system that will begin to be tested in 
1998.
    The Coast Guard is also working at the international level to 
improve the preparedness of the world's tanker fleet to respond to oil 
spills. The Coast Guard has been administering and enforcing the 
various conventions of the International Convention for the Prevention 
of Pollution from Ships (MARPOL) and participating in the International 
Maritime Organization-sponsored convention on Oil Pollution 
Preparedness, Response, and Cooperation (OPRC).
    The Coast Guard's Prevention Through People (PTP) program 
recognizes that the majority of casualties are attributed to human 
factors, and focuses on improvements based on the human element, the 
vessel, and the operating environment viewed together as a system. PTP 
is fundamentally a voluntary program and relies heavily on the idea 
that increased safety leads to greater competitiveness through fewer 
accidents.
         average cost to rotate coast guard military personnel
    Question. The Coast Guard's current policy is to periodically 
rotate all but a few of its military personnel, both officer and 
enlisted. Officer rotations vary from 18 months to 5 years, enlisted 
rotations vary from 2 to 4 years. Costs to rotate staff in fiscal year 
1996 were about $73 million; other costs are also incurred for moving 
time and preparing over 19,000 orders annually. Some studies have 
questioned whether the Coast Guard should revise rotation practices by 
increasing the length of time between rotations and/or eliminating 
rotations for certain types of activities. Besides saving money, such a 
change could counter a problem pointed out in several studies--the 
undesirable effects of frequent rotation on the continuity of 
operations and ability to build expertise and knowledge in certain 
areas.
    Coast Guard officials believe that current rotation policies are 
adequate and that they have developed optimum tour lengths that should 
not be revised. They said changing current practices would have several 
undesirable effects, including adverse effects on multi-mission 
capabilities, a smaller and less qualified leadership pool, and less 
qualified people because potential recruits may be concerned about 
being in undesirable locations for extended periods. The Coast Guard 
currently plans no formal study of this issue. What is the total 
average annual cost to rotate Coast Guard military personnel, including 
moving expenses, idle time, paperwork, and training?
    Answer. From fiscal year 1992 to fiscal year 1996, the Coast Guard 
transferred on average 17,400 Coast Guard personnel each year at an 
average cost of approximately $63 million. The nature of the volunteer 
military workforce means that enlisted personnel contract for periods 
of four years. Currently, only 40 percent of the personnel completing 
their first 4-year enlistment re-enlist for another term. Officers 
enter the Service with either a three-year initial contract or a five-
year commitment, depending on their accession source. Likewise, even 
those officers and enlisted who remain beyond their initial career 
decision point reach their elected or mandatory retirement date. These 
factors alone create a need to recruit, train, and transfer new members 
on a continuous basis. Thus, over 50 percent of all transfers were not 
discretionary, since they were required by new accessions, retirements, 
separations, or training. An additional 25 percent of the transfers 
were required due to the arduous nature/remote location of the 
assignment, or due to special needs of individuals.
    There is no idle time in moving. Members are authorized four days 
to physically pack out and unpack their household goods incident to a 
change of station. Members are also allowed one day travel time per 350 
miles of transfer distance, which averages 2 days per transfer. Members 
may also take accrued annual leave in conjunction with their transfers.
    Paperwork associated with a relocation involves the member, his or 
her command, the servicing Personnel Reporting Unit, and the Coast 
Guard Personnel Command. Each of these commands has multiple functions 
and responsibilities beyond processing transfers. The time required to 
process transfer paperwork varies based on the type of assignment, 
location (in or out of the United States), and number of dependents 
being moved. Considering the non-discretionary nature of most moves and 
the complexities of establishing a standard ``paperwork'' cost of a 
transfer, no specific cost study has been conducted to determine the 
``paperwork cost per move.'' Similarly, training costs vary widely 
depending on the type of assignment, specialties involved, and previous 
experience of the individual. No specific study has been conducted to 
determine the ``training cost per move.''
                in-depth study of lengthening rotations
    Question. Why does the Coast Guard believe that an in-depth study 
of the merits of lengthening rotations is not needed, given their high 
costs?
    Answer. In July 1995, the Coast Guard dedicated 10 months to 
studying this issue. The end result was the change of two rotation 
policies: tour lengths for members assigned in Puerto Rico, Alaska, and 
Hawaii were adjusted; and alternate, shorter unaccompanied tour lengths 
were eliminated in these same locations. These changes established 
closer parity with tour lengths within the continental United States.
    Additionally, in August 1993, the Coast Guard developed a 
geographic stability policy for enlisted personnel and began 
emphasizing voluntary extension of tour lengths and no-cost and low-
cost transfers for both officers and enlisted members. In March 1995, 
the Coast Guard increased E-4 and E-5 tour lengths to 4 years for 
ashore billets. Finally, during the Coast Guard's streamlining 
initiatives, site location that would facilitate geographic stability 
to reduce transfer cost was a prominent factor in unit consolidations 
and relocations.
    The Coast Guard believes these proactive changes, employed since 
1993, have responded to the high cost of rotations.
            adverse effects of lengthening rotation periods
    Question. Would lengthening rotation periods adversely affect the 
Coast Guard's performance of its missions? Please explain.
    Answer. Yes, lengthening rotation periods would adversely affect 
the Coast Guard's performance of its missions. Fifty percent of all 
rotations are non-discretionary due to accessions, separations, 
retirements, and training. An additional 25 percent are required due to 
the remote location of assignment, arduous nature of the assignment, or 
by special needs of the member or family. Remote location tours are 
those where the military member is unaccompanied by his or her family, 
such as assignment to one of three isolated Loran stations in Alaska. 
Arduous tours of duty are those tours in which a member is subject to 
frequent immediate recall or subjected to harsh physical demands, such 
as assignment to one of the Coast Guard's 86 patrol boats. Lastly, 
special needs are created when a military member or immediate family 
member experiences a change in physical or emotional status, requiring 
a move. For example, a special need arises when a spouse dies, creating 
a need to relocate a family closer to child care providers. Beyond 
these extraordinary assignments, more than 4,800 members are assigned 
to major cutters that deploy away from home port more than 185 days per 
year. Rotational assignments provide these and other members an 
opportunity for greater family stability.
    The Coast Guard prides itself in the Service's ability to quickly 
and efficiently shift from one mission to the next without a 
degradation in mission effectiveness. This multi-mission capability is 
gained through the wide experience base of Coast Guard personnel, and 
is only achieved through the regular rotation of personnel to different 
assignments.
    The Coast Guard needs a pool of highly qualified operational 
leaders. These leaders--men and women, officers and enlisted--acquire 
the requisite experience for command through exposure to different and 
increasing operational challenges, achieved by rotational assignments. 
An increase in tour lengths will cause a commensurate reduction in 
breadth of experience represented in senior leadership positions. 
Similarly, lengthening tours will lead to a decreased number of 
training opportunities for junior members in afloat, aviation, and 
marine science careers.
    Finally, from a Service retention perspective, longer tour lengths 
decrease the attractiveness of the Service to new accessions. Most of 
the Coast Guard's new recruits are attracted by the opportunity to 
serve their country, while still gaining life experiences through 
operational assignments in different geographic areas, which will make 
them valuable contributors to the Coast Guard and the Nation. By 
lengthening tours, training and experience opportunities will decrease, 
and over-exposure to demanding assignments may further reduce their 
propensity to remain in the Coast Guard.
    In summation, significant changes to the Coast Guard's rotation 
policies would significantly alter multi-mission effectiveness, 
leadership development, and retention in the Service.
   coast guard rotation policies compared to other military services
    Question. How do the Coast Guard's rotation polices compare to the 
policies of the other military services?
    Answer. The Coast Guard's rotation policy is similar to the 
policies of the Department of Defense (DOD). In general, the Coast 
Guard's rotation policy for assignments within the U.S. is four years 
in shore billets and three years in sea billets, except patrol boats, 
which are two-year assignments. In assignments outside of the 
continental U.S., tours range from 12 months to 36 months, based on the 
arduous nature of the assignment and remoteness of the location.
    DOD's rotation policy within the continental U.S. is three years in 
both shore and sea billets; however, certain enlisted ratings extend 
sea billets to five years. Naval commands, such as combatants based in 
foreign countries and fleet marine forces deployed overseas, limit 
their tours of duty to two years. DOD shore duty outside of the 
continental U.S. ranges from 12 months to 36 months, based on the 
arduous nature of specific locations and whether the assignment is 
accompanied or unaccompanied.
    All of the services make allowances from the general rotation 
policy to meet their service needs. For example, command cadre 
positions among all of the services tend to be shorter for assignments 
ashore and afloat. Additionally, first tour assignments afloat and some 
assignments ashore are 18 months to two years. Specific extensions and 
reductions are made to member tours based on special needs of the 
member or the service.
                         frequency of rotation
    Question. If the Coast Guard were to revise rotation policies, what 
programs or missions would lend themselves to less frequent rotations? 
For which programs or missions is it critical to maintain the current 
rotation policies and why?
    Answer. As outlined in the previous questions, the Coast Guard has 
recently reviewed and changed tour lengths where appropriate. Also, for 
the reasons cited, there will be adverse consequences for making 
further changes.
                        amtrak regional support
    Question. Amtrak's financial health is precarious, despite the fact 
that its current appropriation level is $843 million (including $175 
million just for the Northeast Corridor Improvement Program). Amtrak is 
the Nation's only intercity passenger rail system. It is burdened with 
many expenses over which it has little control, such as railroad 
retirement payments for employees of freight railroads as well as its 
own employees, six-year labor payments for workers who are laid off, 
limited opportunities for contracting out, heavy debt service payments, 
and limited opportunities to generate new revenues. Reform legislation 
that might have helped to reduce overhead and increase revenues failed 
to pass during the last Congress. Amtrak's future is troubled unless 
legislation is passed to either reduce its need for Federal subsidy, or 
to provide it with a dedicated revenue source, or to privatize it.
    The annual appropriations process has been keeping Amtrak on ``life 
support'' while Congress and the administration have failed to agree on 
long-term solutions to make Amtrak viable, or to privatize it. ``Life 
support'' has not helped Amtrak to get stronger, but it has reduced the 
funds available for other programs.
    What are your views on tapping into regional support for Amtrak 
service, whereby States and/or private investors could pay for Amtrak 
service?
    Answer. The administration believes it is important that States, 
localities and the private sector provide support for those Amtrak 
services that are important to them. This is already happening. Since 
fiscal year 1995, the amount of State operating assistance supporting 
Amtrak operations has almost doubled. In addition, several States are 
purchasing equipment for enhanced Amtrak service. The Department's 
National Economic Crossroads Transportation Efficiency Act (NEXTEA) 
proposal includes increased flexibility in many programs to permit 
States to use Federal funds to provide capital support to Amtrak.
                    innovative financing for amtrak
    Question. Could innovative financing be available to help Amtrak, 
such as State Infrastructure Banks or other Federal credit programs 
contained in your ISTEA legislation?
    Answer. Amtrak capital support would be eligible for State 
Infrastructure Banks and the Infrastructure Credit Enhancement program 
in the Department's NEXTEA proposal. Amtrak has many capital needs that 
do not generate a positive return. It would be counterproductive to 
finance these investments. However, last year Amtrak ordered over $1 
billion in equipment with the bulk of the financing provided through 
vendors and other non-Federal sources.
                       long-term plan for amtrak
    Question. How do you plan to work with congressional authorizing 
and appropriations committees this year on resolving Amtrak's long-term 
problems? If no legislative changes are made, how long do you think 
Amtrak can continue ``business as usual?''
    Answer. The Department is committed to working with Congress, 
Amtrak management and labor, State governments, and other interested 
parties in the coming year to develop an affordable long-range plan 
that eliminates Amtrak's dependence on Federal operating subsidies. 
Amtrak is an important component of the Nation's intermodal passenger 
transportation system. We believe that Amtrak must have a reliable 
source of capital investment in the form of contract authority as 
requested in NEXTEA to address the previous lack of investment if we 
are to preserve the national system and permit Amtrak to achieve its 
potential.
                      regional support for amtrak
    Question. Is it more appropriate that States who directly benefit 
from regional Amtrak programs--such as the Northeast Corridor 
Improvement Program--share this burden with the Federal Government?
    Answer. As stated earlier, the administration believes it is 
important that States, localities and the private sector support those 
Amtrak services that are important to them. New Jersey Transit and 
Amtrak recently signed an agreement to jointly fund infrastructure 
improvements to the Northeast Corridor over the next five years that 
benefit both commuter and intercity service. Washington State is 
funding track improvements in the Pacific Northwest Corridor. 
California, North Carolina, Pennsylvania, and Washington have all 
acquired equipment for Amtrak's use on intrastate service. The 
administration's NEXTEA proposal would offer States greater 
opportunities to support Amtrak service important to them.
                         highway safety issues
    Question. Currently, more than 40,000 people die every year on our 
Nation's streets and highways, and nearly 3.5 million people are 
injured in police-reported accidents. NHTSA Administrator Martinez has 
testified that all the ``easy gains'' in reducing fatalities and 
accidents and in making vehicles and highways safer have already been 
made. Incremental improvements will be much more difficult. What 
further gains do you believe that the Department can make, and what 
specific plans does the Department have to make these gains? Does DOT 
need new legislative authority or changes to existing legislative 
authority?
    Answer. The Department's overriding goal in NEXTEA is safety, to 
reduce deaths and injuries from transportation-related crashes. We have 
fashioned a reauthorization proposal that cuts across intermodal lines 
to help achieve a safe and secure U.S. transportation system.
    The NEXTEA proposals must contend with the fact that motor vehicle 
deaths and injuries have increased in recent years, and the traffic 
fatality rate has ceased its decline and instead stagnated. A number of 
risk factors associated with crashes are evident: the number of older 
and younger drivers is increasing; use of alcohol and other drugs is 
rising, and the results are showing up in our crash statistics; safety 
belt and child seat use is still low; and speeding and other forms of 
aggressive driving have increased. We also face higher speed limits and 
attempts to weaken or repeal motorcycle helmet laws.
    NEXTEA needs to provide a balanced program for NHTSA that addresses 
both vehicle and behavioral safety problems, while providing a 
foundation for research, crash data and injury prevention activities. 
An active technical assistance program is required to support NHTSA's 
safety partners in the States and communities, health and business 
arenas, educators, and safety advocates.
    A critical need in NEXTEA is to make an adequate Federal investment 
in highway safety, consistent with the top priority assigned to safety 
by the administration. Coupled with this is the Department's proposal 
to fund all of NHTSA's program from the Highway Trust Fund. NHTSA and 
FHWA incorporated flexibility for States to be able to shift their 
infrastructure safety funds to address other critical highway safety 
issues.
    The goal includes continuing a performance-based Section 402 grant 
program that supports basic highway safety programs in States and 
communities. The Department's proposal also recommends continuing the 
use of incentive grant programs, because incentive grants have proven 
effective in motivating States to enact stronger laws and begin better 
programs. The proposal recommends incentives for new laws, programs and 
safety results in the areas of impaired driving deterrence and 
increased restraint usage, plus new initiatives to strengthen State 
data systems, and programmatic and legal actions to deter drugged 
driving.
    Since behavioral programs alone cannot prevent vehicle crashes and 
crash injury, the reauthorization needs to provide an adequate resource 
base for NHTSA's initiatives in both vehicle safety and consumer safety 
information.
    A final goal for NEXTEA is to create a foundation of critical 
research for pursuing future safety initiatives in vehicle crash 
worthiness and crash avoidance, as well as behavioral areas. Priorities 
include linking vehicle safety engineering and medical research to 
learn more about preventing crash injury. High among the Department's 
priorities are promoting improved air bag systems, collision avoidance 
under the Intelligent Transportation System program, and intermodal 
human factors work using research tools such as advanced motion-based 
simulation. Continuation of national crash and injury data systems is 
also crucial.
                           foreign experience
    Question. What are we learning from other countries in reducing 
accidents and keeping unsafe drivers off the road? What fundamental 
societal differences, if any, exist between these other countries and 
the United States that would make it difficult to adopt their 
successful countermeasures?
    Answer. Through bilateral contacts with researchers in most of the 
developed world, as well as active participation in international 
organizations such as the International Council on Alcohol, Drugs and 
Traffic Safety (ICADATS), the Department can stay abreast of advances 
in other countries. We have international cooperative agreements in 
place between NHTSA and Germany and the Netherlands to conduct research 
of common interest. In Germany, a series of studies was completed on 
the effects of various drugs on driving performance, and in Holland, a 
study of the effects of marijuana smoking on driving is underway.
    Individual liberties differ greatly between the U.S. and other 
countries. For example, some members of the European Union, Australia 
and New Zealand more freely allow the use of automated enforcement 
devices, and view civil liberties in a different light. In much of 
Europe, automated speed enforcement is widespread. In Australia, 
besides the use of photo radar, no probable cause is required to compel 
a motorist to take a roadside breath test. Many Australian states use 
random breath testing, red light cameras, photo radar for speeders, and 
strict enforcement of belt use and helmet use laws to reduce crashes 
and injuries. These measures have worked and are acceptable to 
Australians, but it is doubtful that many of them would pass legal, 
constitutional, or political muster in the U.S.
    In most countries other than the U.S., national laws, rather than a 
myriad of differing State and local laws, prevail. Most European 
countries have national police forces or, as in Canada and Australia, 
few state or provincial police agencies, instead of over 13,000 
agencies as in the U.S. Their systems can often provide greater 
national uniformity in legislation, enforcement and adjudication.
    The fundamental societal difference in occupant protection is 
reflected in the difficulty the United States has experienced in 
increasing its national seat belt use rate. Other industrial countries 
have not been hampered by the passage of secondary enforcement laws and 
the need to pass belt law legislation in a large number of States. An 
additional consequence of that process is that each one of these laws 
differs in some way from the other State laws. All this tends to erode 
the importance of compliance among the general public. Other countries 
have been able to raise use rates into the 80-percent range over a much 
shorter duration, which has then enabled them to implement stronger 
countermeasures involving the assessment of driver points for 
violators, and to implement enforcement programs that increase the risk 
of apprehension for belt law violations than is able to be accomplished 
in this country. The result is that these countries have use rates in 
the high 80 to low 90 percentages, while the U.S. has been stagnant at 
national use rates of 66 to 68 percent for the past 4 years.
                            safety belt goal
    Question. The Nation has not reached DOT's goal that 75 percent of 
all vehicle occupants will use safety belts by 1997. Was this goal too 
optimistic? How do other countries achieve 90-95 percent usage rates? 
What do you propose to do to increase safety belt usage?
    Answer. The usage rate goal of 75 percent by 1997 was not too 
optimistic; however, the level set was intentionally challenging 
because of the importance of increasing usage as quickly as possible in 
order to prevent unnecessary losses.
    There are a number of differences between the United States and 
other countries that have achieved seat belt usage rates of up to 90-95 
percent. These countries have primary enforcement laws and have had 
these laws in effect for longer periods of time. Many of the countries 
with the highest use rates assess driver's license demerit points, in 
addition to fines, for seat belt law infractions. Some countries have 
nationwide traffic laws and police agencies. Others (such as Canada or 
Australia) have different laws in different states or provinces but 
have many fewer such jurisdictions than the U.S., with our 50 States 
and over 13,000 law enforcement agencies. This uniformity eliminates 
confusion about seat belt use laws, penalties, and enforcement.
    The Department proposes a number of actions to increase safety belt 
use in the United States. As directed by President Clinton, NHTSA, in 
cooperation with the Congress, the States, automobile manufacturers, 
the insurance industry and other concerned Americans, has developed a 
plan to increase the use of safety belts and child safety seats 
nationwide. NHTSA also provided the leadership to establish the Air Bag 
Safety Campaign (ABSC, created May 1996). The ABSC is a public-private 
partnership including car and safety seat manufacturers, insurance 
companies, government agencies and health and safety advocates. The 
ABSC is building on three proven NHTSA program initiatives: intensive 
public education, occupant protection use law improvements, and high-
visibility safety belt and child safety seat law enforcement programs. 
The ABSC is coordinating activities with NHTSA to maximize national 
impact.
    NHTSA has made extensive efforts to provide States technical 
support to upgrade their safety belt and CSS laws. NHTSA has worked 
closely with many partners (such as the National Automobile Dealers 
Association, National Safe Kids Coalition, Juvenile Products 
Manufacturers Association, National Sheriffs' Association, 
International Association of Chiefs of Police, AAA, IIHS, and National 
Safety Council) and has distributed educational materials (such as 
video news releases, satellite media tours, consumer advisories, press 
releases, fact sheets and basic tips sheets, articles for magazines, 
press interviews, news articles, print ads, educational videos, and 
posters) to educate the public. NHTSA is assisting about 18 States to 
conduct Special Traffic Enforcement Programs (STEPS) thru June 1998 to 
increase belt use. In addition, the Department's NEXTEA reauthorization 
proposal includes an occupant protection incentive grant program to 
encourage States to increase their belt use and improve their occupant 
protection laws.
                             air bag risks
    Question. There has been a lot of publicity recently about the 
risks of air bags, particularly for young children and small women. 
What concrete steps is the Department taking to reduce these risks, 
while providing protection for front seat occupants of a car?
    Answer. The Department has amended the occupant crash protection 
standard to ensure that vehicle manufacturers can quickly depower all 
air bags so that they inflate less aggressively. This action is 
temporary, and will provide manufacturers with the option of producing 
air bags that are less aggressive to small children and small-stature 
adults, such as small female drivers who are at risk with current air 
bag designs. These amendments became effective March 19, 1997 (62 FR 
12960), and manufacturers are expected to take immediate advantage of 
the new provisions by planning to install depowered air bags in the 
very near future. These provisions apply to any new vehicle 
manufactured between March 19, 1997, and September 1, 2001.
                    consensus on ``smart'' air bags
    Question. NHTSA has said there is a consensus that the ``smart'' 
air bag is the best means for preventing air bag deaths. How was this 
consensus determined?
    Answer. Automobile manufacturers submitted comments in response to 
a ``Request for Comments'' on aggressive air bag deployments in 
November 1995 and a Notice of Proposed Rulemaking (NPRM) on options to 
reduce adverse effects of air bags in August 1996. Comments to both 
these actions indicated that manufacturers are actively developing 
improved air bag systems. The essence of an improved air bag is that 
the system will provide air bag deployment, when needed, and possibly 
at different inflation levels, and will not deploy when sensing a 
situation where the occupant will be at risk from the air bag 
deployment. The goal is to provide the optimum means for preventing air 
bag deaths while providing protection to a wide range of occupants in a 
variety of crash circumstances and severity.
                       technologies for air bags
    Question. What efforts has the Department made to encourage the 
development of different technologies to solve air bag risks to vehicle 
occupants?
    Answer. The Department has encouraged advanced occupant crash 
protection through direct advisory briefings with the original 
equipment manufacturers (OEMs) and suppliers (e.g. the inflatable knee 
bolster, in production by Morton International; and the acoustic/
infrared occupant position sensor produced by Aerojet General [now 
owned by Bosch]).
    The Department has sponsored, through cooperative agreements, the 
following contracts: the assessment of pre-crash sensing technologies 
(Romeo Engineering International, Inc.); development and demonstration 
of occupant position discrimination through use of ultrasonic 
compartment mounted sensors and signal processor (Automotive 
Technologies International); and an economical radar system to detect 
and identify impending crash and closing speed immediately prior to 
impact, thereby providing information to allow earlier air bag 
deployment avoiding late deployments where the occupants are too close 
to the air bag prior to deployment (Hittite Microwave Corporation). In 
addition, a cooperative agreement with Automotive Safety Laboratory is 
producing major reductions in the aggressivity of deploying driver air 
bags through development of improved air bag inflators and redesigned 
air bags, thereby reducing the hazards to out-of-position small-stature 
drivers.
    The Department also supports an ongoing test program at its Vehicle 
Research and Test Center to test and evaluate any new and innovative 
air bag systems that reduce the potential for injury and fatalities to 
occupants. To date, depowered and alternative inflator systems, along 
with a few improved systems using seat sensors, have been tested and 
evaluated.
                     ``smart'' air bag availability
    Question. When will so-called ``smart'' air bags likely be 
available in cars?
    Answer. Mercedes Benz has provided improved air bag inflation in 
their production cars sold in the U.S. for approximately seven years. 
Its air bag deploys at a lower crash severity if the occupant is 
unbelted (about 9 m.p.h. crash-induced velocity change) and only at 
high crash severity if the occupant is belted (about 16 to 18 m.p.h.).
    According to U.S. car producers, improved air bags in their most 
simplistic and least sophisticated forms will be introduced in 1999, 
and improvements will be produced through the next 5 to 10 years, with 
each improvement reducing the air bag threat and increasing occupant 
crash protection. Initial systems will include such devices as dual 
level inflators, and then evolve eventually into more comprehensive 
systems that can discriminate by occupant size, weight and position, 
and by crash severity, deploying at differing levels, or not at all, 
accordingly.
                   short-term solutions for air bags
    Question. Have other short-term available solutions been explored 
that do not require new technology (for example, variable sizes of air 
bags, variable deployment speeds, and variable reaction times that 
correlate to vehicle speed)? Is the technology for these three examples 
currently available? What is NHTSA's position on each of these options?
    Answer. Variable sizes of air bags have not been developed outside 
Europe, where there is the ``Euro-bag'' or ``face-bag'' for belted 
drivers. This is a smaller bag that provides protection to the face and 
head in frontal crashes if the occupant is belted. If the occupant is 
unbelted, the Euro-bag may provide less chest or lower torso protection 
than that afforded by air bags sold in the U.S. NHTSA has found that 
nearly three-fourths of the lives already saved by air bags have been 
in crashes where the occupant has been unbelted. The Department, 
therefore, does not advocate only small air bags.
    Variable deployment speeds are the subject of current efforts by 
the Inflatabelt Co. and dual-stage air bag inflators are available from 
several air bag suppliers (TRW, Morton International and Bendix/Allied 
Signal are three of the major suppliers in the industry). Dual-stage 
inflators allow a delay between activation of the first and second 
stages. The first stage permits an initial, slower emergence of the air 
bag, and based on the crash severity or occupant proximity, activation 
of the second inflator stage can provide rapid inflation and maximize 
gas into the air bag for best crash energy management for the occupant. 
Alternatively, the intentional non-activation of the second stage can 
provide a compromised, less aggressive deployment that is less likely 
to cause serious injury to an occupant who is too close to the air bag.
    Implementation of dual-stage inflators and other sophisticated 
approaches to achieve variable deployment speeds requires reliable 
crash severity sensors and/or occupant position sensors. Such sensors 
are currently in various stages of production, prototyping, or fleet 
evaluation testing. The Department looks forward to and encourages 
manufacturer implementation of such advancements.
                                 ______
                                 
                Questions Submitted by Senator Domenici
                          roswell radar status
    Question. Secretary Slater, over the past six years we have been 
working with the FAA to establish a stand-alone Terminal Radar Approach 
Control Facility (TRACON) at the Roswell Industrial Air Center Airport 
in Roswell, New Mexico.
    I appreciate the FAA's monthly updates to the Congressional 
Delegation. However, I am very disturbed to learn that completion of 
the radar may once again be delayed by the FAA. This is just one more 
delay in the long line of similar setbacks in completing this important 
project and frankly my concern stems from the FAA's inability to stay 
on schedule.
    I am continually being forced to readdress this issue during each 
appropriation cycle and would very much like to pin down a timetable 
and have the FAA's commitment that the project will be completed on 
time.
    What is the current status of the Roswell Radar project and why are 
we once again facing a delay?
    Answer. The building construction phase of the project is 
approximately 86 percent complete. Duct work and fire alarm systems are 
currently being installed in the TRACON building. With the improvement 
in the weather, the remote transmitter/receiver (RTR) construction has 
resumed and is projected to be completed by September 1997. The ASR-9 
radar system was commissioned on March 24, 1997, one month ahead of the 
projected schedule. The delay we are experiencing in commissioning the 
facility is due to software development and testing difficulties 
Lockheed Martin has encountered with the ARTS2E automation system. The 
ARTS2E Program Office met with Lockheed Martin on March 20, 1997, and 
determined the system can be delivered no later than February 1998.
    Question. Would you provide a current schedule for completion of 
this project and include any further anticipated FAA delays?
    Answer. We do not anticipate any further delays to the following 
current timetable:

------------------------------------------------------------------------
             Function               Projected     Revised       Actual  
------------------------------------------------------------------------
Roswell ASR-9 Commissioned.......        11/96         4/97         3/97
RTR Construction Completed.......         9/97         9/97  ...........
ARTS IIE Delivery................        11/97         2/98  ...........
Roswell Controller Training......        12/97         4/98  ...........
Roswell Ready for Commissioning..         1/98         5/98  ...........
------------------------------------------------------------------------

    Question. Will you give me your commitment that completion of the 
Roswell Radar Project will be a top priority within the FAA and will be 
completed according to the schedule you produce?
    Answer. The Roswell Radar Project is a top priority in the FAA. We 
regret these unavoidable delays and remain committed to completing the 
project as soon as possible.
                  aging aircraft center in albuquerque
    Question. Secretary Slater, you are aware of my ongoing interest in 
work to ensure the safety of our commercial air fleets. Exciting new 
technology is being developed to improve the safety of our aging air 
fleet at the Aging Aircraft Non-destructive Evaluation Center (AANC) in 
Albuquerque, New Mexico. This center has been supported by the FAA for 
the past six years and we are seeing substantial progress in developing 
new techniques to assess the structural integrity of our commercial 
fleets.
    In fact, in your budget request, the administration highlights this 
new technology by stating it will save over 700 man-hours per aircraft 
inspection over current methods. You also acknowledge this new 
technology will require less disassembly of the aircraft to conduct the 
inspection which reduces the chance for ancillary damage during the 
disassembly and reassembly process should no corrosion be detected. 
Recently, I requested the Department of Transportation to designate 
this center as one of excellence so new technology may be utilized more 
extensively.
    What is the process followed for a center to be designated a Center 
of Excellence by the Department of Transportation?
    Answer. Public Laws 101-604 and 101-508 authorize the FAA 
Administrator to select and establish Air Transportation Centers of 
Excellence (COE) at universities and mandate the following evaluation 
criteria:
  --Needs of the region for improved air transportation.
  --Demonstrated research and extended resources.
  --Established air transportation programs.
  --National or regional leadership capability in air transportation 
        solutions and advancements.
  --Ability to disseminate results through State or regional technology 
        transfer and continuing education.
  --Proposed projects.
    The FAA received approval from the White House Reinvention 
Laboratory to award sole source contracts without further competition, 
in addition to matching grants--a first in government. This enables 
aviation research centers to engage in engineering development and 
rapid prototyping, and to provide deliverables as appropriate.
    The COE selection process developed by the FAA follows:
Step 1.
    Needs Assessment. On an annual basis, the FAA conducts a survey of 
organizations to determine interest, need, and anticipated available 
funding to support a COE for a period up to ten years.
    Following organizational responses, one technology area is 
specified and approved as the focus of the new COE, and base funding 
levels are solidified.
    Draft solicitation is prepared.
    Information Meeting. A public meeting is announced in the Federal 
Register, and an open session for potential offerors is hosted with the 
sponsoring organization(s). A draft solicitation is provided to 
attendees for discussion and external input.
Step 2.
    Final solicitation is prepared, published and distributed.
    Lead universities submit proposals.
Step 3.
    Government subject matter technical experts evaluate proposals.
    Government management/fiscal team reviews proposals.
    Site visits are conducted to inspect facilities as appropriate.
    Evaluation package is prepared by the COE program manager for final 
review by the FAA Associate Administrator for Research & Acquisition.
    FAA Administrator announces selection.
Step 4.
    COE program manager prepares cooperative agreement. New COE 
prepares for dedication.
    FAA/COE define technical projects, and funding levels are 
established for matching grants. FAA awards grant at the time of 
dedication.
Step 5.
    Technical monitor(s) and COE program manager administer grant 
awards.
    Technical monitor determines need to award contracts and serves as 
contracting officer's technical representative.
    Reporting requirements: Year 1, Quarterly Reviews; Year 2, Semi-
Annual Reviews; Annual Meeting and Report; and Year 3, Symposium hosted 
by each COE, close out initial award, call for audit of matching funds.
    Prepare Phase II documents.
    Question. Where in the process is the Aging Aircraft Non-
destructive Evaluation Center?
    Answer. The Air Transportation Center of Excellence (COE) in 
Airworthiness Assurance (AWA) was approved in 1996 for establishment 
during fiscal year 1997. It is currently in the final stage of the 
selection process. The solicitation closed on February 15, 1997, and an 
initial technical evaluation followed. On March 20-21, 1997, the FAA's 
COE program manager and the airport and aircraft safety R&D division 
mangers hosted a joint meeting at the FAA William J. Hughes Technical 
Center. In attendance were representatives from the two proposing 
institutions found to be within the competitive range. Technical 
debriefings were conducted and an opportunity was provided for 
questions and answers.
    Question. What would be the next step and a timetable for its 
evaluation?
    Answer. The proposing universities will be given two weeks to 
provide additional questions for clarification and will submit a best 
and final proposal to the FAA within the next eight weeks. We 
anticipate an announcement in June, and establishment of the new Center 
by October. The Aging Aircraft Non-destructive Evaluation Center will 
be an integral part of any COE that is established in Airworthiness 
Assurance.
                    aging aircraft research funding
    Question. Speaking again of the Aging Aircraft Center, the 
administration's budget proposes to reduce the level of funding for 
aging aircraft research from $13.9 million in fiscal year 1997 to $13 
million in fiscal year 1998. I am puzzled by this administration's 
policies regarding aviation safety. On one hand the President 
identifies commercial air safety as one of his top priorities, but on 
the other hand he produces a budget proposal that once again decreases 
funding for one of our most important aviation safety issues. Knowing 
that by the year 2000 more than 2,500 commercial aircraft in the United 
States may be flying beyond their original design lives, I believe this 
is dangerous policy.
    Do you believe the administration's current budget proposal is 
sufficient to continue our efforts in ensuring aircraft safety?
    Answer. The fiscal year 1998 budget request does not represent a 
decrease in the aging aircraft program. Rather, it reflects an increase 
of $2.4 million in contract funds. The total dollar amount appropriated 
in fiscal year 1997 was $13.9 million, which included in-house costs. 
The fiscal year 1998 budget request of $13 million reflects contract 
funds only, as in-house costs are now part of a separate budget line 
item. The budget proposal is sufficient to continue our highest-
priority work in ensuring the safety of aging aircraft.
    Question. What current activities will be sustained with these 
resources?
    Answer. Our highest-priority aging aircraft activities in 
structural integrity, and maintenance and inspection in testing, 
evaluation, demonstration, and validation will be conducted.
    Question. What activities will be reduced or eliminated due to 
budget reductions?
    Answer. No major activities will be reduced or eliminated at the 
proposed $200 million budget level.
    Question. What is the administration's proposed budget for the 
Aging Aircraft Non-destructive Evaluation Center in Albuquerque?
    Answer. The 1998 budget requests approximately $3 million for 
inspection technology development and validation.
      recommendations of white house commission on aviation safety
    Question. Secretary Slater, Vice President Gore's final report from 
the Commission on Aviation and Security made several recommendations to 
the President on increasing aviation safety and security. I believe 
this report has raised several important safety and security concerns 
which merit our attention, however, I would like to have your insight 
on one recommendation today. The Gore Commission also identifies aging 
aircraft as a major concern for aviation safety. In fact, the 
Commission recommends expanding the current Aging Aircraft program to 
include the effects of age on non-structural components of commercial 
aircraft.
    Is the administration supportive of expanding the current aging 
aircraft safety testing to include non-structural components?
    Answer. The FAA, working with the aviation industry, will develop a 
coordinated plan to implement the White House Commission 
recommendations regarding the effects of age on non-structural 
components of commercial aircraft. This partnership approach was used 
very successfully in the current aging aircraft program.
    Question. Which technologies are the most promising/cost efficient 
in accomplishing this recommended goal?
    Answer. At this time, the FAA has not identified which technologies 
are the most promising/cost efficient in accomplishing the White House 
Commission recommendations.
                   rural roads protection act of 1997
    Question. Secretary Slater, one transportation challenge rural 
States like New Mexico must face is maintaining and improving our vast 
rural road systems. Rural States like New Mexico, with a large land 
mass and smaller population, face an uphill battle in meeting the 
demands of supporting our transportation infrastructure. For example, I 
am sad to say that New Mexico is reported to contain five of the 20 
most dangerous roads in the nation. While I understand that every State 
is in need of additional highway funding, I believe we need to pay more 
attention to the special needs of rural States like New Mexico when 
reauthorizing ISTEA. For this reason, I have co-sponsored a bill which 
mandates a one-percent set-aside within Federal-aid Highway funding for 
rural States. I believe this set-aside is essential to leveling the 
playing field for rural States and will be helpful in providing the 
necessary funds to ensure safer roads.
    Does the administration's NEXTEA proposal contain any provisions 
which would assist rural States such as New Mexico to receive 
additional highway funding?
    Answer. The administration's NEXTEA proposal would authorize $175 
billion over 6 years, which represents an 11-percent increase in 
funding over ISTEA. In addition, the highway apportionment formulas 
included in the proposal to distribute funds among the States attempt 
to strike a fair balance between the many diverse States of this 
nation. Beyond just the overall funding increase, NEXTEA would provide 
States and local governments with greater flexibility through expanded 
eligibilities in the core programs, better enabling them to target 
NEXTEA funds to the types of infrastructure investments that will work 
best for them.
    Although we were cautious about proposing new programs in NEXTEA, 
the administration's proposal does include a new Border Crossing and 
Trade Corridors Program. This program would provide $270 million in 
funding over six years to assist States, such as New Mexico, in meeting 
needs at border crossings and along trade corridors.
    NEXTEA also significantly increases the emphasis on safety with 
greater funding levels, better targeted safety programs, greater 
emphasis on safety results, and greater flexibility for States to 
tailor safety programs to their needs. It eliminates the current STP 
ten-percent safety set-aside and replaces it with two new programs: (1) 
a new Highway Infrastructure Safety Program ($3.25 billion over 6 
years), and (2) an Integrated Safety Fund ($300 million over 6 years).
                          new mexico spaceport
    Question. Secretary Slater, as you are probably aware, New Mexico 
has the potential to be one of the leaders in commercial space 
launches. The State of New Mexico, through its Office of Space 
Commercialization has worked tirelessly to promote this effort 
statewide and I am excited about the prospect of bringing commercial 
space launches to Southern New Mexico. I believe New Mexico, with its 
excellent climate, high altitude, and low population density is well 
suited to take advantage of the new opportunities available in 
commercial space efforts being put forth by the State of New Mexico. 
Currently, the New Mexico Office of Space Commercialization has 
submitted an application for a site license to the Licensing and Safety 
Division of the FAA, and they are anticipating approval no later than 
April 16, 1997.
    Would you work to ensure this license is issued to the New Mexico 
Spaceport on schedule?
    Answer. The New Mexico Office of Space Commercialization (NMOSC) is 
utilizing a phased approach to development of a commercial launch site 
in New Mexico for the staging of activities involving reusable launch 
vehicle technology currently under development. NMOSC is employing a 
phased approach as a result of, among other things, the lack of 
detailed information on reusable launch vehicles. The FAA is 
cooperating with NMOSC's request and has been working closely with the 
State of New Mexico to complete a site feasibility review. The 
licensing process cannot be completed until the NEPA process is 
concluded and the site is finally selected and is under NMOSC's 
operational control. We will continue our close cooperative efforts 
with the State of New Mexico.
    As part of its phased approach, NMOSC has requested a determination 
of feasibility of a proposed site in south-central New Mexico from the 
FAA, with the understanding that any findings by the FAA are 
preliminary, or conditional, in that they are subject to completion of 
all environmental reviews required under NEPA as well as acquisition of 
the land under consideration. A finding of site feasibility signifies 
that, based on NMOSC's planned uses for the site, it is situated in a 
manner that can support safe launch activities at the site.
    Question. Secretary Slater, the New Mexico Office of Space 
Commercialization is currently working with the Department of 
Transportation to obtain the notice of availability on the 
Environmental Impact Statement it submitted for legal review. This 
approval is necessary for the State of New Mexico to begin conducting 
public hearings and proceed with future construction plans. 
Unfortunately, the DOT has been delayed in performing this important 
review for various reasons and currently no date has been set for 
initiating the review.
    When can the State of New Mexico expect the Department of 
Transportation to conduct the legal review and issue a notice of 
availability?
    Answer. The legal sufficiency review of the Draft Environmental 
Impact Statement for the Southwest Regional Spaceport has been 
completed and review comments have been provided to representatives of 
NMOSC for inclusion in the document. Department of Transportation 
cognizant personnel received the revised document from NMOSC and it is 
now under review. The Bureau of Land Management (BLM) and Fish and 
Wildlife Service (FWS) have voiced objections regarding the Southwest 
Regional Spaceport (SRS) EIS effort undertaken by the FAA. Once the 
final review is completed and the issues with BLM and FWS are resolved, 
the Notice of Availability will be published shortly thereafter. The 
notice should be published within the next two months.
         innovative financing and camino real intermodal center
    Question. Secretary Slater, the Department of Transportation 
recently began utilizing innovative financing initiatives to launch 
critical transportation projects nationwide. I have followed this new 
program closely and am impressed with its preliminary results. I 
believe it is essential for Congress to provide greater flexibility to 
States engaging in advanced construction using anticipated 
apportionments and private funding alternatives. One pilot project 
selected for this new program was the Camino Real Intermodal Center in 
Saint Teresa, New Mexico. The New Mexico Department of Transportation 
has partnered with a private entity to expedite a needed intermodal 
facility to make border crossing more efficient. I must commend the New 
Mexico Department of Transportation for being innovative and 
resourceful in meeting the increased demands for border crossings due 
to the NAFTA free trade agreement.
    What effects has this new program had on transportation 
infrastructure construction, and do you see innovative financing 
provisions to be utilized more rather than less in the future?
    Answer. The innovative finance program has created new ways of 
thinking about funding transportation projects. Innovative finance 
provides the States more incentive to obtain other sources of revenue, 
issue bonds, or seek donations. The program also provides more flexible 
Federal procedures, allowing States to better tailor finance plans to 
meet individual project needs. The result has been an increase in the 
non-Federal investment in projects and, for many projects, the ability 
to advance the construction schedule by several years. We believe these 
provisions will be used more in the future as States become more 
familiar their benefits.
    Question. Has the DOT discovered any complications or inadequacies 
within this new program?
    Answer. Certainly, some of the innovative finance provisions are 
more complicated to administer than traditional grant provisions; 
however, as we become more familiar with the new techniques, the 
complexities will diminish.
    Question. I understand that within the administration's NEXTEA 
proposal, a new Border Crossing and Trade Corridors program is 
established to supplement existing funds available for border 
infrastructure. Are there provisions within this program which provide 
relief funds to States like New Mexico which have already invested 
significant highway funds to improve their border crossing stations 
such as Santa Teresa?
    Answer. The Trade Corridor and Border Gateway Pilot Program 
contains three elements: (1) supplementary surface transportation 
planning funds for multistate efforts to coordinate trade corridor 
development; (2) supplementary surface transportation planning funds to 
support binational planning efforts; and (3) a discretionary capital 
program directed toward major international gateways with Mexico and 
Canada to improve gateway transport efficiency and safety. The capital 
improvement program would be restricted to the major gateways 
identified in the Department's ISTEA Section 6015 study report, 
``Assessment of Border Crossings and Transportation Corridors for North 
American Trade.'' The West Texas/New Mexico gateway is identified in 
the Pilot Program as being eligible.
    The Pilot Program does not identify prior State and local efforts 
to improve gateways as a discretionary grant condition. It establishes 
criteria for grants as follows: (1) reduction in travel time through 
the gateway; (2) leveraging of Federal funds; (3) improvements in 
vehicle and cargo safety; (4) degree of binational involvement and 
cooperation, including cooperation with the Federal Inspection Services 
(Customs, INS, USDA, etc.); (5) innovation and transferability to other 
gateways; (6) local commitment to sustain the effort; and (7) full use 
of existing facilities prior to any new construction.
   the role of new mexico's national labs in transportation research
    Question. Secretary Slater, as you are aware, the State of New 
Mexico has two of our national labs. I believe these labs provide this 
nation with not only a strong national defense but a valuable resource 
for developing new technologies. Both Sandia and Los Alamos National 
Labs have permanent departments which research and develop Intelligent 
Transportation Systems (ITS) and alternative fuels. As we begin to 
debate the reauthorization of ISTEA, I have a strong interest in re-
evaluating the current role our national labs play in transportation 
research and development. I believe our nation's transportation 
infrastructure is of the utmost importance, and as our transportation 
needs continue to grow, I believe our labs can play a significant role 
in researching and developing new transportation technologies.
    Do you support our national labs playing a significant role in 
transportation research and development?
    Answer. DOT considers the national labs to be a major technical 
resource, for both the public and private sectors of this country. DOT 
is an active member, along with many of the Department of Energy (DOE) 
labs, in the Federal Laboratory Consortium (FLC). The FLC is a 
legislatively mandated body that exists to make the technical expertise 
of the labs available to solve national problems and support industry 
in the development of commercializable products. The FLC has also 
proven to be a very effective forum for sharing technical insights 
across Federal agency and program lines.
    DOT also uses national labs to perform research for it on a 
reimbursable basis, with great success. In addition to the work 
highlighted in the question, we are particularly proud of the work the 
Los Alamos National Laboratory performed to advance the state-of-the-
art with transportation planning tools. An interagency Travel Model 
Improvement Program (TMIP) is addressing the linkage of transportation 
to air quality, energy, economic growth, land use, and the overall 
quality of life. One of the most advanced components of TMIP is the 
TRansportation ANalysis and SIMulation System (TRANSIMS). TRANSIMS is a 
series of advanced computer models specifically designed to help State 
and metropolitan planners meet the analytical requirements of the 
planning processes created in the Intermodal Surface Transportation 
Efficiency Act of 1991 (ISTEA). TRANSIMS was originally proposed by Los 
Alamos, and its development and testing is proceeding there.
    We have had excellent results with our use of the labs for 
transportation R&D, and strongly support their continued use in this 
manner.
    Question. Do you foresee our labs being utilized more rather than 
less in developing new Intelligent Transportation Systems and 
alternative fuels?
    Answer. On August 6, 1993, the U.S. Departments of Transportation 
and Energy signed a Memorandum of Understanding (MOU) defining the 
working relationship between them for conduct of research on 
Intelligent Vehicle-Highway Systems, or IVHS (a more narrowly defined 
concept that has evolved into ITS). The MOU specifically permits DOT to 
``use the DOE and its laboratories on a reimbursable basis to conduct 
IVHS R&D and operational testing activities, and to transfer the 
technologies developed to the commercial sector.'' It highlights 
sensors, navigation systems, data fusion, communications, safety 
assessments, system concepts, and systems integration as areas for 
collaboration.
    The Department of Transportation considers the DOE labs a major 
resource supporting its ITS program, and will continue to do so in the 
future. Moreover, our surface transportation reauthorization proposal 
provides opportunities for the Department of Transportation to enhance 
its relationship with the national laboratories, and we plan to take 
advantage of this opportunity. Their world-class and interdisciplinary 
scientific and technical capability in areas such as advanced 
materials, manufacturing, energy and environmental technologies (e.g., 
fuel cells and alternative fuels), simulation and modeling, testing, 
and electronics, coupled with their ability to prototype and 
demonstrate new and innovative concepts to address national problems, 
can be a real boon to the civil and commercial transportation sectors.
    Question. Does the Department of Transportation recommend any 
changes to the current role our labs play in transportation research 
and development?
    Answer. As mentioned previously, the Department of Transportation 
has been very pleased with the performance of the national labs, both 
as sources of technical expertise on advanced technologies, and on 
actual conduct of R&D. Much of the department's research and 
development, historically, has focused on applied research that can be 
implemented in the near term. The Intermodal Transportation R&D Program 
in our surface transportation reauthorization proposal, with its 
emphasis on basic research and longer time horizons, will be an area 
where the labs can make significant contributions, and we hope to be 
able to draw on their skills more in the future.
                     process to disconnect air bags
    Question. Secretary Slater, recently, both the United States House 
and Senate Transportation Committees held hearings on the unintended 
consequences surrounding air bag safety devices. Clearly, we have found 
that air bags save lives; however, we are now aware these devices 
actually pose a life-threatening situation for certain people and their 
families. I understand that the National Highway Traffic Safety 
Administration (NHTSA) and the automobile manufacturers are working to 
educate car owners and produce safer air bags. I would like to know 
what steps are currently being taken to modify the standard for air bag 
deployment and what stage we are currently at regarding new rules for 
legal air bag disconnection.
    What is the current process a vehicle owner must pursue to obtain 
the necessary permit from NHTSA to have their air bag disconnected by 
an authorized automobile dealership?
    Answer. The vehicle owner should contact NHTSA in writing, asking 
for permission to have the air bag(s) disconnected. The letter should 
state why the owner wants the air bag(s) disconnected and should 
provide any additional information, such as a physician's statement of 
medical reason why the air bag(s) could do more harm than good in this 
specific case. The letter should be addressed to: Office of the Chief 
Counsel, National Highway Traffic Safety Administration, 400 Seventh 
Street, Southwest, Washington, D.C. 20590.
              timing of new rule on disconnecting air bags
    Question. What is the current time line for implementing new 
regulations which allow vehicle owners to work directly with the 
dealership for air bag disconnection?
    Answer. This proposed rulemaking is part of NHTSA's highest-
priority rulemaking actions regarding air bags. The proposals for 
deactivation were published in the Federal Register (62 FR 831) on 
January 6, 1997. To date, over 500 respondents have replied to this 
proposal, with additional comments coming in almost daily. There are 
many complex legal issues surrounding this proposal. A final resolution 
of these issues is expected shortly.
                       unbelted testing standard
    Question. Are steps currently being taken to modify the testing 
standard for air bag deployment to no longer use the unbelted standard 
for certification?
    Answer. NHTSA is currently responding to a petition from Senator 
Dirk Kempthorne to amend the provisions in its automatic occupant 
protection standard to place a moratorium on testing with unbelted test 
dummies. NHTSA has concluded that Section 2508 of the Intermodal 
Surface Transportation Efficiency Act of 1991 precludes it from 
eliminating the unbelted test requirement. Since NHTSA can recommend 
legislative changes to Congress, it is currently seeking public 
comments on the benefits and disbenefits of eliminating the unbelted 
test. The Request for Comments was published in the Federal Register 
(62 FR 8917) on February 27, 1997, with comments due by March 31, 1997.
                   nafta border crossing and trucking
    Question. Secretary Slater, the North American Free Trade Agreement 
(NAFTA) has opened our nation's borders to its neighbors to promote 
trade and strengthen our global economy. In 1993, the Senate passed a 
resolution which instructed the Department of Transportation to 
``uphold all United States truck safety standards, including truck 
sizes and weights'' during the negotiations with Canada and Mexico. 
Unfortunately, with over a year behind us, this issue of commercial 
trucks crossing the Mexican border is still lingering and remains 
unresolved.
    What is the current status of negotiations regarding the 
harmonization of truck safety standards with the Mexican government?
    Answer. Since NAFTA was implemented on January 1, 1994, the 
Department of Transportation has worked with its counterparts in Mexico 
and Canada through the Land Transport Standards Subcommittee (LTSS) to 
develop compatible safety and operating standards for motor carriers. 
For example:
  --Truck Requirements. The three NAFTA countries have adopted a basic 
        commercial vehicle safety standard as the minimum level of 
        mechanical fitness to be sustained by all commercial motor 
        vehicles operating in international commerce. This standard is 
        based on regulations currently in effect in the United States 
        and Canada.
  --Driver Age and Language Requirements. The three NAFTA countries 
        have agreed to require that drivers operating in international 
        commerce be at least 21 years old and be able to communicate in 
        the language of the country in which they are operating. Thus, 
        even though Mexico permits drivers to obtain a commercial 
        license at age 18, only drivers who are at least 21 years old 
        will be permitted to operate across the border into the United 
        States. Moreover, those drivers will have to have at least a 
        basic understanding of English.
  --Hazardous Materials Requirements. Mexico requires drivers of trucks 
        carrying hazardous materials to obtain an endorsement to their 
        drivers licenses indicating that they have received specialized 
        training for handling shipments of hazardous cargo, for driving 
        tank trucks containing bulk shipments of hazardous materials, 
        and for emergency response. Moreover, Mexico has promulgated 
        regulations applicable to hazardous materials transportation 
        that are based on the UN recommendations on the Transport of 
        Dangerous Goods, which is the international consensus standard. 
        In addition, the three NAFTA countries have published a North 
        American Emergency Response Guidebook in English, Spanish, and 
        French.
  --Hours-of-Service and Driver Logs. The United States, Canada, and 
        Mexico have agreed to assure that the duty time of drivers 
        engaged in cross-border transportation will be recorded and 
        accounted for. Mexico has already begun to take the steps 
        necessary to implement a logbook requirement for hazardous 
        materials and bus drivers. The three countries are developing a 
        North American logbook that will be modeled on logbooks 
        currently used in the United States and Canada. In addition, 
        Mexico has asked that the United States and Canada assist in 
        completing regulations on hours-of-service for commercial 
        drivers that Mexico would implement for domestic and cross-
        border motor carrier operations.
    If the Department were to consider amending existing truck size and 
weight regulations, it would follow the normal regulatory procedures 
for the issuance of Federal regulations, including ample provision for 
public comment on any proposals. Any proposals to change current 
vehicle weights and dimensions standards as set forth by statute would 
be decided by the Congress. No such recommendations are currently being 
considered by the LTSS.
    Question. What are the areas of major contention involved in the 
negotiations regarding cross-border trucking?
    Answer. In negotiations over the past year, the United States, 
Mexico, and Canada have discussed developing a strategy to assure that 
motor carriers are in compliance with their safety obligations prior to 
beginning cross-border operations. These discussions are taking place 
in the Land Transport Standards Subcommittee, which was established by 
NAFTA to address development of compatible safety and operating 
standards for truck, bus, and rail transportation and for the 
transportation of hazardous materials.
    The three countries have agreed on critical safety areas that will 
be reviewed and approved by each country's authorities before a carrier 
can begin cross-border operations, including: (1) safety management 
systems, (2) driver qualifications, (3) hours of service compliance, 
(4) drug and alcohol testing, (5) condition of vehicles, (6) accident 
monitoring programs, and (7) compliance with regulations governing the 
transportation of hazardous materials. In addition, we have agreed on 
several elements that are essential to implementation of a successful 
cooperative and coordinated compliance and enforcement program, such as 
clear communications between governments and with motor carriers; 
development of electronic data bases and exchange of safety information 
for companies, drivers, and vehicles; and involvement of State and 
local officials.
    Discussions with Mexico currently involve implementation of 
specific elements of a compliance and enforcement program in Mexico 
that will be directed at motor carriers who will be operating across 
the border into the United States. This program includes a roadside 
inspection program focussed on the northern border, a process for 
providing the United States with detailed information on motor carrier 
applicants for authority, and a safety management oversight program.
    Taken as a whole, this strategy will enable the Department to 
evaluate a carrier's safety performance based on verified information 
provided by the Mexican government and the carrier itself. Only 
carriers with positive evaluations will be approved to operate beyond 
the commercial zones. In addition, this strategy will assure that 
carriers that receive such approval will be monitored for compliance 
with safety and operating regulations by inspectors based both in 
Mexico and the United States.
    Question. When do you expect to have this issue resolved?
    Answer. The Department hopes to have a package that resolves all 
outstanding transportation issues between Mexico and the United States 
in the near future. Senior officials from the Department and Mexico's 
Secretariat of Communications and Transportation have met on many 
occasions over the past months to discuss safety issues that led to the 
delay of implementation of NAFTA's truck and bus access and investment 
provisions.
    DOT's major concern is that there be a system in place in Mexico to 
independently verify the safety compliance of the carriers that will be 
operating across the border into the United States. Thus, officials are 
discussing with Mexico implementation of basic compliance/enforcement 
program elements for motor carriers granted authority to operate in the 
United States. DOT is working with its Mexican counterparts on how best 
to implement these measures and to determine a time frame within which 
implementation will be possible.
    Question. Do you anticipate any further delay in finalizing this 
agreement in a timely fashion?
    Answer. The United States remains committed to NAFTA and its 
promise of economic prosperity for North America. The United States 
fully intends to honor its NAFTA commitment to permit Mexican motor 
carriers to operate in this country. However, there are a number of 
steps that the United States, Mexico, and Canada can take together that 
will benefit motor carriers and their customers while enhancing public 
safety and security in all three countries. Once the safety concerns 
that led to the delay in implementing NAFTA's truck and bus access and 
investment provisions have been resolved, the Department of 
Transportation will begin processing applications from Mexican motor 
carriers to operate in the U.S. border States. The Department hopes to 
have a package that resolves all outstanding transportation issues 
between Mexico and the United States in the near future.
                 nondestructive evaluation and testing
    Question. Secretary Slater, the administration puts an increasing 
emphasis on the use of technology in transportation in its fiscal year 
1998 budget request. You know of my interest in the work that is being 
done by the Aging Aircraft Nondestructive Evaluation Center (AANC), 
which is supported by the Federal Aviation Administration. This 
collaboration has been very successful. Several years ago, the 
Department helped fund the use of such techniques on two bridges in New 
Mexico that were scheduled to be demolished. This project provided 
valuable information on the utility of these techniques to 
transportation.
    The Department's budget request now includes $10 million for 
advanced research through the Federal Highway Administration to 
investigate new, emerging or advance technologies which have the 
potential for long-range application in highway engineering, safety, 
and traffic research and development. Throughout this initiative, 
nondestructive testing and evaluation is a component.
    Mr. Secretary, can you please characterize the Department's current 
initiatives that focus on nondestructive evaluation and testing 
techniques or technologies and their contribution to the mission of the 
Department?
    Answer. The contribution of FHWA's current initiatives in 
nondestructive evaluation to the Department's mission can be summarized 
in two words: safety and efficiency. The FHWA's current safety-related 
initiatives include projects to develop new and better technologies to 
detect and evaluate fatigue cracks in steel bridges; projects to 
evaluate bridges where the depth and condition of the foundations below 
ground are unknown; projects to ensure that the cables supporting large 
bridges are intact; projects to ensure that the highly stressed, yet 
hidden, tendons supporting prestressed concrete bridges are intact; and 
projects to facilitate the quantitative load testing of bridges. The 
FHWA is also developing nondestructive evaluation technologies which 
support rapid, efficient, and quantitative condition assessment in 
support of modern bridge management systems. The FHWA is developing new 
technology to rapidly and quantitatively evaluate the condition of 
bridge decks without the need to stop traffic. This particular project 
is highly significant because half of the bridge deck area in the 
United States is covered by asphalt and cannot be adequately evaluated 
using visual inspection. The FHWA is developing other devices to 
quantitatively measure overloading, fatigue loading, and corrosion 
rates in passive non-invasive ways. The FHWA is developing new tools, 
technologies, and methods to manage the Nation's bridges with factual 
objective data, in addition to subjective visual inspection.
    Question. What is currently underway at the Department to assess, 
for example, the structural integrity of bridges? What are the 
components of this program?
    Answer. A large component of FHWA's NDE research and development 
program specifically addresses structural integrity of bridges. In 
addition to the specific projects mentioned above, FHWA has developed a 
laser-based bridge deflection measurement system that quantitatively 
measures the three-dimensional deflection response of highway bridges 
to load. The system provides the ability to accurately and precisely 
measure deflections at hundreds of points on a bridge. This global 
assessment technology can rapidly detect pathologic conditions such as 
corrosion or fatigue weakened girders that could compromise structural 
integrity.
    The FHWA has also developed wireless telemetry systems that greatly 
facilitate the ability to assess bridge structural integrity through 
diagnostic and proof load testing of highway bridges. FHWA is also 
closely coordinating, cooperating, and co-sponsoring bridge health 
monitoring technologies with its State partners. Several large-scale 
bridge instrumentation projects are underway in Ohio, New Mexico, 
Connecticut, California, and New York--all intended to develop systems 
to ensure structural integrity by measuring the dynamic and static 
response of highway bridges using sophisticated computer-based sensor 
and telemetry systems.
    Question. What are the research goals of the proposed new program?
    Answer. The goals of the Advanced Research Program are to improve 
the long-term safety, durability, mobility, efficiency, environmental 
impact, and productivity of highway and intermodal transportation 
systems. Certainly, Advanced Research has long been one of the 
cornerstones of the R&T programs in FHWA. During FHWA's outreach 
meetings in preparation for development of NEXTEA, we consistently 
heard from States that Advanced Research needed to be done by the FHWA. 
One top official, reflecting on the need for a national focus on 
Advanced Research said, ``If not by FHWA, then who?''
    There are elements of the more basic scientific research in all of 
our research categories (i.e., Pavements, Safety, ITS, Structures, 
etc.). However, the proposed initiatives are directed to five areas 
that have crosscutting applications. These five areas are:
  --Diagnostic Methods: advanced sensors to nondestructively measure 
        the ``health'' of the physical infrastructure (roads and 
        bridges). Diagnostics lies at the intersection of three fields: 
        nondestructive testing, material science, and computational 
        structural mechanics.
  --Materials Characterization: better understanding of the chemistry 
        and microstructure of major highway materials (cement, asphalt, 
        steel, etc.) will permit the engineering of materials to 
        produce the macroscopic properties (strength, stiffness, 
        toughness) that yield better performance. Many scientists 
        believe this is the field with the greatest potential for 
        dramatic improvements.
  --Modeling and Simulation Methodologies: through the use of advanced 
        computer assisted modeling, we can better understand multi-
        faceted relationships and can better predict the consequences 
        of changing variables. This technology supports ITS, Safety, 
        Materials, and Traffic Assignment. Effective modeling focuses 
        the research and is perhaps one of the best investments we can 
        make in terms of conducting research.
  --Artificial Intelligence and Mathematics: developing, testing, and 
        evaluating the reliability and robustness of software for many 
        traffic, safety, structural conditions and other technologies 
        requires advanced mathematical concepts such as expert systems, 
        neural networks, voice recognition/synthesis, pattern 
        recognition, advanced visualization, and related statistical 
        and computational methods.
  --Advanced Sensor and Commutations Technology: traffic control and 
        vehicle surveillance systems are keys to the safe and efficient 
        operation of most major urban highways in the next century. 
        Development of ``smart'' detectors for highways, building on 
        aerospace and military technologies, will leverage this 
        investment.
    Question. Is this a multi-year effort, and what are the outyear 
projected budgets for this advanced research program?
    Answer. This program is proposed at a budget level of $10 million 
for fiscal years 1998-2000, and then at a level of $20 million for 
fiscal years 2001-2003. There is a need to ``grow'' staff and research 
management in several of these sophisticated areas, and prudent 
judgment suggests starting with a good foundation. As basic research 
flows through the R&D pipeline, experience has taught us that the 
heaviest demand is several years after the initial investment if we are 
to capitalize on our investment.
    Question. How does the Department propose to implement this new 
initiative?
    Answer. No increase in staff is proposed. We intend to lead this 
advanced research program using the much more effective Broad Agency 
Announcement device for acquisition of research. This approach permits 
FHWA to select several contractors with several different concepts from 
the same advertisement. Also, we would continue to utilize Cooperative 
Agreements and, when appropriate, grants to public agencies to leverage 
research providers such as the national laboratories. Internally we 
will continue to utilize NSF post-doctorate individuals, graduate 
research fellows, and loaned staff from States, other countries, and 
universities. As existing staff retire or resign, we will investigate 
filling of each vacancy so as to maximize the effectiveness of the 
total R&D program.
                        highway funding request
    Question. Secretary Slater, the President's Budget proposes that 
total highway spending for programs authorized under the Intermodal 
Surface Transportation Efficiency Act (ISTEA) will be reduced from 
their 1997 level of $20.5 billion to $19.9 billion in 2002.
    The aggregate reduction, when compared to a current law spending 
path, is $3.9 billion over this five-year period.
    Do you personally think such a reduction is possible, especially in 
2001 and 2002, given the level of support here in the Senate for 
highway spending?
    Answer. The administration is committed to the overall effort to 
balance the Federal budget, and all spending decisions should be made 
in that context. As we all know, hard choices are necessary to achieve 
a balanced budget. If we are to achieve a balanced budget, increased 
highway spending translates into decreases elsewhere. If both Congress 
and the administration are willing to make hard choices, then this 
spending level is realistic. But you may, of course, decide to pursue a 
different approach. We submitted a proposal that makes a serious effort 
to address the concerns of the Senate and others about achieving a 
balanced budget. It should also be noted that the $600 million 
reduction in obligations cited in the question is less than the $745 
million reduction in highway demonstration obligations from fiscal year 
1997 to fiscal year 2002.
                         highway funding needs
    Question. Do you also believe such a reduction can be achieved 
given the latest USDOT Conditions and Performance Report, showing a 
shortfall of $11 billion in local, State, and Federal highway funding 
just to maintain current highway conditions across the Nation?
    Answer. The administration's reauthorization proposal seeks to 
maximize the overall level of funding for the transportation program 
within the framework of a balanced budget. We must work within the same 
financial constraints facing every other Department in trying to meet 
growing needs with limited Federal resources. To that end, we have 
initiatives designed to leverage the Federal dollar and increase 
private sector participation in transportation investment.
    Specifically, our budget proposal will provide sufficient revenue, 
when combined with State and local match and expected State-only 
programs, to allow us to (1) continue improving the pavement conditions 
on our Nation's arterial system, including the National Highway System; 
(2) continue the reduction in the number of structurally deficient and 
some functionally obsolete bridges; (3) improve roadway surfaces, 
alignments, shoulders, sight distance, and other road related factors 
that contribute to continued reduction in highway fatality rates, 
including efforts to effect driver behavior that influences safety; and 
(4) continue making capacity and operational improvements to address 
the congestion problems associated with increasing highway travel 
demand.
                 administration's reductions to the faa
    Question. Secretary Slater, the President's Budget proposes that 
total FAA spending will be increased from its 1997 level of $8.5 
billion to $9.3 billion in 2002. This increase represents a 1-percent 
reduction when compared to a current law spending path over this five-
year period.
    Do you personally think such a reduction is possible, given the 
increased demands put on FAA, especially in light of the recently 
released report from the White House Commission on Aviation Safety and 
Security?
    Answer. The Operations, Facilities and Equipment, and Research, 
Engineering, and Development accounts will grow at a current services 
spending path over the five-year period ending in 2002. Only the 
Airport Improvement Program (AIP) will be held constant at its fiscal 
year 1998 level. It is due to the lack of growth in the AIP account 
that the overall FAA budget appears to grow at a rate lower than 
current services
    The five-year budget assumes a transition to full user-fee funding, 
which was endorsed by the White House Commission. The overall spending 
in the outyears will depend on FAA needs and users' willingness to 
finance those needs.
                  need for further aviation user fees
    Questions. Will additional user fees, above those recommended from 
1999 through 2002 in the President's Budget, be needed to meet the 
funding needs of the FAA?
    Answer. Generally no; however, user fees are proposed to recover 
100 percent of the FAA's budget, so any change in cost from current 
forecasts will result in adjustments to the user fee proposal.
                        faa cost-based user fees
    Question. Secretary Slater, the President's Budget proposes that 
beginning in 1999, the aviation excise tax will be replaced with a 
cost-based user fee system, raising $36 billion between 1999 and 2002.
    How would these user fees be collected and how would they be 
assessed on the traveling public and the aviation industry?
    Answer. The procedures for billing and collecting user fees in 
fiscal year 1999 to 2002 will depend on the specific fees that will be 
charged. The specific fees to be charged have not been determined and 
will be influenced by the recommendations of the National Civil 
Aviation Review Commission. How the user fees are assessed and 
collected will be based on several considerations, including whether 
the fees are paid before, after, or concurrent with the provision of 
services; the volume of payments to be made; and the size of individual 
payments.
    Question. If these decisions have not been made, how did USDOT and 
OMB arrive at these revenue figures?
    Answer. Projected revenues were based on the recovery of FAA's 
costs to provide service to users and are independent of how the fees 
would be assessed and collected.
    Question. Would it have been more advantageous for the 
administration to wait for the final report of the National Civil 
Aviation Review Commission before making FAA user fee proposals in its 
budget submissions to Congress?
    Answer. The administration is assuming that the work of the 
Commission will be completed by the end of this year and 
recommendations provided to Congress and DOT. This will allow time to 
make any necessary changes in the proposal to establish and implement 
user fees.
                          outyear faa funding
    Question. Secretary Slater, the President's Budget proposes that 
beginning in 1999, the aviation excise tax will be replaced with a 
cost-based user fee system. However, the President's Budget is silent 
on where increases and reductions should be made in the FAA beyond 
1998. Each account is zeroed out and total FAA spending is replaced by 
user fee revenues. There are no specific assumptions how these revenues 
should be spent.
    In what accounts of the FAA budget between 1999 and 2002 will these 
user fee revenues be spent? How much will be spent for FAA operations, 
research, facilities and equipment, and the Airport Improvement Program 
(AIP)?
    Answer. User fees will provide funding for all FAA programs. 
Estimates for the specific accounts in future years reflect 3-percent 
annual growth except for the Airport Improvement Program, which remains 
constant at $1 billion.
    Question. If these decisions have not been made, how did USDOT and 
OMB arrive at the total funding level for the FAA between 1999 and 2002 
shown in the President's Budget?
    Answer. Using 1998 as a baseline, a 3-percent inflation factor per 
year was applied to operations, facilities and equipment, and research. 
AIP was straight-lined at $1 billion. As the President formulates his 
budget each year, decisions will be made on a year-to-year basis to 
update these assumptions.
                                 ______
                                 
                 Questions Submitted by Senator Specter
                   foreign oil dependency and transit
    Question. As co-chair of an informal Senate Transit Coalition, I am 
very concerned that the administration's fiscal year 1998 budget 
request proposes only $4.3 billion for Federal transit programs, 
essentially a freeze from fiscal year 1997. You have proposed to 
eliminate Federal operating assistance for public transportation and 
the capital budget would not grow under your proposal despite available 
surpluses in the Mass Transit Account of the Highway Trust Fund and a 
widely recognized need to invest more in our transit systems. Coupled 
with Federal mandates and funding pressures at State and local levels, 
Federal cutbacks have already resulted in some combination of fare 
increases and transit service cuts in many Pennsylvania communities.
    At a time of instability in the Middle East (particularly Saudi 
Arabia) and a growing U.S. dependence on foreign supplies of oil, isn't 
it essential that we focus our resources on public transportation, 
which saves million of gallons of gasoline annually and has 
corresponding environmental benefits as well?
    Answer. Yes. Transit reduces auto fuel consumption by nearly two 
billion gallons annually, lowering the Nation's trade deficit and 
reducing dependence on foreign oil. The energy and environmental 
benefits of transit are another example of what occurs when people are 
given transportation choices. Today's transit investments will reduce 
our dependence on foreign oil in the future and deliver other important 
benefits.
                      pennsylvania transit funding
    Question. A survey by my staff of nearly 20 small and mid-sized 
transit systems across Pennsylvania shows that 27 percent of their 
annual budgets comes from Federal sources. In Pittsburgh, the figure is 
even higher, at 22 percent of their $376 million annual budget. How do 
you envision these systems responding to the growing needs from their 
communities when we are curtailing the Federal Government's support?
    Answer. We support continued stable funding levels for transit as 
reflected in the fiscal year 1998 budget and the NEXTEA reauthorization 
plan. In addition to stable funding, our proposals would increase 
transit agency flexibility in spending Federal transit dollars, 
allowing them to target resources to pressing needs. For example, the 
fiscal year 1998 budget merges Bus Discretionary funding and the Fixed 
Guideway Modernization grant program into Formula Programs. This 
increases the Formula Programs funding level from $2.1 billion in 
fiscal year 1997 to $3.3 billion in fiscal year 1998. This improvement 
gives transit agencies the ability to continue using former Bus 
Discretionary funds for bus purchases and Fixed Guideway Modernization 
funds for rail improvements and rolling stock, but the funds can also 
be used for any other eligible Formula purpose selected by the transit 
agency.
    Another measure in the fiscal year 1998 budget and the NEXTEA 
proposal delivers relief to transit agencies through a redefinition of 
operating and capital expenses. Our proposal would eliminate operating 
assistance in urbanized areas over 200,000 population while providing 
relief by redefining capital to include maintenance expenses. This will 
match the transit definition of capital to the definition in the 
Highway program.
    In areas under 200,000, all Urbanized Area Formula funding would be 
eligible for operating or capital expenses at the operator's 
discretion.
    The proposed redefinition of preventive maintenance as a capital 
expense builds upon the measure endorsed in last year's Appropriations 
Conference Committee Report whereby a portion of transit vehicle 
overhauls can be reclassified from an operating to a capital expense.
    FTA analysis indicates that the proposed capital redefinition will 
effectively offset the elimination of operating assistance. For 
instance, PAT, the Pittsburgh-Port Authority of Allegheny County, will 
be able to reclassify from operating to capital expenses over 8 times 
more in expenditures than its Federal operating assistance cap.
    FTA will take all necessary measures to inform grantees of the 
change and will assist agencies in fully using the new provisions.
    The combination of funding stability and increased flexibility will 
continue to provide transit agencies in communities of all sizes with 
important Federal support for transit. Federal transit funding 
leverages State and local support, and our proposal will continue this 
important Federal role.
                 adequacy of proposed highway spending
    Question. Highway spending authorized in the 1991 ISTEA law is 
limited by the annual obligation ceiling set in the appropriations 
bill, which is in turn a function of the 602(b) allocation received by 
your Subcommittee. In practical terms, this means that Pennsylvania is 
entitled to $750 million for fiscal year 1997 through formulas but can 
only spend $670 million, which is its share under the national 
obligation ceiling. Do you think that the $18.2 billion obligation 
limit on Federal-aid highway spending is sufficient, given the 
significant surpluses in the Highway Trust Fund? In Pennsylvania, for 
example, last year the State had to announce delays in construction of 
nearly 80 highway projects due to a projected lack of funds. As a 
result of the current obligation ceiling, Pennsylvania lost an 
estimated $80 million in fiscal year 1997 that it was entitled to spend 
through the apportionment formulas.
    Answer. We realize that the Highway Trust Fund can support a higher 
level of funding. However, the administration's reauthorization 
proposal must be looked at within the framework of the entire Federal 
budget. The administration is committed to balancing the budget, and 
all spending and taxing decisions must be considered in that context. 
The reauthorization proposal seeks to maximize the overall level of 
transportation funding while still remaining within an overall balanced 
budget.
                   amtrak service cuts and prognosis
    Question. The Amtrak Board has taken a number of steps to improve 
the financial situation of our national railroad, including a number of 
cuts in routes and service in Pennsylvania and other States. For 
example, the Board proposed eliminating the local Philadelphia-
Harrisburg ``Keystone Service,'' which was saved in part by a 
commitment by the Pennsylvania Department of Transportation to assume 
more of the costs. What is the status of the cuts in routes and service 
proposed by the Amtrak Board? What steps has the administration taken 
to work with the States to preserve routes and segments wherever 
possible? What is your prognosis for Amtrak?
    Answer. Amtrak's Board proposed the termination of service on four 
routes effective November 10, 1996, which was postponed for a period of 
six months. These routes were the Boston to Albany segment of the 
``Lake Shore Limited,'' the St. Louis to Dallas ``Texas Eagle,'' the 
Salt Lake City to Portland ``Pioneer,'' and the Salt Lake City to Los 
Angeles ``Desert Wind.''
    The Massachusetts and Texas State Departments of Transportation 
have developed a proposal that would, if approved by the State 
legislatures, continue service on the ``Lake Shore Limited'' and the 
``Texas Eagle'' through October 1, 1997, during which time Amtrak and 
the States would work together to develop other concepts to make these 
trains commercially viable. It presently appears that the other trains 
will terminate service on May 10, 1997. The Department strongly 
supported the efforts of Amtrak and the States to identify means to 
provide the financial assistance necessary to preserve these trains.
    With regard to Amtrak's future, the Department is committed to 
working with Congress, Amtrak management and labor, State governments, 
and other interested parties in the coming year to develop an 
affordable long-range plan that eliminates Amtrak's dependence on 
Federal operating subsidies. Amtrak is an important component of this 
Nation's intermodal passenger transportation system. We believe that 
Amtrak must have a reliable source of capital investment through 
contract authority proposed in the administration's NEXTEA bill over 
the next several years to address the previous lack of investment if we 
are to preserve the national system and permit Amtrak to achieve its 
potential.
                          amtrak budget needs
    Question. As someone who rides Amtrak at least two times a week, I 
know that a safe, convenient and effective national passenger rail 
system is not a luxury, but a basic component of our modern economy and 
society. Amtrak also offers a viable alternative to congested highway 
and air travel.
    What impact will the administration's budget request have on 
Amtrak's ability to provide intercity rail service in the future? How 
has the administration responded to the cost of replacing and 
modernizing Amtrak's physical assets (maintenance facilities, train 
equipment, and support assets), which represent a key challenge to the 
viability of the railroad?
    Answer. The administration is committed to a long-term vision of 
Amtrak as an important component of this Nation's intermodal, intercity 
passenger transportation system. Amtrak must have the tools to develop 
into a self-sustaining competitive player. One tool that Amtrak must 
have is a reliable source of capital investment to address the previous 
lack of investment. The administration's NEXTEA proposal includes 
authorization of over $3.4 billion over the next 6 years to further 
progress the recapitalization of Amtrak.
    The Department is committed to working with Congress, Amtrak 
management and labor, State governments, and other interested parties 
in the coming year to develop an affordable long-range plan that 
eliminates Amtrak's dependence on Federal operating subsidies.
                                 ______
                                 
                 Questions Submitted by Senator Gorton
                 airport improvement program reductions
    Question. During your nomination hearing before the Senate Commerce 
Committee last month, as well as your written responses to submitted 
questions, you continually emphasized this administration's commitment 
to record amounts of dollars for infrastructure investment in the 
United States over the past four years. At the same time, however, the 
President's fiscal year 1998 budget submission lowers funding for the 
Airport Improvement Program (AIP) by over 30 percent--from an fiscal 
year 1997 enacted level of $1.46 billion to a proposed $1.0 billion in 
fiscal year 1998. This is not a new trend. When President Clinton took 
office, AIP was a $1.9 billion program. Every year since then, the 
administration has asked for less airport construction money than did 
the previous administration.
    Regarding the Airport Improvement Program--not infrastructure as a 
whole--but the Airport Improvement Program specifically, can you tell 
me how the President continues to justify spending fewer dollars on 
aviation infrastructure when just yesterday, you released a statement 
from the Annual Commercial Aviation Forecast Conference that ``an 
unprecedented 605 million people flew on the nation's air carriers in 
1996 with enplanements expected to grow to nearly one billion by 
2008?'' Does the President believe that aviation infrastructure will 
magically regenerate itself without capital investment?
    Answer. It is important to remember that the AIP is not the only 
source of funding for airport improvements, nor the only FAA program 
involved with aviation infrastructure. In fact, the majority of airport 
development dollars (75 to 80 percent) come from sources other than the 
AIP. Likewise, the FAA also administers funds for significant 
infrastructure programs such as the Facilities and Equipment (F&E) 
program. Although the ultimate ``owner'' of the F&E improvements, such 
as airport control towers and navigation aids, is the FAA, nonetheless 
nearly $1.9 billion is recommended for this aviation infrastructure 
program for fiscal year 1998.
    Although certain programs are recommended to be reduced as part of 
the effort to balance the Federal budget, we believe that other funding 
sources, such as bond sales by airport sponsors and Passenger Facility 
Charges (PFCs), will be available to continue needed airport 
development. The FAA will, of course, continue to provide aviation 
design and operational standards to foster systemwide safety.
                  funding puget sound regional transit
    Question. As you are aware, the voters of a three-county region 
approved a $3.5 billion bond measure last November to construct a 
regional transit system in the Puget Sound area. The plan, called Sound 
Move, envisions a mix of light rail, commuter rail, High Occupancy 
Vehicle expressways and regional bus routes. Commuters would some day 
be able to travel through all portions of the system with a single 
ticket. Specifically, it calls for: a 25-mile light rail line with 26 
stations between Seattle's University District and the City of SeaTac 
via downtown Seattle and the Seattle-Tacoma International Airport; a 
1.6-mile light rail line between downtown Tacoma and the Tacoma Dome 
train station; and an 81-mile commuter line using existing freight 
track between Everett and Lakewood, via Seattle and Tacoma, with at 
least 14 stations. Of the total cost, the planners of this system will 
be asking for $737 million from your Department of Transportation to 
cover the Federal share of the project.
    In the President's fiscal year 1998 Federal Transit Administration 
budget, however, not only has the President shifted all of Section 3 
discretionary money back into formula grants, but more importantly for 
this project specifically, the President has eliminated funding for all 
future ``new start'' projects. The proposed budget, as you know, only 
provides money to continue funding existing full-funding agreements. 
How do you suggest that I explain to my constituents the President's 
desire, through his fiscal year 1998 budget submission, to look past 
the specific needs of the Puget Sound region as it relates to this 
specific project?
    Answer. The Federal Transit Administration's policy, as found in 
its annual Report on Funding Levels and Allocations of Funds (the 
``3(j) Report''), is that transit major capital investments (or new 
starts) funding shall only be proposed for projects that will be 
construction-ready in the budget year. A project such as Puget Sound's 
should be funded with planning or formula funds until it is 
construction-ready.
    Regarding the possibility of receiving funding in the next several 
years, NEXTEA provides $5.7 billion in budget authority for major 
capital investments over 6 years. Of this, $3.7 billion will be 
required for projects under existing or pending Full Funding Grant 
Agreements, using virtually all the funding under obligation 
limitations proposed by the administration. Those obligation 
limitations reflect our commitment to help balance the Federal budget. 
If the economic and budget environment improves during the NEXTEA 
years, the obligation limitations may be increased, and as much as $2 
billion may become available for additional projects like Puget 
Sound's.
    Funding for additional new starts is also available through FTA's 
innovative finance initiatives, as well as the flexible funding 
provisions contained in ISTEA and broadened in NEXTEA.
                  clinton ferry terminal in washington
    Question. Three weeks ago, I sent you a letter regarding the 
utilization of fiscal year 1997 funds for a ferry terminal project in 
Washington State, and to date, I have not received a response from your 
office. Accordingly, because you are here today, I would like your 
thoughts on this situation. Let me explain the details of this matter. 
On Wednesday, November 13, 1996, representatives from the Washington 
State Department of Transportation (WSDOT) received the first faxed 
notice of the fiscal year 1997 allocations of discretionary funds from 
the Federal Highway Administration's (FHWA) Olympia, Washington, 
Division Office. WSDOT officials were very pleased that two of the 
smaller local ferry systems in Washington State are scheduled to 
receive funding from the ISTEA Section 1064--Construction of Ferry 
Boats and Ferry Terminal Facilities--discretionary account. They were 
dismayed, however, to find that the Clinton Ferry Terminal was not 
included on the list.
    A detailed analysis of the entire national listing of all 
discretionary funding categories for fiscal year 1997 also failed to 
show any funding for the Clinton Ferry Terminal. Upon further review, 
it appears that Washington State was overlooked, in spite of language 
in the Senate's fiscal year 1997 Department of Transportation 
Appropriations Report 104-325. Could you please explain how the FHWA 
has overlooked the Senate report language and neglected to provide 
funding for this project?
    Answer. The FHWA was aware of the Senate report, but also aware of 
the language in the Conference report (House Report 104-785) stating 
that the conference agreement deleted the Senate references of priority 
designations and set-asides within the FHWA's discretionary grant 
programs. As a result, all candidates for discretionary ferry boat 
funding were equal from a legislative standpoint. In choosing among the 
many worthwhile candidates submitted nationwide, funds were not 
available to finance many excellent candidates, including the Clinton 
ferry terminal project. However, as you have noted, two other projects 
in the State were selected for ferry boat discretionary funding in 
fiscal year 1997.
                highway/rail grade crossings separation
    Question. The following is an issue that you and I discussed during 
your nomination hearing, and I appreciate your willingness to help on 
this matter. As you know, with automobile and railroad traffic 
increasing in the Puget Sound region, the Port of Seattle, the Port of 
Tacoma, the Puget Sound Regional Council, and the Washington State 
Department of Transportation are currently working on a project to 
construct grade separations at existing street-level railroad crossings 
for both safety and traffic efficiency reasons. To date, this group has 
identified approximately 70 street-level crossings along the north-
south corridor between Everett and Tacoma that should be grade 
separated. Unfortunately, this would have to be done at a cost 
exceeding $1.5 billion.
    While grade separation and freight mobility are extremely important 
issues for the ports, they are also important in light of Burlington 
Northern-Santa Fe's decision to reopen Stampede Pass, a major east-west 
corridor in Washington State. Initially, BNSF projects that it will 
operate 10 to 12 trains per day during 1997, but will increase that 
number to 18 to 20 operations by 1998. With this new traffic moving 
through the Central Puget Sound region, cities from Auburn, Kent, and 
Maple Valley to Ellensburg and Yakima will be affected.
    In your previous response to this question, you expressed your 
openness to ``help develop consensus regarding the scope, cost and 
financial support needed to implement the rail improvements'' in the 
region. Do you have any specific ideas on how funding for this project 
may be addressed within the context of ISTEA? Clearly, innovative 
financing is one possibility, but are there either existing alternative 
sources of funding or new programs that could be utilized to find 
funding for such a major project?
    Answer. To implement the improvements envisioned along the Puget 
Sound rail corridor will require a public-private partnership among 
regional, State and Federal interests. The current ISTEA framework 
provides several flexible programs through which grade crossing 
eliminations can be funded. These programs include the National Highway 
System (NHS), the Surface Transportation Program (STP), and Congestion 
Mitigation and Air Quality (CMAQ), as well as Railway-Highway Crossing 
and Hazard Elimination funds. The administration's NEXTEA proposal 
would continue these programs, and in some instances specifically 
extend eligibility to publicly-owned rail infrastructure.
    These programs are funded, of course, from State allocations and 
spent according to local priorities. NEXTEA would establish two 
additional programs that might provide alternative sources of funding.
    First is the Transportation Infrastructure Credit Enhancement 
Program, which would provide grants (up to 20 percent of total cost) to 
assist in the funding of nationally significant transportation projects 
that otherwise might be delayed or not constructed at all because of 
their size and uncertainty over timing of revenues. The program's goal 
is to encourage the development of large, capital-intensive facilities 
through public-private partnerships consisting of State or local 
governments with private business. The program would require a public 
agency to acquire and operate the rail facility, as is being done in 
California's Alameda Corridor.
    Second is the permanent establishment of the State Infrastructure 
Bank (SIB) program. SIBs offer a menu of loan and credit enhancement 
assistance, such as direct loans, interest rate subsidies, lines of 
credit and loan guarantees. States can capitalize their SIBs using 
funds from regularly apportioned ISTEA categories and from a 
discretionary $150 million annual DOT fund for seed money. The program 
was originally limited to ten pilot States, but NEXTEA offers all 
States the opportunity to establish a SIB.
                           aviation user fees
    Question. As the new Chairman of the Senate Aviation Subcommittee 
of the Commerce Committee, I have heard from many people who are very 
concerned with the $300 million in new user fees to be assessed as 
proposed in the President's Budget. Could you please specifically 
identify what types of activities these user fees will be assessed for?
    Answer. The following fees are assumed in the budget request for 
fiscal year 1998:
  --Security User Fee
  --International AirCargo User Fee
  --General Aviation (GA) Turbine Engine Airplane User Fee
    The expected revenue in fiscal year 1998 from the three user fees 
is approximately $300 million. The charge rates and annual revenue from 
each fee have not yet been determined. The cost of service for each fee 
will be determined from the fiscal year 1995 Cost Allocation Study and 
supplementary analyses.
    A more detailed list of services for which fees would be assessed 
follows:
    Security: Services include the security inspection of domestic/
foreign air carriers, inspections of hazardous materials, processing of 
application amendments for airport and air carrier security programs, 
testing and approval of advanced technology security equipment, and 
provision of aviation security technical assistance, education and 
training.
    International Air Cargo: International air cargo is transported by 
domestic and foreign all-cargo carriers and in the belly of domestic 
and foreign passenger airplanes. The U.S. currently imposes no tax or 
fee on cargo transported by air into or out of the U.S. Airplanes 
carrying cargo to/from foreign countries receive terminal and enroute 
air traffic services from FAA. Services include domestic departures and 
domestic and oceanic fly-overs provided by enroute centers, and 
terminal radar approach control facility services. Service recipients 
are foreign and U.S. cargo carriers (direct service recipients) and 
cargo shippers (indirect recipients).
    General Aviation Turbine Engine Airplane: Services include the 
provision of enroute and terminal air traffic services to turboprop and 
turbojet airplanes operated in non-commercial service which fly under 
instrument flight rules. Service recipients are GA turboprop and 
turbojet airplane operators.
                                 ______
                                 
                Questions Submitted by Senator Faircloth
             preservation of rail rights-of-way for transit
    Question. The 1997 transportation appropriations bill included a 
``New Start'' appropriation ($2 million) for the Triangle Transit 
Authority's plans to build a light rail system in Raleigh-Durham, North 
Carolina.
    This system will use existing tracks and possibly build a limited 
number of additional tracks. The plan thus avoids much of the expensive 
right-of-way acquisition that drives up project costs. Their foresight 
will save the taxpayers tens of millions of dollars.
    Is the policy of the DOT to encourage planning and construction of 
fixed-guideway transit systems before these rights-of-way are 
developed, sold, or otherwise lost for this use?
    Answer. The Federal Transit Administration (FTA) encourages the 
consideration of fixed-guideway transit systems only when the local 
planning process identifies the need for a significant transportation 
investment, a wide range of multimodal alternatives to meet this need 
are systematically evaluated, and the ongoing financial support of such 
a system is adequately demonstrated. Such evaluation may in fact show 
that a fixed-guideway transit project on an existing rail right-of-way 
would be lower in cost than alternative rail alignments, and would have 
a greatly reduced environmental impact on the community in terms of 
noise, displacement, neighborhood traffic, safety problems, and 
destruction of parks and natural areas. However, the costs, benefits, 
and impacts of other mode and alignment alternatives must also be 
evaluated as part of this local process before a decision is made on 
the selection of a locally preferred alternative.
    Question. What does the Department plan to do to encourage this 
advance planning?
    Answer. FTA supports the preservation of transportation corridors 
through the local planning process. FTA will participate in the advance 
acquisition of railroad rights-of-way for future transit projects when: 
(1) the long-range metropolitan transportation plan for the area 
identifies a future need for fixed guideway transit in the corridor; 
(2) funding for the acquisition has been programmed in the metropolitan 
and statewide transportation improvement programs; and (3) the 
requirements of the National Environmental Policy Act (NEPA) regarding 
the consideration of alternatives prior to commitment to a particular 
project can be satisfied. In many cases, a NEPA categorical exclusion 
can be granted when a railroad right-of-way is merely changing 
ownership without any near-term change in its use.
                          airport construction
    Question. The administration budget cuts the funds for the Airport 
Improvement Program (AIP), which funds airport construction and 
improvements, from its current $1.45 billion to $1 billion. (Asheville 
Airport and Sanford-Lee County Airport submitted applications to the 
FAA for funds through this program).
    AIP funding is at the lowest level in years. The administration 
requests $1 billion for 1998. In the past four years, annual airline 
passenger traffic is up 16 percent while investment in airport 
development has already decreased 23 percent. I know that State and 
local governments can now collect passenger fees, but I wonder about 
the lack of Federal participation. In fact, in my State, we have a 
number of airport expansion programs that the State is undertaking 
without substantial Federal aid, and I wonder if this is the future 
trend. Have we been spending too much on airports, or is the 
President's Budget underfunding our airport needs?
    Answer. Like many other Federal programs, the requested AIP level 
has been reviewed carefully to help the administration and Congress 
balance the Federal budget. The ability to collect and use Passenger 
Facility Charge funds will continue to provide an important supplement 
to Federal grant funds, and we hope the newly authorized demonstration 
program for innovative financing will help airports do more with the 
Federal funds that are made available to them.
    We are optimistic that the work of the National Civil Aviation 
Review Commission will produce recommendations for long-term funding of 
airport infrastructure, as well as other aviation programs. The Federal 
Aviation Administration will continue to place the highest priority on 
attaining adequate funding for the most critical system needs 
nationwide.
                           faa mismanagement
    Question. Coopers & Lybrand just released its financial assessment 
of the FAA. The report concluded that ``the FAA's core program managers 
have not demonstrated an understanding of financial management.''
    Last year, the FAA told this subcommittee that the congressional 
budget resolution for 1996 to 2002 left the FAA some $12 billion short 
over that time period, and this figure became known as ``the gap.''
    I believe that the national air traffic control system is clearly a 
Federal responsibility. I believe that the FAA needs a stable and 
reliable source of funds. I look forward to that debate later this 
year.
    However, I am concerned when the FAA points to a projected multi-
billion funding dollar ``gap,'' while I see no real movement towards 
internal reforms to promote efficient operation of the FAA.
    Clearly, we will debate FAA reorganization at some point this year, 
and this will be a major issue for some Senators. However, meanwhile, 
what tangible steps have you taken to ensure that the taxpayers see an 
improved level of financial management at the FAA?
    Answer. The FAA has taken numerous steps in the last three years to 
reduce personnel costs and reduce FTE levels as called for by the 
National Performance Review (NPR). Through the end of fiscal year 1996, 
the agency has been able to reduce overall FTE usage by 11.7 percent or 
6,324 FTE. Cumulative savings as a result of FAA's downsizing exceed $1 
billion through fiscal year 1996, with fiscal year 1996 savings 
estimated at over $400 million.
    Since over 62 percent of the agency's work force is part of what is 
referred to as the ``safety work force,'' the downsizing has been 
concentrated in the non-safety areas. The non-safety work force has 
been reduced by 18 percent through fiscal year 1996. Prior to the 
downsizing, administrative personnel accounted for only four percent of 
the total work force, which was already the lowest percentage among the 
departments of the Federal Government.
    Some examples of efforts by the agency to streamline and achieve 
cost savings are as follows:
  --Contracting Out of Level 1 Towers
    --85 Towers contracted out
    --Additional savings anticipated in fiscal year 1998
    --Supported by the NPR
  --Airway Facilities (AF) Realignment
    --Reduced levels of AF organization in regions and field from 5 to 
        3
    --Nearly 900 supervisory positions eliminated
  --Human Resource Management (HRM) Streamlining
    --HRM staffing reduced by over 400 positions since fiscal year 1993
    --Supervisory ratio increased from 1:5 to 1:15
    FAA is continuing efforts to implement a cost accounting system by 
the end of this fiscal year. Work on this new cost accounting system 
began before the results of the Coopers & Lybrand assessment were 
available. The basic system will be in place by September 30, and 
continuous improvements will be made to the system to strengthen 
financial management in FAA.
    Question. As you know, FAA procurement and personnel practices were 
relaxed last year, and this was intended to let the FAA modernization 
program move ahead. Was this a mistake in light of these studies and 
their conclusions about mismanagement?
    Answer. The new personnel and procurement flexibilities provided to 
FAA have been beneficial. FAA has implemented the initial phase of new 
personnel policies and processes. Development of completely new 
personnel programs to replace the existing systems must be done in a 
thorough, systematic manner to ensure that new programs support the 
underlying objectives of reform, properly address problems with the 
existing system, and ensure fiscal responsibility. Procurement 
flexibility has allowed new contracts to be awarded in less time than 
under the previous system. This will result in avoiding cost growth due 
to longer program schedules.
           highway allocation error at department of treasury
    Question. The DOT 1997 supplemental budget request includes $318 
million to correct a Treasury Department accounting error that affected 
States' highway allocations. North Carolina lost $15 million in 
obligation authority due to this error. How hard will the 
administration push for this additional money from the Congress?
    Answer. The administration believes this error should be rectified 
and is asking Congress to fund the correction.
                management of high-cost highway projects
    Question. As you know, the costs of large-scale highway projects 
continue to grow. The Boston Central Artery/Tunnel project is expected 
to top $10.4 billion.
    The General Accounting Office (GAO) just released a report that 
encouraged the Federal Highway Administration (FHWA) to spread cost-
containment strategies to State departments of transportation. The 
report concluded that FHWA was in a good position to spread the 
successful strategies to the States that lag behind in this area.
    Do you agree with this conclusion?
    Answer. The Department's surface transportation reauthorization 
proposal requires States to prepare financial plans as part of cost-
containment for all projects estimated to cost $1 billion or more. 
Administratively, the FHWA has required financial plans on the Central 
Artery project and the I-15 projects in Utah, and will continue to 
monitor costs on these projects.
    Question. What steps will you take to implement these 
recommendations?
    Answer. The FHWA will work with the States to implement these 
provisions and will share best practices of cost-containment as they 
are identified.
                       inaccurate dot statistics
    Question. When the so-called Baucus amendment was on the Senate 
floor last summer, many of us relied on charts prepared by the DOT. As 
it turned out, Department of Transportation charts and Federal Highway 
Administration charts conflicted in their data, and the final chart was 
admittedly wrong. As we move forward on the surface transportation 
reauthorization bill, we will again rely on DOT and FHWA charts.
    What tangible steps have been taken to assure the accuracy of the 
DOT and FHWA charts that many of us will rely on?
    Answer. The Department recognizes the importance of timely and 
accurate assistance to the Congress as it considers the complex issues 
associated with the distribution of funds among the States under 
reauthorized surface transportation assistance programs. In order to 
ensure that our technical assistance meets the standards we have set 
for ourselves and that you expect from us, FHWA has reorganized its 
technical assistance support staff to handle requests in a more timely 
and professional manner. An Apportionment Analysis Group has been 
established in the Office of Budget and Finance, with direct reporting 
links to the Acting Federal Highway Administrator.
    FHWA also recently hired an outside contractor with expertise in 
this area to develop and operate a new model to analyze the 
distribution of highway funds among the States based on various 
proposals. We are now using that model, and believe it enhances our 
ability to serve the technical assistance needs of our many customers.
    FHWA receives numerous requests for technical assistance on 
legislative proposals that often differ greatly in their basic program 
structure and design. This requires that FHWA utilize models that 
provide maximum flexibility to respond to many different highway 
program specifications. Given the importance to members of Congress of 
the computations of State-by-State shares under alternative program 
proposals, authorizing committee leadership (Chairman Chafee and 
Ranking Member Baucus of the Senate Environment and Public Works 
Committee, and Chairman Shuster and Ranking Member Oberstar of the 
House Transportation and Infrastructure Committee) asked the 
Comptroller General in a February 6, 1997, letter to validate the 
computer model being used by FHWA to provide technical assistance to 
the Congress. We welcome this review, which is currently underway, as 
we believe it will verify that the new model we are using contains all 
the attributes necessary to carry out this vital function.
                   section 402 highway safety grants
    Question. I understand that the Section 402 Formula Grants for 
highway safety are among the most successful such programs. I note that 
the proposed budget freezes this appropriation at $140.2 million. The 
budget proposal increases other safety programs, such as anti-drunk 
driving initiatives and the National Motor Carrier Safety Program, so I 
wonder if this is a judgment on the Section 402 grant program.
    What is your assessment of the Section 402 program?
    Answer. The Section 402 program has been extremely successful in 
enabling all States to implement critical highway safety programs. 
Grants have leveraging effects and benefits far beyond their original 
amount. A recent assessment indicated that Federal funds have been 
vital for starting new programs aimed at improving traffic safety: 90 
percent of the projects in 4 States were started entirely or partly 
with Federal grants as seed money. Every occupant protection project, 
every Community Traffic Safety Program, and each project to modernize 
traffic records began with Section 402 funds. Then, States and 
communities elect to take over the responsibility for projects begun 
with Federal funding. The assessment showed that 75 percent of the 
safety projects eventually obtained partial or complete funding from 
non-Federal sources and that 78 percent were eventually expanded to 
other areas of the State.
    In addition, the Section 402 program is a major tool in the effort 
to reduce economic costs and reduce the Federal deficit. The benefits 
of traffic safety programs exceed their costs by very large ratios, up 
to 31-to-1. Even without factoring in pain and suffering or loss of 
life, the economic benefits of traffic safety programs exceed their 
costs by a 9-to-1 ratio.
    In NHTSA's fiscal year 1998 budget request, the consolidated 
Section 402 highway safety grant program, including formula and 
incentive grants, increases to $183.2 million from $165.2 in fiscal 
year 1997 ($140.2 million for formula grants and $25.0 million for 
Section 410 incentive grants).
                                 ______
                                 
                 Questions Submitted by Senator Stevens
                     international overflight fees
    Question. Last year, the Congress gave DOT the authority to assess 
a user fee for international overflights, with the proceeds to help 
fund the EAS program. The legislation anticipated that these fees would 
not be levied on any flight with an origination or destination in the 
United States. It is my understanding that the administration is 
considering levying these fees on domestic Canadian flights and 
domestic Mexican flights that transit United States airspace. Is this 
accurate? When is the rule expected out?
    Answer. The interim final rule was published in the Federal 
Register on March 20, 1997. Aircraft operations that transit U. S.-
controlled airspace and do not land in, nor take-off from the United 
States, will be charged fees to recover the costs of providing air 
traffic control (ATC) and related services. Currently, overflights 
contribute nothing to the provision of FAA ATC and related services. 
The overflight fee for Canada-to-Canada operations is deferred until 
October 1, 1997. The deferral was given to allow time for U.S.-Canada 
consultations and NAV CANADA (the air traffic control agency of Canada) 
to implement its planned en route charge system, minimizing temporary 
disruption of air traffic due to the introduction of charges. No 
deferral was given to Mexican overflights. Given the pattern of Mexican 
aircraft operations, air traffic disruptions are not expected.
    Question. Has the administration considered that the Canadian and 
Mexican governments might levy similar overflight fees on domestic U.S. 
flights that transit their airspace if we go down that path? Do you 
anticipate exempting domestic Canadian flights and domestic Mexican 
flights from this fee?
    Answer. The administration does anticipate that Canada will levy 
overflight fees on U.S. domestic flights. Within the next two years, 
NAV CANADA will be required to become a fully user-fee-funded entity. 
Consequently, NAV CANADA will be required to recover all of its costs, 
including the cost of providing air traffic control services to U.S. 
domestic flights. The Canadian Government has presented a Note to the 
Department of State proposing consultations in early May to discuss 
overflight fees. We are in the process of setting a mutually 
satisfactory date for those discussions.
                        wind profiling research
    Question. I've recently been briefed by representatives of the FAA 
and other organizations about some anemometer and wind profiling 
efforts that are ongoing in Juneau, Alaska. The effort that is underway 
will allow carriers to use the Gastineau Channel routes in a way 
previously not possible in ground-induced turbulence conditions, 
improving safety, and addressing the wind speed concerns that have led 
to a number of flight delays and cancellations. What the FAA is 
pursuing with Alaska Airlines and the National Center for Atmospheric 
Research (NCAR) is similar to what NCAR and the FAA did for the new 
airport in Hong Kong. This project should fit nicely with the HALASKA 
initiative, and I commend the effort to your attention and look forward 
to working with the Department to develop this new capability.
    Does this particular initiative fit into the HALASKA effort, or 
more broadly, the Free Flight 2000 initiative?
    Answer. While this capability is not specifically one of the free 
flight capabilities planned for Flight 2000, we are currently 
developing a program plan that will include weather initiatives, and 
this capability will be considered. The program plan is scheduled to be 
completed by the end of June.
                              free flight
    Question. The term ``Free Flight'' has been discussed in many 
aviation publications in the past several months. In your view, how 
will this initiative provide the architecture and the tools to meet the 
projected 40-percent increase in flight operations by the end of the 
decade--and what shifts of resources will it require within the FAA?
    Answer. The free flight initiative consists of an operational 
concept and a joint government/industry consensus list of 46 
recommended actions necessary to evolve toward a mature free flight 
environment. These recommendations provided focus to the development of 
a complete architecture and a set of technologies and procedures 
necessary to meet the increased demand for services. This is outlined 
in the proposed FAA Architecture Version 2.0. The current FAA/industry 
review of Version 2.0 will help identify the appropriate shifts in 
resources necessary to gain free flight efficiencies in the earliest 
possible time frame. The architecture will implement the free flight 
enhancements recommended through the government/industry consensus 
process necessary to meet the projected traffic growth through the end 
of the decade and the 40-percent increase in passenger enplanements and 
the resulting 15-percent increase in air traffic operations forecast by 
the year 2006.
                             commuter rule
    Question. Mr. Secretary, I want to draw an FAA rule to your 
attention that has a dramatic effect on Alaska. The rule is known as 
the ``Commuter Rule,'' and requires that all airlines with scheduled 
service using planes with 10 or more seats conform to Part 121 
requirements--the same rules that apply to jetliners. For almost all 
Alaska's air transportation markets, the increased economic burden 
represented by this rule renders 10- to 19-seat aircraft non-economic.
    At present, most carriers with scheduled service in Alaska operate 
under Part 135--which is a much lower level of regulatory burden. The 
preamble to the ``Commuter Rule'' stated that ``there are scheduled 
operations using airplanes of less-than-10 passenger seats conducted 
under Part 135, but they typically occur in geographic areas such as 
Alaska and Hawaii where air transportation is virtually the only 
feasible mode of transportation and where the operational environment 
is unlike other air transportation environments.'' Alaskan air 
operations with 10- to 19-seat aircraft are typically short-haul 
operations often carrying only 4 to 6 passengers--the additional 
aircraft capacity is utilized for cargo movement, mail movement, 
medivac evacuations, and other special needs that are unique to Alaska. 
They resemble air taxi operations more than commuter operations even 
though the flights are scheduled.
    By comparison, the FAA's ``Commuter Rule'' was designed to cover 
operations for lower-48 carriers that either already operated under 
Part 121, or whose operations certainly resemble the operations of the 
large national carriers more than they do the typical Alaskan operation 
with 10- to 19-seat aircraft.
    Last year, Senator Murkowski, Congressman Young, and I had a series 
of meetings with then-FAA Administrator Hinson about this matter. We 
informed him that over half the fleet of 10- to 19-seat aircraft had 
already been removed from service in Alaska--even though the rule was 
not in full effect--and that the other half of the fleet was 
anticipated to leave scheduled service by March of this year. We 
provided discretionary authority that would allow the FAA to view 
Alaska differently as they considered rulemakings. Unfortunately, the 
FAA has failed to use that authority.
    While the FAA contends that the Commuter Rule will lead to greater 
safety nationwide in the 10- to 19-seat aircraft category, for every 
one of the 10- to 19-seat aircraft that leaves the fleet mix in Alaska, 
twice the number of flight operations must be made with less-than-10-
seat aircraft (which still operate under Part 135) to move the same 
amount of people and cargo as would otherwise be moved in 10- to 19-
seat aircraft. The net effect of this rule has been to reverse a 20-
year trend toward the use of turboprop aircraft in Alaska--turboprop 
aircraft are more technologically advanced, better suited for the 
terrain, and the shifting weather conditions that characterize many 
areas of my home State.
    Further, the safety record of 10- to 19-seat aircraft is the best 
for any category of aircraft operating within the State. The new 
commuter rule will require the increased burden of new dispatch rules, 
new communication protocols, new maintenance manuals, new operational 
manuals. In Alaska, many of the communications requirements are not 
possible--a fact that FAA has conceded as well as some other 
maintenance items. However, they refuse to modify the rule to save this 
class of aircraft operations in Alaska.
    Given the safety record of these aircraft, I would really like to 
know how many of the accidents over the last several years in Alaska 
would have been prevented by the application of the Commuter Rule.
    Mr. Secretary, rural Alaskan consumers are beginning to lose 
service with these larger turboprop aircraft, because the FAA 
regulations are forcing aircraft choice on carriers. This is really the 
wrong way for equipment decisions to be made, and may have significant 
safety consequences for Alaska.
    My question is, have you had an opportunity to look into this 
situation? Do you have any thoughts for me as to how the FAA may 
proceed in this arena?
    Answer. First, the Commuter Rule was designed to cover ALL commuter 
operations, including those in the State of Alaska. This rulemaking was 
based, in part, on safety recommendations from the National 
Transportation Safety Board (NTSB). These recommendations included 
Alaska commuter operations, although specific site visits were not 
conducted in Alaska as part of the NTSB's study. Many exceptions were 
provided for the 10- to 19-seat fleet based on specific comments from 
Alaska carriers and the Alaska public. These comments were provided to 
the regulatory docket.
    During the implementation period, specific issues were raised by 
Alaska carriers that were resolved through exemption relief, operation 
specifications, or regulatory amendments. Examples of these include 
relief to use the Part 135 weather reporting and visibility minimums in 
remote areas, relief from some of the dispatch enroute communications 
requirements due to lack of infrastructure in parts of Alaska, and 
relief to carry personal medical oxygen by passengers in Alaska.
    The statement that over half the fleet of 10- to 19-seat aircraft 
had already been removed from service in Alaska is not supported. A 
review and survey of all carriers shows that some carriers did go out 
of business in Alaska, but these actions were due to bankruptcy or lost 
leases or other financial reasons independent of and before the 
commuter rulemaking. Five carriers were in business and impacted by 
this rule in Alaska. The following represents the status of those 
carriers:
    1. Pen Air. This carrier was the first in the country to transition 
to Part 121. Since their transition, they have added one, and are in 
the process of adding a second, 30-seat Saab aircraft, resulting in 
increased passenger seat availability. Exemption relief was provided 
for the carriage of medical oxygen. Actions are currently being taken 
to accelerate the installation of Automated Weather Observing Station 
weather reporting in Atka to meet the weather reporting requirements 
for this carrier.
    2. Seaborne. This is a seasonal carrier that operates in Alaska 
during the summer months. Seaborne completed the recertification and 
did not require/request any exemption relief. They will conduct 
additional validation flights upon their return to Alaska in the May 
time frame.
    3. ERA. This carrier completed the recertification. They did 
request, and were given, specific dispatch and some weather relief for 
their Bethel remote area operations. There was no loss of passenger 
seat availability or service in remote areas.
    4. Frontier. This carrier did not meet the recertification deadline 
but is continuing the recertification efforts. The FAA has dedicated a 
team of inspectors to assist in these efforts. Exemption relief for 
remote area operations will be provided.
    5. Cape Symthe. This carrier withdrew its transition plan. They 
operate a fleet of 9- or fewer-seat airplanes in addition to 3 turbine-
powered Beech 99 airplanes. They are continuing to operate these three 
turbine-powered airplanes, but have removed seats to operate them in 
the nine- or fewer-seat configuration. The carrier states that 
operations with more than nine seats represents less than two percent 
of their operation. The FAA will continue to work with this carrier if 
it elects to transition and similar exemption relief will be provided.
    The net effect of this rule is provision for the highest level of 
safety of operations in the United States, including Alaska. The agency 
has used the legislation provided for regulatory amendments, 
exemptions, or operations specifications relief for Alaska commuter 
operations. This legislation has also been used to address the needs of 
other Alaska carriers. It formed the basis for the Single Engine 
Instrument Flight Rule Notice of Proposed Rulemaking that addresses the 
needs of on-demand operations in single-engine airplanes. This 
rulemaking directly responds to requests from the Alaska Air Carrier 
Association and to the NTSB safety study in Alaska.
    The FAA is also working with the above groups to study safety 
policies and regulations dealing with in-flight icing. The FAA has 
already issued several airworthiness directives that address in-flight 
icing for turbo-propeller aircraft and has also issued operational 
bulletins to this part of the industry. Also, as part of the FAA's in-
flight icing efforts, the FAA has developed an in-flight icing plan 
that outlines several recommendations to improve safety for inadvertent 
flight into icing conditions. The FAA plans to implement as many of 
these recommendations as possible prior to the 1997-98 winter season.
           dot resources devoted to commuter rule rulemaking
    Question. Please provide a breakdown of the OST/FAA FTEs and budget 
authority that can be attributed to the ``commuter rule'' rulemaking.
    Answer. The FAA and the Office of the Secretary of Transportation 
accumulated costs of approximately $3.5 million in developing the 
commuter rule, beginning with the initial drafting of the rule in 
December 1994. Costs include dedicated rulemaking teams in the FAA 
headquarters, the regional offices, and field personnel involved in the 
data gathering; drafting of the rule; legal and economic support; 
public meetings; developing guidance for the FAA inspector workforce 
and industry; and working on implementation issues. The Department 
estimates that in the period between December 1994 and final 
implementation of the rule in March 1997, a total of 30 full-time 
equivalent staff were devoted to the commuter rule.
                                 ______
                                 
               Questions Submitted by Senator Lautenberg
             dot stance on 0.08 blood alcohol content laws
    Question. When it comes to determining the appropriate Blood 
Alcohol Content (BAC) level for prosecuting drunk drivers, NHTSA has 
determined that drivers become significantly impaired at 0.08 BAC. 
NHTSA also found that the risk of being in a crash rises gradually as 
the BAC level increases, but then rises very rapidly after a driver 
reaches or exceeds 0.08 BAC.
    Don't you think we need to take a more aggressive stance to get the 
States to adopt 0.08 for prosecuting drunk drivers?
    Answer. Yes. NHTSA has been actively working to get States to adopt 
0.08 BAC laws to reduce drunk driving. NHTSA has employed convincing 
research and timely technical assistance combined with public education 
and public support. Efforts such as these have resulted, for example, 
in Idaho becoming the 14th State to adopt a 0.08 BAC law. NHTSA will 
continue to provide useful support like the new publication ``Setting 
Limits, Saving Lives--The Case for .08 BAC Laws'' to its public 
partners to inform, educate and encourage the adoption of lower BACs in 
the States. In addition, the Department's reauthorization proposal in 
NEXTEA includes an alcohol incentive grant proposal that rewards States 
for enacting a 0.08 BAC law.
                     incentive grants for 0.08 bac
    Question. Current law provides incentive grants to States that 
adopt 0.08 BAC. Even so, only 13 States have adopted this standard 
since it is fiercely opposed by the restaurant and tavern lobby. Now, 
your ISTEA proposal expands the existing incentives for going to 0.08 
BAC.
    Are you confident that expanded incentives will do the job in 
getting more States to adopt 0.08 BAC?
    Answer. The Department has learned that incentive grants are 
effective in encouraging States to pass critical laws to reduce drunk 
driving. Since the passage of the amended Section 410 program in ISTEA 
in December 1991,
  --Nine States have enacted 0.08 BAC laws. (A total of 14 States have 
        0.08 BAC laws.)
  --34 States plus the District of Columbia have enacted 0.02 BAC laws 
        for drivers under age 21. (A total of 37 States and DC have .02 
        BAC laws for drivers under 21.)
  --Ten States have enacted administrative license revocation (ALR) 
        laws. (A total of 39 States and DC have adopted some form of 
        ALR.)
    The Department believes that the new alcohol incentive grant 
proposal contained in NEXTEA places more emphasis than the current 
Section 410 program on adoption of 0.08 BAC laws as a means to receive 
funds. Under the current program, States can qualify for grant funds by 
implementing five out of seven laws or programs designed to reduce 
drunk driving. One of the seven requirements calls for a 0.10 per se 
law, and only after three years of grants is a 0.08 per se law 
required; therefore, States had many other options and several years of 
funding before considering passage of 0.08 laws as a route to receive 
incentive funds. Under the new proposal, there are three options for a 
State to qualify for funding--one option is by implementing four out of 
five specified laws and programs, the second is demonstrating specific 
performance, and the third is by enacting only two key laws: 
administrative license revocation and 0.08 BAC. States can qualify for 
funding under one, two, or all three options. However, this third 
option will more clearly focus State attention on 0.08 BAC laws as a 
means to qualify than the Section 410 approach.
         highway funding sanctions to achieve 0.08 bac standard
    Question. We have seen that highway sanctions HAVE done the job 
when it comes to getting States to do the right thing regarding drunk 
driving. And while I do not usually propose legislation that could 
possibly sanction my own State's highway funds, I am prepared to do so 
to push New Jersey to do the right thing.
    What would be your view of a bill that sanctioned highway funds 
from States that do not adopt 0.08 BAC after a reasonable period of 
time?
    Answer. The Department supports 0.08 BAC. While the Department has 
witnessed success through the use of incentive grant programs to 
encourage passage of such legislation, the Department is open to 
considering a full range of options.
                      sanctions versus incentives
    Question. In your formal opening statement, you correctly point out 
that we face a daunting challenge in reducing the fatality rate on our 
Nation's highways. A prestigious researcher at Boston University 
recently compared the number of alcohol-related deaths in the first 
five States that lowered their BAC limit to 0.08 to five nearby States. 
He found clear evidence that lowering BAC levels to 0.08 reduced the 
number of alcohol-related fatalities. Indeed, he estimated if all 
States lowered their BAC limits to 0.08, alcohol-related highway deaths 
would decrease in the United States between 500 and 600 per year.
    Wouldn't you conclude that a sanction that pushed the States to 
adopt 0.08 would have a more immediate effect in saving lives than 
continuing or expanding incentive grants?
    Answer. The Department has observed that incentive grant programs 
have been successful in pushing States to pass life-saving highway 
safety laws.
   faa personnel reform and new york-new jersey controller staffing 
                               shortages
    Question. Mr. Secretary, in your formal opening statement, you call 
attention to the fact that the FAA personnel reform authority, which we 
included in the 1996 appropriations bill, has enabled you to hire the 
best people possible in the most effective way.
    However, when we agreed to grant the FAA these personnel reform 
measures, it was in part with the intent of giving the agency the tools 
to get the right people in the right place at the right time. For years 
now, I have been frustrated with the FAA's inability to get the 
authorized numbers of air traffic controllers in place at the several 
air traffic facilities in my region.
    Notwithstanding promises to the contrary, the number of controllers 
at the air traffic control tower and Newark Airport are almost ten 
percent below the authorized level. The same is true for the New York 
area TRACON, and staffing at the New York Air Traffic Control Center. 
It is 12 percent below the authorized level.
    Given the far-reaching personnel reforms that we granted to the FAA 
in 1996, what explains these continued delays in getting the right 
number of controllers in the right place as soon as possible?
    Answer. There are delays, unrelated to the personnel rules, 
associated with the recruitment, testing and selection of controller 
candidates. Overall controller hiring will be at an even rate of about 
85 per month starting in April 1997. Newark Tower is scheduled to 
receive seven controllers in fiscal year 1997, four of whom are already 
onboard. Similarly, New York Air Traffic Control Center is scheduled to 
receive 42, of whom at least 12 are onboard. New York TRACON will 
receive a total of 22 in fiscal year 1997, of whom at least 4 are on 
board. All current and future hiring will be accomplished in a manner 
that allows sufficient time for required facility training.
    Question. We continue to hear reports that trainees at these 
facilities cannot get fully qualified in the jobs that they are there 
to study because all available controllers are handling aircraft, and 
do not have the time to perform their training functions.
    What is being done to address this problem?
    Answer. We are implementing plans to increase staffing at New York 
area facilities. In addition, we have recently increased overtime 
funding for New York Center by $735,000 to optimize the on-the-job 
training of new hires.
    In addition, we have developed some management controls at New York 
Center, such as: (1) the establishment of a stand-alone training 
department; (2) a staff manager for training; (3) assignment of two 
training specialists and two data analysts to the training department; 
and (4) six operations supervisors (one from each area to assume 
collateral training duties).
    Question. What is your target date to get all of the facilities in 
my region staffed to the area called for by the FAA's own staffing 
plan?
    Answer. The projected date to reach targets for full-proficiency-
level controllers is September 30, 1998.
             direct air links between new jersey and japan
    Question. Mr. Secretary, in March of 1996 United Airlines canceled 
the only non-stop service from Newark International Airport to Tokyo. 
Last year, over 85,000 passengers flew between New Jersey and Japan. 
New Jersey exported over $1.5 billion worth of goods to Japan's 
markets. Newark should have non-stop service to Japan.
    What can you do to replace this critical air service with a carrier 
like Continental that has a vested interest in serving the Newark-Tokyo 
market?
    Answer. Under existing aviation agreements with Japan, the United 
States does not currently have the right to designate a new carrier 
like Continental to serve the Newark-Tokyo market. However, we are now 
engaged in exploratory talks with Japan that we hope will lead to 
formal negotiations and an agreement that will open up additional 
opportunities for U.S.-Japan air services, including the opportunity 
for carriers like Continental to enter the Newark-Tokyo market.
    Question. As an interim step would you consider allowing a carrier 
to take over the service as a replacement carrier?
    Answer. Until the U.S. succeeds in negotiating additional rights, 
the only U.S. carriers authorized under the U.S.-Japan aviation 
bilateral agreements to operate nonstop Newark-Tokyo services are 
United Airlines, Northwest Airlines and Federal Express. Although these 
three airlines are authorized to serve the New York (Newark)-Tokyo 
market, we cannot require that any of these airlines serve a particular 
market. It is up to airline management to decide what markets it will 
serve.
                                 ______
                                 
                  Questions Submitted by Senator Byrd
                      highway trust fund balances
    Question. The Budget Reconciliation Act of 1991 saw to it that an 
additional two-and-a-half cents of the Federal gas tax began being 
deposited in the Highway Trust Fund at the beginning of fiscal year 
1996. These new deposits, in combination with the increased amount of 
gas consumption, have substantially increased the balances of available 
resources in the Highway Trust Fund.
    Under your budget proposal, how much will those balances grow over 
the six years of the next highway bill?
    Answer. Under our NEXTEA and budget proposals and planning numbers 
for FYs 1998 through 2003, at the end of fiscal year 2003, the 
termination date for the reauthorized program, the cash balance in the 
Highway Trust Fund will be $48 billion, an increase of $24 billion from 
the $24 billion balance projected for the end of fiscal year 1997. We 
are proposing authorization levels in NEXTEA that are higher than 
outyear planning numbers in the budget. If the economic and deficit 
pictures improve beyond current projections, actual obligation levels 
might be higher than current planning levels and, as a result, Trust 
Fund balances could be lower than these projections.
                      use of two-and-a-half cents
    Question. Is it correct to say that the two-and-a-half cents that 
began being deposited in the Highway Trust Fund at the beginning of 
last year will not even be used under the highway spending figures 
assumed in your budget request?
    Answer. Yes.
                       appalachian highway system
    Question. Several weeks ago, the Chairman of the House Budget 
Committee held a press conference with other Members where they 
identified several Federal programs as ``corporate welfare.'' I was 
astounded to learn that this group identified the Appalachian 
Development Highway System as an example of corporate welfare. The 
Appalachian Highway System was conceived to bring economic development 
to some of the most isolated and impoverished communities in the United 
States.
    Mr. Secretary, can you imagine any definition of the phrase 
``corporate welfare'' that can be made to include the Appalachian 
Highway System?
    Answer. The Appalachian Highway System is a strong supporter of 
industry and tourism and enables the region's residents to move freely 
between their homes and jobs, schools and other public facilities. It 
is quite opposite of welfare in that it has enabled the creation of 
many new jobs and increased the ability of the Appalachian people to 
compete for jobs wherever they choose to work and live.
    Question. I am grateful that you accepted my invitations to tour 
segments of the Appalachian Highway System in West Virginia. What were 
your personal observations during your tour of the Appalachian Highway 
System in West Virginia regarding the economic benefits that the 
Appalachian Highway System has brought to the region?
    Answer. I was impressed by the beauty of the region, but also by 
the difficulty of construction. Significant economic benefits were 
evident both in the Corridor D area adjacent to Parkersburg and along 
Corridor G from Charleston to Williamson, including a new development 
near Charleston called Southridge, construction of another large 
development in the Logan area, and, in general along both corridors, 
considerable traffic volumes and residential and business development.
                    emergency relief program funding
    Question. Mr. Secretary, the recent tornados in Arkansas, as well 
as the severe flooding in my region of the country, come on the heels 
of earlier floods that impacted California, the Pacific Northwest, as 
well as the Midwest. Absent any supplemental funding, your Department 
will be limited to $100 million in emergency relief funding for this 
fiscal year.
    Can you give us a preliminary assessment of the needs for emergency 
highway relief funding at the current time? What's the available 
balance in the Highway Emergency Relief sub-account?
    Answer. The administration has submitted a fiscal year 1997 
supplemental emergency funding request of $291 million for the 
emergency relief program. All available emergency relief funds have 
been allocated to the States.
    Question. At present, do you expect to have sufficient funds to 
cover all of the highway restoration projects eligible for emergency 
relief for this fiscal year?
    Answer. No. A supplemental appropriation will be needed.
    Question. Do you have a sense of what amount of emergency 
supplemental funds will be needed?
    Answer. The administration has submitted a fiscal year 1997 
supplemental emergency funding request of $291 million.
    Question. Do you know if and/or when the administration plans to 
seek an emergency supplemental for highway restoration funds?
    Answer. The supplemental was submitted March 19, 1997.
     performance of automated surface observing system at airports
    Question. Mr. Secretary, on February 19, I sent a letter asking you 
to suspend the removal of contract weather observers from airports in 
West Virginia until you can certify that safety would not be 
compromised once they are removed. As I said in that letter, I have 
heard a number of complaints from airports in my State regarding the 
poor performance of the Automated Surface Observing System (ASOS). 
These automated weather observation systems are intended to replace 
these contract weather observers. However, they have been consistently 
reporting inaccurate weather conditions, especially during inclement 
weather.
    What can you tell me regarding how the ASOS systems are performing 
across the country?
    Answer. There are 389 commissioned ASOSs, sponsored by FAA or the 
National Weather Service (NWS), operating at airports throughout the 
Nation. Fifty-six additional systems are in the evaluation phase that 
precedes commissioning. ASOS observations comply with Federal aviation 
requirements.
    A 6-month demonstration conducted at 22 operational ASOS locations 
in 1995 showed ASOS performance to be comparable with that of human 
observers in all critical aviation weather elements. This demonstration 
was sponsored by the FAA and NWS with participation by controllers, 
observers, and pilots.
    The FAA is actively pursuing improvements and advances in ASOS 
sensor technology. Testing of an independent thunderstorm and lightning 
detection/reporting capability that will interface with ASOS is 
expected to be complete in late summer 1997, with national 
implementation planned by December 1997. Sensors that detect freezing 
precipitation have been purchased and are being installed. Additional 
enhancements are being included through a product improvement program.
    In August 1996, the FAA began implementation of new Aviation 
Service Standards at airports with a commissioned ASOS. Developed in 
conjunction with industry and the NWS, the standards define four 
categories of aviation weather service. The standard level of service 
to be provided at an airport will be based on the occurrence of 
significant weather, aviation activity, distance to the nearest 
suitable alternate airport, and critical airport characteristics. 
Service provided under the new standards will range from ASOS operating 
in a ``stand-alone'' mode at low-activity airports, to ASOS operating 
with full-time augmentation and back-up at the high-activity major 
airports.
    Question. Have you heard similar complaints regarding the ASOS 
systems from airports in other regions of the country?
    Answer. The National Weather Service is responsible for the 
performance, maintenance, and logistical support of ASOS. The FAA's 
primary focus has been on operational issues that address user 
perceptions of ASOS and the acknowledged and truly distinct differences 
between human observations and those provided by automated systems.
    The FAA has received a number of complaints from individuals 
employed as contract weather observers. A significant number of these 
complaints focus on the differences between reports generated by ASOS 
and those prepared by human observers or weather parameters that are 
not reported by ASOS. Complaints of this nature will be a major focus 
in the upcoming 120-day evaluation of ASOS at selected locations.
    Question. What is your schedule for evaluating the capability of 
the ASOS systems in West Virginia?
    Answer. The FAA will conduct a 120-day assessment of the ASOS 
system at selected locations, including all of the sites in West 
Virginia. The assessment will focus on sites with contract weather 
observers and the comments generated by those individuals over the past 
year. The assessment performed will include some combination of the 
following:
  --field comparison of ASOS observations and manual observations for a 
        length of time at each test site and analysis of discrepancies 
        between the two observation types;
  --pilot and airport operator feedback from user meetings at each test 
        site; and
  --evaluation of pre-commissioning certification data performed by the 
        NWS for each test site.
    ASOS commissionings in West Virginia have been placed on hold and 
the contract weather observers will be retained at all locations within 
the State, at least until the assessment is completed.
    The selected test sites will include all sites at which contract 
weather observation was scheduled to be terminated within the next 120 
days. We intend to address the perception of ASOS inadequacy, identify 
corrective measures where necessary (possible relocation of sensors, 
changes to software, etc.), and education of users on ASOS reporting 
capabilities.
    Concurrent with this performance evaluation, the FAA will conduct 
an overall availability assessment by remotely gathering information 
from a representative sample of commissioned ASOS sites. This 
assessment will address site technical data such as system and sensor 
availability, frequency of augmentation by weather parameter, and 
frequency of backup by sites and by weather parameter.
    The information gathered from these two assessment activities will 
be utilized in the overall annual Aviation Service Standards review to 
determine needed changes in weather elements reported at each service 
level, any change in ranking criteria, airport operations data or 
airport characteristics, and to identify, prioritize, and develop 
action plans to resolve personnel or equipment performance or 
procedural problems. The annual review will cover all ASOS sites, 
commissioned or not commissioned, whether they belong to the FAA or the 
NWS. An industry/government workshop will be conducted in April to 
present the plans for assessment and to obtain feedback from industry 
representatives on the implementation of the Aviation Service Standards 
over the past year.
    Question. At this point, are you confident that the contract 
weather observers can eventually be removed from West Virginia airports 
and the ASOS systems will serve as adequate replacements for the 
contract weather observers without safety being compromised?
    Answer. Yes. The ASOS provides observations in full compliance with 
documented Federal aviation requirements. The four parameters required 
for an instrument landing are wind, visibility, altimeter, and time of 
observation. The ASOS goes well beyond these requirements by also 
providing precipitation type and accumulation, cloud height, 
temperature, dew point, and selected significant remarks such as 
variable cloud height. Freezing rain sensors are being deployed at 
qualified sites, and FAA will begin to implement a thunderstorm 
reporting capability later this year.
    The FAA is confident that the combination of service standards, 
product improvement plans, and an effective quality control program 
will address the concerns that have been raised regarding the 
performance and reliability of ASOS. Safety is and will remain the 
FAA's number-one priority.
                                 ______
                                 
                  Questions Submitted by Senator Kohl
               reductions in airport improvement program
    Question. The President has proposed a funding level of $1 billion 
for the Airport Improvement Program (AIP) in fiscal year 1998, $460 
million or 31 percent below the fiscal year 1997 level. The proposal 
includes increases for FAA safety personnel--air traffic controllers, 
safety and certification inspectors--yet decreases AIP, the core 
program of Federal investment in our aviation system and our primary 
mode of assisting those at the front line, the men and women 
responsible for day-to-day operations, safety and security at airports 
across the country.
    My State of Wisconsin received approximately $20 million under the 
AIP formula and discretionary accounts in fiscal year 1996. Fiscal year 
1997 figures are not yet available; however, the Wisconsin Department 
of Transportation predicts that Wisconsin airports could face 
precipitous and unforeseen reductions of $7 to $10 million under the 
President's proposal for fiscal year 1998.
    Mr. Secretary, would you please take a moment to discuss the AIP 
reduction in the context of the U.S. Department of Transportation's 
(DOT) vision for the whole aviation system? In particular, how does DOT 
expect airports to cope with such significant reductions in core 
funding at a time of increased security requirements and record levels 
of passengers?
    Answer. I agree that AIP is an important program, but the reduction 
of AIP does not mean that safety and security needs will go unmet, or 
even that all construction on airports will stop. The airport industry 
generally has the ability through its own revenue production 
activities, the collection of Passenger Facility Charges (PFCs), and 
other financing options, to continue needed airport development in the 
face of a smaller AIP. In making the hard budget choices, one 
consideration was these other sources of funding for airport 
development.
    In contrast, we believed it necessary to maintain levels of funding 
for programs that do not have as well-developed alternative methods of 
funding, such as FAA's Facilities and Equipment program, personnel and 
operations funding, and our Research, Engineering and Development 
program.
    The majority of airport development dollars (75 to 80 percent) 
traditionally come from sources other than the AIP. We believe that 
other fund sources, such as issuance of bonds by airport sponsors and 
PFCs, in addition to the AIP level we have proposed, will be available 
to undertake needed airport development.
                   coast guard icebreaking user fees
    Question. The President's Budget instructs the Coast Guard to 
formulate a user-fee system for domestic icebreaking by fiscal year 
1999. As you know, annual domestic icebreaking occurs almost 
exclusively on the Great Lakes and is crucial to both the regional and 
national economies. The Great Lakes region comprises nearly half of our 
national industrial and agricultural output and approximately one-third 
of our population. Without seasonal icebreaking, the economic impact 
would be felt across the country--in steel mills lacking iron ore, 
public utilities waiting for coal shipments, and all the world markets 
that rely upon the export of Midwestern grain. Icebreaking is also 
necessary in other areas of the country such as on the Hudson River or 
the Boston Harbor, and is only one of many services provided by the 
Coast Guard. Other Coast Guard services include such services as buoy 
tending and other navigational aid maintenance, vessel traffic control 
services, and many others.
    I have strong concerns about the President's icebreaking proposal. 
As I've mentioned, the Coast Guard provides a whole host of services 
across all port ranges, and very few of these services are funded by 
user fees. It seems highly inappropriate for one narrow service to be 
singled out in this manner, especially when it would have such a grave 
impact on the economic viability of one specific port range.
    Can you explain the administration's rationale for singling out 
Coast Guard icebreaking services to be funded through a user fee, when 
most other Coast Guard services are funded through regular 
appropriations? For the record, could you provide the Subcommittee with 
a list of all services provided by the Coast Guard, and itemize which 
of these services are funded through user fees? Have you consulted with 
the Saint Lawrence Seaway Development Corporation, another agency under 
the jurisdiction of the U.S. Department of Transportation, to better 
understand how this proposal would affect their efforts to attract 
vessels to the Great Lakes?
    Answer. The administration intends to propose legislation to allow 
the assessment of user fees beginning in fiscal year 1999 for domestic 
icebreaking services provided by the Coast Guard. The administration's 
proposal is consistent with other applications of user fees where 
discrete services are provided to an identifiable commercial activity 
user group that benefits from the service. In this case, the user group 
is commercial vessels operating during the ice season in the Great 
Lakes and northeastern U.S., and the commercial activity is the 
transport of cargo. The following vessels are excluded from the 
proposed fee: recreational vessels, fishing vessels, fish processing 
vessels, fish tender vessels, passenger vessels, ferries, public 
vessels, and vessels not traveling to or from a U.S. port.
    Services provided to the public by the Coast Guard are categorized 
within seven major program areas: Search and Rescue; Enforcement of 
Laws and Treaties; Marine Environmental Protection; Marine Safety; Aids 
to Navigation; Ice Operations; and Defense Readiness. Services funded 
through user fees are listed in the Coast Guard User Fee Report, which 
is submitted to Congress annually. Of these existing user fees, nearly 
all fall within the marine safety mission area.
    As the legislative proposal is developed, consultations are in 
progress with the Saint Lawrence Seaway Development Corporation 
concerning the user fee legislation and the impact of the legislation 
on the Corporation's efforts to attract vessels to the Great Lakes.
                        transit formula factors
    Question. The President's Budget contains a number of significant 
changes to the Mass Transit Account. Most notably, transit 
discretionary grants have been folded into the formula program, and 
transit operating assistance has been eliminated for all but the 
smallest systems. It is my understanding that formula grants are 
currently distributed according to several factors, including 
population density, population and vehicle miles traveled (for the 
larger systems).
    In addition, under the Federal Transit Administration, the 
President has requested $100 million for transportation assistance to 
welfare recipients. This effort to address one of the most crucial 
elements of successful welfare reform--transportation--is to be 
commended. Finding a job is only meaningful and sustainable progress if 
a person can get to work on time and secure a ride home once that work 
is done. For example, according to the Wisconsin Department of 
Transportation, in Milwaukee's central city, 64 percent of the 
residents do not have access to an automobile, and 17 percent of 
residents do not even have a valid driver's license. These figures 
demonstrate the vital importance of mass transit options in securing 
mobility for all. I look forward to working with you and the 
administration on implementing this new program.
    On the other hand, I am concerned about the proposed compilation of 
transit distributions under the formula program. My State of Wisconsin 
has 1.6 percent of the urbanized-area population nationally, yet under 
the transit formula program, in fiscal year 1997 Wisconsin received 
only 1.2 percent of the formula distribution. That difference, 0.5 
percent, may seem small, but in dollars it translates to $7.7 million, 
a very significant amount of money for Wisconsin's transit systems.
    Mr. Secretary, would you please explain what factors are used to 
determine transit formula distributions and the respective weight of 
each individual factor? Also, would you please explain the role of 
population density as a criteria for transit formula distributions? 
Specifically, why does population density play a role for areas with 
populations over 200,000, even though it is not considered when 
determining distributions for areas with populations below 50,000, or 
transit assistance for the elderly and disabled?
    Thank you again for your consideration. Again, I look forward to 
working with you on these and other issues.
    Answer. The Urbanized Area Formula Program is distributed by a 
statutory formula based on urbanized area and transit service 
characteristics. It is designed to provide assistance based on relative 
needs for transit.
    Of the funds provided, 9.32 percent is allocated to areas of under 
200,000 population. Of this amount, 50 percent is apportioned based on 
urbanized area population, and 50 percent based on urbanized area 
population weighted by population density (population per square mile).
    The remaining 90.68 percent is allocated to areas over 200,000 
population. Of this amount, 33.29 percent is allocated by a formula 
reflecting fixed guideway needs. The fixed guideway tier has two parts. 
The first 95.61 percent of the fixed guideway tier is allocated 60 
percent based on fixed guideway revenue vehicle miles, and 40 percent 
based on fixed guideway route miles. The remaining 4.39 percent is 
allocated by an incentive formula designed to reward service efficiency 
and effectiveness. This allocation is based on fixed guideway passenger 
miles weighted by fixed guideway passenger miles divided by fixed 
guideway operating costs.
    The remaining 66.71 percent of the funds for areas over 200,000 is 
allocated by a formula reflecting bus needs. The bus tier also has two 
parts. The first part is the basic formula, which comprises 90.8 
percent of the bus tier funds. Of the basic bus tier amount, 73.39 
percent is allocated among areas over 1,000,000 population, of which 50 
percent is based on bus revenue miles, 25 percent is based on 
population, and 25 percent is based on population weighted by 
population density. The remaining 26.61 percent of the basic bus tier 
is allocated to areas under 1,000,000 population, of which 50 percent 
is based on bus revenue miles, 25 percent is based on population, and 
25 percent is based on population weighted by population density. The 
second part of the bus tier is the incentive tier, and is allocated 
based on bus passenger miles weighted by bus passenger miles divided by 
bus operating costs.
    In summary, population density is used to weight population in 
allocating 50 percent of the funds for urbanized areas under 200,000 
(which account for 9.32 percent of the total), and 25 percent of the 
basic bus tier funds for areas over 200,000, (which account for 54.93 
percent of the total). Thus, population density-weighted population is 
a factor in 18.39 percent of the allocation.
    Population density is used as a factor to account for the greater 
transit needs in dense urban areas. Fixed-route transit works best when 
population densities are high, since traffic congestion is generally 
higher in such areas and additional population density results in a 
higher number of potential transit riders. Population density is not 
used in the non-urbanized and specialized program formulas, since their 
services are generally provided on a demand-responsive basis where 
population density is substantially less important. Instead, these 
programs are allocated based only on non-urbanized area population, and 
numbers of elderly and disabled persons, respectively.
                                 ______
                                 
                 Questions Submitted by Senator Murray
                       flex funding possibilities
    Question. I wanted to first thank Secretary Slater and tell this 
committee how I met our new Secretary. He had been in office less than 
a week when he traveled unexpectedly, over 3,000 miles to the most 
remote corner of our mainland, to join myself, Commandant Kramek and 
the community of La Push, Washington. In an emotional farewell, the 
Secretary honored three Coast Guardsmen who lost their lives rescuing a 
distressed sailboat off the Washington Coast. I can tell you, Mr. 
Secretary, that your remarks and presence there that day are 
immeasurable. It meant so much to the families of these heros, the 
entire Coast Guard community and the Quillayute Indian Tribe who shares 
this community.
    Mr. Secretary, I also wanted to commend the work of your deputy 
assistant secretary John Horsley. John was a long-time County 
Commissioner from the State of Washington and has been a tremendous 
asset to your Department.
    Mr. Secretary, as you flew over the Olympic Peninsula in my State, 
you had the opportunity to view its natural beauty. This area 
surrounding the Olympic National Park is an unspoiled treasure and has 
become a destination for cyclists from around the State and Nation. 
However, logging trucks and cyclists do not mix well and we have 
witnessed unfortunate tragedies over the last few years. I have been 
working with 7 different communities around this Peninsula who are 
voluntarily constructing a 360-mile bike trail. We have used Scenic 
Byway funds and hope to expand these dangerously narrow road shoulders. 
I wanted to get your sense of Enhancement and CMAQ funds, along with 
future possibilities for safety improvements that can be used by our 
communities in a flexible manner.
    Answer. Washington State has received $404,539 in Scenic Byways 
discretionary funds for the construction of pedestrian and bicycle 
facilities along Highway 101. The administration's surface 
transportation reauthorization proposal continues the National Scenic 
Byways program. There would be $15 million available each fiscal year 
to fund eligible scenic byways.
    Several categories of Federal-aid funds are available for 
development of bicycle facilities and improving their safety. These 
facilities are one of the eligible activities under the transportation 
enhancement provisions of ISTEA. ISTEA provided that ten percent of the 
Surface Transportation Program (STP) funding was to be used for ten 
specific activities identified in the legislation; bike and pedestrian 
facilities are part of that list.
    Under the administration's proposal for NEXTEA, we continue to fund 
project activities for transportation enhancements to the same or 
greater extent as we have done under ISTEA. We have found the program 
to be a major contributor to our efforts to participate in the 
President's initiative to sustain our communities through a variety of 
measures that will spur economic development while maintaining the true 
sense of community connectivity.
    The Congestion Mitigation and Air Quality (CMAQ) program is another 
source of funds that could be used for bicycle and pedestrian trails, 
provided the project is located in a nonattainment area and the project 
results in an improvement in air quality. However, the Olympic 
Peninsula is not a nonattainment area, so these funds would not be 
available for this bike trail project.
                  funding puget sound regional transit
    Question. Mr. Secretary, you are probably aware that the voters of 
the Puget Sound Region recently approved a Regional Transit Plan that 
has a 50/50 match. It's a mix of commuter rail, HOV lanes, express bus 
service and highway improvements to relieve congestion in such sites as 
Bellevue's crowded I-405. My constituents are excited about this 
proposal, but very skeptical that our shrinking budget and backlog of 
projects will prevent us from ever getting off the drawing board. Can 
you comment on the future of rail new starts in relation to projects 
currently underway and suggestions for my State as we begin this 
process?
    Answer. The Federal Transit Administration's policy, as found in 
its annual Report on Funding Levels and Allocations of Funds (the 
``3(j) Report''), is that transit major capital investments (or new 
starts) funding shall only be proposed for projects that will be 
construction-ready in the budget year. A project such as Puget Sound's 
should be funded with planning or formula funds until it is 
construction-ready.
    Regarding the possibility of receiving funding in the next several 
years, NEXTEA provides $5.7 billion in budget authority for major 
capital investments over 6 years. Of this, $3.7 billion will be 
required for projects under existing or pending Full Funding Grant 
Agreements, using virtually all the funding under obligation 
limitations proposed by the administration. Those obligation 
limitations reflect our commitment to help balance the Federal budget. 
If the economic and budget environment improves during the NEXTEA 
years, the obligation limitations may be increased, and as much as $2 
billion may become available for additional projects like Puget 
Sound's.
    Funding for additional major capital investments is also available 
through FTA's innovative finance initiatives, as well as the flexible 
funding provisions contained in ISTEA and expanded in NEXTEA.
                      airport improvement program
    Question. Mr. Secretary, you have stated that your foremost concern 
is safety. I remain concerned that we may compromise that safety by 
targeting the Airport Improvement Program for nearly half a billion 
dollars in cuts. Many of our airports are suffering, particularly rural 
areas who depend upon AIP funds for their survival and safety. How can 
our airports absorb these cuts?
    Answer. A reduction in funding for AIP does not mean that safety 
and security needs will go unmet or that new construction at smaller 
airports will stop. The larger airports generally have the ability 
through other financing options, such as Passenger Facility Charges, to 
continue needed airport development if lower funding levels are 
provided for the AIP. The proposed budget will allow safety, security 
and high-priority capacity development to continue at the smaller 
airports.
                highway/rail grade crossings separation
    Question. As you know, the West has experienced tremendous growth, 
particularly in regards to freight rail as we move goods to the West 
Coast for shipment abroad. A new rail corridor has just reopened 
through the middle of Washington State. Unfortunately, many communities 
are now watching freight trains daily cross their front yards. I am 
hopeful that we can work together and with these communities in helping 
to fund grade separations that mitigate some of the impacts this new 
rail corridor brings.
    Answer. ISTEA provides a flexible framework of programs through 
which grade crossing eliminations can be funded, such as the National 
Highway System (NHS), Surface Transportation Program (STP), Congestion 
Mitigation and Air Quality (CMAQ), and Railway-Highway Crossing and 
Hazard Elimination funds.
    The administration's NEXTEA proposal would continue these programs 
and, in some instances, specifically extend eligibility to publicly-
owned rail infrastructure. These programs, of course, are funded from 
State allocations and spent according to local priorities.
    NEXTEA also establishes two additional programs that might provide 
alternative sources of funding:
  --The Transportation Infrastructure Credit Enhancement Program would 
        provide grants (up to 20 percent of total cost) and encourages 
        public-private partnerships consisting of State or local 
        governments with private business. (Note: the program would 
        require a public agency to acquire and operate the rail 
        facility, as is being done in California's Alameda Corridor.)
  --A permanently established State Infrastructure Bank (SIB) program 
        makes possible an array of loan and credit enhancement 
        assistance, such as direct loans, interest rate subsidies, 
        lines of credit and loan guarantees. States can capitalize 
        their SIBs using funds from regularly apportioned ISTEA 
        categories and from a discretionary $150 million annual DOT 
        fund for seed money.

                          Subcommittee Recess

    Senator Shelby. This will conclude the hearing. The hearing 
of the Subcommittee on Transportation is now recessed.
    The next subcommittee hearing is scheduled to be held on 
Thursday, March 20 at 10 a.m. in Dirksen 192. The topic then of 
the hearing is transportation infrastructure financing. Thank 
you.
    [Whereupon, at 12:13 p.m., Thursday, March 6, the 
subcommittee was recessed, to reconvene at 10:05 a.m., 
Thursday, March 20.]



 DEPARTMENT OF TRANSPORTATION 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 10:01 a.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Richard C. Shelby (chairman) 
presiding.
    Present: Senators Shelby, Bennett, Faircloth, Stevens, 
Lautenberg, Byrd, Kohl, and Murray.

                      DEPARTMENT OF TRANSPORTATION

                     Federal Highway Administration

STATEMENT OF JANE F. GARVEY, ACTING ADMINISTRATOR
ACCOMPANIED BY:
        GEORGE REAGLE, OFFICE OF MOTOR CARRIERS
        PETER J. BASSO, DEPUTY ASSISTANT SECRETARY, BUDGET AND PROGRAMS

                            Opening Remarks

    Senator Shelby. The subcommittee will come to order.
    Thank you for coming today, Ms. Garvey, Mr. Linton, and Dr. 
Martinez. We will get into some of the funding implications of 
the administration's NEXTEA proposal in a few minutes, but I 
want to discuss briefly with you some of the administration's 
priorities in light of the funding constraints we are likely to 
face for fiscal year 1998.
    In addition, I want you to have the benefit of hearing from 
the subcommittee membership about their particular priorities 
in this funding cycle and for them to have the benefit of your 
expertise on the administration's reauthorization proposal 
which will ultimately influence our appropriations bill.
    I think that the most important goal of the reauthorization 
legislation is to help States find the tools and the 
flexibility to address their specific transportation needs. 
Clearly the types of transportation infrastructure investment 
needed in the Nation's urban centers differs significantly from 
the needs of rural communities or areas of the country that are 
experiencing high growth rates.
    My State transportation officials tell me that ISTEA has 
complicated their lives and made it more difficult to meet 
Alabama's transportation needs. In short, they want more money 
and fewer categories.
    Many States would like to see a more equitable return of 
what they pay into the highway trust fund. I agree with them 
and have supported proposals that would ensure that States 
receive at least a 95-percent return on the payments they make 
to the highway trust fund. I believe we must help them to make 
the Federal investment in this program more effective.
    Today, I am interested in exploring with you and with the 
users group panel that follows you as many of the following 
issues as time permits, such as, how is NEXTEA more flexible 
and simpler to utilize than ISTEA?
    How has the intelligent transportation systems program's 
evolution affected the administration's funding priorities?
    How can we better focus our infrastructure investments on 
national priorities and on projects with significant economic 
returns?
    What is the administration proposing in terms of financing 
programs and toll programs?
    And in light of the severe constraints facing the transit 
new starts program under the 1998 budget, what does the 
administration's reauthorization proposal anticipate for the 
program over the life of NEXTEA?
    And how has the administration restructured the safety set-
aside program for rail-highway crossings and hazard 
elimination?
    Over the next several months, the authorizing committees 
will struggle with allocation formulas, policy and equity 
issues, and reviewing whether the current funding categories 
have fulfilled the promise of ISTEA. The Transportation 
Appropriations Subcommittee will struggle to stretch its 
limited Federal resources among the competing priorities 
articulated in current law and in forthcoming authorization 
legislation.
    The current budget environment further complicates our 
task, but it is critical that we focus our limited Federal 
resources on projects that create jobs, create opportunities, 
create economic activity, and improve mobility. As we complete 
the rest of our hearings and as a budget resolution takes 
shape, we will have a better idea of the funds available for 
transportation.
    I can assure you that we all want more money for specific 
programs, projects, or initiatives. There are no easy choices. 
I remain dedicated to continuing in the search for more 
efficient, less costly ways to deliver transportation services, 
to work with the authorization committees to improve programs 
by enhancing their flexibility, and reallocating funds from 
lower to higher priority activities.
    I hope the discussion we have today will be candid and 
productive and that we can start to focus on our highest 
priorities and needs as we move to appropriate Federal 
resources for the surface transportation program.

                           Prepared Statement

    Before I ask you to summarize your opening statement for 
us, I want to first recognize the ranking member of the 
subcommittee, Senator Lautenberg.
    [The statement follows:]
                  Prepared Statement of Senator Shelby
    Thank you for coming today, Ms. Garvey, Mr. Linton, and Dr. 
Martinez. We'll get into some of the funding implications of the 
Administration's NEXTEA proposal in a few minutes, but I want to 
discuss with you some of the Administration's priorities in light of 
the funding constraints we are likely to face for fiscal year 1998. In 
addition, I want you to have the benefit of hearing from the 
Subcommittee membership about their particular priorities in this 
funding cycle and for them to have the benefit of your expertise on the 
Administration's reauthorization proposal which will ultimately 
influence our appropriations bill.
    I think that the most important goal of the reauthorization 
legislation is to help states find the tools and the flexibility to 
address their specific transportation needs. Clearly, the types of 
transportation infrastructure investment needed in the nation's urban 
centers differs significantly from the needs of rural communities or 
areas of the country that are experiencing high growth rates. My state 
transportation officials tell me that ISTEA has complicated their lives 
and made it more difficult to meet Alabama's transportation needs--in 
short, they want more money and fewer categories. Many states, like 
Alabama, would like to see a more equitable return on what they pay 
into the Highway Trust Fund. I agree with them and have supported 
proposals that would ensure that states receive at least a 95-percent 
return on the payments they make to the Highway Trust Fund. We must 
help them to make the federal investment in this program more 
effective.
    Today, I'm interested in exploring with you, and with the user 
group panel that follows you, as many of the following issues as time 
permits:
  --How is NEXTEA more flexible and simpler to utilize than ISTEA?
  --How has the Intelligent Transportation Systems program's evolution 
        affected the administration's funding priorities?
  --How can we better focus our infrastructure investments on national 
        priorities and on projects with significant economic returns?
  --What is the administration proposing in terms of financing programs 
        and toll programs?
  --In light of the severe constraints facing the transit new starts 
        program under the fiscal year 1998 budget, what does the 
        administration's reauthorization proposal anticipate for the 
        program over the life of NEXTEA?
  --How has the administration restructured the safety set-aside 
        program for rail/highway crossings and hazard elimination?
    Over the next several months, the authorizing committees will 
struggle with allocation formulas, policy and equity issues, and 
reviewing whether the current funding categories have fulfilled the 
promise of ISTEA. The transportation appropriations subcommittee will 
struggle to stretch its limited federal resources among the competing 
priorities articulated in current law and forthcoming authorization 
legislation. The current budget environment further complicates our 
task, but it is critical that we focus our limited federal resources on 
projects that create jobs, create opportunities, create economic 
activity, and improve mobility. As we complete the rest of our hearings 
and as a budget resolution takes shape, we will have a better idea of 
the funds available for transportation. I can assure you that we will 
all want more money for specific programs, projects, or initiatives. 
There are no easy choices. I remain dedicated to continuing the search 
for more efficient, less costly ways to deliver transportation 
services; to work with the authorization committees to improve programs 
by enhancing their flexibility, and reallocating funds from lower to 
higher priority activities.
    I hope the discussion we have today will be candid and productive--
and that we can start to focus on our highest priorities and needs as 
we move to appropriate Federal resources for the surface transportation 
program. Before I ask you to summarize your opening statement for us, I 
would ask the ranking member of the subcommittee, Senator Lautenberg, 
if he has an opening statement that he wishes to make?

                    STATEMENT OF SENATOR LAUTENBERG

    Senator Lautenberg. Thanks very much, Mr. Chairman. I also 
want to welcome our witnesses from the administration. They are 
three very capable administrators, and I am pleased again to be 
able to have you in front of this subcommittee.
    We are examining, as everyone is aware, the details of the 
administration's NEXTEA proposal, the proposal for the 
reauthorization of the Intermodal Surface Transportation 
Efficiency Act.
    Let me also commend you, Mr. Chairman, for structuring this 
hearing the way that will allow us to discuss NEXTEA 
simultaneously with our Highway Administrator, Transit 
Administrator, our Highway Safety Administrator because it is 
in keeping with the spirit of ISTEA which is to structure 
generally an intermodal system and this, thusly, I think we can 
call it an intermodal hearing because we have all the parts as 
we would like to review them.
    I recall vividly--I didn't say fondly, Mr. Chairman--my 
experience 6 years ago when I served as chairman of this 
subcommittee while working on the authorization of ISTEA as a 
member of the Environment and Public Works Committee. Mr. 
Chairman, it will be a real challenge to accommodate, as you 
said in your remarks, three Senate authorizing committees, 
while producing an appropriations bill that stays within our 
ceiling and maintains our role in overseeing and directing 
transportation expenditures. But it is a critical task for our 
country's future and I pledge my best efforts to work with you.
    ISTEA was a bold and innovative step toward launching 
America's transportation system into the next century. The last 
6 years demonstrated that it works. It increased planning and 
flexibility, put power in the hands of local planners, 
encouraged new technology, and prioritized the mitigation of 
transportation-related pollution in congested areas.
    While the Nation's existing infrastructure continues to 
decay and we face reduced budgets, economic competition demands 
ever greater efficiency. We need to build upon ISTEA's 
successes to prepare for more intense global competition. We 
should retain ISTEA's intermodal system and its flexibility to 
let State and local officials use Federal assistance in the 
manner that is most appropriate for their needs.
    In many ways my State, New Jersey, is a national microcosm. 
We have densely populated areas, sprawling suburbs, rich 
farmlands, and vast protected, open spaces. New Jersey is a 
corridor State linking commerce and travel between the 
Northeast and the rest of the country. No State is more 
intermodal than New Jersey. From the moment goods arrive in the 
ports of Elizabeth and Newark, they are loaded onto rail cars 
or trucks and they are distributed to the rest of the country. 
Goods traveling just 24 hours on a truck from New Jersey will 
reach a market of 40 percent of the total population of the 
United States and Canada, over 100 million people.
    New Jersey is also a very heavily commuting State. There 
are more cars per mile on New Jersey roads than any other State 
in the country, but in many areas there is no place else to put 
down more concrete, to open new roads. We cannot build 
ourselves out of congestion and we are heavily reliant on new 
technology, mass transit, and Amtrak to reduce congestion.
    ISTEA's focus on moving goods and people efficiently has 
given States and localities greater latitude in deciding which 
transportation system works best for them. The flexibility 
provisions contained in ISTEA undeniably improve the efficiency 
of our Federal transportation spending.
    My State has enthusiastically opted to use over $163 
million of ISTEA highway funds for mass transit. That is the 
choice that we made. That is where it serves us best. Other 
States have used transit formula funds to build highways, and 
we should continue to advance the agenda of balance and 
flexibility.
    We must also acknowledge that Amtrak is a critical part of 
our national transportation network. It needs the kind of 
capital investment that is necessary to improve its bottom 
line, its operating efficiency.
    Mr. Chairman, I recognize that Amtrak will be called to 
testify before us at a later subcommittee hearing, but I want 
to note today that one of my greatest disappointments during 
the ISTEA conference 6 years ago was that my provision to allow 
States the flexibility of using their Federal ISTEA funds for 
Amtrak's expense was dropped.
    Finally, I want to underscore the need to promote safety on 
our highways. After several years of steady improvement, we are 
now seeing a tragic increase in deaths associated with drunk 
driving. These are preventable deaths and we should insist on 
making our highways safer.
    I look forward to discussing with our witnesses this 
morning how we can enhance the efficiency and safety of our 
Nation's transportation system. ISTEA has worked for our 
cities, our country, our environment, and our economy. The 
subcommittee's responsibility must be to build on the success 
of the past and not turn the clock back on transportation 
progress.
    I thank you very much, Mr. Chairman, for the opportunity.
    Senator Shelby. Senator Byrd.
    Senator Byrd. Mr. Chairman, I would like to yield to 
Senator Stevens first.
    Senator Shelby. Senator Stevens.
    Senator Stevens. You were here first, Senator. I will be 
glad to wait. Thank you very much.
    Senator Byrd. Well, I thank you.
    Mr. Chairman----
    Senator Shelby. The former chairman yielding to the current 
chairman of the Appropriations Committee. That is good. Then 
yielding back. That is good. [Laughter.]
    Senator Byrd.

                       STATEMENT OF SENATOR BYRD

    Senator Byrd. Mr. Chairman, the soon-to-be chairman again. 
[Laughter.]
    Senator Stevens. I knew a revolution was coming. 
[Laughter.]
    Senator Byrd. Thank you very much, and let me commend you, 
Senator Shelby, for proceeding with these important hearings on 
the reauthorization of the Intermodal Surface Transportation 
Efficiency Act.
    The crafting of a new surface transportation bill may well 
be the most important legislative challenge that we will face 
in this congressional session. While the surface transportation 
bill is an authorizing measure in the jurisdiction of three 
different Senate authorizing committees, I think it is wholly 
appropriate and indeed necessary for this subcommittee to 
review the administration's reauthorization proposal which has 
come to be known as the National Economic Crossroads 
Transportation Efficiency Act [NEXTEA], for it will be the 
actions of this subcommittee that will determine whether the 
Federal Government will continue its ill-advised trend of 
disinvestment in our surface transportation infrastructure or 
whether we will make positive strides to replace our aging and 
inadequate highways and transit systems.
    It will be this subcommittee that will determine whether 
the dozens of authorizations included in the surface 
transportation bill will be funded. What will really matter to 
the health of our national transportation enterprise is whether 
this appropriations subcommittee can increase substantially the 
annual obligation limitations that pertain to our surface 
transportation program.
    Budget realities over the last 6 years have meant that all 
of the promises contained in ISTEA--at least some of the 
promises--were not met, and without adequate resources over the 
next 6 years, the promises of NEXTEA will not be met either.
    One does not have to look past the administration's NEXTEA 
proposal to observe this disconnect between legislative 
authorizations and actual resources. Our very able 
Transportation Secretary, Rodney Slater, testified to this 
subcommittee that the administration's NEXTEA bill would 
authorize a total of $174 billion, or an 11-percent increase 
over ISTEA funding levels, but a review of the actual budget 
submitted by the administration clearly asks the Appropriations 
Committee to impose a freeze on the annual obligation 
limitation for the core Federal-aid highway programs for each 
of the next 6 years. There will be no increase in highway 
funding under the administration's budget, and the budget 
request calls for similar freezes for the next 6 years when it 
comes to transit and highway safety funding as well.
    This would fly in the face of the most recently published 
Federal Highway Administration study which indicates that it 
would require an additional $15 billion each year just to 
maintain the current inadequate condition of our Nation's roads 
and bridges.
    So, I hope, Mr. Chairman, that we will all work hard to 
ensure that transportation infrastructure is granted the 
highest priority in our annual budget deliberations, and toward 
that end, I was pleased to join with 55 of my Senate colleagues 
on both sides of the aisle in writing to the distinguished 
chairman of the Budget Committee, Mr. Domenici, to request that 
sufficient resources be allocated to the Environment and Public 
Works Committee to authorize the $26 billion annual highway 
program.
    But we will be doing a great disservice to our States, our 
communities, and the driving public if we go forward and 
authorize a substantial increase in Federal highway spending 
but constrain the Appropriations Committee so tightly as to 
eliminate any hope of an actual increased obligation over the 
next 6 years.
    So, I urge my 55 colleagues who wrote and those who did not 
write in support of a $26 billion highway program to join in 
seeking to secure sufficient domestic discretionary outlays in 
the upcoming budget resolution to support such an increased 
level of highway spending.
    And I join with my colleagues in welcoming our witnesses 
here this morning, Acting Federal Highway Administrator Jane 
Garvey, Federal Transit Administrator Gordon Linton, and 
National Highway Traffic Safety Administrator Dr. Ricardo 
Martinez.
    I am especially glad to welcome Dr. Martinez because I 
think it is critical that the issue of safety be prominent in 
each and every decision that we make in the development of a 
new highway bill. And as we discuss highway safety this 
morning, I remind my colleagues, if I needed to, that our 
highway construction agenda and our highway safety agenda must 
not be viewed as mutually exclusive. Indeed, one of the most 
important ways we can improve safety on our highways is to 
modernize them.
    For this Senator, the most important safety provision in 
the administration's NEXTEA legislation is the proposal to 
grant a predictable source--a predictable source--of funding 
from the highway trust fund for completion of the Appalachian 
Development Highway System. The unfinished segments of the 
Appalachian Highway System are among the most dangerous roads 
in my State. And the same is true across the entire 13-State 
Appalachian region. The unfinished segments of the Appalachian 
Highway Corridor System often consist of undivided, two-lane 
roads that twist and turn around dangerous mountain curves with 
little or no shoulder room and very little or very poor 
visibility. This makes for a very dangerous situation in light 
of the fact that these inadequate highways must be shared 
simultaneously by family vehicles, school buses, and heavy 
commercial vehicles loaded with coal, timber, and other 
products.
    In conclusion, Mr. Chairman, I commend the administration 
and the witnesses for their efforts in presenting to Congress, 
which they will do, the administration's proposed ISTEA 
reauthorization measure. I look forward to working closely with 
them and with the President in achieving much needed 
improvements in the areas that I have set forth in my remarks. 
Thank you, Mr. Chairman.
    Senator Shelby. Senator Stevens.

                      STATEMENT OF SENATOR STEVENS

    Senator Stevens. Well, thank you very much, Mr. Chairman.
    I will always defer to my good friend, Senator Byrd. I 
think he is the person who has the institutional knowledge for 
our guidance, and I am pleased to hear what he said.
    Ms. Garvey, Mr. Linton, and Dr. Martinez, I have some 
questions I would like to submit, Mr. Chairman, so I will not 
go into those.
    But I come from a State that will be just 40 years old next 
year, and it is sad for me to have to try to explain to my 
people why there are more Federal highways in Puerto Rico than 
there are in Alaska. Alaska is one-fifth the size of the Union. 
It stretches from Maryland to California and from Duluth to New 
Orleans in distance, and we have the same amount of roads by 
mile in Alaska today that we had when we were admitted to the 
Union.
    I have decided to commit myself to change that now, and 
that is why I did not sign the Senator's letter because it is 
not enough. I do not know why rural America has been neglected 
so much. It is not your errors. It is the past errors of our 
society.
    But, for instance, we have 80 percent of the national park 
acreage in our State and we have fewer access roads to those 
parks than exist in the Nation's Capital for the National 
Capital parks.
    Now, we have very few transportation links between our 
cities and now the Congress is telling us that there will no 
longer be any subsidy for air mail which in Alaska is our 
lifeline, and we can get subsidies on the roads. But that is 
the catch-22. There are no roads.
    So, what I would like to urge for you to do is to keep in 
mind that we are going to have to find some way to work 
together. I know that there are many people here who talk about 
the donor theory to the trust fund. I wonder what their 
predecessors would have thought in the days when General 
Eisenhower, then Colonel Eisenhower, devised the Interstate 
Transportation System, he had decided that only those States 
that paid taxes into the fund would receive highways. We are 
still part of the growth of America in Alaska and several other 
States I can think of that are rural States. And I do believe 
we have to find some way to bring a balance back to this 
system.
    I have asked you for some specific answers to specific 
questions, so I might address some amendments.
    As Senator Byrd says, it is our joint intention that we 
will monitor the expenditures of moneys under these 
authorization bills to assure the balance that the Senate is 
capable of bringing about. We are the focus of that balance in 
the historic compromise that formed this country. One of the 
Senate's most important functions is to bring about the balance 
in terms of States versus the population centers of the 
country.
    So often I have witnessed the changes in the road systems 
of our neighboring State of the State of Washington. Again, 
there are twice as many roads in King County, WA, as there are 
in its northern neighbor, Alaska, which is 40 times the size of 
that State.
    I want to emphasize to you that I intend to work with my 
friend from West Virginia. We share common thoughts, I think, 
with regard to the application of these funds, and I see no 
reason to put more and more money into these circular roads 
that go around population centers and not have the access for 
the rural people to get to those centers. It is a time for us 
to rethink this highway situation and NEXTEA is going to be the 
time we get to do that.
    So, I look forward to working with you. I look forward to 
the answers to my questions so I might properly frame the 
amendments I intend to offer. Thank you very much.
    Thank you, Mr. Chairman.
    Senator Shelby. Senator Faircloth.

                     STATEMENT OF SENATOR FAIRCLOTH

    Senator Faircloth. Thank you, Mr. Chairman.
    I am very much aware that this subcommittee is not going to 
be involved in the efforts to rewrite the new surface 
transportation bill, but I am pleased and I think it is proper 
that we examine the issues here.
    North Carolina is one of the largest donor States, and we 
have traditionally been receiving 87 cents on the dollar return 
of our money. We have lived with that for a number of years, 
but under NEXTEA, that would go down.
    Now, I am not the only North Carolinian committed to the 
fact that there should be a more equitable distribution. I am a 
strong supporter of Step 21 which returns 95 percent to each 
State. I know that, Mr. Chairman, you are a sponsor of the same 
bill. For too long money has been pulled out of the Southeast 
and fed into the Northeast.
    But now the Interstate System is complete, virtually, and 
there is no reason for the big discrepancy between donor and 
recipient States because the maintenance of the Interstate 
System is going to be the major expense on the highway system 
of all States.
    Early parts of the Interstate System were very inadequately 
built. There was no way to convince in the 1960's the Federal 
Bureau of Public Roads that you had to drain a roadbed before 
you built the road, and they were built without proper 
drainage, subsoil, and they are giving away in many, many 
places. In fact, some of them have long since given away. So, 
there is going to be additional drainage and a lot is going to 
have to be done.
    Senator Byrd. Mr. Chairman, would the Senator yield?
    Senator Faircloth. Yes.
    Senator Byrd. This again points out the fact that we do not 
pay enough attention to history. The Romans knew better than to 
do that. They knew that it was important to drain the roads.
    Senator Faircloth. Well, you are absolutely right, Senator. 
What happened was nobody ever got reelected because he built a 
superior road, but he got reelected because he built a lot of 
roads, so he built more mileage out there.
    The German Autobahn was well drained and it has held up 
much, much better with the proper drainage. But you have no 
strength. The surface of a road is merely to keep it dry 
whether it is asphalt or concrete. There is really no basic 
strength. The strength is in the sub-base and we simply did not 
drain it. It popped and it is falling apart.
    But I believe that the role of the Federal Government in 
transportation must be an equitable one and the States need 
some ability to respond to local needs. And this is one of the 
important things so that we can either go to new roads or to 
repair of existing ones.
    Mr. Chairman, I thank you for holding the hearing and look 
forward to participating.
    Senator Shelby. Senator Kohl.

                           Prepared Statement

    Senator Kohl. I thank you very much, Mr. Chairman. I have a 
statement which I will include in the record.
    Senator Shelby. Without objection, it will be so ordered.
    [The statement follows:]

                   Prepared Statement of Senator Kohl

    Good morning, Mr. Chairman and members of the subcommittee. 
Welcome Administrators Garvey, Linton and Martinez, and all 
those who will be joining us on the second panel. We appreciate 
your continued help and input with our work on transportation 
appropriations for this year and a transportation policy 
framework for the next six years.
    It is my hope, which you no doubt share, that together we 
can do more in the next six years than we did under ISTEA. The 
number one message we hear about transportation and ISTEA 
reauthorization is that we are not doing enough--that our 
current investment in transportation infrastructure is not 
sufficient.
    Fortunately, we all agree that investing more and investing 
it more wisely is imperative to ensuring economic growth, and 
improving transportation safety and the livability of our towns 
and cities.
    Thank you all for coming, and I look forward to hearing 
your thoughts on how we might best achieve those goals. Thank 
you, Mr. Chairman.

                        Introduction of witness

    Senator Shelby. Do you have anything else?
    Senator Kohl. No.
    Senator Shelby. Again, I want to join and welcome Jane 
Garvey, the Acting Administrator, Federal Highway 
Administration; Mr. Gordon Linton, Administrator, Federal 
Transit Administration; Dr. Ricardo Martinez, Administrator, 
National Highway Traffic Safety Administration. Your written 
statement will be made part of the record.
    Ms. Garvey, if you will proceed as you wish.

                      Statement of Jane F. Garvey

    Ms. Garvey. Thank you very much, Mr. Chairman. I have a 
very brief opening statement, if I could.
    Members of the subcommittee, thank you for the opportunity 
to testify here this morning on the administration's proposal 
for reauthorization.
    A few weeks ago, Secretary Slater appeared before this 
subcommittee and provided an overview of the Department of 
Transportation's fiscal year 1998 budget request. He described 
our transportation network as the envy of the world and, simply 
stated, he said that transportation is critical to the economic 
growth of this country. It is critical to sustaining our 
quality of life.
    We are now, as so many of you have suggested, at an 
important juncture as Congress considers reauthorization of the 
Nation's surface transportation program. In a sense ISTEA 
transformed transportation decisionmaking. It was a sea change. 
It was a revolution.
    The administration's reauthorization proposal reflects the 
message that we have heard from our stakeholders, the message 
that we have heard from our customers. Stay the course of 
ISTEA. Tune it. Do not toss it.
    When the administration's NEXTEA proposal was submitted to 
Congress last month, it defined several of the Secretary's key 
national transportation priorities. These priorities include 
strategic investment in infrastructure to support economic 
growth, safety programs that will help reduce highway crashes, 
and a commitment to commonsense government and innovation.
    I would like to very briefly describe the key themes from 
the Federal Highway perspective.
    First of all, the administration's reauthorization proposal 
includes program increases for the core programs, the core 
programs that are clear national priorities. That means 
interstate maintenance, the National Highway System, and the 
surface transportation program. And when combined with the 
other provisions, it will allow States and MPO's to use their 
Federal transportation funds strategically and more flexibly. 
Our proposal builds on the record level of Federal investment 
over the past 4 years. Indeed, NEXTEA increases transportation 
authorizations by 11 percent over the $157 billion authorized 
by ISTEA.
    In the highway formula area, we have sought to strike a 
fair balance among the many diverse transportation needs in the 
Nation.
    Included in the Department's proposal is $20 billion in 
obligations for the Nation's highways and bridges.
    We realize that we need to say right up front that these 
proposed funding levels do not fully meet the needs of the 
Nation's highway systems, but the levels do reflect the 
continuing commitment of both the President and the Congress to 
balance the budget and to reduce the Federal deficit. Our 
spending decisions have been made within the context of a 
balanced budget.
    We are, however, proposing contract authority levels in our 
NEXTEA proposal that are higher than the proposed obligation 
level for 1998. We are doing this because if we have an 
improved economic condition, then we have room in our program 
to grow.
    Secretary Slater has said that transportation safety is his 
highest priority. Our proposal in the 1998 budget provides the 
resources to fight and improve the highway safety and improve 
the fatality trends that we are seeing in our country. Our 
proposal builds on the strong components of the existing law. 
It streamlines programs, for example, by combining the NHSTA 
and the FHWA section 402 safety programs and consolidating the 
safety construction category.
    We are also proposing incentives to encourage agencies to 
work closer together in dealing with their safety problems.
    A cornerstone for the future is a strong shift of resources 
and energies to innovation, innovation that would provide for a 
greater return on our investment. For Federal Highway, this 
moves us from a traditional oversight role to one of proactive 
leadership and it makes technology and innovation in the 
broadest sense a leading element in the transportation system 
for the 21st century.
    NEXTEA proposes a $100 million a year transportation credit 
enhancement program, a program that really has three goals: to 
leverage Federal dollars, to encourage private sector 
investment in projects of national significance, and to move 
projects into construction sooner.
    Our reauthorization proposal also would continue the 
funding for State infrastructure banks with a level of $150 
million a year.
    Finally, Mr. Chairman, as we examine the Federal role in 
transportation and as we continue to work to increase the 
efficiency and effectiveness of our Government, Federal Highway 
has undertaken a comprehensive set of streamlining actions to 
support Department initiatives.
    We look forward to working with Congress and we look 
forward to working with this subcommittee in particular to 
further the advances launched in ISTEA. Thank you very much, 
Mr. Chairman.

                           Prepared Statement

    Senator Shelby. Thank you, Ms. Garvey. We have the combined 
statement of Ms. Garvey, Mr. Linton, and Dr. Martinez, and it 
will be made part of the Record.
    [The statement follows:]
  Prepared Statement of Jane F. Garvey, Gordon J. Linton, and Ricardo 
                                Martinez
                         istea reauthorization
    Mr. Chairman, Members of the Subcommittee. Thank you for the 
opportunity to testify in support of the Administration's proposal for 
reauthorization of the Intermodal Surface Transportation Efficiency Act 
of 1991 (ISTEA) and for our respective agencies' budget requests.
                                overview
    A few weeks ago, Secretary Slater appeared before this subcommittee 
and provided an overview of the Department of Transportation's fiscal 
year 1998 budget request. He told how our transportation network is the 
envy of the world, and how it has made us the most mobile society on 
earth. His message is that safety is our number one priority and that 
transportation is critical to economic growth and to providing our 
citizens with the mobility on which they have come to rely to sustain 
their quality of life. And it is about showing that safe and efficient 
transportation and a clean environment can go hand in hand. We 
Administrators of the DOT agencies most concerned with ISTEA are here 
to reinforce that message and to provide details about our 
reauthorization proposal.
    We are now at a critical juncture as we examine ways to reauthorize 
the surface transportation program this year and to continue to improve 
our transportation systems. The Administration seeks to build upon the 
ISTEA foundation in the six-year, $175 billion authorization proposal 
announced by the President, Vice President, and Secretary Slater last 
month--the National Economic Crossroads Transportation Efficiency Act 
of 1997 (NEXTEA). In the President's words, ``we're taking the next big 
step to maintain and modernize our transportation system, and to make 
sure it is the best in the world.'' He also emphasized that NEXTEA is 
``one of the most important pieces of environmental legislation that 
will be considered by the Congress in the next two years.''
    When the Administration's NEXTEA proposal was submitted to Congress 
last month, it demonstrated several of the Secretary's key national 
transportation priorities. These priorities include strategic 
investment in infrastructure to support economic growth and enhance 
U.S. global competitiveness; safety programs that will improve the 
public health and safety of the Nation by reducing highway crashes and 
resulting injuries and deaths; an Access to Jobs and Training program 
to help ensure that welfare reform works; help to communities to 
balance mobility needs with environmental protection and enhancement, 
and a commitment to common sense government and innovation. Included 
among the innovations in NEXTEA are proposals for (1) innovative 
financing to ensure that Federal resources stretch as far as possible, 
(2) innovation in technology to accelerate advances that close the gap 
between state-of-the-art and state-of-the-practice, and (3) innovation 
to implement common sense government in order to provide the people we 
serve with programs and organizations that work better and cost less.
           strategic investment in infrastructure and safety
    The Nation's surface transportation system, particularly the 
National Highway System and its intermodal connectors, is essential to 
economic development, to providing Americans with greater mobility, and 
to national defense. Clearly, sustained Federal support for 
infrastructure is critical to the health of the economy. The challenge 
we face today is to improve our existing transportation network and to 
provide for continuing economic growth within constrained resources and 
environmental priorities.
    National and regional economic growth relies heavily upon a well-
functioning surface transportation system. For example, the payoff 
relating to highway transportation spending levels goes well beyond the 
actual infrastructure itself and is reflected in the contribution of 
the public infrastructure to private sector employment and private 
sector productivity. At stake are jobs and the economic productivity of 
the Nation. Our highways and their interconnectors to other systems are 
the lifeline of the Nation.
    The Administration's reauthorization proposal and fiscal year 1998 
budget strategically allocate our limited resources, with major 
increases for the National Highway System, Interstate Maintenance, 
Surface Transportation Program (STP), Congestion Mitigation and Air 
Quality Improvement, and safety programs--clear national priorities. 
When combined with other provisions in our reauthorization proposal 
that improve States' ability to use their Federal transportation funds 
more flexibly, NEXTEA will enable States to better target their funds 
to the types of infrastructure investments that will work best for 
them--whether traditional highway investments, transit or rail 
projects, safety improvements, ITS technologies, environmental needs, 
or new intermodal facilities to handle growing intermodal demands.
    One example of the improvements our proposal would make is 
amendment of the definition of transit capital to include maintenance 
as an eligible expense. Such an approach would parallel the eligibility 
for Federal-aid highway projects. This would allow local transit 
operators to make better decisions on whether to invest Federal funds 
to prolong the life of existing assets, or to invest in new vehicles, 
facilities and equipment. In addition, transit providers in urbanized 
areas under 200,000 in population would also be given the flexibility 
to use all their transit funds for any eligible transit purpose--
including operating expenses.
    The Administration's reauthorization proposal and fiscal year 1998 
budget for the Department aim to build on the record level of Federal 
investment over the past four years. Indeed, NEXTEA increases surface 
transportation funding by $17 billion, or 11 percent, over the $157 
billion authorized by ISTEA.
    We propose authorization levels higher than the proposed obligation 
levels so there will be flexibility to increase transportation funding 
within a balance budget if economic conditions improve in future years. 
With multi-year authorizing legislation, such as our ISTEA 
reauthorization, we believe it is important that the contract authority 
levels are set at appropriately high levels. This allows for growth in 
the program in the outyears, if the budget picture permits such growth. 
And in the apportionment formulas that we have proposed to distribute 
Federal highway funds among the States, we have sought to strike a fair 
balance among the many diverse transportation needs of this Nation. 
However, we understand that there will be considerable debate over this 
matter and we offer our proposal as a starting point.
                           highway investment
    Included in the Department's overall fiscal year 1998 program 
levels is $20.2 billion in obligations for the Nation's highways and 
bridges. This includes a Federal-aid highway obligation ceiling of 
$18.17 billion, which is approximately the same level as enacted in 
fiscal year 1997. The total contract authority proposed for fiscal year 
1998 is $22.8 billion, up from $22.5 billion in fiscal year 1997.
    All States have benefited from ISTEA infrastructure programs such 
as Interstate Maintenance, the National Highway System, the Surface 
Transportation Program, the Congestion Mitigation and Air Quality 
Improvement Program (CMAQ) and the Bridge Program. These core Federal 
Highway Administration (FHWA) programs are not only retained in NEXTEA, 
but, in the aggregate, authorizations would increase by 33 percent over 
ISTEA levels. The proposed funding levels for the highway program are 
sufficient to fund system maintenance and preservation costs and some 
capacity improvements. Yet these levels also reflect the continuing 
commitment of both the President and the Congress to balance the budget 
and reduce the Federal deficit.
    Our NEXTEA legislation also includes more than $2 billion from the 
Highway Trust Fund for the continued construction of the Appalachian 
Development Highway System (ADHS) in the 13 States that comprise the 
Appalachian region. The ADHS is now 76 percent complete. In the past, 
this system of highways has been funded from the General Fund through 
various appropriations and authorization acts. Our NEXTEA funding 
proposal would promote much-needed economic development in the 
Appalachian region and throughout the entire eastern United States, 
because more than 92 percent of the Appalachian Development Highway 
System is located on our Nation's most critical and well-traveled 
highways--the National Highway System.
                           transit investment
    We propose budget authority in fiscal year 1998 of $5.1 billion, 
and a $4.4 billion obligation level. Within the fiscal year 1998 
obligation level, our budget makes available $4.2 billion for capital 
investment in mass transportation. Beginning in fiscal year 1998, we 
are proposing to fund the entire $31 billion, six-year transit program 
from the Mass Transit Account of the Highway Trust Fund. Additionally, 
in fiscal year 1998, we are proposing that discretionary bus and bus-
related funding and fixed guideway modernization funding, be rolled 
into Formula Programs.
    NEXTEA proposes to combine some transit program categories to make 
the program simpler to understand and manage, at the Federal level as 
well as at the State and local levels. Our proposal would provide 
simpler, and more flexible program-wide definitions of eligible capital 
costs, matching ratios, and grant requirements. We would also expand 
the transferability of funds among the Urbanized, Non-Urbanized and 
Specialized formula programs.
    NEXTEA proposes having a much larger proportion of the transit 
program go out by formula, rather than on a discretionary basis. This 
will help local agencies plan by reducing uncertainty over funding 
sources and earmarking, and will improve the equity by which the funds 
are distributed. It will also enhance the possibility of using 
innovative financing techniques to leverage the use of Federal funds.
    New transit lines or significant upgrades to existing service can 
be more effective in some cases in addressing congestion than new or 
expanded highway capacity. Recent research by the firm Hickling-Lewis-
Brod examined major transportation corridors and determined that high-
quality transit significantly improves the overall door-to-door travel 
time for both transit riders and highway users. As motorists switch 
from automobile commuting to mass transit, congestion on highways 
lessens and highway travel time improves. Increased transit investment 
in these corridors is an effective use of transportation revenues that 
clearly benefits motorists.
    Since January 1993, the Federal Transit Administration (FTA) has 
signed Full Funding Grant Agreements for 19 new or expanded fixed 
guideway projects totaling $7 billion. When State and local funds are 
also considered, these projects will result in the investment of over 
$12 billion in new mass transit infrastructure in metropolitan areas 
from coast to coast. These actions continue FTA's successful strategy 
of employing the mechanisms provided in ISTEA to execute long-term 
contracts and maintain the Administration's strong support for mass 
transit.
    In addition, NEXTEA builds on the efforts in ISTEA to strike a 
balance between existing infrastructure and the need to build new 
systems. We recognize the need to balance new system construction with 
support to ``older rail cities.'' Such support funds the replacement 
and rehabilitation of the existing rail fleet and the restoration of 
rail facilities such as stations, track, and yards and shops, as was 
guaranteed in ISTEA.
    Our proposal provides an equal amount, $634 million, for major 
capital investments and fixed guideway modernization. That level for 
major capital investments over six years is sufficient to sustain the 
Federal commitment to all existing and expected FFGA's. The amount for 
Fixed Guideway Modernization will be funded under the Formula Programs 
and distributed by the current statutory formula for fixed guideway 
modernization.
                           safety investment
    Secretary Slater has set transportation safety as his highest 
priority. Federal safety programs have contributed to real progress in 
highway safety. Safety belt use has grown from 11 percent in 1982 to 68 
percent in 1996. Alcohol involvement in fatal crashes has dropped from 
57 percent to 41 percent over this same 15-year period. The highway 
fatality rate has declined steadily since 1966, now at the all-time low 
of 1.7 per hundred million miles traveled.
    Despite this significant progress, a look at recent statistics 
reveals that there is no room for complacency. After years of steady 
decline, the total number of highway deaths increased from 1992 to 
1995. Motor vehicle crashes are still the leading cause of premature 
death of our Nation's youth. Safety belt use has grown by only two 
percentage points since 1993. In 1995, the number of alcohol-related 
fatalities increased for the first time in 9 years. In 1996, 41,500 
people died and over 3 million more were injured in police-reported 
crashes. Although our fatality rate remains at an all-time low, highway 
crashes still cost the Nation $150 billion per year. Taxpayers share in 
these costs through Medicare, Medicaid, and income support programs. 
Twenty-four percent of all medical care costs associated with motor 
vehicle crashes are covered by public revenues (14 percent from federal 
revenues and 10 percent from State resources). In 1994, highway crashes 
cost taxpayers $13.8 billion, the equivalent of $144 in added taxes for 
each household in the U.S.
    Improving air bag safety is a top priority. The National Highway 
Traffic Safety Administration (NHTSA) has initiated a comprehensive 
effort to realize more fully the life-saving attributes of current 
driver and passenger air bag systems, and to pave the way for the 
introduction of improved air bags in the near future. Our budget 
request contains an increase of about $8 million for air bag 
initiatives, a top-priority increase for fiscal year 1998.
    Another major priority is to work with Governors and State 
legislatures to encourage the enactment of stronger safety belt and 
child safety seat laws. We will be implementing a Presidential safety 
belt plan to increase the use of these vital life-saving devices. We 
have a number of efforts underway to improve passenger safety of our 
children.
    Speeding--exceeding the posted speed limits, or driving too fast 
for conditions--is a problem on all roads. The human and economic costs 
of speeding are staggering. In 1995, speeding was a factor in 31 
percent of all fatal highway crashes, at a cost to society and the 
economy of more than $29 billion. Currently, 34 States have increased 
their speed limits beyond what would have been allowed under the former 
national maximum speed limit law, and 23 of these 34 States have 
increased their speed limits to 70 miles per hour or greater. NHTSA and 
FHWA have jointly developed and continue to implement a Speed 
Management Plan combining research, enforcement, roadway engineering 
and public education.
    Recent surveys indicate that aggressive driving, a behavior often 
marked by excessive speed, has become the driver behavior that most 
concerns the motoring public. NHTSA's activities to combat aggressive 
driving include public information and education, demonstration 
programs in major urban areas to identify effective enforcement 
techniques, and research to determine the relationship between specific 
unsafe driving acts and crash involvement.
    NHTSA programs have been highly cost effective. The number and 
costs of fatalities and injuries would be significantly higher if not 
for the effectiveness of these programs. Since 1992, safety belts, 
child safety seats, motorcycle helmets, and the age-21 minimum drinking 
age laws under have saved over 40,000 lives. Air bags have saved more 
than 1,850 lives.
    ISTEA recognized the importance of the Federal-State partnership in 
highway safety. We believe that the status quo is not sufficient to 
accomplish what must be done. The successor to ISTEA must continue to 
look at new ways to advance this essential partnership and secure the 
safety of those traveling on our Nation's roads. Our reauthorization 
proposal builds on the strong components of the existing law, but 
streamlines programs, creates new flexibilities, and provides linkages 
among other highway safety programs to move our safety programs forward 
in a coordinated manner to address national priorities.
    Our NEXTEA proposal is designed to help the States deter drunk and 
drugged driving and to encourage increased use of safety belts and 
child safety seats. It includes authorizations for significantly 
increased safety funding with greater emphasis on incentive programs. 
The flexibility inherent in these incentive programs, which give States 
the ability to chose whether to implement suggested legal and program 
criteria, has proved very successful in motivating States to make 
greater efforts in highway safety.
    New incentives within the framework of our Section 402 State and 
community highway safety program will give added momentum to the 
program, at the same time that State and local attention is focused on 
high priority safety needs. Thus, in addition to the Section 402 
performance-based grant program, NEXTEA provides authorizations for 
four carefully crafted and targeted incentive grant programs:
  --an enhanced drunk driving prevention program to help States enact 
        and enforce tough drunk driving laws;
  --a new occupant protection program to encourage States to increase 
        safety belt use--the single best way to protect the occupants 
        of a vehicle;
  --a new drugged driving program, a Presidential initiative to help 
        States enact and enforce tough laws to prevent drug-impaired 
        driving; and
  --a new State highway safety data improvement program to encourage 
        States to improve the data they use to identify the priorities 
        for their highway safety programs.
    NEXTEA increases authorized funding for NHTSA by about 25 percent, 
to $392 million in fiscal year 1998. Within the Department's overall 
fiscal year 1998 program levels is $333 million in obligations for 
NHTSA, about 11 percent more than the amount provided in fiscal year 
1997. This greater amount reflects the high priority both this 
Administration and the American public give to highway safety. This 
funding level will provide a balanced program in fiscal year 1998--to 
address both vehicle and behavioral safety areas and to carry out 
essential safety research, including how to reduce crash injuries. We 
have a strong behavioral program that balances our regulatory mission 
in motor vehicle safety.
    Under our reauthorization proposal, highway safety programs would 
become more flexible and streamlined in a number of areas. We have 
retained the railroad/highway grade crossing program, but would make 
funds under this program available to address noncompliance of grade 
crossing devices. We have combined the FHWA and NHTSA portions of 
Section 402 program so there is one allocation to the States; and we 
have proposed a reduction in the number of separate motor carrier 
program elements. We believe that our jointly administered safety 
delivery program is working well.
    We have also created incentives for State safety agencies to work 
closer together in dealing with their safety problems. For example, if 
a State has an integrated safety planning process in place that deals 
with three major safety areas: roadways, drivers, and commercial 
vehicles, then they will have the ability to spend funds from both the 
STP and hazard elimination program for any of those three safety areas, 
as well as be eligible to tap into a new Integrated Safety Fund; again 
for use within any of the three safety areas.
    We believe that with the increased funding and flexibilities which 
are being proposed, the States will be in a much better position to 
identify and resolve their safety problems. Our reauthorized program 
also includes a major safety research focus within the Intelligent 
Transportation Systems program for the development and testing of 
intelligent vehicle systems, which will include collision avoidance and 
in-vehicle information systems, and which promise dramatic safety 
improvements.
    Our motor carrier safety program also retains its important role in 
our NEXTEA bill and our fiscal year 1998 budget request. For the last 
three years, the number of fatal crashes involving trucks has been 
higher than the number of such crashes in 1992. This follows the three-
year decline in fatal involvements prior to 1992. The FHWA's budget 
request and NEXTEA proposal include $100 million annually for motor 
carrier safety, a 27 percent increase over the fiscal year 1997 level. 
The increased funding will be used to make improvements to driver 
safety programs, information systems and data analysis, and evaluation 
of all aspects of driver performance and safety.
    These funds will support a results-oriented commercial motor 
vehicle safety program. Over 80 percent of the funds will be used as 
grants to States for the implementation of comprehensive, nationwide 
performance based safety programs. States will be given the opportunity 
to strengthen enforcement activities by investing in areas with the 
potential for crash reduction based on their own circumstances. The 
funds will also support national information systems, and analysis and 
development of new systems to support critical safety initiatives such 
as the Commercial Vehicle Information System. Within NHTSA, research 
will be continued to improve heavy truck safety, primarily in the areas 
of braking, rollover stability, tires and cab integrity.
                        innovation in financing
    As we administer transportation programs that will carry the nation 
into the 21st century within tight budgetary constraints, we must 
continue to ask ourselves how we can do it better. That is, how can we 
be more efficient, more innovative in the delivery of transportation 
services?
    Government cannot meet all of the Nation's infrastructure 
investment needs alone. This Administration has strongly supported and 
encouraged creative financing solutions and more private sector 
involvement in infrastructure improvement and management of America's 
transportation system.
    Our reauthorization proposal and our fiscal year 1998 budget would 
continue funding for State Infrastructure Banks (SIB's) at the fiscal 
year 1997 level of $150 million but funding would come from the Highway 
Trust Fund. This program had previously been funded from the General 
Fund.
    In addition, we would continue to focus on new methods of improving 
the way available resources are used and maximizing their benefits. We 
are promoting new financing techniques that have the added benefit of 
leveraging still further resources, including those of the private 
sector, and bringing them on line for much-needed infrastructure 
investment. Our reauthorization proposal proposes a new $100 million a 
year Transportation Infrastructure Credit Enhancement Program to 
leverage Federal dollars and encourage private sector investment in 
transportation projects of national significance that may otherwise be 
delayed or not constructed at all because of their size and uncertainty 
over timing of revenues. With this new program, the Department will be 
able to make grants that, along with supplemental contributions by 
States and other entities, will comprise a Revenue Stabilization Fund 
for projects to secure external debt financing, or to be drawn upon if 
needed to pay debt service costs in the event project revenues are 
insufficient.
    To maximize the impact of every dollar spent on transit, the FTA is 
working to introduce various innovative financing methods to the 
transit community. Since 1994, FTA has reviewed and approved 22 
innovative financing transactions involving over $2.2 billion in 
Federally-supported assets. These included cross-border leases, sale/
leasebacks, bond issues for construction, and leveraging of soft match. 
Altogether, these transactions netted over $143 million in additional 
private investment for the transit systems.
    Innovative financing is but one of many efforts to expand funding 
availability for transit. Other initiatives include facilitating joint 
developments to attract private partners for transit infrastructure 
projects, and developing ways to better coordinate funding between 
Federal programs. For example, some Community Development Block Grant 
funds may be expended in support of transit projects in redevelopment 
communities. Also, FTA is Co-Chair of the DOT/DHHS Coordinating Council 
on Human Services Transportation, which seeks to link transportation 
delivery through multiple programs (Medicaid, elderly transportation, 
public transit) at the local level. Our Access to Jobs and Training 
initiative will also be an important tool in this regard.
                   focusing on people and communities
    ISTEA focused on transportation's bottom line: making America a 
better place to live. It emphasized consideration of how transportation 
investment and policy choices affect safety, community quality of life, 
and the environment.
    One of the most pressing problems today in light of the new welfare 
legislation is making the reforms work. Nationally, only six percent of 
those on welfare own an automobile. A person can't get a job if a 
person can't get to a job. In response to this problem, FTA has 
proposed a new initiative called ``Access to Jobs and Training.'' 
Transit is the ``to'' in ``Welfare to Work.'' The President alluded to 
this initiative in his State of the Union Address. Under this new 
program, governors, units of local government and nonprofit agencies 
will be able to compete for resources. The funds will be used to plan 
and implement the best methods of solving local transportation problems 
related to getting people off the welfare rolls and into jobs or 
training needed to enter the work force. Although it is our intent that 
funding will primarily support operating and capital costs for service 
start-up, other eligible costs include collaborative planning to assess 
employment transportation needs and develop service strategies, 
integrating transportation and welfare planning, the coordination of 
existing service providers, the development of long-term financing 
strategies, promotion of employer-provided financing, administrative 
costs associated with the program, and evaluation activities.
    In addition, the proposed programmatic changes and expanding the 
definition of capital projects for mass transportation will give 
operators added flexibility within the transit programs to provide 
needed support for transit service to meet the requirements of the 
Americans with Disabilities Act.
                              environment
    Under NEXTEA, the basic program structure of our environmental 
programs remains unchanged from ISTEA. Our proposal also continues 
ISTEA's commitment to inclusive transportation planning which will 
enhance State and local decisionmakers' ability to consider the 
environmental impacts of their transportation investment decisions. 
Although our communities have made significant progress in improving 
air quality in recent years, we still face environmental challenges, 
not just to improve our air but to enhance our communities.
    The CMAQ program has proven to be ISTEA's most flexible program, 
representing more than half of all flexible funds used for transit 
purposes ($1.7 billion of $3.0 billion). Other non-highway projects 
that assist areas in improving air quality are receiving an increasing 
share of CMAQ funds as well. Through 1996, over $500 million in CMAQ 
funds were used to establish or expand rideshare services, promote 
demand management, and support bicycle and pedestrian travel. CMAQ 
flexibility has allowed States to fund new innovative efforts such as 
vehicle emission inspection and maintenance programs, alternative fuel 
conversions and refueling facilities and the purchase of clean fueled 
buses and electric vehicles.
    The congestion relief benefits of the CMAQ program have also been 
substantial. Houston's TransStar traffic management and control system 
uses cutting edge technology to manage over 300 miles of freeway and 
over 100 miles of high occupancy vehicle lanes. CMAQ has also funded 
many other congestion mitigation projects, including HOV lanes in Los 
Angeles, shared-ride services in Virginia and New Hampshire, and 
bicycle and pedestrian facilities in Montana. The benefits of promoting 
alternative travel options as envisioned by the Congress in ISTEA have 
clearly been realized through the CMAQ program.
    Under NEXTEA, we will build on this success. The Department 
proposes an increase in the average CMAQ program funding authorization 
under ISTEA from $1.0 billion annually to $1.3 billion under NEXTEA, an 
increase of 30 percent. Funding eligibility would be expanded in 
several ways. These include providing funds on the basis of a State's 
maintenance, as well as nonattainment area, populations; clarifying 
that nonattainment areas for particulate matter (PM) are explicitly 
eligible and adjusting the funding formula accordingly; and including 
programs to reduce extreme cold starts (where the majority of vehicle 
emissions are generated) and to ``buy back'' or scrap higher-polluting 
pre-1980 vehicles. Also, with EPA's proposal to revise the national 
ambient air quality standards, the Department recognizes the need to 
extend funding to any areas newly designated under the new standards. 
We therefore propose that CMAQ funds be available to these areas after 
a State has submitted its implementation plan addressing the new 
standards to EPA.
    NEXTEA also continues investment in bicycle paths, scenic byways, 
and recreational trails that cost relatively little but which greatly 
improve the quality of our lives. While bicycle and pedestrian projects 
can be funded under all of the major ISTEA funding programs, 
transportation enhancement (TE) funds have accounted for 75 percent of 
funding for these projects.
    Transportation enhancements are transportation-related activities 
that are designed to strengthen the cultural, aesthetic, and 
environmental aspects of our transportation system. Such projects have 
become an important part of our commitment to the redevelopment and 
sustainment of communities through a variety of transportation related 
activities, from the renovation of historic rail depots, such as the 
Lafayette Depot in Lafayette, Indiana to the rehabilitation of the 
historic Stone Arch Bridge in Minneapolis and funding for the 
Schuylkill River Park and Trail in Philadelphia. Because of the success 
of this program, in NEXTEA, we propose to retain the current TE 
provisions of ISTEA with continued funding from a 10 percent set-aside 
from STP funds, resulting in a funding increase of over 30 percent. We 
also included a provision that codifies the requirement that TE 
activities have a direct link to transportation.
                        innovation in technology
    As we began strategically planning for a post-ISTEA era, one of our 
goals was to create a fundamental cultural change both within the 
Department and the transportation community as a whole that would 
provide a foundation for the next century. One of the cornerstones for 
the future is a strong shift of resources and energy to technological 
innovation--innovation that would provide for a greater return on our 
investment. This change would also move us from a traditional oversight 
role to one of proactive leadership, and make technology, in the 
broadest sense, a leading element in the transportation system for the 
21st century.
    To make this happen, we are proposing significant increases in 
programs which support the advancement of technological innovation. Our 
reauthorization proposal and fiscal year 1998 budget request recognize 
that a strong Federal transportation research and technology program is 
not a trade-off with infrastructure funding, but is instead a powerful 
tool to ensure that innovation is incorporated into the multi-billion 
dollar infrastructure program.
    Within the FHWA fiscal year 1998 budget request, our proposed 
research and technology programs would be funded through a combination 
of direct contract authority and the administrative takedown from the 
Federal-aid highway program. Technology deployment and technology 
transfer programs--those elements of the research and technology 
program most closely aligned with program delivery and professional 
capacity building--would be supported through their own contract 
authority and not be a part of the administrative takedown. This would 
include activities such as ITS deployment, a proposed National 
Technology Deployment Initiatives program, the Local Technical 
Assistance Program, the National Highway Institute, and University 
Transportation Centers.
    Funds to support pure applied research including basic ITS research 
and technology, and highway research and development, would be funded 
from General Operating Expenses as part of an administrative takedown 
as has been the case in the past.
                   infrastructure and traffic safety
    FHWA is answering our Nation's challenge to make roads better. One 
of our active research and development programs is defining ``better'' 
to mean highways that are safer and operate more efficiently. The 
annual cost of traffic crashes is $150 billion and growing, and 
congestion costs U.S. businesses up to $40 billion per year. The need 
to explore innovative solutions to our highway safety problems has led 
to productive partnerships with NHTSA and the private sector.
    New approaches to modeling and computer simulation of vehicle and 
roadside hardware are being funded jointly with NHTSA and have 
participation from the automotive industry. The use of these powerful 
simulation tools will enable us to design future roadside hardware that 
will perform at higher levels and reduce the severity of crashes. 
Helping drivers to see pavement markings at night and in times of bad 
weather is another promising area of technology.
    Research in the Automated Highway System (AHS) will reach a 
significant milestone this August when its technical feasibility will 
be demonstrated in San Diego. The Department is also planning to link 
more closely the near term benefits of NHTSA's work in Crash Avoidance 
Systems with the research that has been carried out for the AHS. A 
major program review of the AHS will help us focus our resources so 
that we will be able to deliver sooner the benefits of integrating 
several collision avoidance systems into smart vehicles so we can 
reduce crashes while improving the efficiency of our existing highway 
system. The resulting Intelligent Vehicle program will capitalize on 
the synergisms that have been created through the public-private 
partnerships of the National Automated Highway System Consortium and 
the more than 100 public and private organizations who are 
participating as associate members. NHTSA's continuing basic 
development and integration work will help ensure that intelligent 
systems are fully integrated within the vehicle, are useful to the 
driver, and work in concert with the highway system to produce 
significant safety improvements.
               infrastructure materials and technologies
    Building and upgrading the physical transportation infrastructure, 
principally the pavements and bridges across America, requires a major 
use of federal-aid transportation program dollars. The challenge we 
face is to make these roads better. This challenge is being addressed 
by applying technologies developed by the FHWA which can now make 
better pavements, such as ones called Superpave that will last longer; 
better bridge decks that last two to three times longer using epoxy 
coated reinforcement bars and fly ash concrete; and better bridge 
coatings that will last three to five times longer than previous 
systems. For example, FHWA-led research in High Performance Concrete 
(HPC) is helping to construct bridge structures that will accommodate 
loads twice as large as before. In 1996, this was demonstrated on a 
bridge in Houston, Texas. In 1997 we are working with more than 12 
states to build more HPC bridges. Longer spans, fewer girders or beams, 
and longer life cycles, will result in substantial first cost savings 
at well over 1 million dollars for every 10-15 bridges built.
    The FHWA will use requested resources to continue to develop, 
transfer, and implement technology through alliances with our partners 
and the international community. We will use research and technology 
dollars to improve the quality of infrastructure projects and reduce 
life-cycle costs in these times of limited funds.
                      mass transportation research
    In the area of mass transportation research, a major accomplishment 
was the roll-out, in October 1996, of the first prototype of the 
Advanced Technology Transit Bus (ATTB). The ATTB incorporates aerospace 
construction, accessible design and hybrid-electric propulsion into a 
single vehicle design.
    FTA has been increasingly entering into joint sponsorships with 
other government agencies at the Federal, State and local levels, and 
partnerships with consortia formed by transit industry suppliers, 
transit agencies, national laboratories and universities. These 
partnerships can increase competition and leverage funding. Examples of 
programs involving such partnerships include the Advanced Public 
Transportation Systems program (APTS) and the Fuel Cell Transit Bus.
    Federal transit research has played a key role in maintaining the 
Nation's global competitiveness in developments such as electronic 
farecards and transit vehicles powered by low-polluting fuels, hybrid 
electric buses, fuels cells and battery powered propulsion systems. The 
United States must continue devoting resources to this area to ensure 
that emerging technologies are developed for markets both domestic and 
international.
                 innovation for today and tomorrow--its
    In 1991, under ISTEA, the Department initiated the Intelligent 
Transportation Systems program to research, operationally test and 
promote the application of computer and communications technology to 
our surface transportation system, in part, to address the growing 
gridlock in our Nation. Over the past five years, we have learned 
through our research efforts, that an intelligent transportation 
infrastructure applied to our surface transportation can improve 
efficiency, productivity, and safety. We are now ready to support 
deployment of integrated, interoperable ITS infrastructure, while 
continuing to conduct research in critical program areas. Consistent 
with the conclusions of a recent GAO review of the ITS program, we will 
also continue to provide deployment assistance directly to State and 
local agencies through technical assistance, guidance, training, and 
development of standards.
    ITS research is already providing benefits related to improved 
efficiency of the surface transportation system by helping system 
operators monitor system performance, quickly identify and effectively 
respond to problems that develop, and provide timely, accurate 
information to travelers. Freeway management systems have increased 
throughput by up to 22 percent, while also increasing travel speeds and 
reducing accidents. Several locations utilizing ITS infrastructure 
freeway management systems in such states as Washington, Illinois, New 
York, Virginia, Minnesota, and California show reductions in total 
crashes from 15 percent to 50 percent. In San Antonio, Texas, reports 
show a 30 percent reduction in secondary crashes and a 35 percent 
reduction in total crashes. Based on DOT research, electronic toll 
collection systems can move 200-300 percent more vehicles per lane than 
conventional systems.
    Our fiscal year 1998 budget requests a funding level of $150 
million for ITS research. This research will focus on a number of areas 
with high potential benefits such as advanced traffic control 
strategies, effective transit management techniques, and collision 
avoidance technologies.
    It is estimated that widespread deployment of three basic crash 
avoidance technologies--rear-end crash warning systems, roadway 
departure warning systems, and lane change/merge crash avoidance 
systems--beginning in the next five years, could ultimately reduce 
crashes by 17 percent and save $26 billion per year. The results of ITS 
research can also be applied to allow more efficient and accurate 
automated safety inspections of commercial vehicles, further enhancing 
safety.
    States are beginning to experience reductions in the cost of 
regulating motor carrier safety through the use of automated 
registration, fuel tax reporting, and weight screening processes. Such 
deployments can also significantly improve productivity for commercial 
carriers by reducing time and effort needed to prepare necessary 
paperwork, and can reduce the time now wasted while manual weight 
screening is done and manual safety inspections are performed.
    ITS infrastructure consists of a series of elements, such as smart 
traffic signals, advanced traffic management systems, and more. This 
infrastructure allows the public to travel more efficiently and safely. 
Over the last five years we have learned that this system works best 
when the components are interoperable, or ``can talk to one another.''
    In order to jump start State and local government involvement in 
deploying ITS in an integrated manner, consistent with standards and 
within the bounds of the national ITS architecture, we are proposing an 
incentive program. Our reauthorization proposal would authorize this 
ITS Deployment Incentives Initiative and provide $100 million per year 
to fund this effort over the life of NEXTEA. This deployment incentive 
program will focus on integrating existing intelligent transportation 
infrastructure elements in metropolitan areas, including those elements 
installed with other Federal-aid funds. It will also focus on 
installing, as well as integrating, the various elements of an 
intelligent transportation infrastructure for commercial vehicle 
projects, and projects outside metropolitan areas.
    We believe that the timing of deployment is critical. At the 
moment, elements of the intelligent transportation infrastructure are 
being deployed piece by piece, with no guarantee of interoperability. 
State and local governments will then have to live with a stove-piped 
infrastructure, one in which components do not form a system and are 
not necessarily efficient. We believe this program gives state and 
local governments an incentive to cooperate with agencies, 
jurisdictions, and the private sector, to achieve fully integrated ITS 
deployment in accordance with the national ITS architecture and 
established ITS standards and protocols.
            innovation--implementing common sense government
    Secretary Slater has emphasized common sense government and 
innovation as being among his top three priorities and it is reflected 
in our reauthorization proposal. Let me provide some specific examples:
  --In our planning provisions in NEXTEA, we propose to simplify the 
        planning factors, in order to focus States and MPO's on 7 broad 
        goals rather than the 16 to 23 that are included in the 
        statewide and metropolitan planning provisions of ISTEA.
  --In the STP, we propose eliminating the quarterly, project-by-
        project certification of each state's STP projects and instead 
        establishing an annual, program-wide approval for each state's 
        STP program.
  --Also for all projects off the NHS, we would reduce DOT oversight, 
        replacing it with State oversight (except for environmental, 
        labor standards, and similar laws which must remain a Federal 
        responsibility).
  --For transportation enhancements, we retain the simplification 
        provisions in the National Highway System Designation Act of 
        1995--and we commit emphatically to doing everything we can 
        administratively to carry out the letter and spirit of these 
        provisions. In response to the NHS Act, we have already put in 
        place provisions to allow for the use of donated funds, 
        materials, and services as a State's match; allowed for advance 
        payment options for cash-pressed localities; streamlined 
        environmental documentation through the use of categorical 
        exclusions; made changes in response to Uniform Relocation Act 
        concerns; and are completing procedures to trim review time 
        where historic preservation issues are involved.
  --Across our entire program, we propose removing a variety of 
        restrictions on reimbursement of State and local government 
        costs, and eliminating requirements that State and local 
        governments ``turn in'' to the Federal government revenues that 
        they gain from Federal-aid highway projects, permitting States 
        and localities to retain those revenues as long as they use 
        them for title 23 purposes.
  --For the Section 402 highway safety grant program, we will be 
        expanding to all states the performance based management 
        process begun as a pilot in fiscal years 1996 and 1997. Grant 
        management will be simplified and states will have increased 
        flexibility.
    We are also working diligently with our partner agencies to ensure 
that we efficiently deliver ``seamless'' transportation service to our 
customers. In February 1996, the FHWA, FTA, NHTSA and Federal Railroad 
Administrators submitted a joint field restructuring proposal to former 
Secretary Pena. While each agency retained its existing identity and 
reporting relationships, renewed emphasis was placed on the spirit of 
intermodalism embodied in ISTEA. Headquarters and field officials of 
the four surface transportation modes and the Research and Special 
Programs Administration have been actively engaged in creating a new 
model--one which focuses on the complementary relationships of the 
surface transportation modes, as opposed to viewing them as separate 
and unrelated entities. The new model seeks to ensure seamless, 
intermodal, customer-friendly delivery processes through shared 
technical and administrative resources, while realizing reduced 
operating costs.
    For example, in the planning area, one of the Department's more 
significant accomplishments includes the establishment of Intermodal 
Planning/Transportation Groups in each region which include 
representation from each of the surface transportation modes, RSPA, and 
other DOT modal administrations. Many of the regional groups also 
include representation from outside the Department, including the Army 
Corps of Engineers and the Environmental Protection Agency. These 
planning groups serve as vehicles for developing and overseeing agendas 
and carrying out specific initiatives related to transportation 
planning activities.
                               conclusion
    In implementing ISTEA, our efforts have focused on redefining and 
strengthening old partnerships and building relationships with new 
partners. From a program standpoint, we have emphasized the sustained 
economic growth that results from sound and substantial investment in 
transportation infrastructure, particularly the National Highway 
System, from programs that reduce costs to business and average 
citizens by enhancing highway safety, and from investment in research 
and technology innovation that will make our investments more efficient 
and effective. We look forward to working with the Congress to further 
the advances launched in ISTEA as our surface transportation programs 
are reauthorized to move us into the next century.
    Thank you for the opportunity to testify today. We would be pleased 
to answer any questions you may have.

             National Highway Traffic Safety Administration

STATEMENT OF RICARDO MARTINEZ, M.D., ADMINISTRATOR
    Senator Shelby. Mr. Linton, do you or Dr. Martinez have any 
statement?
    Dr. Martinez. Yes, sir; I have a short statement.
    Senator Shelby. Go ahead.
    Dr. Martinez. Thank you, Mr. Chairman and members of the 
subcommittee. I appreciate the opportunity to testify today, 
and I appreciate your opening comments.
    NHTSA is essentially a public health agency. Our goal is to 
prevent or lessen the consequences of motor vehicle crash 
injury. Our mission is to provide people with the tools they 
need to take responsibility for addressing injury prevention 
and improving safety.
    We have made fairly good progress in this over the years. 
In the last 10 years, we have seen seatbelt use grow 
dramatically. We have seen drunk driving deaths drop 
dramatically and since 1992 have saved over 42,000 lives.
    But despite this progress, things are slowing down. Our 
recent statistics show no room for complacency. The total 
number of deaths has been going down. Now it is beginning to go 
back up as the economy expands. Our fatality rate has been 
going down but has flattened in recent years. Seatbelt use has 
gone up and now that has flattened somewhat. Drunk driving has 
gone down and actually, as pointed out by Senator Lautenberg, 
went up last year for the first time in 10 years.
    We have a lot of challenges. The second baby boom is 
coming. We have aging of the population. We have speeds going 
up on the highways. So, we have a lot of things to do to make 
sure that we can continue to protect people.
    In 1996, over 41,500 people died on the highways and 3 
million more were injured. This is a huge burden to our health 
care system. The economic costs to the Nation exceed $150 
billion a year.
    But we are poised to meet these challenges. We continue to 
have strong support for our activities and have built new 
partnerships in the States. And I want to point out that with 
each one of the States represented here today on the 
subcommittee, we have strong partnerships. We have also 
expanded partnerships with health care, education, and business 
sectors. We see a growing demand for our role and the ability 
to work with more partners. Our programs have been very cost 
effective.
    We are requesting additional funding this year, 11 percent 
more than we received in 1997. Our top priorities are airbag 
safety and our budget contains an increase of $8 million for 
airbag work. My top priority is to get this increase and use it 
to improve airbag safety.
    We have redone the section 402 formula based grant program 
to provide authorization for four new programs. No. 1 is to 
enhance the alcohol-impaired driving program, and we have 
increased funding for that program by 60 percent. That has been 
a very effective incentive program. We have a new occupant 
protection incentive program to encourage States to increase 
seatbelt use, which we think is one of the most important 
things we can do. We have a new drug-impaired driving program 
as a Presidential initiative to help States enact and enforce 
tough laws to prevent drug-impaired driving.
    We are also proposing a new State highway safety data 
improvement incentive grant program to become effective in 
1999. One of the things we want to do is have the States and 
the communities take ownership of the problem by collecting 
data and identifying problems. We have to get States and 
communities able to find their problem, so we can come in and 
partnership as a resource to help them attack the problem. I 
want to point out that each one of the States represented here 
today have safe community programs that we started and are 
using this sort of approach.
    We appreciate the opportunity to work with the subcommittee 
to improve highway safety and to answer questions in the time 
ahead. Thank you.

                     Federal Transit Administration

STATEMENT OF GORDON J. LINTON, ADMINISTRATOR
    Senator Shelby. Mr. Linton.
    Mr. Linton. Thank you very much, Mr. Chairman. I am very 
pleased to be here today to join with my colleagues, Dr. 
Martinez and Jane Garvey, in testifying on behalf of the 
administration's reauthorization proposal.
    We at FTA believe that ISTEA works and that the proposal we 
are putting forward builds on the success that we have had over 
the last several years. We recognize that transit is a critical 
element in our overall transportation system and that the goal 
of every Federal transit program is to optimize the benefits of 
transit using commonsense Government and Government that costs 
less and does more.
    These benefits that we plan to optimize include: basic 
mobility for millions of Americans; congestion relief that 
eases gridlock and makes the country more productive; and 
increased access to transit and other services which improve 
the quality of life in making our neighborhoods more livable.
    We have developed our NEXTEA proposal around four key 
themes: flexibility, streamlining, predictability, and 
innovation.

                              flexibility

    First, flexibility. Flexibility in local decisionmaking has 
been one of the hallmarks of ISTEA. NEXTEA includes provisions 
to make the transit program even more flexible, thus further 
enhancing local decisionmaking.
    One, we are proposing to allow urbanized areas under 
200,000 in population to use all their transit funds for any 
eligible purpose. That is including operating assistance 
without limit.
    More importantly, we are proposing to make preventive 
maintenance eligible as a capital expense, as it is now in the 
highway program. This change would give local transit operators 
the option to invest Federal funds to prolong the life of 
existing assets or to invest in new vehicles, facilities, and 
equipment. This change would also help to replace operating 
assistance for those systems in areas over 200,000 in 
population.

                              streamlining

    Second, streamlining. NEXTEA would combine some transit 
program categories, thus making the program simpler to 
understand and manage at the Federal level as well as the State 
and local level. Specifically, NEXTEA would combine the fixed 
guideway modernization and bus discretionary program into the 
urbanized area formula program. NEXTEA would also provide 
simpler and more flexible programwide definitions of eligible 
capital costs, matching ratios, and grant requirements. And 
NEXTEA would also expand the flexibility between the urbanized, 
nonurbanized, and specialized formula programs.

                             predictability

    Third, predictability. Under NEXTEA, a larger proportion of 
the transit program would go out by formula rather than on a 
discretionary basis. This would not only reduce uncertainty, it 
would also enhance the possibility of using innovative 
financing techniques to leverage the Federal funds. We propose 
to continue to fund new starts using the full funding grant 
agreements approach, as we have over the last several years.
    In addition, NEXTEA would fund the entire transit program 
from the mass transit account of the highway trust fund at an 
authorized level of $5.1 billion per year.

                     innovation and welfare reform

    Four, innovation. We are proposing a series of initiatives 
which will enhance the ability of State and local governments 
to provide safe and efficient transit service by focusing on 
new methods designed to meet new as well as old problems.
    We are particularly proud of our effort in the area of 
welfare reform. We in the Department of Transportation, as well 
as across the Nation, have recognized that transit is, in fact, 
the to in welfare-to-work. If we are going to make a successful 
transition of those now on welfare into the work force, we must 
make sure that transportation services they need are in place, 
and that the local transit agencies are involved. We have 
included in our NEXTEA proposal a new access to jobs and 
training program of discretionary grants to expand 
opportunities to help meet that new market.
    NEXTEA also proposes to continue and strengthen our 
research efforts. We are very proud of these programs which 
recently saw the rollout of the advanced technology transit bus 
[ATTB]. This bus would incorporate aerospace construction, 
accessible design, and hybrid electric propulsion in a single 
vehicle. The ATTB is a solid example of our defense-related 
technologies converted to transit use.
    In closing, NEXTEA seeks to build on the success of ISTEA 
in meeting the President's goal of balancing the budget by 
2002. NEXTEA provides substantial funding for transit, plus 
gives State and local decisionmakers better tools to meet the 
transportation challenges ahead.
    I stand, Mr. Chairman and members of the committee, to 
answer the questions that you may propose.
    Senator Shelby. Thank you.

                            gas tax revenues

    Ms. Garvey, Mr. Linton, Dr. Martinez, I am going to ask 
this question to all of you. Are you supportive of moving the 
4.3 cents of gas tax revenues currently dedicated to general 
revenues to the highway trust fund? Ms. Garvey.
    Ms. Garvey. I hope we all give the same answer. [Laughter.]
    Let me say that the administration has not been supportive 
in the past of moving the 4.3 cents back into the highway trust 
fund. The spending decisions that we make are all within the 
context of trying to balance the budget and reduce the deficit. 
I know this is an issue that Congress is going to look at and 
it is going to be, I know, hotly discussed through the next few 
months.
    Senator Shelby. Mr. Linton, is your answer the same?
    Mr. Linton. Absolutely. [Laughter.]
    Senator Shelby. Dr. Martinez.
    Dr. Martinez. Yes, sir. [Laughter.]
    Senator Shelby. I believe you all had a breakfast meeting. 
[Laughter.]
    Do you oppose moving the transportation funds off budget? 
Ms. Garvey.
    Ms. Garvey. The answer is essentially the same, that the 
administration has not in the past supported that because of 
again the implications for the budget and for reducing the 
deficit and balancing the budget.
    Senator Shelby. The same for you, Mr. Linton?
    Mr. Linton. Ditto, Mr. Chairman.
    Dr. Martinez. Yes, sir.
    Senator Shelby. You all had two breakfast meetings. 
[Laughter.]
    Ms. Garvey. Mr. Chairman, thank you very much for leading 
with me. [Laughter.]
    Senator Shelby. Thank you. You are doing well on behalf of 
the administration thus far.
    Senator Byrd. They had chicken for breakfast. [Laughter.]
    Senator Shelby. Chicken for breakfast, Senator Byrd says. 
Probably had a lot of it.

                      transit funding under nextea

    Mr. Linton, the transit program is the only major component 
of the administration's NEXTEA bill whose overall funding 
authorization was cut as compared to ISTEA. Specifically 
transit was cut $1 billion, from $31.5 billion to $30.5 
billion, over the 6 years. Is the administration sending 
Congress a signal that transit is less of a priority than it 
was under ISTEA?
    Mr. Linton. Mr. Chairman, let me just say that, considering 
this issue of fairness, I think transit will, in fact, get its 
fair share under the NEXTEA proposal. Although it may appear 
that transit is getting a reduction, actually under NEXTEA 
transit will get a 4 percent higher amount than it received 
under ISTEA. After you adjust for the--there is a bubble that 
was placed in the authorization ceiling in the last year that 
makes it appear as if transit gets less funding.
    Senator Shelby. How large a bubble? Do you know or do you 
want to furnish that for the record?
    Mr. Linton. I can submit that to you for the record, but it 
is clear that the bubble in the authorization ceiling makes it 
appear as if there is less money for transit. But it is clear I 
believe that the NEXTEA will provide a 4 percent higher 
allocation for transit than was the case under ISTEA.
    [The information follows:]

    ISTEA authorized $5.1 billion each year for fiscal year 
1993 through fiscal year 1996, and then jumps to $7.2 billion 
in fiscal year 1997. This is a ``bubble'' of $2.1 billion in 
fiscal year 1997. Without this ``bubble'', the total ISTEA 
authorization would have been $29.4 billion. This when compared 
to the $30.5 billion proposed in NEXTEA would mean a 4 percent 
increase.

                               new starts

    Senator Shelby. Mr. Linton, currently there are 13 transit 
new starts with full funding grant agreements and 2 more, 
Sacramento and San Francisco BART, awaiting FFGA's. If the two 
additional projects receive their FFGA's, for a total of 15 
projects, please describe for the committee how much new start 
funding would be available for other projects under the $634 
million level proposed in the President's budget. How much 
would be available if new starts were to be funded at the high 
authorization levels proposed in NEXTEA?
    Mr. Linton. Our authorization level for the NEXTEA proposal 
is $5.8 billion in budget authority. If we look at our 
commitments to the existing full funding grant agreements, we 
would have assumed $3.7 billion of that. That will provide 
about $2 billion additional available under the authorization 
of NEXTEA for additional projects.
    Senator Shelby. But that would really cripple new starts in 
that area, would it not, if all these were fully funded that 
you have on the board.
    Mr. Linton. Well, it will mean that it will be difficult to 
meet all the demands in the country for new start projects, but 
clearly we have followed the path that was established in ISTEA 
in terms of authorizing the projects that we worked on, as well 
as the earmarks by the Congress. That has led us to the $3.7 
billion figure that we will be working with into NEXTEA.
    Senator Shelby. Mr. Linton, I understand that yesterday, 
April 9, you wrote to the chairman of the Los Angeles County 
Metropolitan Transit Authority and essentially informed him 
that you plan to rewrite the full funding grant agreement 
regarding the troubled Los Angeles rail system. Evidently you 
found serious deficiencies and questionable assumptions in the 
recovery plan proposed by Los Angeles. Your letter states--and 
I quote:

    We're incredulous that despite the engineering and 
financial difficulties on the construction already underway, 
the board is contemplating even more requests to the Congress 
about various costly extensions to your rail system.

    If you rewrite the FFGA, the grant, for Los Angeles, will 
you free up more contingent commitment authority to be used for 
other FFGA's, other projects?
    Mr. Linton. I am amazed how quickly my letters get around.
    Senator Shelby. They came over the transom. [Laughter.]
    Mr. Linton. Let me just say, Mr. Chairman, that quite 
frankly we have had some concerns over the years with the 
project in Los Angeles. We did send a letter, as you indicated, 
to the chairman of the board, and we did call for rewriting the 
full funding grant agreement.
    However, in our rewrite of the full funding grant 
agreement, what we are attempting to do is segment MOS-3 into 
three separate legs, primarily for administrative funding/
programmatic reasons so that we can better monitor how much the 
Federal share is committed to each one of the legs and to also 
make sure that we can monitor how the local share is being 
provided by Los Angeles.
    However, in that rewrite of the FFGA, we do not see where 
there will be any additional contract authority available 
because the three segments of the project will still be called 
for in MOS-3.
    Senator Shelby. Senator Lautenberg.

                     highway apportionment formulas

    Senator Lautenberg. Thank you, Mr. Chairman.
    As we all are aware, the challenge to existing formulas is 
developing, and one of the things that I want to point out is 
that though we talk about a return of dollars to particular 
States based on their contribution, I think if we extend that 
proposition, we have got to look at what return we get overall 
from the Federal Government based on contributions that we 
make. I would quickly point out that unfortunately New Jersey 
gets 68 cents on the dollar for all Federal programs, 68 cents 
on the dollar that we send down to Washington. So, we will have 
to look very carefully at this change in formula that is 
contemplated.
    Now, I would ask you, given our need to conserve fossil 
fuels and the direct link between gas consumption and 
pollution, why do you choose to continue the practice of 
distribution of large sums of highway money to States based on 
their consumption of gasoline?
    Ms. Garvey. I think the formula is the most difficult issue 
that we face. It is certainly among the most difficult issues.
    In the area of the STP program, we have included population 
as one of the factors. VMT is still a factor. You are right, 
Senator. And that seemed to be from our perspective one of the 
best ways to at least gain some equity.
    Senator Lautenberg. Because I think realistically what it 
does is it penalizes those who choose to invest in energy 
efficient systems and trains, buses, et cetera, at their peril.
    Ms. Garvey, in examination of the 25 busiest airports in 
the United States, 4 of them are used regularly by my 
constituents. That includes Newark, La Guardia, Kennedy, and 
Philadelphia. These four airports contribute a very high 
percentage of the ticket tax revenues that go to the airport 
grants program.
    Well, do you think we should guarantee each airport a grant 
equal to 90 percent of the revenues that they contribute toward 
grant programs no matter what their needs are? You are just 
getting ready for a whole series of questions I know. 
[Laughter.]
    I want to give you some practice.
    Ms. Garvey. I was not prepared for an airport question, 
Senator. [Laughter.]
    If you give me overnight, Could I get back to you tomorrow 
on that one?
    Senator Lautenberg. I am willing to do that because it is a 
little bit out of left field.
    Senator Shelby. Senator Lautenberg, if you would yield. I 
assure you we will get together, the two of us, and put 
together a hearing if you would like that, on this subject.
    Senator Lautenberg. Excellent. Thank you very much, Mr. 
Chairman. You see the South and North come together here very 
quickly. [Laughter.]
    And I like that. I have found that to be with Chairman 
Shelby. We work together on other committees too.
    Well, if we distribute Federal airports--funds, rather--
airports. Boy, that would be a good subject--based on needs 
rather than contribution, again why recommend that we do the 
reverse when it comes to distributing Federal highway funds? It 
is fairly simple, is it not? We will talk about that at a later 
date too I assume.

                             its technology

    Up through fiscal year 1997, we have provided almost $1.3 
billion in funding to explore and apply new intelligent 
transportation systems [ITS]. These technologies are expected 
to improve the performance of roads and transit systems and 
increase capacity while protecting or improving safety.
    Based on your most recent evaluation of this program, can 
you point to any concrete benefits that the Nation's taxpayers 
have received from this investment?
    Ms. Garvey. I think there are several areas. Starting with 
safety--and Dr. Martinez may want to talk about this more 
specifically, but in the area of safety, I think ITS has been 
enormously successful. One of the lessons that we are hearing 
and one of the observations that we have made in looking at the 
operational tests and also looking at the GAO report is that 
integration is key. When you look at ITS, it is most successful 
when it is integrated. That is really the emphasis that we are 
focusing on as we look at NEXTEA. Where can we deploy ITS in an 
integrated fashion to improve safety, to improve capacity. I 
think managing the systems we have built, ITS is key for that.
    There are some applications even in the rural areas. We 
have a mayday system that works very well by identifying where 
there are accidents using ITS. Tourist information is another 
area that both rural and metropolitan areas find ITS very 
successful.
    So, integration is important, training of State DOT's----
    Senator Lautenberg. By integration, you are saying safety, 
efficiency bring forward the elements, or are you talking about 
a system that has an automobile link to a central data system 
that includes not only perhaps mapping, emergency calling? What 
is the----
    Ms. Garvey. The second part of your response, Senator, is 
the emphasis that we see or the area that has the most 
potential.
    Dr. Martinez.
    Dr. Martinez. We look at three phases of a crash: avoiding 
the crash to begin with, what happens during the crash, which 
is our vehicle standards, and after the crash which is why we 
actually have such a strong role in EMS. But interestingly 
enough, after the crash also has a role with ITS.
    The biggest bang for the buck from our perspective with ITS 
is the crash avoidance itself. Ninety percent of these crashes 
are human factors related, not vehicle related. So, therefore, 
we are seeing programs come on board the car to help with 
hazard warning, control of the vehicle, fatigue issues, et 
cetera. Some of them actually are already coming into the 
marketplace. We see that as the fastest way to get ITS into the 
marketplace as the infrastructure is being built. We see a huge 
payoff with ITS in terms of benefits for the dollars spent.

                          its role in transit

    Mr. Linton. If I may add, I think that ITS probably has the 
most applications in the transit industry, particularly in the 
areas of fleet management. We see a number of opportunities 
there to reap savings to our systems as we look at issues such 
as welfare to work and trying to create opportunities to move 
people from job sites to training sites as well as to their 
homes.
    We see opportunities for things such as route deviation 
where you can use the ITS technology to take buses off route, 
to pick individuals up when they are not on a fixed-route 
system.
    We see its uses in paratransit where you need to have an 
individual response to individuals.
    We also see it in customer service. It enables customers to 
know what time vehicles are arriving so that they can better 
plan their time and their day.
    ITS technology is valuable in emergency response by 
identifying where vehicles are located in case of accidents. It 
also provides information when there are security incidents on 
buses and rail vehicles; the ITS control center is used to get 
that information to police and other emergency personnel. So, 
it is very effective in transit.
    Senator Lautenberg. Thank you very much, Mr. Chairman.
    Senator Shelby. Senator Byrd.

                           zero tolerance law

    Senator Byrd. Dr. Martinez, the zero tolerance provision, 
which I included in the National Highway System Act, will 
implement sanctions on States' Federal highway funds beginning 
in October 1999 if they do not pass a law requiring that youths 
under the age of 21 be prosecuted for drunk driving if they 
have an amount of alcohol above .02 in their system. At the 
time we passed that law, about 24 States had this policy in 
place.
    What can you report to this subcommittee regarding the 
other 26 States and how many of them have implemented a zero 
tolerance law since passage of the National Highway System Act?
    Dr. Martinez. Well, that is a success, I think, of zero 
tolerance. It was accompanied with a Presidential radio address 
that talked about how simple it was, the concept that if you 
cannot drink under 21, you should not be able to have any 
alcohol in your system under age 21. I can tell you that as of 
June 10, 1995, 13 States have enacted zero tolerance laws, 13 
additional States added to the 24 that already had that law.
    Senator Byrd. What do you see for those that have not 
implemented this?
    Dr. Martinez. Well, we have a very large coalition that is 
working with the States to have them move forward. There are 
other States who have discussions under way I believe right 
now. I believe at least three States are looking to change 
their law in order to come into compliance with that zero 
tolerance provision. Our hope is that all States have zero 
tolerance in the next few years and that it becomes the law of 
the land.
    Senator Byrd. Are you pushing hard for that?
    Dr. Martinez. Yes, sir.
    Senator Byrd. Or are you just hoping?
    Dr. Martinez. We are pushing hard. We think that seatbelt 
use and drunk driving are two very important issues. We have a 
big focus not on just drunk driving but drunk driving and 
youth, and it is not just a matter of talking about zero 
tolerance, but the ability to enforce those laws. We are 
working also with the judicial system and with law enforcement 
because one of the problems we find, for example, in the 
younger groups under 21 that cannot get their alcohol as 
readily in bars and restaurants, what they do is purchase it at 
convenience stores or have someone else purchase it. They 
consume it in other places such as parks or river fronts, et 
cetera. So, you have to have special patrols for that.
    I think that we are seeing, not only the continuation of 
efforts from us with our coalitions built throughout the States 
to pass the laws, but also to make sure those laws are seen by 
the youth as being effective, and they will be complied with.
    Senator Byrd. Do you anticipate that any of the States will 
not be in compliance beginning in October 1999?
    Dr. Martinez. I think that is a distinct possibility, but 
it is something that we do not hope will happen. What we have 
done is create a program called Partners in Progress to not 
only expand the partnership but also to find ways to move this 
into the States. Our hope is that most all the States--or all 
the States would address this issue and respond to this issue 
within the next 2 years.
    Senator Byrd. What are your impressions as to how the law 
has aided our efforts to minimize drunk driving by our Nation's 
youth?
    Dr. Martinez. We have found that zero tolerance laws are 
effective in decreasing fatalities and decreasing crashes in 
youth. It sends a very strong message. Youth are the highest 
risk drivers. They also have crashes at lower BAC. So, it is a 
triple win in our opinion. We find variation in the amount that 
it decreases. It has decreased fatalities as much as 16 percent 
in some places. We are excited about that.
    We also know that just raising the age to 21 has dropped 
deaths by 50 percent over the last 10 years in that age group. 
We think this adds a significant margin of safety to that 
young, inexperienced driver.

                           aggressive driving

    Senator Byrd. Does your administration have any ideas or 
proposals that would promote zero tolerance of aggressive 
reckless driving?
    Dr. Martinez. Yes, sir, we do. That is an area of 
tremendous concern for us. Just in local surveys in this area, 
we found that people are more concerned about aggressive 
driving than they are about drunk driving, because they see it 
so much more often. They can see that on the highway every day 
going back and forth to work, and it is certainly an area of 
anxiety.
    What we are doing is working with 21 States right now in 
order to increase awareness, and at the same time increase the 
enforcement. One of the areas we find of greatest benefit is to 
increase or have highly visible law enforcement for aggressive 
driving.
    One of the concerns we have is that over the last 10 years 
we have seen an increase in traffic on the highways by 35 
percent. Yet, we have seen no commensurate increases in law 
enforcement.
    We have programs ongoing in four or five States to look at 
how they are going after aggressive driving and evaluating 
those and then bringing those to other States in our role of 
trying to find best practices. But it is an area of extreme 
importance for us.
    Senator Byrd. An aggressive driver may be drinking.
    Dr. Martinez. Absolutely and not wearing their seatbelt and 
following too closely and many other things. High risk 
behaviors link.
    The other thing I will point out is that we found that by 
going after aggressive drivers, you also pick up a lot of other 
criminal behavior. I think North Carolina with their Click It 
or Ticket campaign has shown a tremendous correlation between 
people with outstanding arrest warrants, lack of seatbelt use, 
and other behavior just from going after those without 
seatbelts.
    Senator Byrd. Should we consider legislation to encourage 
States to toughen their laws and their enforcement of those 
laws to vigorously prosecute these reckless, aggressive 
drivers?
    Dr. Martinez. We certainly think that is an option. What we 
have done right now is to begin the research aspect on it, on 
what we need to do to attack the problem.
    One of the other areas I am concerned about is whether or 
not the sanctions are strong enough. Are we giving the tools to 
the law enforcement and to the judicial system to be able to 
prosecute and send the right message to people? So, I would 
expect in the next year or so, as we finish up our studies and 
our evaluations, we will be able to come forward with some very 
solid recommendations.
    Senator Byrd. Mr. Chairman, I see my time is up. Thank you.
    Senator Shelby. Senator Faircloth.

             use of its technology in the trucking industry

    Senator Faircloth. Thank you, Mr. Chairman.
    Ms. Garvey, I noticed that the NEXTEA, the administration's 
reauthorization proposal, is committed to the promotion of 
intelligent transportation systems. Amongst other tools, this 
is the transponders on trucks to identify where they are, which 
can let them move nationwide and bypass weigh stations. If they 
have been weighed in Virginia, for example, they do not have to 
be weighed in North Carolina.
    You are encouraging the use of these systems. Is that 
right?
    Ms. Garvey. For safety reasons, yes. Yes.
    Senator Faircloth. All right. The companies put in this 
expensive system, the transportation, the trucking companies, 
and now you are attempting to use them as an enforcement tool. 
Is that not in a direct opposition to encouraging them for 
safety, encouraging them to put them in? And then you turn 
around and use it as an enforcement tool, and the trucking 
company that does not have it simply does not come under the 
enforcement rule. The one that does have does. If I ever saw a 
reason not to put one in, you are giving it to them. Besides 
that, you say you are encouraging them to do it.
    Ms. Garvey. We are encouraging them through some incentive 
programs for safety reasons, and Senator, I think the point you 
raise in terms of enforcement, could it be abused, for 
example--we are working very closely with the trucking industry 
to establish some guidelines that works for them and works for 
us as well. A number of the trucking companies that we have 
worked with, obviously, are also very, very concerned with the 
safety benefits of some of the technology that we are 
suggesting.
    Senator Faircloth. You are missing the point. You say that 
you are encouraging the use of ITS for safety, but when you 
subpoena records, it is a strong disincentive to all companies. 
We can't lose focus of the need for safety and these subpoenas 
don't help.
    Ms. Garvey. Yes, sir.
    Senator Faircloth. And then you turn right around and 
subpoena the records. So, the trucking companies are abandoning 
the whole system. Now, which way are you headed?
    Ms. Garvey. We are heading toward using it for safety and 
working with the trucking companies to establish the 
appropriate guidelines for enforcement.
    Senator Faircloth. What are trucking companies telling you?
    Ms. Garvey. Mr. George Regal, from our motor carriers 
office is here, who has worked very closely with ATA and with a 
number of the trucking companies, I would like for him to 
respond more directly.
    Mr. Reagle. Senator, I think in the past our enforcement 
people have in some cases been overzealous.
    I think you have two things happening. You have technology 
emerging which we see can really help us with safety and the 
companies do as well.
    Senator Faircloth. Who are you with?
    Mr. Reagle. I am with the Office of Motor Carriers under 
Ms. Garvey.
    Senator Faircloth. OK, you are with the----
    Ms. Garvey. Federal Highway.
    Mr. Reagle. And so I think you have two things emerging. 
You have companies using technology for safety which is a plus. 
You have our enforcement people who in some cases--and I know 
the particular case you are talking about--where they in fact 
may have been overzealous.
    What we have tried to do--we have a draft proposal now that 
I would like to outline for you. One, it would create 
incentives for companies to use this technology by reducing the 
paperwork burden. Now, that was not the case with the specific 
case you are talking about.
    Senator Faircloth. Well, which one am I talking about?
    Mr. Reagle. Well, I think there was a case in North 
Carolina where we subpoenaed records.
    Senator Faircloth. How about the Ohio one?
    Mr. Reagle. In the past, because we have not had a policy, 
I believe in some cases we may have been overzealous.
    Senator Faircloth. What does overzealous mean?
    Mr. Reagle. Well, where we have gone in and instead of 
working with the company to improve their safety management 
oversight, we have just subpoenaed records and done those kinds 
of things.
    Senator Faircloth. Throwing your weight around.
    Mr. Reagle. Well, that may be the right term. Yes, sir.
    Senator Faircloth. All right, go ahead.
    Mr. Reagle. So, what we are trying to do is, one, create 
incentives for companies to use technology by in turn reducing 
their paperwork burden.
    Two--and I think this will alleviate the problem--the 
methodology we use to go audit a company in the first place has 
been changed, and now almost exclusively, we would go into 
companies whose accident rates were above the average. So, we 
would be visiting companies who in our view would be bad 
carriers.
    And two things could occur. If one of those bad carriers, 
in fact, did not have technology and our safety investigator 
went in, one of the suggestions he would make would be you 
might want to acquire technology to help you have a better 
safety management oversight system. Where the rubber sort of 
hits the road is that if we go into a company that has poor 
results, but it also has technology, we would want to look at 
that kind of technology and see how it is being used for safety 
purposes.
    I think this policy will really go a long way in 
alleviating the problem you have talked about, sir.
    Senator Faircloth. All right. My time is about out. I will 
pass it on.
    Senator Shelby. Thank you.
    Senator Kohl.

                            NEXTEA Formulas

    Senator Kohl. Thank you very much, Mr. Chairman.
    Ms. Garvey, as you may know, my State of Wisconsin 
contributes more to the highway trust fund than we receive. 
Under ISTEA, Wisconsin and other donor States, as you know, 
have relied upon equity adjustments to address this problem. 
For example, in January of this year, Wisconsin received a one-
time adjustment to compensate for its poor return in previous 
years. While we certainly appreciate the help, 1 good year out 
of 6 is still not acceptable. In reauthorization, we need to 
put more fairness in ISTEA's core program formulas.
    NEXTEA does not provide the kind of comprehensive formula 
reform that I am advocating. So, how do your proposals ensure 
that States like my own can count on equity promises being kept 
every year throughout the life of the bill?
    Ms. Garvey. As I mentioned earlier, Senator, I do believe 
that the formula issue, as you have suggested, is among the 
most difficult.
    What we have done or tried to do certainly with our 
formulas is to strike a balance among the many competing needs. 
We have updated the formulas and the factors that are used. For 
example, population factors are the most current and will be 
updated annually as will the contributions to the highway trust 
fund.
    In a couple of categories, we left the formulas as is. The 
bridge category and interstate maintenance are left as is. The 
NHS we have changed somewhat and also STP.
    But I think you are absolutely right. Trying to find the 
right balance and strike the right balance is very challenging.
    We are certainly willing. We have put our formulas forward, 
tried to address all the needs across the Nation, but we are 
certainly willing to work with Congress and individual Members 
to try to formulate an even better formula if there is one.
    Senator Kohl. OK.

                    Changes in Definition of Capital

    Administrator Linton, NEXTEA proposes changes to the 
primary transit programs including rolling discretionary 
accounts into formula, phasing out operating assistance, and 
expanding use of capital assistance, all at a time when welfare 
reform will only increase demands for alternative modes of 
transportation. Although you proposed a separate welfare-to-
work program, the transit changes appear to be a repackaging of 
same much needed funds.
    Do you feel that the current transit formulas reflect the 
emerging needs of urbanized areas of all sizes throughout the 
country, and how do your proposed structural changes help 
transit systems cope with declining resources?
    Mr. Linton. Thank you very much. Actually we think the 
proposed changes that we are making in our formula funds and 
our structuring of our program will enhance transportation 
services available throughout the Nation, as well as urban 
centers. We are going to provide more flexibility, specifically 
by changing the definition of capital to include preventive 
maintenance. As I indicated earlier in my remarks, that 
definition will make our program similar to Federal Highway's.
    I will give you an example. If you paint a bus today, that 
is considered operating cost. If you paint a bridge, that is 
considered capital. And there are a number of examples of that. 
If you operate a traffic control center, that is considered 
capital. If you operate a similar center on the transit side, 
it is considered operating.
    So, what we are trying to do is change the definition of 
capital so that it is consistent with the highway programs, so 
we will have similar definition across our surface 
transportation programs.
    We also think that by changing the definition and moving 
our bus discretionary program into a formula fund, you allow 
systems to have a steady stream of revenues on a consistent 
basis. We would be able to formulize those funds and, 
therefore, transit operators would have those funds readily 
available for innovative financing and be able to leverage 
funds from other financial sources.
    We think this proposal provides more flexibility, more 
predictability, and, therefore, will aid those local transit 
systems in better meeting local needs.

            Welfare Reform and Coordination Between Agencies

    Senator Kohl. Thank you.
    The administration has proposed an initiative to help 
States and localities move people off welfare into jobs. We are 
pleased that you have given special attention to transportation 
as an integral aspect of welfare reform.
    My State of Wisconsin has been a leader in welfare reform 
initiatives, as you know, and next month the State department 
of transportation and local transit authorities are scheduled 
to conclude a comprehensive study on transportation components 
of welfare reform. When released, I would like to share the 
results with you.
    For today I am encouraging you to make access to jobs 
responsive to States and localities that have already begun 
tackling this issue.
    My question is, To what extent do you perceive performance 
under other welfare reform initiatives playing a role in this 
program?
    Mr. Linton. Well, we are very excited about the Access to 
Jobs and Training Program that you mentioned, but what we are 
also doing is working with programs such as Bridges to Work 
which is a program that is funded under HUD and which we were 
involved in at the very beginning. Over the last several years, 
we have been doing new initiatives which we call livable 
communities in which we have been doing things like 
incorporating training facilities, day care centers, et cetera, 
within the same locations of transit stations.
    What we are trying to do across the Government is, working 
with our other partners, like the Department of Labor and the 
Department of Health and Human Services, to make sure that we 
have coordinated services to meet these emerging needs that 
will develop as a result of people moving from welfare to work.
    So, we are trying to work across Departments and also to 
take that across-Department approach to State governments. We 
are working with the National Governors Association through a 
grant to allow them to begin to work with their State 
departments of labor, transportation, and welfare so that they 
can also move the resources that we provide on the Federal 
level to more effectively target them on the State level as 
well.
    Senator Kohl. Thank you.
    My time is up, Mr. Chairman.
    Senator Shelby. Senator Bennett.

                           Utah I-15 Project

    Senator Bennett. Thank you, Mr. Chairman. I want to take 
the opportunity to thank Ms. Garvey and Mr. Linton for the 
personal interest that they have taken in Utah. They have been 
to the State of Utah. They have taken a look at some of our 
problems there. Like everyone, we think our problems are 
unique. So, we are grateful that they are willing to take a 
look at it.
    I want to touch on two Utah issues and get some comments 
and reactions from them as a result of their visit there.
    The first one is the Olympics. I think we have finally 
recognized in this Nation that with the Olympics having 
achieved the level of international interest and complexity 
that they have, that a city can no longer host the Olympics. A 
State can no longer host the Olympics. A nation must be 
involved in hosting the Olympics, and as we learned in Atlanta, 
many of our problems relating to hosting the Olympics are 
transportation problems.
    So, these Administrators, Mr. Chairman, have been to Utah 
to deal with preliminary planning on the Olympics and we are 
very grateful for their willingness to do that.
    And we would appreciate any comment they might have about 
the activity going forward in the House that would indicate 
that any American city--this is not Utah-specific--that ends up 
as a host city for the Olympics would have flexibility under 
ISTEA legislation to have transportation support coming from 
the Federal Government.
    And then to get the second question down so that you can be 
thinking about it while answering the first, I understand that 
the rebuilding of Interstate 15 along the western front of the 
Wasatch Mountains, Salt Lake County in Utah, Salt Lake County, 
Utah County, Davis County, and so on, is the largest design-
build project ever undertaken and that DOT is watching this 
very closely to see how it works out on the assumption that if 
we get what we think we are going to get, you will learn things 
that will allow you to save substantial sums when faced with 
similar design-build opportunities in other places.
    Could you comment on both of those rather parochial 
interests of mine?

                           Utah Design-Build

    Mr. Linton. Sure, Senator. Let me start and I will leave 
the design-build on I-15 to Jane Garvey, but I can talk a 
little bit about design-build in transit.
    Let me just say, Senator, I will be leaving here about 6 
o'clock to once again go to Utah. I will be traveling there 
this evening. We will have a ground breaking tomorrow for your 
light rail system, as well as announcement of additional 
resources for bus fleet expansion from the current 1997 grant.
    Senator Bennett. If I could just interrupt you, you do 
remind me I have the same interest the chairman has with 
respect to full funding grant agreements and what would happen 
to diluting existing ones. So, when you are out there looking 
at our program and cutting the ribbon for it, keep that in 
mind.

                                Olympics

    Mr. Linton. We have no desire or plan to dilute your full 
funding grant agreements. Let me be clear about that right now.
    But let me just say that I will also be meeting with 
members of the Olympic committee as well as Mayor Cordini 
tomorrow and looking at continued efforts on our part to work 
with them as they pursue the implementation of the 2002 Olympic 
games.
    We have learned a lot from Atlanta. We have learned that 
Olympics is a major national event. It requires additional 
resources, but it also provides opportunities for the Nation in 
terms of putting our Nation and our Nation's cities on front 
stage, allowing us to benefit from that event by increasing 
business opportunities and increasing tourism. So, as a result 
of that, we think it is more than just a local event. It is a 
national event.
    However, that means there has to be a partnership, a 
partnership between private providers who the Olympic 
committees generally are, and State and local government, as 
well as Federal Government. We think the reauthorization 
proposal does give some attention to the significance and the 
uniqueness of the Olympics. And many of our cities around the 
country are looking forward to competitively competing for 
Olympic games in the years to come and they are looking for 
some flexibility within the reauthorization that will allow us 
to work with them as better partners.
    Senator Bennett. Thank you.
    Ms. Garvey. Very quickly. I-15 is the largest design-build, 
and we are watching it very closely. We are greatly encouraged 
by the creativity that I think Utah's DOT has brought to this 
issue, and we will learn a lot both in terms of new ways of 
contracting, innovative contracting, financing--we are working 
very closely with Utah's DOT to think of new ways to finance 
this project--and also streamlining some of the Federal 
processes. And I was reminded of this when the chairman raised 
some of the comments earlier, that we really need to look at 
ways to streamline and to be more efficient.
    In a project that is very large and complex, we were able 
to get the environmental work done, very quickly and it is 
because people came around the table, all the Federal agencies, 
the State agencies, and really hammered out some agreements and 
some understandings very early on in the process. So, I think 
those are the lessons that we can apply to other projects as 
well.
    While design-build may not be the answer for every project, 
it certainly is useful for large and interesting complex 
projects like this one.
    Thank you.
    Senator Bennett. Thank you.
    Senator Shelby. Senator Murray.

                           Ferryboat Funding

    Senator Murray. Well, thank you, Mr. Chairman, and let me 
thank you too, Ms. Garvey, for the work you have done within my 
home State of Washington. You have really been a leader in 
innovative financing and helping us finding some solutions to 
our infrastructure problems, and we appreciate it.
    One concern that has been voiced by many of my constituents 
is the loss of the ferry fund. This is a very small source of 
funding but it is invaluable to my State and to many of the 
coastal States as well. We kind of see the water in my home 
State as an extension of the highway system, and, in fact, 
there are 24 million passengers who travel by ferry every year 
in my home State, many of them from their home to their job.
    Can you share with us what the administration's reason is 
for eliminating this fund and possible alternatives for these 
commuters?
    Ms. Garvey. That was a difficult decision and discussion 
within the administration, and it was really an effort to scale 
back on some of the number of discretionary programs. But I 
know you are absolutely right. Your State has done a wonderful 
job in addressing water transportation as a key component.
    The eligibility of STP has been expanded and a number of 
those projects can be funded through the STP program which will 
be significantly larger under NEXTEA. And again, that increased 
flexibility will give the State an option to choose water 
transportation just as they might choose highway or other modes 
of transportation as well under the STP program.

                   Puget Sound Regional Transit Plan

    Senator Murray. OK, I appreciate that. I would like to 
continue to work with you.
    I believe you are aware of the Puget Sound regional transit 
plan that was passed by voters in my State overwhelmingly 
provides a 50-50 funding match and it mixes commuter rail, HOV 
lanes, and express bus service. I know you are working through 
a backlog of transit projects. Can you give me an idea of what 
kind of chance this stands under the NEXTEA plan?
    Mr. Linton. Well, as we stated earlier, we do have an 
authorization level under NEXTEA of about $5.8 billion and 
about $3.7 billion of that will be absorbed by existing 
programs. I have had a chance to meet with many of the 
supporters from your area. My regional office and I are going 
to be working very closely with them in looking at the major 
opportunities that will come about as a result of the passing 
of your local tax initiative.
    I have been impressed with the corporate and business 
involvement in the projects, and we are looking to work with 
them to see how we can move this through as we go through each 
stage of the project. But I am very impressed with the broad 
based support, including support from the corporate sector, and 
with the local initiative itself. I think it is a marvelous 
model for how we can develop projects in the country.
    Senator Murray. And very supported. So, I look forward to 
working with you on that.
    Secretary Slater is going to be in Seattle this Monday. He 
is looking at the fast rail corridor that is going to go 
through the heart of Washington State. This is an exciting 
project, much needed for our economy, but it also brings some 
problems with it. I wanted to ask you for your thoughts on some 
innovative financing that will help us supplement grade 
separation projects and other challenges we face as this goes 
into place.
    Ms. Garvey. We certainly would be very happy to work with 
you. We have a great innovative financing team at Federal 
Highway. It may be possible to use some of the CMAQ funds to 
seed or to act as a loan. We can certainly look at a number of 
proposals with you. State infrastructure banks is another 
possibility. Washington has some good and interesting ideas in 
that area as well.
    Senator Murray. OK, great. I look forward to working with 
you.

                            CMAQ Flexibility

    One final question. I think we all recognize that safety is 
a priority for any piece of legislation, and I have been 
working with seven different communities around the Olympic 
Peninsula in my home State. We are trying to expand 
recreational opportunities in an area that is also very reliant 
on our roads for commerce.
    Essentially what is happening is our logging trucks and our 
cyclists have been debating who is going to get the roads in 
that region, and we have had a number of tragedies that have 
resulted because of that.
    We have previously used scenic byway funding to expand some 
of our road shoulders, but that funding is very limited and we 
have 360 miles of very dangerous highway around the Olympic 
Peninsula right now.
    Can you comment on the flexibility of CMAQ funding, 
enhancements, or other resources that we might look to in the 
future for this project?
    Ms. Garvey. Both the CMAQ and the transportation 
enhancement are increased under the President's proposal. That 
may be good news for projects like that.
    Senator Murray. And there will be flexibility within that 
too?
    Ms. Garvey. Yes, absolutely.
    Senator Murray. OK. I appreciate it.
    Ms. Garvey. Thank you, Senator.
    Senator Shelby. Senator Byrd, do you have any second round 
questions?

                         Appalachian Corridors

    Senator Byrd. I have proposed that States with Appalachian 
corridors that remain to be completed be allowed to draw from 
the highway trust fund on the basis of contract authority so 
that those States are not dependent upon appropriations from 
the general fund which appear as demonstration projects.
    It seems to me that if we are going to emphasize safety, we 
should keep in mind that in these 13 States of Appalachia, 24 
percent of the corridors remain to be completed. In West 
Virginia, 26 percent has not yet been constructed. So, West 
Virginia is behind the region.
    I have noted that some of these roads in my State are among 
the most dangerous and produce more accidents and fatalities 
than any other highways. It seems to me that if we really want 
to improve the overall safety of drivers, we ought to work with 
a will in completing the construction of these corridors.
    Do you have any comment?
    Ms. Garvey. Senator, I think your point about the need to 
address safety through the infrastructure investments along the 
corridor that you are speaking about is absolutely right on 
target. I think it is also true for a number of other rural 
roads as well and it is why the administration has really felt 
a commitment to the Appalachian corridor and obviously previous 
administrations as well. I agree wholeheartedly.

                 Appalachian Development Highway System

    Senator Byrd. Some weeks ago the chairman of a committee--
we have rules which preclude our naming names, although some 
Members disregard the rules, but the chairman of a certain 
committee held a press conference where he identified dozens of 
Federal programs as corporate welfare, and one of those 
programs was the Appalachian Development Highway System.
    How can the Appalachian Development Highway System be 
regarded as corporate welfare in your estimation?
    Ms. Garvey. I would not describe it that way.
    Senator Byrd. Pardon me?
    Ms. Garvey. I would not describe it that way, Senator. I 
think the points that you made earlier about the need to 
improve the highway both for safety reasons as well as even 
economic development reasons are positions that the 
administration would share.
    Senator Byrd. You see, in West Virginia we cannot resort--I 
wish we could--to mass transit. We cannot have these high-speed 
rail systems, and we cannot depend upon aviation and airport 
grants. We have to depend upon highways. That is all we have. 
So, I think it is very important from the standpoint of safety 
if for no other reason that we finish construction of the 
Appalachian Highway.
    Corridor L, for example, runs from Beckley in Raleigh 
County, southern West Virginia, and joins up with I-79 around 
Sutton. Tourists and travelers from Canada and from the 
Northern States and from the Southern States use this corridor, 
and it has been two-lane, beautifully scenic. Two lanes. Very 
dangerous. Very dangerous. There have been a lot of fatalities 
on it.
    First of all, I have assisted in completion of the 
construction of that highway, at least in appropriating all of 
the Federal funds under a matching system that would be 
required to finish it. Now, that would improve the safety of 
driving on the highways for out-of-State drivers, as well as 
for in-State drivers.
    It seems to me if we would press harder to complete these 
systems--it is not easy to appropriate moneys for construction 
of highway corridors. It has been becoming more difficult all 
the time. So, that is why I suggested to the President that we 
initiate a program whereby these corridor States can, through 
contract authority, get money from the trust fund which would 
not compete with their other moneys that they ordinarily get 
through other formulas and so on so that those highways can be 
completed.
    The people in Appalachia were promised these corridors over 
30 years ago. I was around as I was around when we initiated 
the Interstate System.
    The Senator from Alaska was here a little earlier talking 
about the needs in Alaska. I am the only remaining U.S. Senator 
who voted to admit Alaska into the Union. So, I have seen the 
need for this improvement of our way of funding the 
construction of corridors, leaving aside the economic impact 
that such completion would have, just talking about safety 
only.
    I hope that we will redouble our efforts to help to see the 
completion of these corridors in these 13 States.
    Now, if we want to really mean what we say, we ought to 
forget all this business about a tax cut. Forget it. It is no 
time to cut taxes. Of course, it is something I like to vote 
for. I have been voting for over 50 years, and that is about 
the easiest vote I have ever cast is a vote to cut taxes. But 
it is folly for the administration or for the other party to 
advocate a cut in taxes. I know it has a great political appeal 
out there, but we cannot talk out of both sides of our mouth 
and be believed and be seen as having any integrity. This is no 
time to cut taxes.
    That money ought to be put on infrastructure, building up 
our country's infrastructure, so that we can compete in world 
markets, so that our children, our future citizens, will have 
an infrastructure that will enable them to improve their way of 
living and to increase the opportunities for jobs.
    So, I know this is not in your grade level, but I hope the 
President and others will hear what at least one Senator 
thinks. It is absolutely folly to talk about cutting taxes at 
this period. Our unemployment is the lowest it has been in a 
long time. If we are not going to use the money that would 
otherwise go to pay for a tax cut, if we are not going to use 
that to lower our deficits, at least put it into 
infrastructure. I can think of no better way to spend it.
    So, I am glad to hear you say that you think that 
completing the construction of these highways, making them four 
lanes and divided would be one of the foremost ways that we 
could advocate when it comes to improving safety.
    My time is up.
    Senator Shelby. Senator Faircloth.
    Senator Faircloth. Thank you, Mr. Chairman.
    Senator Byrd, I was just wondering, did Strom vote not to 
let Alaska in?
    Senator Byrd. Well, you know, I do not like to talk about 
somebody else's voting record. [Laughter.]
    I can only tell you that this Senator is the only Senator 
who is still around who voted to admit Alaska and Hawaii into 
the Union. So, you will have to figure for yourself the answer 
to your question. [Laughter.]
    Senator Shelby. I think the Senator from North Carolina 
figured it out the first time. [Laughter.]

                     Interstate Reimbursement Costs

    Senator Faircloth. Ms. Garvey, ISTEA sent $3.6 billion to 
New York, New Jersey, Pennsylvania and certain other States. It 
was supposedly to pay them for having built the New Jersey 
Turnpike, the New York Thruway, the Pennsylvania Turnpike, and 
some other preinterstate roads. I thought it was the most 
ridiculous and ludicrous thing I had ever heard of in my life.
    Now I see you are sending them $6 billion more in NEXTEA. 
Will you tell me why?
    Ms. Garvey. I am going to turn to Jack Basso who is here 
with us who has developed some of the formulas and worked with 
Bud Wright.
    Senator Faircloth. I am sure he is looking forward to it.
    Ms. Garvey. I bet he is. Do you think so? [Laughter.]
    Sometimes it helps to be in charge and you can ask those 
guys to help you out a little bit.
    Senator Shelby. If the Senator from North Carolina would 
yield. When you are answering that, could you tell us what 
years this was done too?
    Mr. Basso. Yes, sir.
    Senator Faircloth. What years what was done?
    Mr. Basso. I think the chairman is asking what year this 
money was incorporated and maybe I can tell a little bit about 
the system.
    Senator Faircloth, I am the Deputy Assistant Secretary for 
Budget and Programs for the Department. Let me just make a 
couple of observations on that.
    There has been obviously some significant debate about 
reimbursing for components of the system that really were built 
pre-1955. The administration's rationale has been that those 
were parts of the system that are the oldest parts of the 
system, are parts that did not have to be built and paid for at 
that time, and therefore----
    Senator Faircloth. Let me ask you this.
    Mr. Basso. Yes, sir.
    Senator Faircloth. Was the administration's rationale that 
they are going to turn all the tolls collected since 1940 over 
to the Federal Government?
    Mr. Basso. No, sir.
    Senator Faircloth. Well, if they are going to keep the 
money--the Pennsylvania Turnpike was with bonds, was it not?
    Mr. Basso. Yes, sir, it was.
    Senator Faircloth. Those bonds have long since been paid 
off, have they not?
    Mr. Basso. I really do not know, but I assume that is 
correct.
    Senator Faircloth. When was it built?
    Mr. Basso. It was built in the late 1940's and early 
1950's.
    Senator Faircloth. All right. So, you are talking about 50-
plus years.
    Mr. Basso. Yes, sir.
    Senator Faircloth. So, the bonds were not issued in excess 
of 50 years.
    Mr. Basso. I understand.
    Senator Faircloth. So, they have been paid off or are in 
default.
    Mr. Basso. Sure.
    So, again----
    Senator Faircloth. So, here is a highway that the traveling 
public has paid for totally, completely with a return to the 
investors on the bonds, and we are going to send them billions 
of dollars.
    Mr. Basso. Yes, Senator; and let me just again comment that 
our view was that those particular funds represented a decision 
the Congress made in 1991 to address an older segment of the 
system to provide basically costs, as they existed from a 1980 
study, if I remember correctly. And the administration has 
decided, in submitting its bill, to propose to the Congress to 
continue that reimbursement.
    Senator Faircloth. How long do you think we might continue 
that reimbursement? How long do you think we ought to continue 
to pay for a highway that has been built and paid for by the 
traveling public for 20 years and we are going to continue to 
pay them for it?
    Mr. Basso. I think beyond the life of NEXTEA, you know, it 
is very hard for us to anticipate what that might be. But 
clearly in this case, we have come forward with a proposal that 
will be debated in the Congress and decided. Senator, your 
position is respectfully understood by all of us who have dealt 
with this for a long period of time, sir.
    Senator Faircloth. What do they do? Plan to cancel the 
tolls as soon as they get this money?
    Mr. Basso. Well, sir, I do not know about that. I could not 
answer that.
    Senator Faircloth. What do you think?
    Mr. Basso. My opinion would be, based on----
    Senator Faircloth. Do you think they are going to take down 
the toll booths on the New Jersey Turnpike?
    Mr. Basso. No, sir; I would be disingenuous to you if I 
told you I thought they were, and I do not think they would.
    Senator Faircloth. Well, you could dance this around most 
any way you want to, but what it amounts to is $6 billion to 
these States, just extra money, totally pork barrel money.
    How much did it cost to build the Pennsylvania Turnpike?
    Mr. Basso. I could get that figure for you for the record, 
Senator. I do not know right off of the top of my head what the 
cost was.
    Senator Faircloth. Well, assuming that the split here would 
be about $2 billion, you are paying them about seven times what 
it cost to build it originally in reimbursement.
    Mr. Basso. As I said, the numbers that have been put forth 
for the reimbursement are based, as I recall, on a study that 
was done and completed in 1980 and it looked back at the 
original cost of the system. But I would be happy to get any of 
that information for you.
    Senator Faircloth. You mean the $6 billion that we are 
giving them now was based on a study done in 1980?
    Mr. Basso. Yes, sir; it was. In fact, the 1991 legislation, 
the factors that were derived for each of the States was based 
on that same legislation except that one-half of 1 percent was 
guaranteed to each of the States without regard to whether they 
participated in this program or not.

                            Interstate Tolls

    Senator Faircloth. Well, let me ask you one more thing. The 
proposal to put tolls on the Interstate System--tell me about 
that.
    Ms. Garvey. Thank you, Senator.
    The proposal that the administration has put forward is an 
option for States. It is not something that is required. It is 
something that States can choose to use or not to use, whatever 
the case would be. It would involve public participation 
obviously, and it is just one more option for States to have, 
not a requirement at all.
    Senator Faircloth. It is a tax increase.
    Ms. Garvey. It is an option, Senator, that would be a tax 
increase.
    Senator Faircloth. Who would set the rate or the amount of 
the toll?
    Ms. Garvey. That would be decided at the State level 
through the planning process that is in place.
    Senator Faircloth. Well, what if we put a $100 per car toll 
on I-95 through North Carolina? What would be the response to 
the Federal Highway Administration?
    Ms. Garvey. Well, to be honest, I cannot imagine the State 
DOT, with public participation, would be involved in something 
like that.
    Senator Faircloth. We might just put it on interstate cars 
going from Virginia to South Carolina.
    Ms. Garvey. Again, it is an option for States to use.
    Senator Faircloth. So, what you are saying is the States 
could put any sort of exorbitant toll on a highway they might 
see fit. Of course, I was making a ludicrous example, but for 
the Federal Highway Administration to say that States can put a 
toll on a highway that has been paid for by Federal money and 
the--this is a form of raising revenue.
    Ms. Garvey. Senator, the way the language is worded, it 
would have to be tied to the rehabilitation of that facility. 
So, in other words, if you wanted to rehabilitate a section 
between point A and point B, a State could elect to do that. My 
experience in the last few years with States is that they 
approach those things very cautiously. It is an option that 
they have. ISTEA gave the option for bridges and tunnels, and 
States have, for the most part, chosen not to use that.
    Senator Faircloth. Well, we have never had a toll road in 
North Carolina.
    Senator Shelby. If the Senator from North Carolina would 
yield for an observation. If we could follow some of the 
suggestions of the Senator from West Virginia and properly fund 
the Appalachian corridor the way the East got funded, there 
would probably be more equity there. The sum of $6 billion 
would do a lot I think for the Appalachian area, including most 
of the Southeast.
    I would hope that we would have the administration's 
support in that regard. I know that Senator Byrd has toiled for 
years and years as he has pointed out, and this would affect 
not only West Virginia but North Carolina, Alabama, you name 
it. And $6 billion would do a lot for our area too, and I am 
sure that with the wisdom of Senator Byrd, we are going to 
pursue that till we get it.
    Senator Faircloth. Thank you, Mr. Chairman. I intend to 
pursue opposing $6 billion to subsidize 50-year-old highways 
that have been paid for many times.
    Senator Shelby. Senator Bennett.
    Senator Bennett. Thank you, Mr. Chairman. I am cognizant of 
the fact that we have a vote coming, so I will not pursue all 
my time. But I would like to make a couple of philosophical 
statements.
    I have not been around as long as Senator Byrd has, but I 
do go back a little ways. I served in the Nixon administration 
in the Department of Transportation, so I have some 
institutional knowledge of the Interstate Highway System and 
the philosophy behind it.
    As we get into this debate about formulas, I would just 
share with you this concept that came from another official in 
the Nixon administration when I was there, a young adviser to 
the President by the name of Daniel Patrick Moynihan, who said 
that nothing that had been done in this country had had the 
impact on the way we live approaching the impact of the 
Interstate Highway System.
    I remember the speech which he gave to us where he said 
Eisenhower has been categorized as a passive President, whereas 
Kennedy and Johnson were active Presidents. But historically 
nothing down in the Kennedy and Johnson administrations 
approached the impact of the Eisenhower decision to proceed 
with the Interstate Highway System, that this passive President 
had had more effect on Americans and the way they lived.
    And the philosophy behind the Interstate Highway System was 
that it was national. It was truly an interstate system, and 
just because, to pick a State out of the air, Utah happens to 
have more miles than people in it and, therefore, more highway 
building than, say, a small State like, to pick another one out 
of the air, New Jersey, the impact on the Nation as a whole for 
the system to be able to provide free transportation of goods 
throughout the country affects everybody. It transformed the 
railroads, not necessarily for the good from the standpoint of 
railroad investors, but the creation of an interstate network 
transformed everything for everybody, including fruit shipped 
from California to New Jersey, and in order to get there, they 
have to go through Utah.
    If we start carving up the money on the basis of artificial 
boundaries that says, OK, this State is going to get so much 
money and if their highways break down and their infrastructure 
does not work, the folks on the east coast are going to feel 
that even though they say it is unfair for us to have paid for 
it.
    So, I would hope you would keep that view in mind as you go 
through this.
    The only other comment--and I probably should not say it, 
but I will--I am reading NEXTEA, and I will just highlight a 
few comments and then make an editorial comment.
    It starts out, ``President Clinton will announce.'' Then on 
page 4, ``When President Clinton promised to rebuild America 5 
years ago,'' and then it goes on. Page 7, ``President Clinton 
recognized this in his January.'' Then page 8, ``Under 
President Clinton, America is once again.'' Under Page 9, 
``President Clinton proposes to build, to support his 
comprehensive welfare program.'' Under page 10, ``President 
Clinton has taken advantage of ISTEA's landmark to reduce,'' so 
on and so forth.
    My only comment is, the election is over. This is an 
official document. Let us not use it for political campaigning 
purposes.
    With that, I will go save the Republic, along with my 
chairman.
    Senator Shelby. I thank the Senator from Utah.

                          Submitted Questions

    I have a number of written questions for the record and the 
record will also stay open for other members of the committee 
that might have questions of the first panel.
    All of you, I appreciate you coming. I wish you had not 
eaten breakfast together twice earlier. [Laughter.]
    But you did and I understand that. I am sure that all of 
you will abide by the decision of the Congress in its wisdom, 
whatever we do up here, regarding legislation that would affect 
you and the American people.
    I am going to go vote and we are going to have to recess, 
and then we will come back to the second panel. I thank all of 
you on the first panel.
    Ms. Garvey. Thank you, Mr. Chairman.
    Senator Shelby. We will stand in recess for about 10 
minutes.
    [A brief recess was taken.]
    [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 Shelby
               enhancing safety with roadway improvements
    Question. Under ISTEA, rail-highway crossings and other roadway 
hazard elimination projects were funded from a 10 percent safety 
apportionment from the Surface Transportation Program (STP) account. 
Because of the set-aside nature of the program, as the highway 
obligation ceiling went up, the State apportionments increased from 
$353 million in fiscal year 1992 to $600 million in fiscal year 1997. 
The comparable NEXTEA ``flexible highway infrastructure safety'' 
program is a fixed-rate program, totaling $3.25 billion over the six-
year authorization.
    Does structuring rail-highway crossing and hazard elimination 
funding in a fixed-rate program preclude growth in this area if more 
highway funds are made available?
    Answer. The Infrastructure Highway Safety Program (IHSP) provides 
funds to: 1) eliminate hazards on public roadways other than the 
Interstate, and 2) improve the safety of rail/highway grade crossings. 
The Rail/Highway Grade Crossing program receives a straight-line $165 
million per year while the Hazard Elimination program receives the 
balance of IHSP funding, increasing from $335 million in fiscal year 
1998 to $410 million in fiscal year 2003. These two programs no longer 
receive their funding through a percentage takedown from the STP. Under 
ISTEA, if increased funding were made available to STP, both Rail/
Highway Grade Crossing and Hazard Elimination funding would increase. 
Under NEXTEA, unless more highway funds are made available specifically 
to the IHSP, funding for Rail/Highway Grade Crossing and Hazard 
Elimination programs would remain at NEXTEA authorized levels. The 
NEXTEA proposal allows states to shift hazard elimination funds to non-
infrastructure safety programs, such as NHTSA's section 402 public 
education program or FHWA's motor carrier safety program.
    Question. Do you believe that highway safety education and 
enforcement programs are more effective at preventing accidents and 
saving lives than correcting road hazards, separating grade crossings, 
and installing warning devices?
    Answer. We believe both are necessary and effective. Under NEXTEA, 
States would be granted greater flexibility to use funding where they 
believe they can leverage the greatest results in grade crossing 
safety. Certainly, the safest crossing is one that does not exist. 
However, crossing safety is in most cases a local safety challenge that 
warrants diverse local solutions. That is why the Department initiated 
the multi-faceted Rail-Highway Crossing Safety Action Plan in 1994, and 
unveiled with Operation Lifesaver, Inc., the Always Expect a Train 
public awareness campaign in 1995. Since the Department instituted 
nationwide and multi-faceted safety initiatives, there has been a four-
year downward trend in fatalities.
    Question. I have heard that the administration is considering a new 
bill to amend or ``fine tune'' the safety section of NEXTEA. Can you 
confirm this? What programs are being reworked?
    Answer. On April 17, Secretary Slater transmitted to Congress the 
``Surface Transportation Safety Act of 1997.'' This constitutes Part II 
of NEXTEA. Title IX--Traffic Safety, which contains certain amendments 
designed to enhance the safety provisions of NEXTEA. This title further 
encourages States to increase safety belt use by adopting primary 
enforcement of safety belt use laws; increases the number of new motor 
vehicles that may be exempted from compliance with Federal motor 
vehicle safety standards on the basis that they possess innovative 
safety features; closes a loophole in the vehicle safety statute by 
prohibiting retailers of motor vehicle equipment from selling defective 
items of equipment; clarifies the Secretary's authority to engage in 
harmonization activities that promote the worldwide improvement of 
motor vehicles; encourage new efforts to achieve uniformity in State 
laws regulating the titling and control of severely damaged passenger 
motor vehicles; and includes several regulatory reform proposals. The 
key provisions are:
    Primary Safety Belt Use Laws: The Administration's NEXTEA proposal 
includes incentive funds to help States increase belt use. Primary 
enforcement is the most important life-saving aspect of belt use laws, 
adding significantly to the rate of belt use. This bill would establish 
a date certain by which all States would be required to have enacted 
primary safety belt use laws. Beginning in fiscal year 2003, a State 
that has failed to enact such a law would have a percentage of its 
highway construction funds transferred to its section 402 highway 
safety program. However, the transfer of funds would not apply to a 
State in a fiscal year beginning after fiscal year 2003 if the State 
has a statewide belt use rate of 85 percent or higher in both front 
outboard seating positions in all passenger motor vehicles.
    Motor Vehicle Equipment Safety Defects: Closes a loophole by 
prohibiting all retailers, not just auto dealers, from selling 
defective items of motor vehicle equipment, such as child safety seats, 
that have been recalled.
    Safety Compliance Exemptions: Increases the number of new motor 
vehicles that may be exempted from compliance with Federal standards on 
the basis that they possess innovative safety features.
    International Harmonization: Clarifies the Secretary's authority to 
engage in harmonization activities that promote the worldwide 
improvement of motor vehicle safety without any diminution of U.S. 
safety performance standards.
    Titling: Encourage new efforts to achieve uniformity in State laws 
regulating the titling and control of severely damaged passenger motor 
vehicles. The new program would ensure that these vehicles are 
inspected for applicable safety and anti-theft standards.
    Question. The NEXTEA proposal allows states to shift hazard 
elimination funds to non-infrastructure safety programs, such as 
NHTSA's section 402 public education program or FHWA's motor carrier 
safety program. Do you believe that highway safety education and 
enforcement programs are more effective at preventing accidents and 
saving lives than correcting road hazards, separating grade crossings 
and installing warning devices?
    Answer. Both infrastructure and non-infrastructure safety programs 
are important. Our proposal gives states the flexibility to use their 
hazard elimination funds for non-infrastructure if the state has an 
integrated highway safety planning process and established goals and 
benchmarks for safety improvements.
    Between 1992 and 1995, since ISTEA was enacted, the use of safety 
belts and child restraints has saved 35,000 lives, the use of 
motorcycle helmets has saved 2,155 lives, and age 21 drinking laws have 
saved 3,300 lives. Costs of highway crashes would have been $30 billion 
higher in 1994 (versus 1990) had it not been for injury rate reductions 
due to these and other safety countermeasures. Clearly behavior change 
can make a significant difference. Safety belt use has grown from 11 
percent in 1982 to 68 percent in 1996. Alcohol involvement in fatal 
crashes has dropped from 57 percent to 41 percent over this same 15-
year period. The President has set a national goal of 85 percent safety 
belt use by 2000, and 90 percent by 2005. NHTSA estimates that 
increasing belt use from the present 68 percent to 90 percent would 
save 5,500 lives per year. FHWA and FRA have estimated that during the 
period 1992 through 1995, hazard elimination saved 6,200 lives and 
highway-rail grade crossing safety programs saved 1,700 lives.
    Risk factors are increasing that require renewed efforts in 
education and enforcement. The number of youngest and oldest drivers 
will significantly increase between now and 2005. The use of alcohol 
and drugs is on the rise and has begun to show in highway fatality 
statistics. Combined risk factors pose threats and challenges: 
aggressive driving, drivers who speed, run red lights, disregard 
traffic signs, drink, and don't wear their safety belt. Due to the 
aging infrastructure, safety features need to be added and upgraded, 
e.g., guardrails replaced, signs upgraded, new pavement markings, and 
hazards eliminated. Clearly highway safety must be attacked on all 
fronts.
                      financing and toll programs
    Question. What is the difference between State Infrastructure Banks 
and the Transportation Infrastructure Credit Program?
    Answer. State Infrastructure Banks (SIB's) are State-level 
investment funds which are capitalized, in part, with Federal funds and 
offer loans and other types of financial assistance to transportation 
projects. Loan repayments and credit fees from the SIB's customers are 
used to replenish the funds and permit them to become self-sustaining 
financial institutions devoted to transportation investment. The 
Transportation Infrastructure Credit Enhancement Program, on the other 
hand, represents direct Federal assistance to specific projects. Rather 
than simply allowing States to use a portion of their Federal highway 
and transit grant funding to capitalize SIB's, this initiative would 
provide Federal assistance directly to projects of national 
significance--those projects with national economic benefits and 
financing requirements that exceed the capacity of SIB's and States' 
regular transportation programs. Under the credit enhancement program, 
the Administration's reauthorization proposal, $100 million per year 
would be used to capitalize revenue stabilization funds for one or more 
such projects of national significance to enable them to access the 
capital markets for most of their financing. These revenue 
stabilization funds would be used to secure external debt financing and 
if needed, to pay debt service costs in the event project revenues are 
insufficient.
    Question. Since the SIB's program was authorized in the 1995 
National Highway System Designation Act, what has the track record been 
for the program? How many of the 10 pilot states have secured federal 
loans?
    Answer. The results to date for the SIB pilot suggest that the 
program will complement the regular Federal-aid program by serving 
certain local and state-wide projects that have access to dedicated 
revenue streams, but need flexible financial assistance to get 
underway.
    With just four months having passed since most States signed 
cooperative agreements with FHWA and FTA to create their SIB's, 
financial activity has gotten underway with two loans from the Ohio 
SIB, each for $10 million, to support a $100 million bond issuance by 
Butler County for a toll road. A $1.18 million loan has also been made 
by the Missouri SIB for a debt service reserve fund to support a $17 
million bond issue by the Springfield Transportation Commission. 
Ultimately the bond issue will support a variety of street and 
intersection improvements including some overpass work.
    Florida, Missouri, Ohio, Oklahoma, and Oregon intend to make 
additional project loans by October 1997. To date, $80 million in 
Federal funds have been transferred to States to capitalize their pilot 
SIB's. By October 1998, the initial 10 SIB's are expected to have 
provided various types of loans totaling $324 million supporting 1.6 
billion in total project construction.
    Question. The SIB's pilot projects financial condition report was 
due to Congress March 1st. When will this report be submitted?
    Answer. The draft report is in the final review stage and should be 
issued soon.
    Question. The primary barrier to implementing SIB's has been the 
low number of revenue-generating projects that will then be able to 
repay loans made by SIB's. In the Department's experience, what are 
possible ways for states to generate revenue in order to repay their 
SIB loans?
    Answer. There are a variety of ways SIB loans can be repaid. 
Currently, the primary repayments being considered by the pilot states 
include user fees such as developer impact fees, tax increment 
financing, and dedicated local sales taxes. Repayments can include 
traditional tolls (potentially made more acceptable to the public 
through the use of automatic toll collection technology). In addition, 
SIB loans can be repaid with a dedicated portion of a State or 
locality's gas tax or future federal apportionments.
    Question. If the Transportation Infrastructure Credit Program is 
established, what projects now underway would be eligible for funding? 
Would San Francisco's BART extension qualify? Boston's Central Artery 
project? Or the Woodrow Wilson Bridge?
    Answer. Any type of surface transportation project that is proposed 
to be eligible for Federal assistance under title 23 or chapter 53 of 
title 49 in the Administration's reauthorization proposal would be 
permitted to receive a Revenue Stabilization Fund grant, as long as it 
satisfied the program's eligibility criteria. To meet those criteria, 
the project must: 1) be of ``national significance'' in terms of moving 
people or goods more cost-effectively (the Secretary will establish 
specific guidelines concerning improved productivity, cost-benefit 
analysis, job creation, and other factors); 2) be unable to obtain 
adequate financing on reasonable terms elsewhere; 3) be included on the 
State's transportation plan, and, if in a metropolitan area, be 
approved by the metropolitan planning organization; 4) have its 
application for assistance be submitted by a State or local government; 
5) cost at least $100 million or an amount equal to 50 percent of the 
State's annual Federal-aid apportionments, whichever is less; and 6) be 
supported at least in part by user charges or other dedicated revenue 
streams.
    Projects meeting these threshold criteria then would be evaluated 
by the Secretary based on a qualitative analysis of their credit-
worthiness, degree of leveraging private capital, use of innovative 
technologies, and other factors. This program is intended to help large 
revenue-generating projects obtain private financing by enhancing their 
external debt. Projects already underway, such as the BART extension 
and the Central Artery, presumably have already secured the necessary 
financing or identified future funding sources and should not need such 
revenue stabilization funding. (The Central Artery project's current 
finance plan does not contemplate additional Federal assistance outside 
the State's regularly apportioned Federal-aid funding.) Based on the 
eligibility criteria, the Woodrow Wilson Bridge would be a candidate 
for direct Federal assistance under this program.
                             airbag safety
    Question. NHTSA recently announced initiatives to improve air bag 
safety especially with respect to children and smaller-sized adults. 
For example, air bag deployment speeds are proposed to be lowered by up 
to 35 percent. Please describe NHTSA's efforts to make air bags safer 
for drivers and passengers.
    Answer. On November 27, 1997, NHTSA published a final rule 
requiring vehicles equipped with air bags to be equipped with very 
obvious warning labels for parents and care-givers.
    On January 6, 1997, NHTSA published a Federal Register notice 
proposing procedures to allow auto dealers or repair shops to 
disconnect air bags, at the request of vehicle owners, without 
requesting special permission from the Federal government. The public 
comment period closed on this proposal on February 5, 1997. Final 
decisions will be made soon.
    On March 19, 1997, NHTSA published a final rule amending the 
occupant protection standard to allow vehicle manufacturers to quickly 
depower all air bags. For the unbelted occupants, the regulation now 
allows a vehicle sled test to measure the performance, rather than the 
full-frontal barrier test. The agency and the vehicle manufacturers 
estimate this will allow air bags to be depowered by 20 to 35 percent. 
This interim solution will significantly reduce the risk to children 
and small statured adults.
    In addition, NHTSA plans to propose mandating improved, advanced 
air bag technology. NHTSA believes that advanced air bags will provide 
greater safety in frontal crash protection for all size occupants. 
Advanced air bags will preclude air bags from deploying under unsafe 
conditions or effectively tailor the speed of the deployment to match 
the size of the occupant and the crash circumstances.
    The agency has formed an Advanced Air Bag Technology Working Group 
under the Crashworthiness Subcommittee of the Motor Vehicle Safety 
Research Advisory Committee (MVSRAC) with participants from NHTSA, 
automobile manufacturers, automobile air bag suppliers, public health 
care professionals, and academia. The agency will use this working 
group's expertise to provide input to the agency on advanced air bag 
issues through MVSRAC. In addition, the agency is forming a team to 
work on the development of test procedures and performance requirements 
of advanced air bags. The agency also has a contract with the Jet 
Propulsion Laboratory (JPL) to assess the state-of-the-art in advanced 
air bag technology and the time-frame that will be necessary to bring 
these technologies to the market. A Final Report of the JPL work is due 
in October 1997.
    Concurrent with all of these vehicle changes, the agency continues 
to work to increase safety belt use and to educate the public that 
children need to be placed in the back seat. President Clinton and 
Secretary Slater announced an initiative to increase the safety belt 
use to 85 percent by the year 2000. This is in addition to the ongoing 
nation-wide public initiative of the Air Bag Safety Coalition being 
conducted by the National Safety Council, in cooperation with NHTSA and 
other partners.
    Question. NHTSA has a process to permit air bags to be deactivated 
upon application to the agency. What criteria does NHTSA use in 
deciding whether to approve an application? How many applications have 
been approved?
    Answer. Although there is a statutory prohibition (49 U.S.C. 30122) 
against commercial entities knowingly making inoperative any device or 
element of design installed on or in a motor vehicle in compliance with 
Federal Motor Vehicle Safety Standards (FMVSS), NHTSA is not enforcing 
this prohibition with respect to air bag deactivation in the following 
cases:
    a. The vehicle's owner or lessee submits a doctor's statement that 
the owner, lessee, or any other person 13 years or older who is a 
driver or passenger of the vehicle has a medical condition that 
justifies deactivation of the driver or passenger air bag or both;
    b. With respect to a child age one to 12 years old who must sit in 
the vehicle's front passenger seat because of a medical condition, if 
the vehicle's owner or lessee submits a doctor's statement that the 
child has a medical condition that justifies deactivation of the 
passenger air bag;
    c. The vehicle owner must transport an infant in the front seat of 
a vehicle with a passenger-side air bag, either because the infant has 
a medical condition necessitating that the infant be frequently 
monitored or because the vehicle lacks a rear seat that can accommodate 
a rear-facing child restraint; or
    d. The vehicle owner has a frequent need to transport children 
under 12 in the vehicle and does not have enough seating positions in 
the rear to accommodate all children who must be transported.
    From October 1, 1996, through April 29, 1997, NHTSA has received 
6,039 deactivation requests, of which 1,897 have been granted. 
Approximately 80 percent of the grants were for adult medical 
conditions, while approximately 20 percent involved children, including 
both children with medical conditions and children riding in vehicles 
lacking a rear seat capable of accommodating a rear-facing infant seat. 
The ten most often cited medical conditions for which requests have 
been granted are, in approximate order of frequency: Osteoporosis/
osteogenesis imperfecta/brittle or thin bone disease; Pacemakers; 
Heart/thoracic surgery; Breast cancer surgery/breast reconstruction, 
Tinnitus/hyperacusis; Emphysema/asthma/pulmonary conditions; Fractures 
(neck, back, ribs, etc.); Arthritic conditions; Dwarfism; and Previous 
air bag-related crash injuries.
    In addition, a small number of requests have been granted for 
persons 4'6" or shorter with no medical conditions, who would be unable 
to maintain a safe distance from the air bag.
                           safety challenges
    Question. A number of trends, demographics, and other issues 
comprise safety challenges facing NHTSA. Please give us your view on 
where highway safety is heading.
    Answer. Despite significant progress, a look at recent statistics 
shows no room for complacency. After years of steady decline, the total 
number of highway deaths increased from 1992 to 1995. Motor vehicle 
crashes are still the leading cause of premature death of America's 
youth. Based on preliminary estimates the number of fatalities and the 
number of alcohol-related fatalities decreased slightly in 1996, but 
the number of crashes and non-fatal injuries increased yet again.
    Key risk factors between now and the early 21st century are:
    The number of youngest and oldest drivers is increasing. Between 
1996 and 2005 the 15 to 24 year old age group will increase 14 percent, 
compared to an overall population increase of 7.8 percent, and the 
population over age 75 will increase 17 percent.
    The use of alcohol and other drugs is rising. In 1995, the number 
of alcohol-related fatalities increased for the first time in 9 years. 
These fatalities still number over 17,000, even with the one percent 
estimated decrease in 1996.
    Safety belt and child seat use is still low. Safety belt use has 
grown by only two percentage points since 1993; it stands at 68 
percent. Agency checkpoints show that up to 80 percent of child safety 
seats are misused, and statistics show that every day an unrestrained 
child under the age of 5 is killed in a traffic crash.
    Speeding and other forms of aggressive driving are increasing. 
Exceeding the posted speed limits, or driving too fast for conditions, 
is a growing problem on all roads. In 1995, speeding was a factor in 31 
percent of all fatal highway crashes, at a cost to society and the 
economy of more than $29 billion. Currently, 34 States have increased 
their speed limits beyond what would have been allowed under the former 
national maximum speed limit law, and 23 of these 34 States have 
increased their speed limits to 70 miles per hour or greater. Recent 
surveys indicate that aggressive driving, a behavior often marked by 
excessive speed, has become the driver behavior that most concerns the 
motoring public.
    The repeal of motorcycle helmet laws is becoming a reality. The 
motorcycle helmet law in Texas was recently repealed and there are 
moves in several other states to repeal.
    A robust economy has been historically correlated with short-term 
increases in highway fatalities. While continuation of an expanding 
economy is a good thing overall for society, we must address the 
resulting increases in highway safety risk, e.g., higher number of 
miles driven for recreation at night, which is associated with higher 
risks; increased commercial traffic, which affects the vehicle mix on 
the road.
    The vehicle mix on the road has been changing and will continue to 
change.
    Sales of light trucks and vans have been increasing significantly, 
compared to sales of passenger cars. Since 1992 there have been more 
fatalities in car/light truck collisions than in car/car collision. 
Eighty percent of the fatalities are occupants of the passenger car.
    Question. Safety belt and child seat use are low and drunk driving 
remains a major problem. How do you address these issues in the 
reauthorization and do you expect to be successful?
    Answer. Included in the Department's NEXTEA legislation is a 
proposed incentive grant program designed to stimulate increased safety 
belt and child safety seat use. In addition, the Department's NEXTEA 
legislation includes a proposed incentive grant program designed to 
encourage states to implement laws and programs to combat alcohol-
impaired driving. The program is intended to build on the successes of 
the Section 410 alcohol incentive grant program.
    The Department expects these new programs to be successful. Just as 
in the Section 410 incentive grant program, where the number of 
qualifying states, including the District of Columbia, rose from 19 in 
fiscal year 1992 to 32 in fiscal year 1996, NHTSA expects the 
incentives offered will spur states to implement the laws and programs 
needed to meet grant criteria. In addition, participation in the 
occupant protection program will be accelerated as a result of the 
Presidential initiative to increase safety belt use rates nationwide.
    Question. What are NHTSA's top priorities?
    Answer. NEXTEA needs to provide a balanced program for NHTSA that 
addresses both vehicle and behavioral safety problems, while providing 
a foundation for research, crash data and injury prevention activities. 
An active technical assistance program is required to support our 
safety partners in the states and communities, health and business 
arenas, educators, and safety advocates. This is consistent with 
NHTSA's role as a public health agency.
    Top priorities include:
Air bag safety:
    In November 1996, we issued a rule requiring clearer and more 
precise air bag warning labels in both the passenger vehicle and on 
child safety seats.
    In January 1997, we issued a rule extending the period for 
permitting air bag cut-off switches for passenger side air bags in 
vehicles without rear seats or with rear seats that are too small to 
accommodate a rear-facing child safety seat.
    We issued two other proposals in January 1997: 1) to ensure that 
vehicle manufacturers can depower all air bags so that they inflate 
less aggressively; 2) to make it possible for vehicle owners to have 
their air bags deactivated by vehicle dealers and repair shops.
    In February 1997, we issued a proposal to require that motor 
vehicles and add-on child restraints be equipped with uniform 
anchorages to secure the child restraints to vehicle seats.
    In March 1997, we issued a final rule on air bag depowering, 
effective immediately, which allows the manufacturers to proceed with 
their depowering plans.
    A comprehensive research effort to realize more fully the life-
saving attributes of current driver and passenger air bag systems, and 
to pave the way for the introduction of improved air bags in the near 
future.
Occupant protection--Use of safety belts
    Safety belts are the most effective means of reducing fatalities 
and serious injuries in traffic crashes, saving an estimated 9,500 
lives in America each year. Our research has found that lap/shoulder 
belts, when used, reduce the risk of fatal injuries to front seat 
passenger car occupants by 45 percent, and the risk of moderate-to-
critical injury by 50 percent. Child safety seats are the most 
effective occupant protection devices used in motor vehicles today. If 
used correctly, they are 71 percent effective in reducing fatalities to 
children under the age of five and 69 percent effective in reducing the 
need for hospitalization.
  --President Clinton feels strongly that more needs to be done to 
        encourage the use of these life-saving devices. On April 16, 
        Secretary Slater responded to the President's call and released 
        a national strategy to raise U.S. safety belt use to 85 percent 
        by the year 2000. By 2005, our goal is to get 90 percent of the 
        nation's vehicle occupants to use safety belts.
  --Currently, with an estimated 68 percent of America's vehicle 
        occupants buckling up, seat belts are saving about 9,500 lives 
        a year. Going to 85 percent seat belt use would boost the 
        annual number of lives saved in U.S. highway crashes by 4,194, 
        and reduce crash-related medical costs by $6.7 billion a year. 
        If 90 percent of vehicle occupants used their belts, 5,536 more 
        lives would be saved annually and medical-related costs would 
        be cut by $8.8 billion.
  --Actions include: Building partnerships between government and the 
        private sector to help America reach its potential of saving 
        lives and preventing injuries through the use of seat belts and 
        child safety seats; enacting State laws for primary (standard) 
        seat belt enforcement and comprehensive child passenger safety; 
        conducting active, high visibility law enforcement of State 
        seat belt and child safety seat laws; and expanding well-
        coordinated, effective public education programs.
  --Under NEXTEA, a new occupant protection incentive grant program, to 
        encourage States to increase safety belt use, and a proposed 
        transfer of highway construction funds to occupant protection 
        programs to encourage enactment of primary safety belt laws.
Occupant protection--Child safety:
    In February 1997 we issued a proposed rule for a universal child 
safety seat attachment system. The agency also has intensified its 
efforts to educate the public about air bag performance and to properly 
restrain children. We also have set a goal of reducing child occupant 
fatalities (0-4 years) 15 percent by 2000, and 25 percent by 2005.
    Reduce alcohol-impaired driving among the population at large and 
especially for young drivers. Alcohol is the drug abused most 
frequently by our children, and is responsible for 35 percent of the 
highway deaths among our youth, ages 15-20. Forty-one percent of all 
fatal motor vehicle crashes continue to be alcohol-related, and 32 
percent of these fatal crashes involve a drunk driver or pedestrian 
with a high blood alcohol concentration (BAC greater than 0.10 
percent).
    NHTSA's ISTEA Section 410 Impaired Driving Incentive Grant Program 
provides financial incentives to States to encourage improvements in 
laws and programs dealing with impaired driving. Since the passage of 
ISTEA, 37 States plus the District of Columbia have qualified for one 
or more years of incentive grants.
    ``Zero tolerance'' laws make it illegal for a person under 21 to 
drive a motor vehicle with any measurable blood-alcohol content. In 
June 1995, President Clinton called on Congress to make zero tolerance 
the law of the land. Congress responded by including the provision in 
the NHS Act. These laws are very effective, reducing alcohol-related 
crashes involving teenage drivers by as much as 10-20 percent.
    NEXTEA proposes an enhanced drunk driving prevention incentive 
grant program, to help States enact and enforce tough drunk driving 
laws and a new drugged driving incentive grant program, a Presidential 
initiative to help States enact and enforce tough laws to prevent drug-
impaired driving
Crash avoidance research, conducted under DOT's Intelligent 
        Transportation Systems (ITS) program
    The goal of this research is to demonstrate that improved crash 
avoidance performance of vehicles can be achieved through the 
application of advanced sensing and communication technologies to motor 
vehicles. Achievements in this area require that these sensing and 
communication technologies are matched to the limitations and 
capabilities of all drivers without any diminution to safety.
    Our near-term goal is to equip vehicles with several collision 
avoidance systems, in partnership with industry, to demonstrate their 
feasibility and safety potential. We estimate that if all vehicles were 
equipped with just three of the primary ITS crash avoidance systems 
(rear-end, roadway departure, and lane change/merge) 1.2 million 
crashes (one out of ever six) could be prevented annually, saving 
thousands of lives and $26 billion a year.
Giving states the flexibility to address their most critical highway 
        safety problems
    Under NEXTEA a new State highway safety data improvement incentive 
grant program, to encourage States to take effective actions to improve 
the data they need to identify the priorities for State and local 
highway safety programs
    Full implementation of the new performance-based Section 402 state 
grant program.
    Under NEXTEA, a program to encourage integrated safety planning and 
increased flexibility in the use of FHWA safety infrastructure funds 
for states to address their critical safety problems.
   nhtsa's role in reducing head injuries and assisting ems personnel
    Question. Please describe NHTSA's role in working with EMS 
programs. Are EMS personnel the most likely health professionals to aid 
victims of motor vehicle accidents? How can NHTSA help improve the 
services provided by EMS personnel, especially with regard to head 
injuries?
    Answer. NHTSA serves as a national leader, coordinator, facilitator 
and technical resource for EMS programs. The agency develops products 
and services and facilitates national consensus on issues which are 
more efficiently or effectively addressed at the national level than by 
individual states. Examples of agency programs include development of a 
national Standard Curricula for emergency medical providers and 
delivery of technical workshops on issues such as trauma system 
development, data management and quality improvement.
    EMS personnel are typically the first health professionals to care 
for motor vehicle crash victims. NHTSA's central effort to improve the 
effectiveness of these professionals is the EMS Agenda for the Future, 
a vision and plan for EMS that provides guiding principles for the 
continued growth and evolution of EMS in a rapidly changing health care 
environment. The EMS Agenda addresses each of the critical aspects of 
emergency medical systems, assessing the current national status, 
projecting a vision of future performance, and recommending specific 
actions for realizing the vision. An implementation plan for the EMS 
Agenda for the Future is now being developed and will be published 
later this year.
    Question. People injured in car crashes in rural areas may have to 
be transported long distances to reach trauma centers that can provide 
appropriate care. I understand that victims of head injuries, in 
particular, might be spared life-long disabilities if EMS providers 
could improve their emergency response protocols for brain trauma. Is 
NHTSA working with EMS programs to improve the treatment of head 
injuries?
    Answer. NHTSA is currently updating the National Standard 
Curriculum for the Emergency Medical Technician--Paramedic. This 
curriculum includes both classroom and clinical instruction concerning 
patient assessment, injury mechanisms and head injury. The complete 
curriculum involves about 1,000 hours of instruction. In addition to 
the education of EMS providers, the agency also provides technical 
assistance for the development of regional trauma systems. These trauma 
systems utilize triage protocols that are designed to accurately assess 
the condition of trauma patients and efficiently direct their transport 
to facilities with appropriate resources. An effective trauma system 
greatly improves the outcome of patients with severe trauma, such as 
head injury, by providing the best care in the least time.
    Question. Each year we spend billions of dollars for long term 
medical and assisted living care of head-injured patients. Do you think 
that significant savings would be achieved by better EMS response to 
head injuries?
    Answer. We believe that significant savings can be realized by 
better EMS response to all types of severe injuries, including head 
injuries. The outcome of severely injured patients is largely dependent 
on the amount of time between injury onset and appropriate 
stabilization and treatment. As the first link in the continuum of 
trauma care, the EMS system can influence patient outcome with a quick 
response, appropriate stabilization and rapid delivery to an 
appropriately equipped hospital emergency department.
                intelligent transportation systems (its)
    Question. Ms. Garvey, the ITS program appears to be starting an 
evolution into a different program. To this point, IVHS, now ITS, has 
been a program focused on research and demonstration projects. The 
Administration's budget and NEXTEA reauthorization proposals anticipate 
beginning a shift in focus to include a $100 million annual deployment 
program and a 6 year total contract authority funding level increase 
from $659 million in the last authorization bill to almost $1.3 billion 
in the NEXTEA proposal.
    Despite this new push to deployment, a number of obstacles must be 
overcome before ITS technology is widely deployed and integrated. These 
obstacles include the lack of a working knowledge of the systems 
architecture, technical standards to integrate individual ITS 
technologies, technical knowledge at the state and local level, and 
cost-benefit data on ITS.
    What are the reasons for doubling the contract authority for the 
ITS program?
    Answer. Contract authority is being requested for those portions of 
the ITS program which would most benefit from a long-term, predictable 
source of funds. These program areas include the ITS Deployment 
Incentives Program, crash avoidance research, the Advanced Vehicle 
Control and Information Systems program area, the operational test 
program, the architecture and standards program, and major portions of 
the mainstreaming program area (technical assistance, planning/policy 
issues, and training). These represent program areas which we know will 
be viable and in need of substantial funding support throughout the 
period covered by the reauthorization of ISTEA. Program areas with 
resource needs which may vary widely in amount and technical content 
from year to year, such as most of the research program areas, will 
continue to be justified and requested on an annual basis through the 
appropriations process.
    It should also be noted that the proposed ITS Deployment Incentives 
program, which is designed to help spur integrated, intermodal 
deployment of ITS technologies and strategies, accounts for a total of 
$600 million of the contract authority being requested. The remainder 
of the contract authority being requested for research and technology 
transfer activities totals $678 million, an amount comparable to the 
amount received for similar activities under ISTEA.
    Question. Are ITS technologies ready for widespread deployment in 
light of the numerous obstacles?
    Answer. First, ITS technologies are not only ready for widespread 
deployment, but are being deployed. As of 1995, we have counted ITS 
deployments nationwide as follows: 41 freeway management centers, 39 
advanced public transportation management systems, 57 centralized 
traffic signal control systems, 39 ITS incident management systems, and 
28 electronic toll systems. In fact, about $1 billion a year of regular 
Federal aid funds is being spent on three of the nine ITS components 
that we track on our financial system. In the nation's 75 largest 
metropolitan areas, deployment of eight of the nine items is underway 
in most of them.
    However, this deployment is taking place with little regard to 
intra-regional compatibility let alone the interoperability called for 
in the national architecture--thereby losing the potential of the ITS 
infrastructure to bridge the modal and institutional fragmentation and 
enable seamless system management. Thus, in NEXTEA, we propose a 
deployment incentives program to ensure progress to integration. We 
have proposed a very small incentive program, the majority of which 
would be used for integration of ITS infrastructure in metropolitan 
areas where ITS infrastructure deployment is already underway. It would 
also provide incentives for deployment of the commercial vehicle ITS 
infrastructure and rural ITS applications. Several legislative changes 
are also proposed to clarify the eligibility of all ITS applications 
for regular Federal-aid funding.
    Second, we view the primary obstacles to broader ITS deployment as 
the lack of the following: adopted standards, expertise among state and 
local officials, cost/benefit data, and available funds. In our NEXTEA 
proposal, we address many of these ``barriers'' to deployment.
    A significant portion of our proposed research funding would be 
devoted to facilitating development of industry consensus on well over 
100 standards. While the process will take some five years, we expect 
that draft standards critical to integration will be available in the 
next two years. None have been completed, and four more draft standards 
will be done by the end of the year. And we believe that we, will have 
agreement on one of the most critical standards that underlie the tag 
and reader technology in automatic toll collection before the end of 
the summer.
    We also have proposed training for state and local officials. 
Deployment of ITS is not unlike the transition FAA went through when it 
went from a civil engineering organization that oversaw the building of 
airports to one that dealt with management of assets and airspace. For 
that purpose we have developed a five-year strategic plan, that is now 
being translated into a business plan and we have asked for significant 
funds--some $10 million in fiscal year 1998. Recently, we launched the 
program with the first of 70 overview seminars that will be given to 
our staff and partners across the United States in the coming few 
months.
    In these courses, we will cover in considerable detail the costs 
and benefits that have been documented for this program. An impressive 
quantity of cost-benefit data has been presented to Congress and the 
nation at large. For example: Buying smarter by deploying intelligent 
transportation systems infrastructure reduces the need for new roads 
while saving taxpayers 35 percent. A comprehensive study by NHTSA has 
estimated crash avoidance countermeasures can yield a 17 percent 
reduction in all accidents, resulting in a net savings of up to $26 
billion per year. A study by the FTA suggests that ITS can save transit 
authorities between $4 billion and $7 billion over the next decade. 
What is not available to local officials are the analytic tools 
necessary to demonstrate those benefits, because to date all of our 
analytic tools have focused on capital decisions with long range 
horizons. We are in the process of developing those tools now for use 
by states and metropolitan areas across the country.
                 appalachian development highway system
    Much is made of the need to upgrade Appalachian Development Highway 
System roads because of the economic development benefits for the parts 
of the country that these roads serve, but I do not want you to lose 
sight of the safety implications of failing to bring these corridors up 
to divided four lane standards. So I commend you for the commitment 
that the Administration's NEXTEA proposal makes to Appalachian 
Development Highways--more needs to be done--but it is a step in the 
right direction.
    Question. In your review of the ITS program and as you consider the 
future of that program, have you identified rural safety applications 
from the research that has already been done? Please elaborate on these 
rural safety applications. What projects are currently funded and 
underway? What potential projects are being considered?
    Answer. The Department has recently completed strategic and program 
plans for the Rural ITS Program which detail how we will allocate the 
increased resources of the rural program. Our needs analysis identified 
safety as the primary goal of the rural program. We have grouped the 
applications into seven critical program areas:
    (1) Traveler Safety and Security Services such as wide area 
dissemination of safety information (weather and road conditions), 
site-specific safety advisories to alert travelers of near-term 
problems, safety surveillance and monitoring of rural transit vehicles, 
and vehicle or infrastructure based systems that prevent roadway 
departure crashes, animal-vehicle collisions, and high speed collisions 
between vehicles and farm equipment.
    (2) Emergency Services such as May Day systems, and advanced 
dispatching and emergency vehicle based response systems which will 
reduce response times.
    (3) Infrastructure and Fleet Operations and Maintenance Services 
which will reduce weather-related accidents and warn motorists of road 
work or other road hazards.
    There are 11 active ITS program funded projects. But, there have 
been over 50 rural ITS projects funded from various private, state and 
Federal sources. A list of these projects can be provided upon request. 
The Federal ITS projects can be grouped into three areas: Research of 
safety information collection technologies (e.g., weather and road 
hazards), operational testing of May Day systems, and operational 
testing of safety information dissemination systems (e.g., in-vehicle 
displays or AM and FM subcarrier systems). In fiscal year 1997 we will 
initiate research and operational testing on Traveler Safety and 
Security Systems to investigate the most promising technologies that 
will reduce the most prevalent accident types. The focus will be on 
infrastructure based systems that do not duplicate the efforts of the 
collision avoidance program. Technologies may address the following 
issues: animal/vehicle collisions; low cost run-off road collision 
avoidance system; low cost vision enhancement system; and high speed 
farm equipment/vehicle collisions. We will also initiate research and 
operational testing of Emergency Response Systems. This effort will: 1) 
resolve the interface issues between the Public Service Answering Point 
and the Independent Service Providers; 2) investigate advanced 
applications beyond automatic collision notification which provide 
detailed information to emergency care givers in order to improve 
accident site care; and 3) investigate systems for achieving blanket 
communications for May Day services. It should be noted that a minimum 
of 10 percent of the proposed ITS Deployment Incentives program is set 
aside for the deployment and integration of rural ITS technologies.
    Question. Most of the fatalities on rural roads are from single 
vehicle accidents. This would seem to me to be an area that Advanced 
Highway System research may have a significant life-saving application. 
I welcome your thoughts and comments.
    Answer. The majority of rural single vehicle accidents are roadway 
departure collisions. The ITS program is working with industry on 
systems that will greatly reduce this accident type and that will be 
available in five to 10 years. Under the Intelligent Vehicle Program, 
we are developing a roadway departure collision avoidance system which 
automatically detects if a vehicle is leaving the lane, as well as a 
driver inattention detection systems and human factors guidelines to 
reduce driver workload. These applications will produce commercial 
products within five to 10 years. Deployment of these products will 
enable this accident type to be reduced much sooner than the AHS 
products will be available.
        contract authority and obligation limitation disconnect
    Question. In looking at the Administration's Budget submission and 
the NEXTEA reauthorization proposal, there appears to be a disconnect 
between the Contract Authority that the Administration is requesting 
for fiscal year 1998 and the Obligation Limitation level requested in 
the Administration's budget. Please explain the relationship between 
contract authority, obligation limitation, and liquidating cash.
    Answer. Contract authority refers to the type of funding provided 
for the highway program. The authorizations contained in highway acts, 
such as ISTEA, set the amounts of funds that are available for use for 
the entire highway program. These authorizations, which are contract 
authority, represent the upper limits on the obligations that can be 
made by the Federal government. Sums authorized in Federal-aid highway 
acts, because they are contract authority, are made available for 
obligation without appropriations action.
    An obligation is a commitment of the Federal government to pay, 
through reimbursement to the States, the Federal share of a project's 
eligible cost. Obligation is a key step in financing. Obligated funds 
are considered to be ``spent'' even though no cash is transferred, 
since an obligation is a legally binding commitment on the part of the 
Federal government to reimburse the State. As a result, obligations are 
usually the step in the financial process that are controlled in the 
Federal budgeting process. A limitation on obligations acts as a 
ceiling on the sum of all obligations that can be made within a 
specific time period, usually a fiscal year, and thereby controls 
spending. The limit is placed on obligations that take place within the 
specified time period, regardless of the year in which the contract 
authority was made available. Since the appropriations process has been 
the traditional way to control Federal expenditures, obligation 
ceilings are usually established in the annual appropriations act and 
are set at a level consistent with annual spending limits that are 
driven by the effort to reduce the Federal deficit.
    By definition, contract authority is unfunded and a subsequent 
appropriations act is necessary to liquidate (pay) the obligations made 
under contract authority. This authority to pay obligations is referred 
to as liquidating cash.
    Question. Why is the contract authority request for fiscal year 
1998 $2.45 billion more than the total of the requested mandatories 
plus the requested obligation limitation?

Contract Authority...................................... $22,480,000,000
Highway obligation ceiling..............................  18,170,000,000
Mandatory highway programs..............................   1,510,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total highway budgetary resources.................  20,030,000,000

    Answer. The contract authority and obligation limitation amounts 
for our reauthorization proposal have been set at the maximum levels 
allowable within the overall budget targets. These levels reflect our 
continuing commitment to both balance the budget and invest in 
transportation. While the obligation level is lower than the contract 
authority for fiscal year 1998, we are hopeful that budgets in future 
years will permit the use of the funds that cannot be used this year. 
With multi-year authorizing legislation, such as our ISTEA 
reauthorization, we think it is important that the contract authority 
levels are set at the highest levels possible. Since unused contract 
authority can be carried over to future years, this allows for growth 
in the program in the outyears, if the budget picture improves. We 
think that our proposal is the best way to adhere to the financial 
concerns of today while still looking forward to the program needs of 
the future.
                           nextea flexibility
    Question. As I mentioned in my opening statement, the State of 
Alabama views ISTEA as constraining them more than empowering them to 
meet their highway needs. I understand that there is a significant 
amount of flexibility in the current program, but that in many ways 
ISTEA is an overly complicated structure for administering funds to 
your State partners. What additional program flexibility has the 
Administration proposed in the NEXTEA submission, and what program 
delivery streamlining is envisioned?
    Answer. NEXTEA proposes to build on the flexible programs and 
provisions of ISTEA to allow the States to put their funds into the 
surface transportation modes and project types that meet their own and 
the Nation's needs.
    NEXTEA expands and clarifies eligible activities for all core 
Federal-aid programs, including the National Highway System (NHS), 
Interstate Maintenance, the Surface Transportation Program (STP), and 
the Highway Bridge Replacement and Rehabilitation Program. Added or 
clarified eligibilities include preventive maintenance; Interstate 
reconstruction; intercity passenger rail capital investment; bridge 
scour countermeasures; intelligent transportation system capital, 
operations, and maintenance; and intermodal activities.
    Transferability provisions among the various programs and surface 
transportation modes allow States to put their money where their 
surface transportation needs are. Alabama took advantage of this 
feature and transferred ISTEA Surface Transportation Program funds to 
support transit in Montgomery and Birmingham.
    NEXTEA also proposes several streamlining measures. Changes are 
proposed to make STP operate more like a block grant program while 
retaining accountability. NEXTEA establishes annual program-wide 
approval for non-NHS STP projects, rather than the current quarterly 
project-by-project certification and notification.
    NEXTEA permits merger of plans, specifications and estimates 
approval and project agreement execution and provides for obligation of 
the Federal share on a project when the project agreement is executed.
    NEXTEA expands flexibility to States and FHWA to determine mutually 
the appropriate level and extent of State and FHWA oversight on NHS 
projects. NEXTEA provides that FHWA's oversight responsibilities shall 
not be greater than they are under Certification Acceptance and ISTEA, 
unless the State and FHWA mutually decide otherwise. NEXTEA also 
provides that State must assume Title 23 oversight responsibilities on 
non-NHS projects.
                      value pricing pilot program
    Question. What projects were implemented/completed under ISTEA's 
congestion pricing pilot program? What have been the results of these 
programs in terms of improved traffic volume and air quality and the 
availability of new funds for transportation programs?
    Answer. Projects included under the Pilot Program, as well as 
congestion pricing projects in other parts of the world, are beginning 
to provide new, and sometimes surprising, evidence about the potential 
benefits of congestion pricing. Our projects are just in the beginning 
stages, and the evidence is necessarily preliminary, but we can provide 
some indication of how these programs can be expected to affect 
traffic, air quality, and revenue availability. We might also note that 
for all the implementation projects, local interest and support for 
congestion pricing has been quite strong.
    For instance, in San Diego, where excess capacity on the I-15 HOV 
lanes is being sold to HOV's, the initial sale of 500 express lane 
passes at $50 each sold out in the first 6 hours of availability. In 
February of 1997, 200 subscribers were added to the original 500, for a 
total of 700 ExpressPass holders. In March, 1997 the monthly fee was 
increased to $70, and in April, an additional 200 customers may be 
added for a total of 900 ExpressPass holders allowed on the HOV 
facility. Despite a price increase from $50 to $70, 80 percent of the 
original customers opted to remain with the pilot program. Data is 
being collected to gauge price elasticity and the effects of raising 
the tolls on traveler behavior. One of the surprising findings from the 
early evidence on this project is that in the initial months of the 
pilot's operation, carpools on the HOV lanes have increased by 5 
percent from 86 to 91 percent, while the rate of unauthorized users of 
the HOV facility has decreased from 14 percent to 4 percent due to 
increased enforcement. This important finding suggests the HOV Buy-In 
concept can be a ``win-win'' for mobility and the environment.
    All reports have been strongly positive for the innovative pricing 
project on State Route 91 in Orange County, California. This project, a 
privately-designed, constructed, financed and operated project, opened 
in December of 1995. The State Route 91 ``Express Lanes'' constitute 
the country's first variable priced and fully-automated facility. This 
$126 million project has added four new lanes of capacity termed 
``Express Lanes'' along 16 kilometers (10 miles) in the median of the 
highway. While this project is not a Federal-aid project, and is 
therefore not one of FHWA's pilot projects, Pilot Program funds are 
being used to support the California Department of Transportation's 
monitoring and evaluation study of this pathbreaking project.
    In the first year of operation, public response to the Express 
Lanes has been excellent, with a steady increase of patronage to 25,000 
daily customers. A recent opinion poll conducted by the California 
Polytechnic Institute at San Luis Obispo indicates that the project is 
viewed favorably by 65 percent of the Express Lanes customers, 62 
percent of the free, HOV Express Lanes users, and 53 percent of the 
drivers in the adjacent freeway lanes. Express Lanes users reportedly 
can save up to 20 minutes in commute time, and the diversion of single-
occupant vehicles to the priced lanes has made a noticeable improvement 
in traffic flow in the general purpose lanes. According to local 
transportation officials, the State Route 91 highway is running more 
smoothly today than at any time since 1980. Carl Williams, Deputy 
Secretary for Transportation for the State of California, reports that 
at the end of the first three months of operation, the roadway was 
covering the facility's operating costs. By December, 1998, the company 
expects to cover operating costs as well as meet their debt service. 
Williams also reports that HOV-3 vehicles account for 44,000 out of the 
166,000 weekly trips on the express lanes. As an incentive to encourage 
ridesharing, vehicles with three or more passengers are exempt from the 
Express Lanes tolls, while all others are charged for Express Lanes 
usage. The costs vary with time, ranging from $.50 to $2.75 per trip. 
Frequent users can opt to pay a $15.00 monthly fee and receive a $.50 
discount per trip, independent of time of day. All fares are 
automatically deducted from each customer's pre-paid account using 
electronic ``read-write'' transponders mounted on the car windshield. 
Currently, over 50,000 motorists have established an Express Lanes 
account and are equipped with transponders.
    According to Gerald Pfeffer, Senior Vice President of United 
Infrastructure, an official of the State Route 91 Express Lanes owner/
operator consortium, preliminary reports indicate that the majority of 
Express Lanes customers use the facility on a discretionary basis, 
rather than on a daily basis. Express Lanes customers represent all 
income levels, thereby dispelling the notion that only higher income 
motorists benefit from congestion pricing. Apparently, the facility is 
attracting a broad array of commuters including: contractors; plumbers; 
office workers; and parents. This finding is not surprising given the 
demographics of the population in that area. Affordable housing in the 
suburbs surrounding the State Route 91 facility attracts large numbers 
of lower to middle income residents who commute to employment centers 
in adjacent counties.
    By all accounts, this project has been considered an initial 
success. While long-term success is yet to be determined, preliminary 
reports indicate that the capacity increase gained by the addition of 
two new toll lanes in each direction has substantially reduced peak-
period congestion. Waiting times at entry points to the State Route 91 
facility have been significantly reduced.
    Other projects nearing implementation after initial pre-project 
studies under the Pilot Program are in Lee County, Florida, where off-
peak toll discounts following an across-the-board toll increase in late 
1995, will be used to try to divert traffic away from the most 
congested time periods. This project will be implemented within the 
next several months. In Houston, Texas, a pricing project about to get 
underway will sell excess capacity on an existing HOV-3 lane on 
Interstate 10 to HOV-2 vehicles. Both of these projects are expected to 
provide new evidence on the response of travelers to the pricing of 
highway facilities. In Los Angeles, a just completed report on the 
first phase of the Southern California Association of Government's 
congestion pricing pilot study includes recommendations by a local task 
force of business, environmental and transportation interests for 
implementation of a HOT (High Occupancy Toll)-lane project in the Los 
Angeles area. Further study of specific routes will be pursued prior to 
implementation.
    Question. What level of funding did the projects under the 
congestion pricing pilot program receive and spend?
    Answer. A total of $30,613,479 of program funds were obligated 
prior to the rescission of unobligated balances and transfer of 
authorizations for fiscal year 1996 and fiscal year 1997 to other 
programs. Of this amount, $24,108,000 went to implementation projects 
in San Diego ($7,960,000), Lee County, Florida ($16,000,000), and to 
support the California Department of Transportation's monitoring study 
of the private sector project on State Route 91 in Orange County, 
California. Another $5,414,386 went to support pre-project efforts in 
San Francisco, Minneapolis, Houston, Boulder, Portland, and Westchester 
County, New York. An additional $1,091,093 was used by FHWA to conduct 
research and public outreach in support of local project efforts.
    Question. To what extent has FHWA been able to overcome the 
reluctance of elected officials and policy makers to establish these 
programs?
    Answer. We believe that significant progress has been made in 
bringing pricing to the forefront for consideration as a demand 
management tool in metropolitan areas across the U.S. Transportation 
officials, business interests, environmental groups, and others have 
begun to discuss the possibilities for road pricing solutions to 
congestion and air pollution problems. The progress that has been made 
flows out of the pre-project efforts that FHWA has supported, as well 
as FHWA's public education efforts, but is largely due to the efforts 
of FHWA's project partners at the State and local level. They have been 
on the front lines of introducing pricing concepts into the local 
context, and their efforts, following guidelines established by FHWA, 
have brought the participation of a wide variety of local interest 
groups into the development of local project proposals. Recent interest 
in road pricing has been spurred by the initial success of the 
privately-sponsored road pricing project on State Route 91 in Orange 
County, California, and by the early stages of our pilot project in San 
Diego. Our pre-project efforts in Florida, Texas, New York, Minnesota, 
Colorado, and Oregon have also generated considerable interest.
    We recognize that much remains to be learned about the role that 
pricing can play in improving the efficiency of urban transportation 
systems but believe that carefully designed pilot projects, conceived 
and developed with full public participation, can play a positive role 
in improving urban transportation service. We recognize that the path 
to implementation will not be a smooth one, and any new projects will 
need to be developed slowly, with due regard to potential equity and 
other state and local concerns. Still the Department needs to be ready 
and able to provide support to state and local efforts when it is 
needed. The Value Pricing Pilot Program will provide a way for State 
and local governments and toll authorities to continue to experiment 
with congestion pricing solutions, using the Pilot Program both for 
financial and technical support. It will also provide a way of 
demonstrating Federal backing of these efforts.
    Question. Why does the administration believe there is sufficient 
interest in congestion pricing to support the value pricing pilot 
program? How many projects are currently ready to take advantage of 
these funds?
    Answer. We expect there to be considerable interest in this program 
in major metropolitan areas where concern with environmental problems 
and growing traffic congestion have led many to look for new and 
innovative solutions. As indicated by the activity on current pilot 
projects, and by the overwhelmingly positive response to FHWA's 
regional workshops on congestion pricing, very active interest in 
congestion pricing has been stimulated in several cities, including 
some of those facing the nation's worst air quality and congestion 
problems. The first workshop, held in Claremont, California in 
September, 1995, had 60 participants. In October, 1995, the second 
workshop, held in Philadelphia, had 80 participants. The Chicago 
workshop, held in May, 1996, had 104 participants, and 130 people 
participated in the Houston workshop in November, 1996. At our latest 
workshop, held in Tampa, Florida, in April 1997, approximately 80 
attendees discussed recent and potential future applications of pricing 
in the U.S. Very active discussions by a wide variety of agencies 
represented at these workshops showed a very high level of interest in 
the potential of pricing solutions to congestion and air quality 
problems. A spur to the interest in pricing as an air quality tool will 
be the Environmental Protection Agency's soon to be issued guidance 
document on ``Use of Market Mechanisms to Reduce Transportation 
Emissions,'' which will describe how cities and states can gain SIP 
credits for the adoption of market-based transportation demand 
management measures.
    Several of our current project partners, including Caltrans and the 
Southern California Association of Governments, the State of Minnesota, 
and Boulder, Colorado, should be ready to move forward with specific 
implementation proposals in fiscal year 1998. Portland, Oregon, and 
perhaps another project in Texas may be ready for implementation by 
fiscal year 1999. New York may be further from actual implementation, 
but this could change quickly depending on local conditions. The same 
can be said for possible pricing projects in the San Francisco area.
    Even though we believe there is sufficient interest to justify our 
proposal, we also recognize that interest in the value pricing program 
and concept does not necessarily translate into a State and local 
commitment to implement value pricing projects. For this reason, FHWA 
has proposed to limit the risk of program funds not being used by 
incorporating into the Reauthorization proposal a ``rolling lapse'' 
provision, under which unused program funds would become available for 
redistribution to the States if they remain unused for congestion 
pricing purposes after four years of availability.
    Question. What criteria will FHWA use to select the pilot projects?
    Answer. As we did for the Congestion Pricing Pilot Program, FHWA 
will listen carefully to current and potential project partners in 
developing guidelines for program participation. We intend to be 
flexible and responsive to local needs, while maintaining sufficient 
oversight to ensure that projects will provide new and useful 
information about the potential of congestion pricing as a tool of 
transportation demand management. One of our goals will be to encourage 
broader applications of pricing, including new and innovative types of 
parking pricing, as we move forward under the Value Pricing program. We 
will continue to try to support pricing innovations by existing toll 
authorities, and we will continue to look for new and innovative 
applications of pricing that meet local needs and conditions.
               infrastructure credit enhancement program
    Question. The grant amount is limited to $100 million per year, far 
less than many large projects. The Alameda Corridor project, for 
example, which meets DOT's criteria under the legislation and received 
a $400 million federal loan this year, could have absorbed the 
Program's resources for 4 of the program's 6 fiscal years. How does the 
Secretary intend to maximize the value of the program to a large 
project or projects?
    Answer. The Alameda Corridor project will receive direct Federal 
assistance in the form of a loan, not a grant as contemplated under the 
proposed credit enhancement program. Unlike other forms of Federal 
spending, the Federal budgetary cost of such a loan is based on the 
estimated net present value of the cash inflows and outflows associated 
with the loan. Alameda Corridor will receive a $400 million Federal 
loan this year; however, that loan requires only $59 million of budget 
authority (appropriated in the fiscal year 1997 Omnibus Consolidated 
Appropriations Act, Public Law 104-208) to fund the estimated subsidy 
costs.
    The Secretary intends to maximize the value of the Transportation 
Infrastructure Credit Enhancement Program by using grants (limited to 
20 percent of project costs), together with any supplemental 
contributions by States and other entities, to establish a Revenue 
Stabilization Fund for each project which will be used to secure 
external debt financing or drawn upon, if needed, to pay debt service 
costs in the event project revenues are insufficient to meet annual 
debt service requirements. These grants could be most effective if they 
secured smaller, junior lien bond issues which in turn helped 
facilitate the issuance of larger, senior lien bond issues not directly 
assisted by the program.
    Question. How and why did the program evolve from a loan program 
(outlined in the fiscal year 1998 budget request) to a grant program 
(NEXTEA legislation)? Has the intent of the program changed from the 
initial version of the proposed program, which was modeled in part on a 
$400 million direct federal loan to the $2 billion Alameda Corridor 
project? Would the program likely be used to assist projects as large 
as the Alameda Corridor project, or would it be limited to somewhat 
smaller projects?
    Answer. The program evolved from a loan program to a grant program 
in order to address concerns raised by the Department of the Treasury. 
Although the Treasury Department shares DOT's view that large projects 
of national significance require additional forms of assistance, on 
fiscal policy grounds it favors grants over direct lending techniques 
to enhance a project's financing. The Administration's NEXTEA proposal 
synthesizes DOT's programmatic objectives of encouraging innovative 
finance and private sector participation with Treasury's preference for 
using grant mechanisms.
    Question. In addition to using grants for credit enhancement 
purposes, does the Department also intend to pursue credit enhancement 
in the form of direct loans similar to the Alameda Corridor project 
loan in the future outside the Credit Enhancement Program? If so, will 
the Department have the discretion to do so based on its authority 
under NEXTEA?
    Answer. The Administration's reauthorization proposal (NEXTEA)--
including the Transportation Infrastructure Credit Enhancement 
Program--does not contain the legislative authority to make direct 
loans (such as that received by the Alameda Corridor) or provide other 
forms of credit assistance. The Department cannot provide such 
assistance without legislative authority to do so.
    Question. The Secretary is given the authority to select projects 
for Credit Enhancement Program grants. DOT has had inquiries from 
states, including small or rural states, and has noted that 18 states 
have projects costing less than $100 million that would qualify for 
Credit Enhancement Program grants. What projects in which states would 
qualify? What projects in which states would qualify for the program 
with projects at or over $100 million?
    Answer. DOT has not made any determinations about the eligibility 
of specific projects for assistance under the proposed credit 
enhancement program. Of several threshold criteria relating to national 
significance, one addresses project scale. It would require a project 
to cost at least $100 million or 50 percent of the State's most recent 
annual apportionment of Federal-aid highway funds, whichever is less. 
The Department has noted that, based on fiscal year 1997 
apportionments, there are 18 States that could potentially qualify 
projects costing less than $100 million for credit enhancement grants 
under this criterion.
    Question. If this program is established, would projects now 
underway be eligible for funding? Would projects qualify such as the 
Boston Central Artery? San Francisco's BART extension? Has the 
suggested freight tunnel beneath New York Harbor been suggested as a 
potential grant recipient?
    Answer. Any type of surface transportation project that is proposed 
to be eligible for Federal assistance under title 23 or chapter 53 of 
title 49 in the Administration's reauthorization proposal would be 
permitted to receive a Revenue Stabilization Fund grant, as long as it 
satisfied the program's eligibility criteria. To meet those criteria, 
the project must:
    a. be of ``national significance'' in terms of moving people or 
goods more cost-effectively (the Secretary will establish specific 
guidelines concerning improved productivity, cost-benefit analysis, job 
creation, and other factors);
    b. be unable to obtain adequate financing on reasonable terms 
elsewhere;
    c. be included on the State's transportation plan, and, if in a 
metropolitan area, be approved by the metropolitan planning 
organization;
    d. have its application for assistance be submitted by a State or 
local government;
    e. cost at least $100 million or an amount equal to 50 percent of 
the State's annual Federal-aid apportionments, whichever is less; and
    f. be supported at least in part by user charges or other dedicated 
revenue streams.
    Projects meeting these threshold criteria then would be evaluated 
by the Secretary based on a qualitative analysis of their credit-
worthiness, degree of leveraging private capital, use of innovative 
technologies, and other factors. This program is intended to help large 
revenue-generating projects obtain private financing by enhancing their 
external debt. Projects already underway, such as the BART extension 
and the Central Artery, presumably have already secured the necessary 
financing or identified future funding sources and should not need such 
revenue stabilization funding. (The Central Artery project's current 
finance plan does not contemplate additional Federal assistance outside 
the State's regularly apportioned Federal-aid funding.)
    To our knowledge, no proponents of the New York Harbor freight 
tunnel project have approached the Department about seeking assistance 
under the Transportation Infrastructure Credit Enhancement Program. If 
the project satisfied the proposed eligibility criteria, it could seek 
funding under this program. Its application would be evaluated along 
with those of other applicants.
    Question. Beyond the basic eligibility criteria, what expectations 
does the Administration have about the type of public-private 
partnerships that the Secretary would select for the Program to assist? 
Has DOT made any estimates on the amount of private capital that the 
Program might attract?
    Answer. The goal of the program is to encourage the development of 
large, capital-intensive infrastructure facilities through public-
private partnerships consisting of a State or local government and one 
or more private sector firms involved in the design, construction or 
operation of the facility. It will encourage more private sector and 
non-Federal participation, and build on the public's willingness to pay 
user fees to receive the benefits and services of transportation 
infrastructure sooner than would be possible under traditional funding 
techniques. DOT has no preconceived notion of how these arrangements 
should be made. The program should be flexible enough to allow the 
public and private entities to structure their partnerships as 
effectively as possible according to their needs.
    The credit enhancement program could effectively help these large 
projects access the capital markets if the Revenue Stabilization Funds 
were used to enhance junior-lien debt, which is difficult to sell. If a 
Revenue Stabilization Fund secured junior-lien bonds financing 33 
percent of project costs, and if the reserve equaled 20 percent to 25 
percent of the issue size, you might achieve a 12:1 to 15:1 leveraging 
ratio. Thus, annual budget authority of $100 million used in connection 
with junior lien bonds in this manner could support private financing 
of $1.2 to $1.5 billion a year. That would be only one project of a 
scale equal to the Alameda Corridor, but could represent a few projects 
of smaller scale.
    Question. What entities will be able to apply for funding of these 
publicly owned facilities--private organizations, cities, states, 
metropolitan planning organizations?
    Answer. A project sponsor may be a corporation, partnership, joint 
venture, trust, or governmental entity or instrumentality. If the 
entity is not a State or local government or any agency thereof, the 
project it is undertaking must be publicly owned and sponsored--meaning 
that it satisfies applicable Statewide and metropolitan planning 
requirements and that a State or local government or agency thereof 
submits its application to the Secretary.
              congestion mitigation and air quality (cmaq)
    Question. What type of projects were predominately funded out of 
the ISTEA CMAQ funds, e.g. HOV lanes, transit stops, etc.?
    Answer. Since its introduction in 1991 as a major transportation 
program under ISTEA, the CMAQ program has steadily evolved to become an 
important component in the funding of State and local transportation 
projects and programs. Projects which are eligible for funding under 
the CMAQ program include: transit improvements, traffic flow 
improvements, shared ride/demand management programs, bicycle/
pedestrian projects, alternative fuels, inspection and maintenance 
programs and others with air quality benefits.
    The overall obligation rates for CMAQ projects for fiscal years 
1992-1995 are as follows:
  --$1,267,000,000 (46.8 percent) for transit including bus and vehicle 
        purchases, new bus and rail services;
  --$835,000,000 (30.9 percent) for traffic flow improvements including 
        HOV lanes, traffic signal synchronization and turning lanes;
  --$206,000,000 (7.6 percent) for rideshare/demand management programs 
        including carpool and vanpool programs, guaranteed ride home 
        programs, etc.;
  --$74,000,000 (2.7 percent) for bicycle/pedestrian projects including 
        new pedestrian and bike paths, pedestrian bridges and walkways, 
        bike lockers and storage, etc.;
  --$130,000,000 (5.0 percent) for other transportation control 
        measures (TCM's) including inspection and maintenance (I/M) 
        programs and other projects not classified by the above; and
  --$193,000,000 (7.0 percent) for STP/CMAQ obligations in States with 
        no nonattainment areas which may use CMAQ funds for STP-
        eligible purposes.
    Question. Were the projects funded under the CMAQ program part of 
the States' transportation plans prior to passage of ISTEA or were they 
new projects? What are some examples of innovative projects built to 
help improve air quality? What air quality gains have been realized 
from the past six years of CMAQ projects?
    Answer. The ISTEA charted a new course in flexible funding 
transportation programs with the creating and funding of the CMAQ 
program. The focus of CMAQ as an air quality improvement program is 
unique as a transportation funding program. In the early years of the 
program, it is likely that the projects funded under CMAQ had been 
developed prior to ISTEA and already were ``in the pipeline,'' as it is 
sometimes referred. As the program evolved, other innovative 
alternative fuel projects, inspection and maintenance programs and 
freight improvements have been developed to meet the goals the CMAQ 
program, and funded under the broad eligibility allowed only under the 
CMAQ program. Transportation and environmental organizations contacted 
during a 1994 program review reported that many of the projects now 
funded under the CMAQ program would not have been funded under other 
programs.
    The CMAQ program has funded some exemplary projects such as:
  --The Intermodal Transportation Center in Worcester, Massachusetts. 
        The intermodal transportation center will assist Worcester in 
        encouraging the use of mass transit by providing easy access to 
        rail, bus and shuttle services, enhancing bicycle and 
        pedestrian access and improving traffic flow in the downtown 
        area.
  --The Transtar facility in Houston, Texas, is an advanced intelligent 
        transportation management system which monitors traffic 
        conditions and notifies authorities of freeway accidents and 
        congestion problems. The center improves accident response time 
        and reduces the blockage time on area freeways.
  --A transit operating assistance project in Ventura County, 
        California, represents an outstanding example of a cooperative, 
        grassroots effort to implement a transportation/air quality 
        strategy that benefits the local entities as well as the larger 
        region. The county instituted new intracounty bus routes and 
        linked the new routes to existing city-run services, allowing 
        improved access to major activity centers throughout the 
        county, and connections to existing dial-a-ride services in 
        rural parts of the county.
    In 1995 alone, CMAQ funded projects accounted for reductions in 
carbon monoxide of 431 tons per day, in volatile organic compounds of 
170 tons per day, and in oxides of nitrogen of 113 tons per day. These 
benefits will continue for the life of the project.
    While most CMAQ-funded projects are small relative to the size of 
the transportation infrastructure and yield benefits commensurate with 
that size, some projects yield considerably greater benefits. 
Inspection and maintenance programs have been funded under CMAQ 
programs in at least 5 States yielding between 2 tons per day to more 
than 20 tons per day.
    CMAQ-funded projects are critical for some nonattainment areas to 
demonstrate conformity of their transportation plans and programs, thus 
allowing States and local areas to continue their federally funded 
programs. In these and other areas, CMAQ funding also has been 
necessary to ensure funding for transportation control measures 
contained in the State air quality implementation plan, or SIP.
    Finally, the benefits of CMAQ funded projects should not be 
restricted only to air quality benefits when evaluating this program. 
Transportation projects usually meet multiple objectives, and this is 
true of CMAQ projects as well. In addition to air quality benefits, 
these projects have served to help provide congestion relief, 
environmental mitigation, economic development, and have assisted in 
meeting other environmental goals and objectives.
                           intermodal issues
    Question. Has DOT conducted a comprehensive assessment of 
intermodal needs, with specific attention on freight infrastructure 
requirements? If so, what are the conclusions of this assessment?
    Answer. In creating the National Highway System (NHS), the States 
and MPO's identified the critical highway connections to major 
intermodal terminals, including freight facilities, based on criteria 
established by the Secretary. This effort documented the major public 
and public/private intermodal connections affecting the efficient 
movement of people and goods throughout the nation. This information 
was sent to Congress on May 24, 1996, for approval as part of the NHS 
and will be used in the future to identify the condition and 
infrastructure needs of these connections.
    Very large container ships are about to be placed in service on 
major shipping routes connecting U.S. ports to the global marketplace. 
To assess their impact on waterside and port infrastructure as well as 
landside transportation facilities, the Department of Transportation is 
conducting four outreach meetings during the spring and summer of this 
year that will involve representatives of shippers, transportation 
providers and pubic transportation agencies responsible for freight 
movement. This activity is jointly sponsored by the Office of the 
Secretary and the modal administrations within the Department involved 
in goods transportation. Its goal is to bring consensus within the 
Department and the freight community on the potential impacts on 
transportation infrastructure occasioned by these ``big ships'' as well 
as to provide sufficient time prior to these vessels common use to 
permit a coordinated response by those responsible for making 
transportation investments.
    FHWA has undertaken a multi-year research project to study and 
document impediments to intermodal freight efficiency. Phase I of this 
research has concluded, and a two-volume report was produced in 1996. 
The report is titled ``Intermodal Freight Transportation.'' Volume I, 
discusses impediments, data sources, and provides a detailed 
bibliography.
    Volume II presents an intermodal impediments fact sheet and an in-
depth discussion of the federal-aid eligibility of intermodal freight 
projects. The impediments identified include physical, regulatory, 
technical, facility, financial, labor, institutional, and operational 
barriers and impediments for port, rail/truck, and airport facilities. 
The one major conclusion of this research is that impediments to 
intermodal freight transport are widespread and diverse.
    Phase II of the intermodal impediments project, currently underway, 
looks at strategies for overcoming the impediments identified in Phase 
I. The project will produce a primer for transportation planners on how 
to overcome impediments, along with detailed case studies of intermodal 
projects and processes in the U.S.
    Question. Since DOT does not propose to fully fund NEXTEA and 
relies on the States and the private sector to provide funding through 
other financing methods and State Infrastructure Banks, does DOT have 
evidence that this approach will be adequate to meet intermodal needs?
    Answer. NEXTEA's innovative finance programs expand the financing 
capabilities of States in order to complement DOT's traditional grant 
programs. State Infrastructure Banks ( SIB's), for instance, offer a 
menu of loan and credit enhancement assistance that can tailor public 
funds for specific project needs, thereby increasing the effectiveness 
of an overall transportation program.
    Our evidence indicates that most states intend to incorporate 
innovative finance techniques. DOT's solicitations for State 
Infrastructure Banks have received strong response. A pilot round in 
1996 selected ten states for SIB designation. Our second round has 
attracted 26 new proposals from 29 states. From this experience alone, 
we can conclude that at least three-fourths of the states believe that 
SIB's offer the potential to improve their transportation programs.
    Intermodal projects may indeed be well-suited for innovative 
finance and private sector participation. Most freight-related projects 
are linked to privately-owned or privately-operated facilities and thus 
offer the potential for significant private financial participation. On 
the other hand, a strictly passenger-oriented intermodal project 
frequently lends itself to private investment. Many passenger 
terminals, for example, provide retail and commercial opportunities 
that can attract private funds as part of an overall financial package.
    Question. What steps is DOT taking to ensure that intermodal 
issues--particularly freight concerns--receive attention and action in 
the Department?
    Answer. The Department has taken several steps to raise the profile 
of intermodal freight within the Department. It has sponsored several 
Freight Planning Seminars across the nation for Metropolitan Planning 
Organization, State, and federal transportation planners which 
highlight the many issues related to intermodal freight and adequately 
planning for freight.
    In addition, the modal administrations have participated in two 
National Freight Planning Conferences (Albuquerque, NM, in September 
1995 and San Antonio, TX, in October 1996) which provided forums for 
the discussion of the many facets of freight planning. Two additional 
National Conferences are being planned. These conferences draw 
attendees from various levels of government throughout the country, 
including the various modes at the U.S. DOT, as well as representatives 
from the private sector freight community.
    The FHWA also sponsors, the Freight Stakeholders National Network, 
a consortium of the nation's eight major freight-related trade 
associations, which promotes more effective interaction between the 
public and private sectors on infrastructure planning and investment 
throughout the U.S. As part of this effort the modal administrations 
contribute articles to a bi-monthly newsletter called Intermodal 
Connections. This newsletter presents information on intermodal issues, 
including freight-related issues, to a wide range of transportation 
professionals.
    The Department also has developed a course on ``Landside Access for 
Intermodal Terminals'' to address surface transportation infrastructure 
issues created by increasing volumes of maritime and air traffic. This 
three-day course focuses on the methodologies and design elements for 
improving landside access to seaports and airports and presents tools 
and techniques necessary to define challenges and make improvements. 
There have been 10 presentations of this course at major port cities 
around the country.
    Question. How does DOT's current and proposed research support 
intermodal policy and infrastructure needs? Which modal administrations 
are conducting intermodal research and/or demonstration projects? What 
results are expected from this research and demonstration? What 
percentage of DOT's total research budget does this represent?
    Answer. In addition to the specific courses, conferences, and 
publications referenced in the responses to questions 1 and 3 above, 
the following ``general'' research activities within DOT have resulted 
in applications that support intermodal policy and infrastructure 
needs.
  --Applications of Intelligent Transportation System (ITS) program 
        technologies.
  --Compendium of Intermodal Freight Projects, examples from throughout 
        the U.S. of innovative projects and funding mechanisms.
  --Freight Forecasting, development of a quick-response freight 
        forecasting system, manual, and course.
  --Public-Private Freight Planning Partnerships, research and 
        documentation of the state-of-the-art in bringing the public 
        and private sectors together to properly plan for freight.
  --Tools for transportation planners, including the Characteristics of 
        Urban Freight Systems (CUFS) manual, documentation of The Use 
        of Intermodal Performance Measures by State Departments of 
        Transportation, guidelines for public-private freight planning, 
        and freight data handbook.
    Many of the US DOT efforts to support intermodal transport through 
research, education, information services, and technology applications 
have been cooperative efforts involving multiple modal administrations 
and the Secretary's Office of Intermodalism. Examples of these 
cooperative endeavors are:
  --Landside Access to U.S. Ports, 1992, study by Transportation 
        Research Board (TRB): MARAD, FHWA, FRA co-sponsorship
  --Report on Intermodal Activities in the Department of 
        Transportation, 1993: Office of Intermodalism, FHWA, FRA, 
        MARAD, FTA, FAA co-sponsorship
  --Intermodal Technical Assistance for Transportation Planners and 
        Policymakers, 1994: Office of Intermodalism, FHWA, FRA, MARAD, 
        FTA, FAA co-sponsorship
  --Intermodalism--Making The Case/Making It Happen, national 
        conference and proceedings convened and compiled by TRB, 1995: 
        Office of Intermodalism, FHWA, FRA, MARAD, FTA, co-sponsorship
  --Setting An Intermodal Research Agenda, national conference and 
        proceedings convened and compiled by TRB, 1996: Office of 
        Intermodalism, DOD co-sponsorship.
    The results of this research are outlined in responses to this 
question and to questions 1 and 3.
    Although actual figures are not available, it is estimated that 
less than one percent of DOT's total research budget is specifically 
directed to supporting intermodal policy and infrastructure needs. 
Since intermodal transport makes use of individual modes' 
infrastructure, research directed to making the respective modal 
policies and infrastructure more user-friendly generates considerable 
benefits for intermodal transport.
                 fhwa research and technology programs
    According to DOT, ISTEA provided $87 million for FHWA research and 
technology programs. The Administration's NEXTEA proposal authorizes 
$1.6 billion for the highway research program and includes $420 million 
for a new program entitled the ``National Technology Deployment 
Initiatives'' whose goal is to significantly expand the adoption of 
innovative technologies by the surface transportation community.
    Question. What are the major elements of the substantially 
increased research program? What are the highest priorities of the 
expanded research program? Which ISTEA research programs is DOT 
proposing to keep and which is it eliminating? How will research 
programs be evaluated?
    Answer. The major elements of the research and technology program 
included in NEXTEA are the 1) Intelligent Transportation Systems (ITS), 
2) National Technology Deployment Initiative, 3) Professional Capacity 
Building and Technology Implementation Partnerships, 4) Long-Term 
Pavement Performance (LTPP) and Advanced Research, and 5) State 
Planning and Research Program.
    The highest priorities of the research and technology program are 
to continue exploration, evaluation, and deployment of ITS 
technologies; deliver significant, tangible benefits to transportation 
users through acceleration of the deployment of all technologies; 
provide comprehensive technology training and education initiatives 
that yield the required competency to apply the technologies; initiate 
exploratory long-term research which involves more uncertainty and 
risk, but holds the potential for great payoffs; continue the LTPP 
program which was initiated by Congress; and provide funds to the 
States so that they may address research and technology transfer 
activities that are relevant to their needs.
    The FHWA's Research and Technology Program consists of 
complementary elements of research, technology transfer, and deployment 
activities, reaching a range of partners and audiences--such as State 
and local governments, academia, Native American tribal governments, 
private industry, and others--with different services--research, 
development, technology implementation, technical assistance, training, 
test and evaluation, incentive funding, technology exchange, etc. 
Solutions to national issues of infrastructure quality and mobility lie 
in innovations and new technologies. Discovering and refining 
technologies and then transferring, promoting, and integrating them 
into the national transportation systems requires a multifaceted 
program such as is proposed for the FHWA's Research and Technology 
Program under NEXTEA.
    NEXTEA includes a number of programs that are included under ISTEA. 
Intelligent Transportation Systems, National Highway Institute, Local 
Technical Assistance Program, Eisenhower Fellowship Program, University 
Transportation Centers, University Research Institutes, Long-Term 
Pavement Performance Program and the State Planning and Research 
Program were included in ISTEA and are also proposed in NEXTEA. The 
National Technology Deployment Initiative is modeled closely after the 
Applied Research and Technology Program which was included in ISTEA. 
Also, the Technology Implementation Partnerships is modeled after the 
SHRP Implementation subsection which was included in ISTEA. The 
Advanced Research Program, a new element, focuses on exploratory, long-
term research, which involves more uncertainly and risk than 
traditional applied research, but holds the potential for great 
payoffs.
    The ISTEA research and technology programs which are not included 
in NEXTEA include the Highway Timber Bridge Research and Demonstration 
Program, Applied Research and Technology Program, Seismic Research 
Program, and Fundamental Properties of Asphalts and Modified Asphalts.
    The FHWA Research and Technology Program is developed through an 
internal and external review process, including technical, program, and 
executive levels, considering needs within the highway system, 
``customer needs,'' highway community priorities, funding availability, 
and other issues. Projects are aligned with identified high priority 
areas to ensure that the program focuses where the needs are greatest. 
This review process continues through the technology transfer, 
deployment, and training stages to similarly ensure that the programs 
focus where the needs are greatest. Research is evaluated through a 
variety of means, selecting the most appropriate methodology to meet 
the circumstances. For example in ITS, we have used extensive field 
measurement techniques, robust integrated methodological processes, and 
peer review by practitioners and scientists, for field operational 
tests, model deployment, and the entire advanced transportation 
management research program, respectively.
    It appears that in the opening paragraph to this question, the $87 
million under ISTEA and the $1.6 billion under NEXTEA, including the 
reference to the $420 million for the National Technology Deployment 
Initiative, is a comparison of 1 year under ISTEA to 6 years under 
NEXTEA; neither of these figures includes ITS. In addition, some of the 
proposed funding under the Research and Technology Program under NEXTEA 
previously was General Operating Expenses (GOE) funds received by the 
Federal Highway Administration under the annual appropriations process.
    Question. What has the ISTEA highway research program taught DOT 
about deploying new technologies in the field? How have these lessons 
learned been incorporated into the NEXTEA proposal? How will innovative 
technology information be disseminated and what tools will be used to 
significantly expand the use of innovative technologies?
    Answer. During the years of ISTEA, closer ties and partnerships 
have been established throughout the transportation community. One very 
good example of this tighter association is the Priority Technology 
Program under the Applied Research and Technology program (ISTEA 
Section 6005); this program includes projects identified in the field 
and uses Federal/State/industry/academic partnerships to fund and 
conduct the projects as a means of increasing ``ownership'' among the 
partners and facilitating the movement of the technology into use.
    Superpave technology is being implemented through a Federal/State/
industry partnership that has provided significant acceleration of the 
technology. More than two-thirds of the States are already using the 
Superpave binder specification, and most of the remaining States will 
make the switch this year. The Superpave second goal, implementation of 
the volumetric mix design procedures by 2000, is also well on its way; 
two-thirds of the States were already using, during the 1996 
construction season, equipment and techniques associated with this 
stage. The Superpave regional centers, formed through similar 
partnerships, will continue to help State, county, and local 
governments and others with their implementation of this technology.
    The National Technology Deployment Initiatives (NTDI) under NEXTEA 
will focus resources on a distinct set of priority goal areas which 
directly address the concerns of the traveling public. The NTDI was 
developed as a result of extensive outreach and discussion among major 
stakeholders within the surface transportation community. For delivery 
of NTDI resources, special emphasis will be placed on getting projects 
using innovative technologies ``on the ground'' through direct support 
to States and other implementors with funding and deployment support 
for individual projects. These projects will provide valuable insight 
to advance the state-of-the art, and with more widespread confirmation 
of the benefits of use of innovative technologies through the NTDI 
program, there will be significantly greater use of regular Federal-aid 
and other funds for technical innovation by the States and others.
    Similarly, the Technology Implementation Partnerships program will 
facilitate the formation of partnerships and advanced implementation 
for products from the Strategic Highway Research Program as well as 
other high profile technologies that will benefit from a focused 
implementation effort. Individual organizations do not usually possess 
a ``critical mass'' of skills and financial resources to independently 
implement most advanced technologies; this program will facilitate 
bringing key partners together in a cooperative effort to plan and 
execute actions needed to expand adoption of innovation.
    The Long-Term Pavement Performance (LTPP) Program, a 20-year effort 
under the Strategic Highway Research Program created in 1987, will be 
continued through partnerships with users such as State highway and 
transportation agencies, contractors designing and building roads, and 
international transportation interests. This long-term program has the 
unique challenge of testing, in actual service, performance of various 
pavement designs and materials in different conditions, resulting in a 
comprehensive national data set for analysis and ultimate improvement 
in pavement performance. The reauthorized LTPP will emphasize the 
creation of products to continue to fulfill the original LTPP program 
objectives and to meet future pavement technology needs.
    Other Research and Technology elements similarly are designed to 
integrate a connection with the user community early in the process to 
facilitate adoption of innovative technologies. Means for dissemination 
include training, test and evaluation, deployment projects, technology 
exchange, hands-on demonstrations, or other means. A variety of 
traditional and advanced media are used to disseminate technologies and 
information about technologies, including classroom instruction, 
satellite broadcasts, mobile laboratories, computer disks, CD-ROM 
packages, and Internet-based instruction, to provide the highway 
community with the knowledge, skills and abilities needed to 
effectively implement and adopt the innovative technology.
    Question. What are the indications that the surface transportation 
community will benefit from the $420 million National Technology 
Deployment Initiatives program? What methods will the new initiative 
use to increase the use of innovative technologies at the state and 
local levels? How do these differ from the training and technical 
assistance provided through the Local Technical Assistance Program--
whose NEXTEA funding is $72 million? How is the National Technology 
Deployment Initiatives program linked to the ITS deployment activities?
    Answer. Along with the other research and technology elements of 
NEXTEA, the National Technology Deployment Initiatives (NTDI) has been 
developed as a result of extensive outreach and discussion among major 
stakeholders within the surface transportation community. For delivery 
of NTDI resources, special emphasis will be placed on getting projects 
using innovative technologies ``on the ground'' through direct support 
to States and other implementors with funding and deployment support 
for individual projects. These projects will provide valuable insight 
to advance the state-of-the art, and with more widespread confirmation 
of the benefits of use of innovative technologies through the NTDI 
program, there is expected to be significantly greater use of regular 
Federal-aid and other funds for technical innovation by the States and 
others.
    The NTDI will focus resources on a distinct set of priority goal 
areas which directly address the concerns of the traveling public; 
including improved safety, reduced delay, extended infrastructure life 
through use of high-performance materials and innovative preservation 
techniques, enhancement of the environment, and reliable system 
operation. Coupled with uses of advanced materials and construction/
maintenance processes, we hope to foster increased use of innovative 
contracting procedures where valuable to the overall goals and will 
look to maximize flexibility in project administration to meet the need 
of implementing agencies. In addition, training will be combined with 
other methods, such as demonstration projects, to create a synergistic 
approach to each technology deployment area.
    This focus on achieving actual deployment of innovative 
technologies in selected goal areas through funding and other direct 
support, predominately to State departments of transportation and 
highway agencies, is the key unique feature of the NTDI program. This 
contrasts with the Local Technical Assistance Program, for example, 
which provides technical training and assistance on a wide spectrum of 
transportation issues to city and county staff. In addition, the NTDI 
is not linked to the ITS deployment funding proposal, which will focus 
on integrating existing ITS components (such as traffic management 
systems, transit information systems, and traveler information systems) 
in metropolitan areas, and deployment and integration activities in 
rural areas and for commercial vehicle operations projects. We believe 
that the various elements of our proposal are very complementary, and 
each addresses an important Federal role in support of innovation.
      intelligent transportation systems (its) authorized funding
    ISTEA established the Intelligent Transportation System (ITS) 
Program, and authorized funding of $659 million from 1992 to 1997. The 
administration's reauthorization proposal would provide $1.278 billion 
over six years--a 94 percent increase in contract authority. From 1992 
to 1997, the ISTEA authorized funds were supplemented with $602 million 
through the annual appropriations process.
    Question. What are the reasons for the doubling of contract 
authority for the ITS program?
    Answer. Contract authority is being requested for those portions of 
the ITS program which would most benefit from a long term, predictable 
source of funds. These program areas include the ITS Deployment 
Incentives Program, crash avoidance research, the advanced vehicle 
control and information systems program area, the operational test 
program, the architecture and standards program, and major portions of 
the mainstreaming program area (technical assistance, planning/policy 
issues, and training). These represent program areas which we know will 
be viable and in need of substantial funding support throughout the 
period covered by the reauthorization of ISTEA. Program areas with 
resource needs which may vary widely in amount and technical content 
from year to year, such as most of the research program areas, will 
continue to be justified and requested on an annual basis through the 
appropriations process.
    It should also be noted that the proposed ITS Deployment Incentives 
program, which is designed to help spur integrated, intermodal 
deployment of ITS technologies and strategies, accounts for a total of 
$600 million of the contract authority being requested. The remainder 
of the contract authority being requested for research and technology 
transfer activities totals $678 million, an amount comparable to the 
amount received for similar activities under ISTEA.
    Question. Does DOT expect that the ITS program will continue to be 
significantly supplemented with additional funds through the annual 
appropriations process?
    Answer. As noted above, we expect to continue to request funding 
through the annual appropriations process for activities such as 
research, program assessment, and program support. Our fiscal year 1998 
budget request for these activities totals $54 million, which is less 
than half the amount received through the appropriations process in 
fiscal year 1997 ($122 million). If the contract authority available to 
the ITS program is increased as requested, and is not earmarked for 
specific projects, we expect annual appropriations requests for the 
program to remain relatively modest.
                   its deployment incentives program
    During fiscal years 1991 through 1997, the Congress has provided 
the ITS program with about $1.3 billion for research and development, 
operational testing of ITS technologies, and various activities to 
support deployment. In its NEXTEA proposal, DOT is refocusing the 
program to place a greater emphasis on deployment. DOT proposes a $100 
million annual deployment incentives program, that would be used to 
integrate individual components of metropolitan areas' ITS systems. 
Despite this new push to deployment, DOT must overcome a number of 
obstacles before ITS technologies are widely deployed and integrated. 
These obstacles include: the lack of a working knowledge of the systems 
architecture, technical standards to integrate individual ITS 
technologies, technical knowledge at the state and local level, cost-
benefit data on ITS, and funding in light of other priorities.
    Question. The results of the model deployment programs will not be 
known before DOT begins distributing up to $65 million in deployment 
incentive funds for metropolitan areas. To what extent should DOT first 
complete and assess the model deployment program before it distributes 
deployment incentive funds?
    Answer. Although we expect to learn a great deal from the 
implementation and evaluation of the four metropolitan area model 
deployment projects, the primary purpose of these projects is to serve 
as showcases of the integrated, intermodal deployment of technologies 
and strategies which we already know to be very effective. The model 
deployments will help convince transportation decision-makers that 
integrated, intermodal ITS deployment is viable, practical, and cost 
effective. There is no need to wait for the completion and evaluation 
of the model deployment projects to help metropolitan areas which have 
already made a decision to deploy integrated, intermodal ITS 
infrastructure get started with seed funding through the proposed ITS 
deployment incentives program.
    Question. According to the Administration's proposal, recipient's 
of the ITS deployment incentive funds will be required to conform to 
national ITS standards, yet many of the ITS standards will not be 
completed until 2001. How will recipient's conform to non-existent 
standards?
    Answer. As noted in the section by section analysis accompanying 
the Administration's NEXTEA proposal, it is expected that the Secretary 
would determine on an annual basis which ITS standards would be used to 
fulfill the requirements of this provision. Only standards which were 
sufficiently mature in the development and adoption process would be 
included in this determination. It should be noted that, although some 
lower priority standards development and adoption activities may extend 
until 2001, we expect to have nearly all of the high priority standards 
in place well before then. Substantial progress is already being made. 
There are currently nine applicable standards which have been formally 
approved:
  --SAE J1708, Truck & Bus Practice Serial Data Communications Between 
        Microcomputer and Heavy Duty Vehicle Applications
  --SAE J1663, Truth-In-Labeling Standard for Navigation Map Databases
  --SAE J1761, Information Report on ITS Terms and Definitions
  --SAE J1763, A Conceptual ITS Architecture: An ATIS Perspective
  --NEMA TS-3.1 NTCIP Overview
  --NEMA TS-3.2 Simple Transportation Management Protocol
  --NEMA TS-3.3 Class B Profile
  --NEMA TS-3.4 Global Object Definitions
  --NEMA TS-3.5 Actuated Controller Unit Object Definitions
    Four standards are currently in the review and approval processes 
within the standards development organizations:
  --Message Set for Commercial Vehicle (CV) Safety & Credentials 
        Information (TS 285)
  --IEEE P1404, Guide for Microwave Communications System Development: 
        Design, Procurement, Construction, Maintenance and Operations
  --IEEE P1454, Recommended Practice for the Selection and Installation 
        of Fiber Optic Cable in Intelligent Transportation Systems' 
        (ITS) Urban, Suburban, and Rural Environments as well as 
        Transportation Operating Centers and Associated Campuses
  --Surface Vehicle Information Report: SAE J2355, ITS Data Bus 
        Reference Architecture Model
    Sixteen additional standards are under development, 13 of which 
should have usable products by the end of the 1997:
  --NEMA TS-3.6 Variable Message Sign Object Definitions
  --NEMA TS-3.x Ramp Meters Object Definitions
  --Message Set for CV Credentials (TS 286)
  --Dedicated Short Range Communication (DSRC) Protocol--Physical Layer
  --DSRC--Data Link Layer
  --DSRC Message Sets for CV Operations and Electronic Toll Collection
  --Advanced Traveler Information Systems (ATIS) Core Message List and 
        Data Dictionary
  --In-Vehicle Navigation and Related ATIS Communications Device 
        Message Set Standard
  --Message Set for May Day Alert
  --Location Referencing
  --In-Vehicle Databus Interface
  --Standard for Data Dictionaries for ITS
  --Standard Message Set Template for ITS
  --Message Set for External TMC Communication
  --Navigation & Route Guidance (N&RG) Function Accessibility
  --N&RG Transactions
    Question. To what extent do you believe that transportation 
agencies at state and local levels have sufficient technical expertise 
to effectively use the Deployment Incentive Program funds for ITS 
system integration? Is there a risk that these funds will either go 
unused for some years as state transportation engineers begin to 
develop sufficient technical expertise, or that officials unfamiliar 
with ITS and systems integration will not make the best use of 
deployment funds?
    Answer. Certainly, we do not contend that all States and 
metropolitan areas will be able to effectively use ITS deployment 
incentive funding during the first year or two of the program. However, 
we do believe that sufficient expertise does exist in many progressive 
States and metropolitan areas to make full and prudent use of the 
available funds at the beginning of the program. And as States and 
metropolitan areas increase their level of expertise, partially through 
the training and technical assistance activities sponsored through the 
ITS program, the pool of qualified applicants for ITS deployment 
incentive funds will grow. It should also be noted that we have 
specified very precise eligibility criteria for the ITS deployment 
incentives program, which would need to be satisfied before an 
application for funds would be favorably considered. Detailed knowledge 
of ITS and systems integration principles will be required to 
successfully satisfy these criteria.
              its research and program support activities
    In addition to providing funds for the deployment incentive 
program, the NEXTEA proposal includes $678 million over six years for 
carrying out multi-year research and operational tests of promising ITS 
technologies. These funds will be used to explore developing 
technologies, including the automated highway system (AHS) under which 
a computer and telecommunication network assumes the normal tasks of 
driving.
    Question. What information does the Department have regarding the 
willingness of the public to accept the AHS concept, including their 
willingness to surrender control of their vehicles to a central 
computer system?
    Answer. It is too early to tell how widely acceptable automated 
control will be. However, driving simulator experiments in the U.S. and 
Europe indicate that driver comfort with automated systems increases as 
the accuracy and reliability of the control system increases and as the 
drivers gain experience. Additionally, the 1997 Demonstration will 
provide a rich opportunity for passenger feedback on automated 
operations.
    Question. What portion of these funds does DOT expect will go to 
further development of the AHS and related technologies?
    Answer. As explained in the proposed NEXTEA legislation, the 
Department has integrated the AHS, collision avoidance and driver-
vehicle interaction programs into the Intelligent Vehicle program. This 
program will shift resources to working with industry to develop 
integrated driver warning and assistance systems that will improve 
safety and mobility. Part of the Intelligent Vehicle program will 
investigate extending the capabilities of vehicle-based collision 
avoidance and driver information systems through interaction with the 
infrastructure. This is expected to yield improved safety and mobility. 
The only specific AHS work that remains is about $2 million per year to 
develop an AHS concept which evolves from the vehicle-and 
infrastructure-based systems resulting from the Intelligent Vehicle 
program.
    Question. At the end of the six year authorization period, where 
does DOT expect the AHS concept to be and how much more money will be 
needed to advance full deployment?
    Answer. At the end of the authorization period, US DOT will 
demonstrate an ``intelligent vehicle'' which will use on-board and 
limited infrastructure cooperative systems that will increase the 
driver's safety and efficiency but leave control of the vehicle in the 
driver's hands. We will also evaluate specific applications of trucks 
and buses where infrastructure cooperative automation yields 
substantial safety and mobility benefits. Potential applications 
include longitudinal and lateral control of transit buses in narrow 
tunnels and lateral control of snow plows to assist in finding the road 
edge. The AHS concept will be defined by the end of the authorization. 
But because full deployment is at least 50 years away, U.S. DOT has not 
estimated the cost nor do we plan to request additional funding in the 
near future.
               national technology deployment initiatives
    Question. Section 6004 of the administration's proposal would 
establish the National Technology Deployment Initiatives program, with 
funding for $420 million over the 6 year period. According to the 
proposal, the program is intended to significantly expand the adoption 
of innovative surface transportation technologies. Goals include 
improving safety, environmental protection, and reduced delay in 
construction zones. As written, the proposal could extend to ITS 
applications. Will ITS projects be eligible for funding under this 
program? If so, doesn't this appear to conflict with the ITS Deployment 
Incentives Program restriction on deployment funding only for 
integration of existing or planned systems, and not new ITS systems in 
metropolitan areas?
    Answer. In general, ITS projects envisioned by the Intelligent 
Transportation Infrastructure Deployment Incentives Program (NEXTEA 
Sec. 6057) will not be eligible for National Technology Deployment 
Initiative (NTDI) program funds. However, certain projects sometimes 
identified as ITS-related or non-ITS based traffic management concepts 
within the scope of the NTDI goals may indeed be supported with NTDI 
funds. An example would be Road-Weather Information Systems (RWIS), 
which have great value as a potential information source to both 
metropolitan and rural traveler information systems. RWIS's primary 
objective is to provide for more effective winter maintenance 
operations by guiding the timing, location, and extent of anti-icing 
and snow plowing forces, which can significantly aid safety and 
mobility. Innovations in RWIS and other winter maintenance techniques 
are expected to be advanced and deployed with NTDI funds, and this will 
enhance the value of traveler information in these areas.
                     woodrow wilson memorial bridge
    Reconstruction of the federally-owned Woodrow Wilson Memorial 
Bridge is estimated to cost nearly $1.5 billion--about $400 million for 
the bridge and $1.1 billion for the adjacent roadways and interchanges 
in Maryland and Virginia. As specified in the Woodrow Wilson Memorial 
Bridge Authority Act of 1995, the federal government will fund the 
reconstruction of the bridge, while the non-federal Authority 
(established by Virginia, Maryland, and the District of Columbia) will 
assume ownership of the bridge and undertake the reconstruction 
project. Accordingly, the NEXTEA proposal includes $400 million for 
bridge reconstruction.
    Question. When will the Authority be ready to start design and 
construction?
    Answer. Maryland and Virginia have passed enabling legislation to 
enter into an interstate agreement or compact to legally establish the 
Authority, but the District of Columbia has not. There also is no 
agreement among all involved parties on the project implementation 
schedule. The Woodrow Wilson Coordinating Committee plans to proceed 
with development of the project by the issuance of a design request for 
proposals upon the selection of a management consultant for the project 
and the issuance of the Final Environmental Impact Statement and the 
Record of Decision. This is with the anticipation of the having all 
outstanding issues resolved so that design can start in 1997 with 
construction being completed in 2004.
    Question. Has a finance plan been developed, including specific 
sources of funding for roadways and interchanges? If the federal 
government is paying for the bridge, how will the roadways and 
interchanges be funded?
    Answer. To date basic financial analyses have been performed for 
the total project to evaluate the various alternatives on an equal 
basis using different funding sources including tolls. If the federal 
government funds the bridge portion of the project, then the roadways 
and interchanges could be funded from a variety of sources including 
tolls, regular federal-aid apportionments, dedicated state highway 
revenue, and bonding which could be financed over a long term period.
    Question. Should the project be allowed to progress without a 
finance plan?
    Answer. Once the outstanding issues are resolved the project should 
proceed to construction with any necessary additional financial 
analyses being performed as appropriate. Due to the condition of the 
structure it is imperative that the project moves forward and final 
financing be completed as soon as possible.
    Question. Will tolls be established for the bridge? If so, what 
amount of toll is being considered? Will travelers divert to the 
western half of the beltway to avoid paying tolls, thus worsening 
congestion in that area? Was the western half of the beltway 
constructed to accommodate the truck traffic that may use that section 
of the beltway to avoid tolls?
    Answer. All of the replacement alternatives considered assumed 
tolls on the bridge. Only a reconstruction of the existing six lane 
facility would be toll free. The replacement alternatives considered 
tolls in the range of $1.00 to $2.00. Most of the truck traffic is 
local, so it is unlikely many of these trucks would divert to the 
western half of the beltway simply to avoid toll on the Woodrow Wilson 
Bridge; the distance is too long to offset the cost of the toll. Most 
of the western half of the beltway, including the American Legion 
Bridge crossing the Potomac River, has eight lanes.
    Question. Is the $400 million federal contribution fixed? Has the 
federal government pledged to pay any cost increases that might occur 
on the bridge reconstruction?
    Answer. The Administration has recommended that the federal 
contribution to the cost of the total project be the ``minimum federal 
share'' as defined in the NHS Designation Act of 1995 ($400,000,000). 
This recommendation coincides with the amount specified in the 
Administration's fiscal year 1998 budget as well as the 
Administration's reauthorization proposal, introduced as S. 468. There 
has been no federal pledge to pay any cost increases beyond 
$400,000,000. The FHWA expects that the difference between the 
$400,000,000 Federal share and the total estimated reconstruction costs 
of $1,500,000,000 would be made up through a mix of sources--a portion 
financed with long-term, tax-exempt debt backed by user or other 
special fees, and a portion from the States which could include 
allocations of some part of their annual apportionments of Federal-aid 
highway funds available through reauthorization.
                       engineering cost estimates
    Question. Will States continue to use 15 percent of construction 
costs as a basis for estimating the construction engineering component 
of an individual project's total costs? If not, how will States 
estimate the construction engineering cost component of total costs for 
any individual project?
    Answer. Construction engineering costs can vary considerably from 
project to project, for example, engineering costs as a percentage of 
construction may be greater on a bridge construction project than on a 
highway rehabilitation project. FHWA has encouraged States to estimate 
engineering costs based on the type of project. The States have 
considerable information on actual engineering costs which can be used 
to develop more accurate project cost estimates.
    Question. Will FHWA develop guidance on how to estimate costs, or 
will it be up to individual States to develop their procedure?
    Answer. The States are in a much better position to estimate costs 
than FHWA. Since costs vary from State to State, estimates would be 
more accurate if developed by individual States. The States are 
responsible for estimating the total costs of the project, including 
design, right-of-way purchases, and construction so it is logical that 
they also be responsible for estimating engineering costs.
    Question. What effect will removing this requirement have on 
construction engineering estimates and estimates for the total costs of 
individual projects?
    Answer. Removing this requirement should have no effect on 
estimates. The 15 percent requirement does not apply to individual 
projects, but to the total program, therefore, any State currently 
using 15 percent as a standard estimate of a project's engineering cost 
is doing so on its own accord.
                     rail-highway crossing program
    Question. According to FHWA, in 1994 the states used Section 130 
funds to improve about 800 railroad crossings. Given the limited number 
of railroad crossings that can be improved with section 130 funds, to 
what extent does FHWA believe that states will use NEXTEA railroad 
safety funds to support education and enforcement initiatives?
    Answer. Under the NEXTEA grade crossing allocation formula, 23 
States will gain funds and 27 States and the District of Columbia and 
Puerto Rico will lose funds in fiscal year 1998 compared to their ISTEA 
allocation formula. (This analysis does not include hazard elimination 
funds which also can be used for grade crossing. If this is factored 
into the equation, 32 States and Puerto Rico gain and 18 States plus 
D.C. lose.)
    States with increased funding are: Alabama, Arkansas, Georgia, 
Idaho, Illinois, Indiana, Iowa, Kansas, Louisiana, Minnesota, 
Mississippi, Missouri, Nebraska, North Carolina, North Dakota, Ohio, 
Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, 
Wisconsin.
    States with decreased funding are: Alaska, Arizona, California, 
Colorado, Connecticut, Delaware, District Columbia, Florida, Hawaii, 
Kentucky, Maine, Maryland, Massachusetts, Michigan, Montana, Nevada, 
New Hampshire, New Jersey, New Mexico, New York, Oregon, Pennsylvania, 
Rhode Island, Vermont, Virginia, Washington, West Virginia, Wyoming, 
Puerto Rico.
    Question. What are the reasons for expanding the section 130 
program to allow the states to improve crossings on private property? 
How will the public benefit from federally-funded infrastructure 
improvements at these crossings?
    Answer. Safety improvements at private grade crossings have the 
potential to decrease crashes and fatalities at these crossings. The 
safety problem at private highway-rail crossings has been a small but 
constant source of collisions and casualties over the years. In the 
last two years (1995 and 1996), there were 942 collisions resulting in 
94 deaths and 261 injuries. This problem surfaced and was emphasized 
during public hearings which the Department held early in 1996. 
Crossings where the public would benefit would include those open to 
public travel and where the public is often not even aware they are on 
private property; for example, residential, recreational and industrial 
crossings. These categories comprise about 40 percent of all private 
crossings. (The remaining 60 percent are farm crossings.) However, 
about two-thirds of the collisions, occur at these non-farm crossings. 
On a collisions per crossing basis, the most hazardous appear to be 
recreational crossings with residential and industrial crossings 
following a close second and third. Another major concern are the 
nation's passenger and potential high-speed rail corridors, where the 
public benefit accrues more to the rail passengers and crews. The 
intent of expanding this program to private crossings is to provide the 
State program manager the option of addressing these problems where and 
when there will be a public benefit. The State program manager will 
weigh these benefits against benefits which would be realized by other 
options and will select accordingly.
    Question. To what extent, will NEXTEA require states to update rail 
and motor vehicle traffic information in the inventory when they 
improve the physical characteristics of a crossing? Will states be 
allowed to use rail-highway crossing funds to update the national 
inventory? With only 800 crossings improved annually, how will DOT 
ensure that the entire national inventory is updated?
    Answer. Currently, and since 1975, updating the National Inventory 
has been a volunteer effort. Most states and railroads do update the 
file, some more regularly than others. In an average year, the Federal 
Railroad Administration processes between 80 and 100 thousand changes 
into the data base. We have proposed that the allocation of funds for 
crossing safety improvements be predicated (partially) on the number of 
public crossings and the type of warning devices installed at those 
crossings. The provision requiring states to post information on safety 
improvements made with Federal funds is intended to provide 
accountability and to insure that annual allocations are able to take 
into account improvements already paid for. We would expect that when a 
state posts changes or improvements to warning device information they 
will also update traffic counts. Highway planning and Section 402 funds 
are already available, and have been available, which may be used for 
updating the National Inventory, and Rail-Highway Crossing Funds could 
be used under this Administration's proposal.
    Question. Will states that currently do not have many railroad 
crossing accidents and thereby cannot demonstrate a reduction in 
accidents be allowed to transfer all their railroad crossing funds to 
the hazard elimination program?
    Answer. States will be able to transfer grade crossing funds to 
hazard elimination after they reduce public grade crossing accidents 
compared to the average experienced in calendar years 1994, 1995, and 
1996. This does not preclude a State with a very small number of grade 
crossing accidents from transferring funds. For example, if over 
calendar years 1994-96, a State has an average of 4 crashes at public 
grade crossings per year, and then has only 2 such crashes in calendar 
year 1998, it can transfer 50 percent of its grade crossing funds into 
hazard elimination.
    Question. NEXTEA also allows states to transfer up to 100 percent 
of hazard elimination funds to NHTSA's State and Community Highway 
Safety grant Program (also known as the section 402 program) or its 
motor carrier safety allocation. What is the potential impact of this 
transfer on the railroad crossing program?
    Answer. The safety impact on the grade crossing program itself 
should be minor. Flex into the 402 program does not preclude 
expenditures on grade crossings. Grade crossing safety information 
campaigns are eligible for Section 402 funding. States would not have 
been permitted to flex their funds into hazard elimination unless they 
had already demonstrated a measurable decline in number of crashes, and 
then transfer is permitted only in proportion to the decline in 
crashes. NEXTEA proposes allowing transfer of funds out of the program 
only to the extent that the number of crossing collisions has been 
reduced. This, and the needs-based formula distribution of funds, will 
reduce both the number of states and the amount of funds likely to be 
transferred out of the program. The formula uses as a baseline the 
average number of collisions between 1994 and 1996. A rolling three 
year count is used in order to dampen any potentially erratic shift 
that an anomalous good or bad year could have on the distribution of 
funds. If a state has an average of one accident or less, they will be 
allowed to transfer the funds.
    However, under NEXTEA, States would be provided more flexibility to 
address a wider variety of crossing safety improvement options as it 
broadens program eligibility to include education and enforcement 
programs, trespass prevention programs and improvements at private 
crossings when there will be a public benefit. Private crossing 
eligibility could be significant for those states developing high-speed 
rail corridors. Therefore, even a limited amount of funding could be 
used to leverage significant results in areas such as public awareness 
campaigns or enforcement programs, previously not eligible for the 
program's funding.
    NEXTEA also retains 100 percent funding eligibility for projects 
which close or eliminate one or more crossings, and retain the $7,500 
per crossing bonus program eligibility for communities that close 
crossings (when bonus is matched by the railroad).
    Question. How will state's apportionments for the Rail-Highway 
Crossing Program under NEXTEA compare to their apportionment under 
ISTEA? Which states will gain funds and which states will lose funds?
    Answer. Under the NEXTEA grade crossing allocation formula, 23 
States will gain funds and 27 States and the District of Columbia and 
Puerto Rico will lose funds in fiscal year 1998 compared to their ISTEA 
allocation formula. (This analysis does not include hazard elimination 
funds which also can be used for grade crossing. If this is factored 
into the equation, 32 States and Puerto Rico gain and 18 States plus 
D.C. lose.)
    States with increased funding are: Alabama, Arkansas, Georgia, 
Idaho, Illinois, Indiana, Iowa, Kansas, Louisiana, Minnesota, 
Mississippi, Missouri, Nebraska, North Carolina, North Dakota, Ohio, 
Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, 
Wisconsin.
    States with decreased funding are: Alaska, Arizona, California, 
Colorado, Connecticut, Delaware, District Columbia, Florida, Hawaii, 
Kentucky, Maine, Maryland, Massachusetts, Michigan, Montana, Nevada, 
New Hampshire, New Jersey, New Mexico, New York, Oregon, Pennsylvania, 
Rhode Island, Vermont, Virginia, Washington, West Virginia, Wyoming, 
Puerto Rico.
                           financial planning
    Question. DOT's NEXTEA proposal will require a financial plan for 
any project with an estimated total cost of $1 billion or more. Does 
DOT have any specific requirements for the form content and scope of 
such financial plans? If so, when will they be published? If not, does 
DOT plan to implement this requirement on a case-by-case basis?
    Answer. The FHWA does not currently have any specific requirements 
for form, content or scope of a financial plan. If the provision for a 
financial plan becomes law, FHWA will develop guidelines or regulations 
for this requirement.
    Question. Currently there are no federal requirements for preparing 
a cost estimate. On what cost estimate will this requirement be based--
an estimate prepared during an environmental impact statement process 
or some other specific estimate?
    Answer. With the aging of Interstate highways, States are 
initiating some large scale reconstruction projects in urban areas 
costing billions of dollars, such as I-15 in Salt Lake, UT and Central 
Artery in Boston, MA. The FHWA required the States to develop plans for 
these two projects to outline the financial resources that would be 
available for the projects. These financial plans contain cost 
containment provisions and are updated at specified intervals as 
appropriate. As with the provision in the NEXTEA proposal requiring a 
financial plan for all projects estimated to cost $1 billion or more, 
FHWA would expect the State to use the most reliable estimate at the 
time it develops a plan. The FHWA also may require periodic updates of 
the plan.
    Question. If a project is initially estimated to cost less than $1 
billion, but then costs increase, will this requirement then apply?
    Answer. The primary purpose of a financial plan is to serve as a 
cost containment strategy, therefore FHWA would expect the states to 
develop a financial plan for any mega-project that has the potential 
for reaching the $1,000,000,000 threshold.
                           its mainstreaming
    Question. Provide examples of some of the tangible results that can 
be expected from the ITS mainstreaming program. What measures of 
success does DOT use to estimate the benefits from the mainstreaming 
projects?
    Answer. The purpose of the mainstreaming program is to make 
integrated, interoperable, compatible ITS infrastructure deployment as 
``normal'' a part of the federal-aid highway and transit planning, 
development and funding processes, as construction of highway and mass 
transit facilities is today. That will require 1) technical assistance 
from headquarters until it can be delivered as a part of regular 
services provided through field offices. 2) guidance development on 
architecture, best practices, and the over 100 standards expected to 
support ITS deployment; 3) extensive training of FHWA and FTA staff as 
well as state and local staff working in this area. That will begin 
with an awareness of benefits and move to building key skills. In the 
short term our measures will be of ``activities''--number of guidance 
documents, extent of distribution, number of courses, number of 
attendees etc. A more meaningful measure is the desired outcome of a 
surface transportation industry that routinely deploys ITS 
infrastructure as appropriate in a particular locality, existence of 
regional frameworks that are consistent with the national architecture, 
use of standards, and routine inclusion of ITS in the planning process 
(which now includes operations planning.)
    The tangible results that can be expected from the ITS/CVO 
mainstreaming program are institutional processes that lead to 
deployment of CVISN throughout the country by 2005. These processes 
consist of state ITS/CVO business plans which document the goals and 
components of a state's program, and regional business plans that 
integrate the business plans of the states to promote overall 
interoperability. Additional tangible results are expected through 
regional champions to help lead the deployment agenda and the 
mainstreaming forums which will focus on lessons learned and reduce the 
trial and error time that it takes to implement CVISN. The measures of 
success that DOT is using are the cooperative linkages that result 
between state agencies to allow CVISN to operate in an integrated 
fashion, and the level of technical readiness of the states to 
implement CVISN.
    Question. The fiscal year 1998 request for the mainstreaming 
category is twice the size of the fiscal year 1997 funding. Why the 
substantial increase? What activities will this funding be spent on?
    Answer. The total fiscal year 1997 investment in the Mainstreaming 
program area is approximately $13.5 million, including $2 million in 
training activities being funded under the Operational Tests program 
area. The request in fiscal year 1997, however, was for $21.7 million, 
because of the urgency of carrying out technology transfer and 
training. The GAO reflected the same urgency in it recent findings. 
This year, our Mainstreaming funding request mirrors our previous 
request. Our top priority is training, which will now be expanded to 
included state and local staff and more specialized skill building. 
Another activity being substantially increased is the Planning/Policy 
area, which is proposed to grow from $1 million in fiscal year 1997 to 
$4 million in fiscal year 1998. The increased funding for this program 
area will be used to continue and expand efforts to coordinate regional 
planning functions with State and local traffic operations and 
maintenance functions to foster an integrated approach to operations 
planning and deployment of ITS infrastructure to achieve transportation 
system operations and management objectives.
    Question. How will this program make use of the results from 
projects such as the Model Deployment Initiative and Commercial Vehicle 
Information System Networks (CVISN)?
    Answer. We have recently received an extensive case study of the 
Atlanta Showcase effort which has provided us and those developing the 
training curricula with an excellent set of detailed lessons learned. 
Likewise we expect that both the quantitative information emerging from 
both the CVISN and metropolitan area model deployments as well as the 
institutional lessons learned will become case studies used in numerous 
seminars, college curricula and our own training courses.
                     national scenic byways program
    Question. How has DOT used the funding provided under ISTEA, and 
how successful has DOT been in meeting the program's goals and 
objectives?
    Answer. The Scenic Byways Program Grant activities show that the 
States and local communities have achieved significant accomplishments, 
both in initiating new programs as well as strengthening existing 
programs through a variety of scenic byways projects. The Scenic Byways 
discretionary grant funds are serving as seed money for the States and 
local communities to conserve the unique qualities while developing 
economic resources along their byways. These funds have also provided 
an opportunity for the States and communities to work as partners in 
reaching common goals.
    Consistent with ISTEA, scenic byways funds have been used to 
provide technical assistance to the States for the development and 
enhancement of scenic byways programs. Technical assistance activities 
have included workshops, conferences, and technical research to provide 
educational awareness to related scenic byways concerns. Additionally, 
a National Scenic Byways Clearinghouse as well as a World Wide Web site 
(Internet) have been established to allow the States and the public to 
have national/international access to current scenic byways 
information.
    Question. What types of projects have been funded in this program 
during ISTEA? Has this led to a significant increase in the number of 
States implementing a scenic byways program?
    Answer. Overall, $74,300,000 in Scenic Byways Program discretionary 
grant funds were awarded to 37 States, including Puerto Rico and the 
District of Columbia, for 552 projects. There were six categories of 
eligible project types outlined in ISTEA. The following identifies each 
project category, the funds awarded, and the total number of projects 
in each category.

------------------------------------------------------------------------
               Project category                    Awards       Projects
------------------------------------------------------------------------
Planning, design, and development of State                              
 scenic byway programs.......................     $22,600,000        186
Making safety improvements to byways.........         782,000          2
Construction along the scenic byway (ranked                             
 in order of greatest number of projects to                             
 least: Interpretive Facilities, Pedestrian &                           
 Bike facilities, Turnouts & Overlooks, Rest                            
 Areas, and Shoulder Improvements............      38,900,000        202
Improvements to enhance recreation area                                 
 access from byways..........................       1,500,000         26
Protecting historical, archaeological, and                              
 cultural resources adjacent to by-  ways....         665,000          6
Developing and providing tourist information                            
 to the public about byways..................       8,900,000        130
                                              --------------------------
      Total..................................      74,347,000        552
------------------------------------------------------------------------

    Eighteen (18) States previously had no State scenic byways and 
program took advantage of Scenic Byways funding to establish one. 
Eleven (11) additional States used Scenic Byways grant funds to improve 
and upgrade their existing programs.
    Question. What evidence does DOT have that projects funded with 
scenic byway program funds would not have otherwise been funded by 
States and localities using other Federal-aid funds?
    Answer. Demand for projects funded with Scenic Byways Program funds 
exceeded the total available by 145 percent. While the States had the 
opportunity to use Transportation Enhancement funds (TE) to undertake 
these byway projects that were unable to be funded under the National 
Scenic Byway Program, generally they did not. This limited use of TE 
funds is due in large part to the significant demands placed upon TE 
funds for other purposes, such as bicycle and pedestrian facilities.
    motor carrier regulatory relief and safety demonstration project
    Question. When does the FHWA plan to make available application 
forms for the operators of light trucks that are eligible to enroll in 
the FHWA's Motor Carrier Regulatory Relief and Safety Demonstration 
Project?
    Answer. On August 28, 1996, the FHWA published a Notice of Intent 
which outlined our proposed project plan. After the comment period, 
modifications were made and a draft Notice of Final Determination was 
prepared. This Notice of Final Determination, to be published soon, 
will contain the application requirements.
    Question. NHTSA has made wearing safety belts the centerpiece of 
its strategy to save lives on our Nation's roads and highways. For a 
number of years safety belt usage was on the increase on a nationwide 
basis. NHTSA has reported nationwide rates of safety belt use of 62 
percent in 1992 and 67 percent in 1994. During hearings last year the 
Department once again reported that the rate was 67 percent. DOT's 
stated goal for some time has been to achieve 75 percent usage rate by 
1997. In your current budget submission you indicate that your new goal 
is 80 percent by 1999. The 1999 goal appears very ambitious based on 
past accomplishments. Why does the Department keep raising the goal 
when it has yet to achieve past goals?
    Answer. Safety belt usage rate goals established by the Department 
are ambitious, but achievable, when compared to historical data and our 
experience of what is necessary to meet these goals. Looking 
historically at safety belt usage rates, between 1982 and 1992 usage 
rates increased from 11 percent to 59 percent. This increase of almost 
50 percentage points was due primarily to the passage of state seat 
belt laws. From 1991 through 1996, overall usage increased an 
additional nine percentage points as a result of increased enforcement 
and public education.
    In response to the President's new initiative to increase belt use, 
on April 16, 1997 the Department submitted a plan to the President 
entitled The National Strategy to Increase Seat Belt Use in the United 
States. In addition to outlining a new four point strategy to increase 
safety belt usage, the plan calls for even more ambitious goals of 85 
percent usage by the year 2000 and 90 percent by 2005. As compared to 
previous goals, the Department believes these new goals are achievable 
based on the Administration's support of the issue, our knowledge of 
what works in the states to significantly increase safety belt usage, 
and growing public and private sector support, such as the Air Bag 
Safety Campaign. Specifically, we now know that the combination of 
primary seat belt legislation, increased enforcement of existing laws, 
ongoing public education, and the establishment of public and private 
sector partnerships will dramatically increase usage in the U.S.
    Question. What are the chances of achieving the nationwide rate of 
75 percent during 1997?
    Answer. In 1996, seven states reported a usage rate at 75 percent 
or above. California reported the highest rate at 87 percent. Overall, 
the national average for 1996 is 68 percent. NHTSA expects several 
additional states to raise their safety belt usage rates above the 75 
percent goal during 1997; however, it is unlikely that the national 
average will increase seven percent points within one year.
    NHTSA believes that it is realistic to expect that the United 
States will achieve President Clinton's new goals of 85 percent safety 
belt usage by the year 2000 and 90 percent by 2005. NHTSA believes 
these new goals are achievable based on the Administration's support of 
the issue and our knowledge of what works in the states to 
significantly increase safety belt usage. Specifically, we now know 
that the combination of primary safety belt legislation, increased 
enforcement of existing laws, on-going public education, and the 
establishment of public and private sector partnerships will 
dramatically increase usage in the U.S.
    Question. How many states currently have a safety belt usage rate 
of 75 percent?
    Answer. As of 1996, seven states reported safety belt usage rates 
at 75 percent or higher. These states are: California (89 percent), 
Hawaii (80 percent), Iowa (75 percent), New Mexico (85 percent), North 
Carolina (82 percent), Oregon (82 percent), and Washington (84 
percent).
    Question. How many states have achieved an 80 percent rate and 
which states are they?
    Answer. As of 1996, six states reported safety belt usage rates at 
80 percent or higher. These states are: California (87 percent); New 
Mexico (85 percent); Washington (84 percent); North Carolina (82 
percent); Oregon (82 percent); and Hawaii (80 percent).
    Question. What is the current range for the lowest usage rate and 
the highest?
    Answer. Based upon 1996 data reported by the States, safety belt 
use rates range from 43 percent in North Dakota to 87 percent in 
California.
    Question. What safety initiatives is the department planning 
between now and 1999 that will help it achieve a nationwide average of 
80 percent when only a few states now enjoy that level of 
accomplishment?
    Answer. On April 16, 1997, Secretary Slater submitted a plan to 
President Clinton, entitled The National Strategy to Increase Seat Belt 
Use Nationwide, which outlines a new strategy to achieve the 
Department's goals for safety belt use. This plan combines many of the 
highly effective current activities and initiatives with a new four 
point strategy for fiscal year 1998 and beyond. The plan is based on 
building public-private partnerships, enacting strong legislation, 
embracing high visibility law enforcement, and conducting coordinated 
public education. The plan builds upon existing programs and activities 
such as the Special Traffic Enforcement Programs and the Air Bag Safety 
Campaign partnership that have been so successful.
    The plan also includes two new initiatives to help increase seat 
belt use. The first, included in the Department's reauthorization 
proposal, provides incentive grants to encourage states to improve 
their occupant protection laws and enforcement (sample criteria include 
enacting primary belt laws, requiring a fine of at least $25 for each 
safety belt or child seat violation, and conducting special enforcement 
programs). Alternatively, states can qualify if they meet belt use rate 
goals. The reauthorization proposal also includes a provision which 
would transfer funds from highway construction to occupant protection 
programs if a state does not meet belt use goals by 2002. The second 
initiative is a new Executive Order, signed by President Clinton on 
April 16, 1997, that requires all Federal employees to wear seat belts 
while on duty, requires belt and child seat use in National Parks and 
on Department of Defense installations, and encourages Tribal 
Governments and Federal contractors and grantees to adopt seat belt 
policies and programs
               national advanced driving simulator (nads)
    Question. NADS will be located at the University of Iowa in Iowa 
City, IA. As envisioned, NADS will represent the state-of-the-art in 
driving simulation, exceeding the capabilities for realism of the 
Daimler-Benz Driving Simulator (DBDS)--the most advanced driving 
simulator in the world--and the Iowa Driving Simulator (IDS)--the most 
advanced driving simulator in the United States. NADS is currently 
scheduled to be completed and operational in May 1999. TRW, the 
contractor building NADS, plans to begin fabricating the various 
simulator components (vision system, motion system, etc.) after the 
critical design review is completed in March 1997, the University of 
Iowa will award the contract to build the facility in June 1997. All 
components are scheduled to be completed before the end of 1998. The 
total estimated cost to build NADS now stands at $49.3 million--an 
increase of $17.3 million from NHTSA's original 1989 estimate. The 
Department of Transportation (DOT) approved NADS contingent upon NHTSA 
obtaining a one-third cost-sharing commitment from non-DOT sources. As 
a result, DOT will be responsible for paying $32.9 million toward the 
project, with the remaining $16.4 to be paid by non-DOT sources. To 
date, the University of Iowa and the State of Iowa have contributed 
$11.6 million, and TRW has contributed $3.6 million, for a total of 
$15.2 million, leaving NHTSA in search of an additional $1.2 million in 
cost sharing. Once operational, NADS will become the second driving 
simulator owned by DOT. FHWA currently has a driving simulator, called 
HYSIM, at the Turner-Fairbank Highway Research Center in McLean, VA. 
HYSIM was built in 1983 to study human factors issues relating to 
highway signs and markings, roadway geometry and in-vehicle displays. 
What research does DOT plan to perform on NADS that cannot now be 
performed on IDS or HYSIM, and how will this research benefit the 
Department?
    Answer. Due the extremely limited motion cuing available from 
either the HYSIM or the IDS, neither of these devices is capable of 
realistically simulating hazardous driving situations that precede or 
precipitate vehicle crashes. Only the NADS, with its large excursion X-
Y motion base (62 feet by 62 feet) and large yaw rotation capability 
(plus or minus 330 degrees) can provide the necessary motion cues that 
are generated by vehicles in pre-crash maneuvers. Without this level of 
motion cuing fidelity, the results of simulations in this regime of 
vehicle operation would be highly questionable. The extreme high 
fidelity of the NADS cuing systems will allow NHTSA to analyze with 
confidence the complex driver-vehicle interactions that occur during 
crashes. This will lead to the development of advanced driver aids and 
information systems to assist drivers in avoiding crashes.
    Question. What would be the effect of DOT moving the FHWA research 
now being conducted at HYSIM so that it would be performed using NADS?
    Answer. The FHWA research being conducted at HYSIM serves several 
critical functions to the overall research program in highway safety. 
The importance of maintaining the HYSIM at TFHRC is highlighted by the 
fact that the HYSIM:
  --is closely integrated with in-house research conducted in other 
        TFHRC laboratories;
  --provides a flexible test bed in which research questions generated 
        by contract research can be refined or extended;
  --includes the Dynasign, which is a unique system of presenting 
        highway signs and provides the means to evaluate signage in a 
        dynamic driving environment quickly and flexibly;
  --is in close proximity to FHWA highway engineers, who comprise the 
        primary customer base for human factors research;
  --is used as a demonstration and training tool for junior highway 
        engineers and other FHWA customers.
    Moving the research program to NADS would be deleterious to the 
FHWA research in highway safety and would destroy the critical daily 
interaction with FHWA engineers and human factors professionals 
required for conceptualizing, developing, and conducting highway safety 
research efforts.
    Further, a move would:
  --deprive FHWA engineers of human factors insights into every day 
        safety issues, and result in the fractionation of highway 
        safety concerns;
  --decrease the efficiency of industry professionals who must work 
        closely with both engineers and human factors researchers on 
        the same project;
  --disrupt in-house FHWA human factors research at a critical point in 
        ITS and safety research restart-up time;
  --postpone for several years the deployment and operational testing 
        of ITS and safety systems;
  --result in the loss of a critical number of experienced human 
        factors FHWA professionals.
    Question. DOT currently estimates a total project cost for NADS of 
$49.3 million. Through fiscal year 1997, NADS has received $27.8 
million from DOT, $11.6 million from Iowa and $3.6 million from TRW--
for a total of $43 million. However, NHTSA officials stated that NADS 
will need about $16.5 million in additional funding for it to be 
completed. If so, it appears NADS' total cost will be about $59.5 
million. Please explain why it appears NADS needs about $10.2 million 
more than the $49.3 million estimate?
    Answer. The estimate for the NADS Facility Development Cost of 
$49.3 million was provided to Congress in briefings to the House and 
Senate staff in January 1996 and has always been distinguished from the 
NADS Total Project Cost. The NADS Facility Development Cost ($49.262 
million) is the cost of the Phase II construction contract ($34.105 
million) plus the total of all cost sharing contributions ($15.157 
million). The NADS Total Project Cost is the NADS Facility Development 
Cost plus costs associated with the Phase I design competition, Phase 
III transition of the NADS operation to Iowa, program planning and 
management support including cost accounting, Iowa management support, 
Iowa technical support, and Congressionally mandated studies including 
the TRB utilization study and the contractor evaluation of Iowa 
contributed software. The following table provides consolidated costs 
for the total project:

                    NADS Total Project Cost Estimates

        Project phase                                       Project cost
Phase I Design Competition..............................     $7,827,000 
Phase II--NADS Facility Acquisition:
    TRW Contract........................................    (34,105,000)
    University of Iowa Cost Share.......................    (11,530,000)
    TRW Cost Share......................................     (3,627,000)
Subtotal Phase II.......................................     49,262,000 
Phase III--Transition...................................      1,800,000 
Office Support..........................................        950,000 
                    --------------------------------------------------------
                    ____________________________________________________
      Total Project Cost................................     59,839,000 

    Question. DOT approved NADS contingent upon NHTSA obtaining a one-
third cost-sharing commitment from non-DOT sources. If FHWA received 
the $12 million requested for fiscal year 1998, DOT's actual 
contribution would be $39.8 million, or about 67 percent of NADS' total 
project cost, which appears to be about $59.8 million. The Iowa and TRW 
contributions total $15.2 million, or about 26 percent of the total 
cost. What is NHTSA doing to obtain the additional non-DOT cost sharing 
(about $4.5 million) it needs for NADS construction?
    Answer. The Department approved the NADS project with the condition 
that one-third of the acquisition cost of the NADS would have to be 
cost shared by non-DOT sources, not one-third of the total project 
cost. Thus, the one-third non-DOT cost sharing requirement is based on 
the $49.3 million or $16.4 million. The total cost sharing that is in 
place to date is $15.2 million, leaving a balance of $1.2 million yet 
to be secured. To date NHTSA has received no firm commitments for 
additional non-DOT cost sharing. However, NHTSA is currently exploring 
cost sharing with a major truck manufacturer. Preliminary discussion 
indicate that the manufacturer may be interested in providing the 
required truck cab and vehicle engineering and dynamics data.
    Question. Other than NHTSA, has anyone made actual dollar 
commitments to pay for operating time on NADS?
    Answer. At this time, NHTSA does not have any firm dollar 
commitments to pay for operating time on the NADS. This is not 
surprising, since users are unlikely to make such firm commitments 2 
years before the simulator is built. However, NHTSA continues to 
believe in the overall finding of the TRB evaluation of the potential 
utilization of the NADS; i.e., the NADS will have an 80 percent 
utilization rate within 2 years of becoming operational.
                       transit new starts program
    Question. The transit program is the only major component of the 
Administration's NEXTEA bill whose overall funding authorization was 
cut as compared to ISTEA. Specifically, transit was cut by $1 billion--
from $31.5 billion to $30.5 billion--over 6 years. Is the 
Administration sending Congress a signal that transit is less of a 
priority than it was under ISTEA?
    Answer. The NEXTEA funding level reflects a more realistic level of 
increase for the program. ISTEA authorized $5.1 billion each year for 
fiscal year 1993 through fiscal year 1996 with a large increase in 
fiscal year 1997. It is proper only to compare ISTEA to NEXTEA without 
the $2.1 billion ``bubble'' provided in fiscal year 1997 Budget 
Authority. Therefore, NEXTEA represents an increase of $1.2 billion or 
4 percent over six years. Transit remains the same high priority under 
NEXTEA as it did under ISTEA.
    Question. Currently, there are 13 transit new starts with full 
funding grant agreements and two more, Sacramento and San Francisco 
BART, awaiting Full Funding Grant Agreements. If the two additional 
projects receive their FFGA's for a total of 15 FFGA's, please describe 
how much new start funding would be available for other projects under 
the $634 million level proposed in the President's budget? How much 
would be available if new starts were to be funded at the high 
authorization levels proposed in NEXTEA?
    Answer. The outyear funding schedules for the BART and Sacramento 
projects have been accommodated in the President's budget at the $634 
million level. The President's budget for fiscal year 1998 proposes to 
fund the existing 13 existing FFGA's plus the BART and Sacramento 
projects. No funding is proposed for other projects in fiscal year 
1998. It is anticipated that there will be no projects ready to receive 
an FFGA until next fiscal year.
    To complete current and proposed FFGA's will require about $3.7 
billion. NEXTEA would authorize $5.8 billion thereby leaving about $2 
billion for additional projects.
    Question. Will FTA be able to provide full funding grant agreements 
for the projects that will be requesting them in the next few years?
    Answer. Assuming the authorization levels proposed in NEXTEA, FTA 
would be able to provide full funding grant agreements for additional 
projects.
    Question. What impact will there be on the cost and schedule of 
these projects should federal funding not be available for 6 or more 
years?
    Answer. Should federal funding be limited to the extent that no new 
FFGA's could be issued during NEXTEA, projects seeking new starts 
funding would likely face the following options: 1) cancellation; 2) 
delay until the next authorization period [with attendant cost 
increases and unknown scheduling adjustments]; 3) secure a combination 
of local and/or State, and non-new start Federal funding [Urban 
Formula, STP, CMAQ] to finance the project; 4) employ innovative 
financing techniques to leverage stable Federal revenue streams; or 5) 
use existing funds to raise bonds to finance construction.
    To the extent that project sponsors delayed the initiation of the 
projects until Federal funding became available, the project costs 
would most likely escalate due to inflation, although the rate of 
increase might be mitigated by a more favorable bidding climate in the 
future.
    Question. The President's budget generally freezes transit funding, 
except for the new starts program which was cut by about 17 percent. 
Thus, the budget proposes only $634 million per year in actual spending 
for new starts. The six-year NEXTEA bill proposes new starts funding 
that begins at $800 million in fiscal year 1998 and grows to $1.03 
billion by fiscal year 2003. Since these additional new starts funds 
are not in the budget, where are they to come from?
    Answer. The fiscal year 1998 President's budget proposes funding 
for 15 projects for which Full Funding Grant Agreements (FFGA's) are in 
place or pending. Our proposed outyear funding is sufficient to cover 
funding requirements for these 15 projects. Our reauthorization 
proposal includes a higher level of contract authority which could 
become available dependent upon future Federal budget decisions.
    Question. Mr. Linton, I understand that on April 9th, you wrote to 
the Chairman of the Los Angeles County Metropolitan Transportation 
Authority and essentially informed him that you plan to re-write the 
full funding grant agreement regarding the troubled Los Angeles rail 
system. Evidently, you found ``serious deficiencies and questionable 
assumptions'' in the recovery plan proposed by Los Angeles. Your letter 
states that: ``We are incredulous that, despite the engineering and 
financial difficulties on the construction already underway, the Board 
is contemplating even more requests to the Congress for various costly 
extensions to your rail system.'' If you re-write the FFGA for Los 
Angeles, will you free-up more ``contingent commitment authority'' to 
be used for FFGA's for other projects?
    Answer. As part of my intensive effort to assist the LACMTA to 
manage this vital project, I intend to treat the three components of 
MOS-3, North Hollywood, East Side and Mid-City, as three separate legs. 
I will issue revised FFGA's for each of these legs with the overall 
Federal commitment for MOS-3 remaining unchanged. However, the MOS-3 
outyear funding schedule will be revised to reflect cash flow 
requirements for each leg or segment. This will involve some reordering 
of the funding schedule. To the extent that outyear requests will be 
adjusted, some additional short term funding may become available. I do 
not anticipate that this will be a substantial amount and the final 
amounts will, of course, be contingent on the cash flow requirements 
analysis conducted by my staff for each segment.
    We believe LACMTA's revised recovery plan, currently under 
preparation, will furnish a blueprint for ensuring that MOS-3 is 
completed in a timely and effective manner and for fully accomplishing 
LACMTA's other substantial responsibilities.
                    transit formula program funding
    Question. The FTA is proposing that, beginning in fiscal year 1998, 
the discretionary bus and bus-related funding and fixed guideway 
modernization funding be rolled into the Formula Program. FTA Officials 
state that funds from these categories will be available to be spent 
for any eligible purpose, as opposed to being limited to specific 
categories. FTA's most recent needs report painted a bleak picture as 
to the state of the nation's transit inventory. The report noted that 
over 13,000 buses were in excess of the useful life guidelines 
established by FTA and that over 3,800 rail transit vehicles were in 
excess of the minimum useful life guidelines. The cost to replace these 
vehicles could be in the billions of dollars. What is FTA hoping to 
achieve by moving funding for these categories into the Formula 
Program?
    Answer. The significant transit needs are the primary reason for 
consolidating two categorical programs into a more flexible Formula 
program. Merging the Fixed Guideway Modernization and Bus grant 
programs into the Urbanized Area Formula program will provide transit 
operators with greater flexibility in targeting Federal funding to 
locally determined needs. Under this proposal, the formula funding 
level would increase from $2.1 billion in fiscal year 1997 to $3.4 
billion in fiscal year 1998. Fixed Guideway Modernization resources 
will still be apportioned using the ISTEA formula, but once made 
available, these funds, as well as all other formula funds, may be used 
for any eligible purpose. This will help local agencies plan by 
reducing uncertainty, and will improve equity by distributing more 
funds by formula. It will also enhance the possibility of using 
innovative financing techniques to leverage the Federal funds.
    Question. Under FTA's new funding proposal, what assurance is there 
that available funding will not be mostly directed to one category at 
the expense of the other?
    Answer. This proposal places the responsibility for local 
decisionmaking where it belongs--in local hands. Local officials will 
be free to determine where their greatest needs lie, and direct Federal 
funding to eligible purposes as appropriate.
    Question. What are FTA's long-range plans for replacing buses and 
rail cars that have exceeded their useful lives? Should we focus 
Federal funding more on the replacement and maintenance of the existing 
transit inventory and less on new starts systems?
    Answer. We believe that State and local officials will act in the 
most cost-effective manner if given the authority. The flexibility 
inherent in the proposed merging of programs will enable local 
decisionmakers to tailor a larger pool of Federal funds to their 
specific needs. If the greatest need is bus replacement, funds can be 
targeted for bus replacement. If the greatest need is for rail vehicles 
or facilities, funds can be targeted for those purposes.
    This flexibility is especially important given the differing life 
cycles between buses and railcars. Under the current division of 
programs, a transit operator that receives fixed guideway modernization 
funds cannot use those funds for new buses, even though the bus fleet 
may exhibit the greater need. By combining these programs, funds can be 
used for bus replacement/rehabilitation when needed, and railcar 
replacement/rehabilitation when needed.
    We recognize the need to balance new system construction with 
support to ``older rail cities'' for the replacement and rehabilitation 
of the existing rail fleet and restoration of rail facilities. Our 
budget provides $634 million, the same amount as for major capital 
investments, to be distributed by the current statutory formula for 
fixed guideway modernization.
                      access to jobs and training
    Question. How long will it take for these projects to be 
implemented and begin assisting welfare or previous welfare recipients?
    Answer. We anticipate funding the programs that are ready to be 
implemented to meet the needs of those transitioning from welfare to 
work. Although the funds are flexible and can be used to plan welfare 
to work activities, we are urging states and localities to plan and 
develop their strategies now, so that when funding becomes available, 
they may move to implement services quickly. The time constraints 
associated with welfare reform requires speedy action.
    Question. Provide an example of the type of project this program 
will support.
    Answer. Localities are free to develop the services and service 
strategies which the participating stakeholders agree are needed. 
Strategies may range from conventional bus services to flexible 
paratransit, including ridesharing strategies. We believe intelligent 
transportation technologies will allow for more effective coordination 
of service provided by transit agencies and other providers. The 
program criteria require that a mechanism be established to coordinate 
transportation and human service planning and to coordinate existing 
service providers in developing new service strategies. Therefore, 
participating transportation agencies, existing transportation 
operators, welfare agencies, employment training and other human 
service entities working with employers and community stakeholders are 
in the best position to develop appropriate service strategies. A 
funded program can incorporate several different services and types of 
providers working together to meet unmet needs. The program that is 
developed is meant to be derived from a comprehensive assessment of 
needs and must be programmed within the existing MPO and state 
transportation programming process. We would expect to receive a single 
application to support a comprehensive program, not fragmented pieces 
from different local applicants.
    Question. How many projects will $100 million support?
    Answer. The number of projects would depend on whether projects 
receive a single grant for the entire period or phased funding over 
several years. This issue has not yet been resolved. We expect projects 
to occur in each state where welfare-to-work problems exist. In general 
we would not expect grants to exceed $3-4 million for individual areas.
                            washington metro
    Question. Administrator Linton's testimony before the House 
Appropriation, Subcommittee on Transportation noted that the Washington 
Metrorail system continues on its fast track program for completion of 
the 103-mile system. His testimony also noted that the accelerated 
construction schedule, which continues to receive an annual 
appropriation of $200 million, is expected to save as much as $600 
million. What does FTA base this savings on and is it true costs 
savings or expected savings from avoiding out-year inflation increases?
    Answer. The fast track accelerates the construction schedule and 
completes the system five years earlier than originally planned. The 
estimated savings were based on the avoidance of out-year inflation 
increases.
    Question. Washington Metro recently decided to extend the 103 mile 
system in Largo, Maryland. Have federal funds been provided to this 
project? If so, were they provided under a separate appropriation or as 
part of the $200 million annual appropriation?
    Answer. No federal funds have been provided to extend the Metro 
rail system beyond 103 miles.
                  bureau of transportation statistics
    Question. Since NEXTEA proposed a doubling of the BTS budget, 
please describe BTS' success stories that would warrant such a large 
increase in its budget.
    Answer. The six-year total for NEXTEA is double the six-year total 
for ISTEA, but is a 24 percent increase in annual spending over the 
final year of growth in the ISTEA authorization. BTS started in the 
first year of ISTEA with a budget of $5.0 million, and grew 
incrementally pursuant to ISTEA to $25.0 million in fiscal year 1997. 
The proposed budget in fiscal year 1998 and each subsequent year is 
$31.0 million, which covers in addition to the Bureau's original 
responsibilities the airline and motor carrier programs not anticipated 
by ISTEA. Since its inception, BTS has been able to:
  --Conduct the Commodity Flow Survey in 1993 and get the 1997 edition 
        into the field, providing the first benchmarks in nearly two 
        decades of what is shipped, its origin and destination, and how 
        it moved. This was the first successful effort to measure 
        shipments from non-manufacturing establishments and to estimate 
        ``bridge traffic'' through each state.
  --Conduct the American Travel Survey in 1995, providing the first 
        detailed benchmarks of who travels, by which means, for what 
        purposes, and between what locations.
  --Complete three Transportation Statistics Annual Reports, including 
        special analyses of transportation and economic performance and 
        of transportation and the environment. The fourth edition, 
        featuring transportation and mobility, is in the final stages 
        of completion.
  --Make foreign trade statistics more useful to the transportation 
        community by splitting commodity flows across the US-Canadian 
        and US-Mexican borders by mode and publishing the results on a 
        monthly basis.
  --Assemble and publish the National Transportation Atlas Database, a 
        compilation of data on the location, connectivity, and other 
        attributes of the highway, rail, waterway, fixed guideway 
        transit, and airway networks.
  --Initiate an interagency agreement with the Bureau of Economic 
        Analysis to more precisely identify the resources consumed by 
        the transportation sector, the quantity of transportation 
        consumed by other sectors of the economy, and the contribution 
        of transportation to the costs of products.
  --Conduct a major study through four universities to ascertain the 
        impacts of the Northridge Earthquake on the transportation 
        system of Los Angeles, and the economic consequences of those 
        impacts.
  --Establish award winning programs to make DOT's data accessible. BTS 
        has published 18 major CD-ROM titles, and has created an 
        Internet site that serves over 9,000 customers per week with 
        documents and data from BTS, the rest of the Department, state 
        and local transportation agencies, universities, and 
        international organizations.
  --Initiate cooperative programs with transportation and statistical 
        agencies in Canada and Mexico to establish a continental 
        perspective on transportation.
  --Absorb the Office of Airline Information and improve the time 
        between data collection and release.
  --Absorb the Motor Carrier Financial and Operating Statistics program 
        from the Interstate Commerce Commission and initiate a process 
        to streamline and modernize the program.
  --Launch the coordination and standards setting activities listed 
        under a subsequent BTS question.
    The proposed NEXTEA funding will meet growing demand for these 
services, both those initiated under ISTEA and those subsequently added 
to the Bureau's portfolio. The funding request will also allow pilot 
and proof-of-concept studies for the new initiatives indicated under 
the last BTS question as submitted by the Senator.
    Question. What progress has BTS made in coordinating Departmental 
data collection efforts?
    Answer. BTS is mandated by ISTEA to encourage coordinated data 
collection, but is precluded by ISTEA from requiring cooperation from 
other parts of the Department and other federal agencies unless 
authorized by the Secretary. BTS has been given responsibility within 
the Department to review all Office of Management and Budget clearance 
requests involving surveys to assure they maintain good statistical 
practice. BTS has also coordinated its own intermodal data collection 
programs with the other modal administrations and other federal 
agencies to maximize data collection effectiveness and minimize 
respondent burden and unwarranted program duplication. In compiling the 
National Transportation Atlas Database (NTAD), BTS assembled disparate 
spatial databases from other DOT agencies, established standard formats 
and metadata documentation that complies with the recommendations of 
the Federal Geographic Data Committee, and implemented procedures for 
ongoing maintenance and dissemination. The NTAD represents the first 
integrated set of spatial transportation networks useful for both 
national policy studies and intermodal analyses.
    Question. What progress has BTS made in setting data collection 
guidelines and standards for the Department?
    Answer. In spite of the limitations cited under the preceding 
question, BTS has successfully completed several standards-setting 
activities. BTS represented the transportation community in developing 
of the North American Industrial Classification System (which is 
replacing the Standard Industrial Classification system); updating the 
Standard Occupational Classification System; and the establishing the 
Standard Classification of Transportable Goods. The last item had been 
identified as a major need by the Department in 1969, and was 
accomplished when BTS took the initiative and won the cooperation of 
the Bureau of the Census, Statistics Canada, and Transport Canada. BTS 
is also the lead agency in ongoing work to establish standards for 
geographic data related to ground transportation as part of the 
National Spatial Data Infrastructure under the Federal Geographic Data 
Committee, as well as an effort to modernize the Standard Land Use 
Coding Manual. Most recently, BTS has been asked by the Department to 
review the feasibility and reliability of proposed output and outcome 
measures by each modal administration for compliance with the 
Government Performance and Results Act.
    Question. What activities are planned for BTS over the 6 years of 
the NEXTEA proposal?
    Answer. Most of the NEXTEA budget will be consumed by continuing 
those services required by ISTEA and those later transferred to the 
Bureau without funding (i.e., the Office of Airline Information and the 
Motor Carrier Financial and Operating Statistics program of the 
Interstate Commerce Commission). In response to customer demands, BTS 
also proposes building upon its initial products and services with 
three major initiatives. These initiatives include expanded programs of 
data collection and integration involving international transportation; 
expanded services to state, local, and private sector decisionmakers, 
including a grant program to enhance data collection and sharing 
throughout the transportation community; and a program to develop 
performance measures in DOT and support performance measurement by 
state and local agencies. Pilot and proof-of-concept activities would 
be initiated in each of the following areas under the proposed NEXTEA 
funding levels.
Transportation in a Global Economy
    The initial BTS focus on domestic transportation must be expanded 
to reflect the increasing importance international trade has on the 
economic health of the Nation and its individual communities. This 
expansion includes:
  --The domestic transportation of international trade and travel. BTS 
        proposes to work with the Customs Service and the Bureau of the 
        Census to determine where and how international trade and 
        travel passes through the domestic transportation system. Such 
        data are key to understanding the impact of NAFTA and other 
        trade policies on the demand for domestic transportation 
        facilities and services, and to identifying regional and local 
        opportunities to compete in world markets. BTS has assessed 
        major shortcomings in existing data as part of the Bureau's 
        Transportation Statistics Annual Reports.
  --The condition, performance, and use of transportation links to 
        other nations. BTS proposes to assemble information on 
        transportation facilities and services that link us to other 
        nations, paralleling the Department's ongoing efforts to 
        measure the condition, performance, and use of transportation 
        within the U.S. The requisite work involves acquiring 
        commercial data sources, maintaining data programs of agencies 
        (such as those of the Maritime Administration) that may be lost 
        with institutional change, and data integration.
  --The International Transportation Database. BTS proposes to build a 
        database that supports understanding of international issues, 
        such as the role of transportation in global warming; provides 
        comparative data to inform domestic policy with the experience 
        of other countries with transportation; and contains basic 
        information on international markets for U.S. economic 
        interests.
Enhancing Relevance of National Transportation Statistics for State, 
        Local, and Private Sector Decisions
    The DOT budget is less than a fourth of all government spending in 
transportation, and only 5 percent of spending by the public and 
private sectors combined. For BTS to enhance the effectiveness of 
transportation decisions, the Bureau's national programs must be made 
relevant to the state, local, and private sectors that are the dominant 
stakeholders. The Bureau must improve the timeliness and geographic 
specificity of its data programs through increased sample sizes of data 
collections, the development of monthly transportation indicators, and 
the development of innovative analytical programs. To minimize cost and 
burden of these initiatives, BTS must also develop more efficient and 
less obtrusive methods for data collection, such as through capture of 
information from Intelligent Transportation Systems and administrative 
records. To maximize the effectiveness of these initiatives, BTS must 
also provide technical and financial assistance to organizations that 
integrate local data collections and analyses with national 
counterparts. Such activities are already taking place with respect to 
spatial data. BTS is actively participating in the development of the 
transportation framework layer of the National Spatial Data 
Infrastructure (NSDI), which relies on the integration of databases 
developed at the state and local levels to provide the most accurate 
and up-to-date spatial data which can be used nationwide. The demand 
for these activities is underscored by the Bureau's successful 
participation in the White House Economic Briefing Room, and by a 
policy statement passed unanimously by the Board of Directors of the 
American Association of State Highway and Transportation Officials that 
states ``the U.S. Department of Transportation should encourage and 
support the further development of the Bureau of Transportation 
Statistics, a continuation of the dialogue between the Bureau and the 
states, and an exploration of the Bureau's services to the states, 
including the potential for increased technical assistance.''
    The Bureau's proposal recognizes that America is being wired for 
better communication and offers several programs to begin effectively 
using the new telecommunications technologies. Inherent in the BTS 
proposal is a plan for managing an integrated information 
infrastructure for the transportation community. The plan consists of 
expanding the National Transportation Library and establishing a series 
of partnerships with state and local agencies, universities, and trade 
associations. These partnerships will focus on improving the efficiency 
of data collection and increasing the exchange of information 
throughout the community. The Bureau is proposing a grant program to 
work with non-federal professionals as they begin to collect data 
through Intelligent Transportation Systems technologies, to work with 
universities and others as they begin to build repositories of 
transportation data and information on the Internet, and to work with 
the private sector to ensure that the Department provides American 
businesses with the right information at the right time in the right 
format so they can successfully compete in the global economy.
Performance Indicators
    BTS plans to work with other DOT modal administrations to develop 
effective performance measures for transportation to support the 
Government Performance and Results Act. In response to requests from 
state and local agencies, BTS also proposes to help state departments 
of transportation and metropolitan planning organizations to develop 
performance measures for their own purposes.
                safety issues related to antihistamines
    Question. The Committee is aware that NHTSA is currently developing 
a national public education program to combat the effects of fatigue, 
sleep disorders, and inattention on motor-vehicle crashes to be 
implemented and evaluated in 1998. This is a critical undertaking since 
in recent years, fatigue and drowsiness have been identified by experts 
as major causes of lost worker productivity, workplace injuries, and 
transportation-related accidents. This problem has been further 
compounded by the fact that many persons suffering from seasonal 
allergies self-medicate with over-the-counter (OTC) sedating 
antihistamines. Such reaction-impairing medications were reported to be 
factors in a recent Connecticut truck accident involving the death of 
an 11-year-old girl as well as a metro train accident in San Francisco 
that injured five people. With the 1998 public campaign, which was 
funded by this committee in fiscal year 1996 and 1997, will there be a 
specific focus on the dangers of driving while using sedating 
antihistamines, or will the campaign just have a general warning about 
driving while using impairing substances?
    Answer. The development of the campaign is still in its early 
stages, so it is too soon to know exactly how it will address 
medications in general, and sedating antihistamines in particular. Both 
the target audiences and specific content of this public education 
program are established by a panel of nationally recognized experts in 
the areas of sleep and sleep disorders, education, and traffic safety. 
This panel is convened by the National Center on Sleep Disorders 
Research. At this time, the panel has recommended a focus on young male 
drivers and shift workers, two groups that appear to be over-
represented in fatigue-related incidents. While the panel's 
recommendations are not yet final, they do not currently include 
recommendations to create a specific focus on sedating antihistamines. 
Rather, medication is one of several issues of which the panel believes 
that the motoring public should be aware.
    Question. You have indicated that you have yet to find evidence 
that sedating antihistamines, or, for that matter, any OTC drugs, 
contribute to a substantial number of crashes and that it would, 
therefore, be inappropriate to issue warnings to the public about the 
use of sedating antihistamines. This is troubling because, as you know, 
such ``evidence'' is nearly impossible to collect since the information 
about falling asleep at the wheel, or information about any specific 
causes for such drowsiness, cannot be collected at the scene of an 
accident unless it is volunteered by the driver. And as you also know, 
independent research projects have concluded that the slowed reaction 
time experienced by a person using a sedating antihistamine is 
comparable to the delayed reaction of a person with a blood alcohol 
content (BAC) of .05. So, if it is inappropriate to issue warnings 
about sedating antihistamines based on a dearth of ``evidence,'' 
wouldn't it be appropriate then to take the more positive tack of 
actively encouraging the nation's allergy sufferers to use non-sedating 
medications while driving, particularly given that such antihistamines 
are available?
    Answer. This question implies that there is no evidence on the 
involvement of antihistamines in crashes. This is not the case. In a 
1990 study of the incidence and role of drugs in fatal crashes, the 
Agency found that only 0.6 percent of drivers had any amount of 
antihistamine in their blood, compared with 51.5 percent showing 
measurable amounts of alcohol. This evidence suggests that 
antihistamines are not involved in a significant number of fatal 
crashes. While this does not mean that this issue is not important to 
recognize and address, it is important to concentrate resources on 
those issues that most demonstrably affect safety. NHTSA includes 
messages warning against impairment due to over-the-counter medications 
in its materials on drugged driving and driver education.
    Question. For example, in 1993, the FAA approved the use of 
loratadine, a non-sedating antihistamine, by most pilots and air 
traffic controllers with allergies. Given that the FAA has recognized 
and addressed this safety issue, does any other agency in the DOT offer 
similar guidance in this area, such as the Coast Guard to its pilots 
and cutter commanders?
    Answer. In general, the U.S. Coast Guard does not provide 
instruction as to the clinical treatment or therapy for specific health 
problems, including those requiring use of antihistamines. The over-
arching policy is that all Coast Guard members must be ``fit for full 
duty''. This means that any health problem and its respective treatment 
must keep the ``fit for full duty'' concept in the forefront. Competent 
medical authorities (i.e., medical officers) make decisions as to the 
fitness for duty, using their clinical judgment, operational 
experience, input from supervisors/command, and guidance set forth in 
various Coast Guard instructions. Advisory information on the use of 
specific medication in aviation is made available to medical officers 
through several publications including the Coast Guard ``Flight 
Surgeon's Guide''.
    The Federal Railroad Administration also does not offer specific 
guidance on sedating antihistamines. It publishes medical regulations 
and conducts training for railroad company medical officers. FRA 
reviews the periodic training and testing of operating personnel 
conducted by the railroads.
    The Federal Highway Administration issued a report in 1991 that 
states that ``for treatment [of allergic rhinitis], only non-sedating 
antihistamines or intranasal steroid sprays should be used to prevent 
sedation that occurs with conventional therapy.'' A condensed version 
of the report states that commercial motor-vehicle drivers ``should 
avoid potentially sedating antihistamines.'' This condensed report is 
included in FHWA's standard medical information package, which is sent 
to medical practitioners who request information regarding medical 
fitness qualifications for commercial drivers.
    The Secretary of Transportation has reinforced modal efforts to 
urge caution regarding the use of medications by promulgating a policy 
strongly urging ``all transportation industry employers to include in 
their employee training materials appropriate information to address'' 
both over-the-counter and prescription medications for persons 
performing safety-sensitive duties. In addition, the policy encourages 
``employers to reiterate with their employees the need to report use of 
such medications when required by applicable DOT rules or by company 
policies.''
    Question. How does the FAA disseminate to medical directors at the 
air carriers information about the directive concerning the use of non-
sedating antihistamines? Is this an adequate public information 
mechanism, and if so, could it be a model for NHTSA or other modes in 
the DOT which might consider adopting a similar advisory?
    Answer. FAA provides medical advisory information including 
information on non-sedating antihistamines to aviation medical 
examiners (AME's), libraries, medical professional groups, aviation 
user groups, and others. This information is disseminated by the Office 
of Aviation Medicine (AAM) through the Federal Air Surgeon's Medical 
Bulletin, which is published quarterly and distributed to approximately 
6,000 physicians. In addition, AAM has widely distributed information 
on the use of over the counter medications to both physicians and 
airmen.
    The bulletin and other pamphlets such as Medical Facts for Pilots 
are prepared by the FAA's Civil Aeromedical Institute with policy 
guidance and support from AAM. AME's and other authors submit articles 
and photos for publication in the bulletin.
    We believe that this is an adequate public information mechanism 
since all airmen are required to undergo periodic physical examinations 
by AME's. AME's are required to be knowledgeable of FAA policies and 
practices regarding the acceptability of medications in the performance 
of airman duties. Publication of pamphlets and distribution of 
informational material to libraries, medical professional groups, user 
groups, and others could, however, be effectively used by other modes 
of DOT.
    Because the National Highway Traffic Safety Administration does not 
have regulatory control over motor-vehicle operators, it does not have 
a network of medical examiners through which to disseminate such 
information. Other modal administrations that have regulatory authority 
appear to use methods similar to the FAA.
    Question. What plans does NHTSA have for the development of a 
safety standard in this area which could or should be applied to the 
surface transportation modes as well, particularly rail, transit and 
motor carriers?
    Answer. NHTSA does not have statutory authority to promulgate a 
standard that would have any binding effect on motorists or on State 
and local governments. In the past, the agency has issued guidance 
about the negative effects that over-the-counter drugs and other drugs 
can have on driving behavior. As more information is developed in this 
area, the agency will issue additional guidance to the States and the 
public as the need arises.
                                 ______
                                 
                Questions Submitted by Senator Domenici
                                air bags
    Question. Administrator Martinez, I understand that last month, 
NHTSA (National Highway Traffic Safety Administration) published a new 
rule allowing vehicle manufacturer's to depower air bags so that they 
inflate less aggressively. NHTSA believes ``this is a short-term 
solution to the problem of fatalities and injuries that current air 
bags cause to children and the elderly in low speed crashes.'' What 
trade-offs result from this depowering decision? That is, if the 
depowering decision makes air bag deployments safer in low speed 
crashes, are vehicle occupants less safe in high speed crashes?
    Answer. Based on the ``Final Regulatory Evaluation, Actions to 
Reduce the Adverse Effects of Air Bags, FMVSS No. 208, Depowering,'' 
NHTSA, February 1997, the agency has estimated the benefits and 
tradeoffs of depowering air bags.
    Assuming no changes are made in where children sit in vehicles, 
restraint usage rates, and no changes are made to the current air bags, 
an estimated 140 children, 25 drivers and 7 adult passengers would be 
killed in low speed accidents by air bags over the lifetime of one 
model year's fleet if all vehicles in that model year had driver and 
passenger side air bags. Of these, an estimated 47 children's lives, 
and a large portion of the 32 adults could be saved by depowering. For 
higher speed accidents, analyses based on test results and modeling 
indicate that depowering could save 4 to 22 belted passengers.
    Analyses based on test results and modeling indicate that in higher 
speed accidents 16 to 151 drivers (comprised of 13 to 110 belted 
drivers and 3 to 41 unbelted drivers) would not be saved and 34 to 280 
unbelted adult passengers lives would not be saved as a result of 
depowering every vehicle in the fleet.
    Based on limited crash data on one less aggressive depowered air 
bag, an air bag on a General Motors designed Holden vehicle in 
Australia, an estimated 643 lives of belted occupants could be saved by 
having depowered air bags like the Holden bag in every vehicle.
    Question. I understand that a new air bag technology, based upon 
compressed-gas inflation mechanism, has recently been developed and is 
much safer than currently installed air bags. I further understand 
that, last December, the federal government's Transportation Research 
Center in East Liberty, Ohio conducted a series of tests with this new 
technology. How many and what type of tests were conducted? How do the 
test results compare to test results for currently-installed air bags?
    Answer. Air Belt Systems Inc. has made claims that their air bags 
are safer than conventional systems. The agency conducted over 175 
tests on various production and depowered air bag systems. These tests 
included static (stationary vehicle) simulations of out-of position 
children, and 30 mph crash simulations of adult occupants. Eleven of 
these tests were conducted with air bags provided by Air Belt. The 
tests revealed that Air Belt's air bags are very similar to more 
conventional depowered air bags. With current technology, including Air 
Belt, a trade-off must be made between adult protection at higher 
speeds and minimizing injury to small children who are unrestrained. 
This trade-off can only be overcome with advanced occupant sensing, 
used in concert with computational algorithms and advanced multi-stage 
or variable inflators such as the Air Belt inflator.
    Question. How does this alternative technology compare with 
depowered air bags? Would vehicle occupants be more safe with this new 
technology than with a depowered air bag?
    Answer. Systems from several vehicle and component manufacturers 
were tested to assess aggressiveness of production systems and the 
potential benefit of air bags with less energy. Included in these tests 
were air bag systems supplied by Air Belt Systems, Inc. These systems 
were different from production air bags because they utilize un-heated 
gas and fast acting valves rather than chemical reactions and heated 
gas to deploy the air bag. The Air Belt air bag inflator has an output 
similar to depowered air bags with an additional low onset pressure 
rise-rate. The agency's test results showed the Air Belt design of air 
bags to be similar in performance to depowered air bags from other 
sources. Consequently, the agency does not believe that the present Air 
Belt air bag system is a total solution to the child and small adult 
injury problem, just as the agency does not believe depowering is the 
total solution.
    Question. Are there other tests that NHTSA needs to perform with 
this new air bag before it can be safely installed in vehicles? Which 
tests and when, if appropriate, can NHTSA arrange to test fully this 
system?
    Answer. The agency believes that the Air Belt system, together with 
other air bag systems, has the potential for future development toward 
advanced air bag systems. This development will require sensors and 
algorithms to tailor the air bag deployment in each particular crash 
based on occupant, crash and vehicle characteristics. The agency 
estimates three to five years before sensors and algorithms are 
sufficiently developed and tested to be ready for production vehicles. 
The agency believes that Air Belt Systems Inc. needs to conduct the 
necessary research for development and integration of such advanced air 
bags into production vehicles. The agency does not know if the design 
of the Air Belt system inflator will be superior to other inflators in 
developing smart air bag systems. Consequently, any developmental 
testing should be conducted in collaboration with auto manufacturers 
and air bag component suppliers to ensure a competitive market that 
brings forth the optimum solutions for ``smart'' air bags.
                                 ______
                                 
              Questions Submitted by Senator Slade Gorton
                           intermodal safety
    During both Secretary Slater's confirmation hearing in the Commerce 
Committee, as well as the first hearing of this subcommittee, I asked 
Secretary Slater about his thoughts/comments/suggestions on possible 
programs to help alleviate the freight mobility and passenger traffic 
congestion in the Puget Sound.
    With automobile and railroad traffic increase in the Puget Sound 
region, the Port of Seattle, the Port of Tacoma, the Puget Sound 
Regional Council, and the Washington State Department of Transportation 
are currently working on a project to construct grade separations at 
existing street level railroad crossings for both safety and traffic 
efficiency reasons. To date, this group has identified approximately 70 
street level crossings along the north-south corridor between Everett 
and Tacoma that should be grade separated. Unfortunately, this would 
have to be done at a tremendous cost.
    While grade separation and freight mobility are extremely important 
issues for the ports, they are also important in light of Burlington 
Northern-Santa Fe's decision to reopen Stampede Pass, a major east-west 
rail corridor in Washington state. Initially, BNSF projects that will 
operate 10-12 trains per day during 1997, but will increase that number 
to 18-20 operations by 1998. With this new traffic moving through the 
Central Puget Sound region, cities from Auburn, Kent, Maple Valley, to 
Ellensburg and Yakima will be affected.
    As I see it, I believe this matter of freight and passenger 
mobility raises two important issues. First is safety. While we have 
been fortunate thus far, with over 70 grade crossings between Everett 
and Tacoma, something has got to be done to ensure that the Puget Sound 
does not witness a train-car type of accident at one of these at-grade 
crossings in the future. From my perspective, with more trains and more 
passenger vehicles operating in the same limited amount of space, an 
accident is almost destined to occur if nothing happens to rectify this 
problem. Secondly, freight mobility in the Puget Sound area, unlike 
other regions in the country, relies on an equal balance of rail, truck 
and passenger traffic. Accordingly, it would seem that something has to 
be done to ensure that all three operations--rail, commercial vehicle, 
and passenger traffic--can all coexist in an efficient and safe manner 
to ensure that the Puget Sound can maintain its standing as the second 
largest import/export port on the West Coast.
    Question. How would the President's NEXTEA proposal be able to 
address this issue of Safety? What other types of funding mechanisms 
would you recommend to fund a project that could potentially cost 
nearly $2.0 million?
    Answer. The Department's NEXTEA proposal contains an Infrastructure 
Safety Program, funded at $500 million in 1998 growing to $575 million 
by 2003, which provides funds to eliminate hazards on public roadways 
other than the Interstate, and to improve the safety of rail/highway 
grade crossings. It replaces the STP safety set-aside program. The 
rail/highway grade crossing portion of the program is funded at $165 
million per year, but additional infrastructure safety funds can be 
used for grade crossing improvements if the State decides it has the 
need. This program continues to be a 90 percent Federal share matching 
program.
    In addition, NEXTEA would authorize an additional $50 million per 
year for an Integrated Safety Fund. This is a new incentive grant 
program designed to foster integrated, results-oriented safety 
planning. Where states implement an integrated safety planning process, 
additional funds will be provided that can be used for any purpose 
permissible under the various DOT auto, traffic safety or motor carrier 
programs.
    Other sources of funding are: Surface Transportation Program (STP) 
funds and National Highway System (NHS) funds if the crossing is on the 
NHS. The State Infrastructure Bank (SIB) Program may also be an option 
if the projects are eligible under Title 23. The SIB program would 
require matching funds from the State and private sectors. In addition, 
the Transportation Infrastructure Credit Enhancement Program may be an 
option. If the project satisfies the proposed eligibility criteria, 
which include national significance, it could seek funding under this 
program. Its application would be evaluated along with those of other 
applicants.
    Together, we believe these programs provide states, like 
Washington, the tools they need and the funding sources to enable them 
to address the grade crossing safety problems they face.
                      elimination of 1064 program
    Question. The President's NEXTEA proposal eliminates funding for 
the 1064 program--the ``construction of ferry boats and ferry terminal 
facilities'' account. While I recognize there are several states that 
do not utilize this funding source because they do not operate a ferry 
system, that is true for many transportation programs. Respectfully 
using my friend and colleague from West Virginia as an example, few 
Washingtonians utilize the Appalachian Highway System, yet, I recognize 
the needs of that region and the importance in maintaining that 
program. How did the Administration justify eliminating the 1064 
program when there are the Coastal and Great Lake state, each with 
unique marine transportation needs, that have used this program quite 
successfully to meet the transportation needs created by each state's 
marine environment?
    Answer. During the outreach for the development of the ISTEA 
reauthorization proposal, there were two resounding points FHWA heard. 
One, ISTEA is working, it needs some minor adjustments, but it does not 
need to be restructured. Two, there are too many funding categories, 
and programs should be streamlined and consolidated. The FHWA had to 
strike a balance in responding to these points when formulating the 
program structure in the NEXTEA proposal. As a result, the NEXTEA 
proposal would eliminate selected relatively small discretionary 
programs, including the 1064 program. Ferry boats and ferry terminals 
are activities that a State can fund using Surface Transportation 
Program funds, National Highway System funds, or Congestion Mitigation 
and Air Quality Improvement Program funds, as appropriate. Accordingly, 
even if the ferry discretionary program is no longer funded, Washington 
and other Coastal and Great Lake states, can use their regular Federal-
aid highway funds for improvements to their ferry system.
                 border gateway crossing pilot program
    Question. The President's NEXTEA proposal provides $270 million for 
a Border Gateway Crossing Pilot Program. As you know, Washington State 
has been a national leader in working with its Canadian counterparts to 
develop an efficient flow of goods and people across the Northern 
border of Washington State, both through intelligent transportation 
systems, as well as the PACE program. Two questions--how do you 
envision this NEXTEA program being operated, and what type of State or 
local projects do you foresee as being worthy of funding from the 
Administration under this program?
    Answer. The Trade Corridor and Border Gateway Pilot Program 
provides planning funds for multi-State corridor and binational 
transportation and program funds for improvements to border crossings 
and approaches. This program facilitates corridor development and 
border planning, and addresses the transportation impacts of NAFTA and 
international trade growth. It provides supplementary planning and 
program support to coalitions of States and transportation and economic 
development partners to encourage innovation and cooperation in dealing 
with these issues. The program provides specific sums for planning and 
coordination purposes with all remaining funds used for project 
implementation.
    Corridor and border planning.--The program provides $3 million/year 
supplemental planning funds to States engaged in multi-State 
transportation corridor planning. Grantees must submit plans and 
implementation schedules for corridor improvements. It provides $1.4 
million/year for border planning grants to States and MPO's. Under this 
program grants may not exceed $100,000 for any State/MPO in any one 
year, but grants can be made annually through the reauthorization 
period. Grantees must commit to joint planning with counterparts in 
Mexico or Canada.
    Border Gateway Pilot Program.--This program provides discretionary 
funding to States or other implementing authorities to improve the 
safety and efficiency of international border gateways, through a 
combination of infrastructure, operational, institutional, and/or 
regulatory improvements. Selection Criteria for grants include: (1) 
reduction in travel time through the gateway; (2) leveraging of Federal 
funds; (3) improvements in vehicle and cargo safety; (4) degree of 
binational involvement and cooperation, including cooperation with the 
Federal Inspection Services (Customs, INS, USDA, etc); (5) innovation 
and transferability to other gateways; (6) local commitment to sustain 
the effort; and (7) full use of existing facilities prior to any new 
construction.
    The program authorizes eight projects, including at least two each 
on the Canadian and Mexican borders, with no project receiving more 
than $40 million from this program through the reauthorization period.
    The proposal intentionally does not specifically identify types of 
activities for which funds would be eligible to allow for a broader 
consideration of types of activities to address improved thruput. 
Generally speaking, the following would be eligible for the 
infrastructure elements of a border gateway pilot program, although the 
list is not definitive:
  --Construction, reconstruction, safety improvements, or capacity 
        additions to roads, bridges, and ramps connecting directly to a 
        border crossing, either for the purpose of improving overall 
        thruput or to separate commercial and non-commercial vehicles 
        to expedite border clearance.
  --Commercial vehicle inspection/enforcement facilities, used directly 
        to process commercial vehicles within or approaching a major 
        gateway.
  --Grade separations for major border approaches.
  --Telecommunications infrastructure dedicated to improvements in ITS/
        CVO and related EDI measures to expedite commercial thruput 
        and/or coordinate binational border clearance procedures.
  --Intermodal facilities that improve commercial and non-commercial 
        thruput. Major rail freight relocations would be eligible only 
        to the extent that they are also made eligible under other 
        provisions of NEXTEA.
                      ferry discretionary program
    Question. In February, I sent a letter to Secretary Slater 
requesting assistance in resolving a funding dispute between the FHWA 
and the Washington State Department of Transportation (WSDOT). In the 
fiscal year 1997 Senate Transportation Appropriations Committee report, 
I specifically included language directing the FHWA to provide $2.5 
million in fiscal year 1997 funds for a ferry terminal in Clinton, 
Washington. On November 13, 1996, however, representatives from the 
WSDOT received a faxed notice that the allocation of FHWA's fiscal year 
1997 discretionary money did not include the Clinton Ferry Terminal. I 
would like your clarification on two matters regarding this issue. 
First, can you tell me why the FHWA chose to disregard the Senate 
report language that I included on the Clinton Ferry Terminal, which 
specifically designated $2.5 million for the project. Second, can you 
tell me why, after two months, I have not received either a telephone 
call or a letter from the Department of Transportation on this matter?
    Answer. The FHWA was aware of the Senate report, as well as 
language in the Conference report stating that ``[t]he conference 
agreement deletes the Senate references of priority designations and 
set-asides within the Federal Highway Administration's discretionary 
grant programs;'' see p.45, Report 104-785, to accompany H.R. 3675. 
Based on the later direction from the Conference report, all candidates 
for discretionary ferry funding were treated equally. In choosing among 
the many worthwhile candidates submitted, there was insufficient 
funding to allocate discretionary funds to many excellent candidates, 
including the Clinton ferry terminal project. The formal response to 
your letter is under review and should be sent soon.
                                 ______
                                 
                 Questions Submitted by Senator Stevens
                         federal lands highways
    Question. Alaska, as you may know, has significant lands held by 
Native Corporations, some of the largest and most visited national 
parks in the county, has more public lands than any other state, and 
the largest forests in the United States. However, I'm told by my staff 
that last year Alaska received next to nothing under these programs. 
Can you explain this to me?
    Answer. In fiscal year 1996, several items impacted the amount of 
funds which were provided for transportation projects under the Federal 
Lands Highway Program. These included a $32.1 million reduction 
required by Section 1003(c) of the Intermodal Surface Transportation 
Efficiency Act of 1991 and a $0.32 million reduction required by 
Section 31002 of the Omnibus Consolidated Recision and Appropriations 
Act of 1996. Also, the State of Alaska decided not to request any 
Public Lands Highway Discretionary funds in fiscal year 1996. The 
following amounts of Federal Lands Highway Program funding by category 
was provided for transportation projects in Alaska. A total of $28.5 
million was allocated for projects in State of Alaska. This amounted to 
7.5 percent of the program and is one of the largest percentage of 
Federal Lands Highway Program funds allocated for projects in any one 
State:
                                                        Fiscal year 1996
        Federal Lands Highway Program Funding Category        Allocation
Indian Reservation Roads................................     $16,500,000
Forest Highways.........................................      12,200,000
Park Roads & Parkways...................................         200,000
Public Lands Highway Discretionary......................................
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................      28,500,000
                                ferries
    Question. In NEXTEA, the Administration has deleted the ferry 
discretionary program, know as Section 1064 of ISTEA. This program 
provided tremendous benefit to Alaska and other States, whose 
communities rely on ferries as their only form of transportation 
between communities. In Alaska alone, the public ferry system provides 
services to twenty percent of Alaska's population, with its eight ships 
stopping at 35 ports. There are 3,700 route miles, including 1,911 that 
are designated National Highway System miles. The ferry system also 
provides jobs for marine and shore-side labor, marine engineers and 
employees in shipbuilding industry. These jobs are in and outside of 
Alaska. What was the rationale behind deleting this critical program?
    Answer. Under NEXTEA, no new authorizations would be provided for 
several discretionary programs, including the ferry discretionary 
program. This reflects input received during the outreach and focus 
group meetings held by the FHWA during the development of the NEXTEA 
proposal, where it was recommended that discretionary programs be 
eliminated or significantly reduced in number. One major concern is 
that funding of discretionary programs reduces funding available for 
core programs shared in by all States. In the case of ferry boats and 
ferry terminals, these are activities that a State can fund using 
Surface Transportation Program funds, National Highway System funds, or 
Congestion Mitigation and Air Quality Improvement Program funds, as 
appropriate. Accordingly, even if the ferry discretionary program is no 
longer funded, the State of Alaska can use its regular Federal-aid 
highway funds for improvements to its ferry system.
                            highway formula
    Question. In the Administration's NEXTEA proposal, the highway 
funding formula is structured so that States without a large 
population, high traffic count, or high road mileage are put in a hold 
harmless situation. It appears that the highway funding formula seems 
to favor States with developed highway infrastructure because much of 
the apportionment is based on the amount each State pays into the 
Highway Trust Fund. Have you considered including in the funding 
formula base factors such as: 1) predominance of Federal lands; or 2) 
underdeveloped highway infrastructure as compared to other States?
    Answer. In arriving at our formula proposal, we considered a large 
number of factors in the context of the program elements contained in 
our NEXTEA proposal, and the criticisms of the ISTEA formula factors 
identified in the General Accounting Office (GAO) 1995 report, 
``Highway Funding: Alternatives to Distributing Federal Funds.'' This 
report criticized many aspects of the ISTEA formulas as being archaic, 
obscure and irrelevant.
    For land area, in particular, the GAO report pointed out that this 
factor, while once felt to be an adequate proxy for potential highway 
development, no longer bears a close relationship to future highway 
needs, namely the need for new construction, since the highway system 
is no longer growing rapidly throughout the country. Consideration of 
development needs is another possible factor, and, while this might be 
done by developing some measure of ``highway underdevelopment,'' we 
felt that targeting funds to meeting defined national highway program 
goals would best serve for the economic development needs of the 
Nation.
    In recognizing the need to replace outdated and outmoded 
apportionment factors, we have proposed Highway Trust Fund 
apportionment formulas that we believe are fair to all States, yet 
relate well to the objectives of the basic program elements and satisfy 
the overall goal of the Federal-aid program to meet the Nation's need 
for the safe, efficient, and environmentally sound movement of people 
and goods. While we believe we have a strong formula proposal, one that 
takes into consideration the needs of both donor and donee States, 
while providing protection from rapid disruptions in program 
apportionments, we fully understand that there is no one ``right 
answer'' to the question of apportionment formulas, and we will be 
working with the Congress to develop apportionment formulas that will 
best meet all competing demands.
                                 ______
                                 
               Questions Submitted by Senator Lautenberg
                         nextea formula changes
    Question. The Administration created a great deal of nervousness 
when it was revealed that you would be proposing formula changes in 
your NEXTEA proposal. New Jersey will receive the same percentage of 
the total program under your proposal but this is certainly not the 
case for every State. Given the controversy surrounding the ISTEA 
formulas, what criteria did you bring to bear in developing your new 
formula proposal?
    Answer. While recognizing the need to replace outdated and outmoded 
apportionment factors, we have proposed apportionment formulas which we 
believe are fair to all States, yet relate well to the objectives of 
the basic program elements and satisfy the overall goal of the Federal-
aid program to meet the Nation's need for the safe, efficient, and 
environmentally sound movement of people and goods.
    In developing the proposed apportionment factors, we attempted to 
choose factors that would satisfy individual program goals, such as 
maintaining and improving the NHS, as well as overall Federal-aid 
program goals such as maintaining and improving human and natural 
environments and conserving energy. Additionally, we considered such 
questions as, ``Is the data for these factors current, readily updated, 
dependable, and easily understood by those affected?'' As such, many 
factors were considered, both system-related such as lane miles and 
VMT, as well as broader economic and demographic factors such as 
population, in attempting to satisfy these many, competing goals. We 
believe that the factors contained in the our formula proposal, while 
individually not meeting all the varied goals and criteria set forth in 
our effort, do collectively, as part of the overall program structure, 
effectively address the multiple goals of the Federal-aid highway 
program.
    Also, we recognize that a sudden change to new formula factors 
could be disruptive to State programs, and therefore, have proposed 
certain equity adjustments to ease the transition to a more sound, 
logical basis for the apportionment of Federal highway dollars. 
Specifically, three different equity adjustments have been included in 
our proposal. The first adjustment, similar to the current Minimum 
Allocation program, is based on 90 percent of a State's percent 
contributions to the Highway Account of the Highway Trust Fund. The 
second adjustment is based on 90 percent of a State's prior year 
apportionments. The third is a final adjustment designed to protect 
State's from too rapid a disruption in apportionment dollars by 
ensuring that each State's share of NEXTEA annual apportionment dollars 
must equal at least 95 percent of its average ISTEA (fiscal year 1992-
97) percent apportionments throughout all NEXTEA years. Since the 
equity calculations are done sequentially, each equity adjustment is 
affected by subsequent equity adjustments.
    In presenting these factors for consideration, we understand that 
there is no one ``right answer'' to the question of apportionment 
formulas, and we look forward to working with the Congress to develop 
apportionment formulas that will best meet all competing demands.
    Question. Given our need to conserve fossil fuels and the direct 
link between gas consumption and pollution, why did you choose to 
continue the practice of distribution of large sums of highway money to 
states based on their consumption of gasoline?
    Answer. While we recognize that using factors such as VMT and 
Highway Account Contributions to the HTF may reward fuel consumption 
and thereby raise concerns about air quality and energy conservation, 
we believe there are several sound reasons for incorporating these 
factors into our proposed apportionment formulas. First, while these 
factors may appear inconsistent with national air quality and energy 
conservation goals, they do help to achieve other important Federal-aid 
program goals such as mobility enhancement and economic productivity. 
Additionally, these factors are effective in helping to achieve 
program-specific goals, such as maintaining and improving the 
Interstate and the NHS, by accounting for the use and extent of each 
respective system.
    It should also be noted that these factors, while important, are 
only part of our complete formula proposal and the Administration's 
overall NEXTEA package. In addition to these factors, we are proposing 
the use of population as a factor in apportioning 30 percent of STP 
funds, because we believe this factor effectively represents the multi-
modal goals of the STP program. Additionally, our Congestion Mitigation 
and Air Quality Improvement (CMAQ) program incorporates factors for 
newly-designated attainment areas, so that those jurisdictions recently 
achieving the national ambient air quality standards can continue 
receiving CMAQ funds and remain in attainment. Lastly, we have proposed 
increasing CMAQ funding by over 25 percent, increasing transportation 
enhancements spending by more than 25 percent, and continuing funding 
for National Scenic Byways, recreational trails, bicycle 
transportation, and pedestrian walkways as part of our NEXTEA proposal.
    In developing the proposed apportionment factors, we attempted to 
select factors that would satisfy as many of the competing goals as 
possible. While we believe that we have selected factors which 
effectively meet many of these goals, we also fully understand that 
there is no one ``right answer'' to the question of apportionment 
formulas, and we look forward to working with the Congress to develop 
apportionment formulas that will most effectively meet all competing 
demands.
    Question. Doesn't this factor reward States that have high gasoline 
consumption and penalize those who choose to invest in energy efficient 
modes of travel, such as buses, commuter rail and carpooling?
    Answer. While we recognize that using Highway Account Contributions 
to the HTF as a factor may reward fuel consumption, which is 
inconsistent with national air quality and energy conservation goals, 
we selected this factor because it helps to achieve other important 
Federal-aid program goals such as mobility enhancement and economic 
productivity. Additionally, this factor is effective in helping to 
achieve program-specific goals, such as maintaining and improving the 
Interstate and NHS, by accounting for the use and extent of each 
respective system. Also, the data for this factor is considered highly 
reliable, readily updated, and easily understood by those affected.
    It should also be noted that this factor, while an important 
element of our formula package, is only part of the complete formula 
proposal and the Administration's overall NEXTEA package. In addition, 
we are proposing the use of population as a factor in apportioning 30 
percent of STP funds, because we believe this factor effectively 
represents the multi-modal goals of the STP program. Additionally, our 
Congestion Mitigation and Air Quality Improvement (CMAQ) program 
incorporates factors for newly-designated attainment areas, so that 
those jurisdictions recently achieving the national ambient air quality 
standards can continue receiving CMAQ funds and remain in attainment. 
Lastly, we have proposed increasing CMAQ funding by over 25 percent, 
increasing transportation enhancements spending by more than 25 
percent, and continuing funding for National Scenic Byways, 
recreational trails, bicycle transportation, and pedestrian walkways as 
part of our NEXTEA proposal.
    We believe the formula factors we have proposed need to be reviewed 
within the context of our complete NEXTEA proposal, including the 
various environmental provisions contained in the package, as well as 
the increases in funding for environmental programs we propose. We 
believe our NEXTEA proposal does satisfy the national goals of mobility 
enhancement and environmental quality maintenance.
                          chafee-bond proposal
    Question. My colleagues, Senators Chafee and Bond, have introduced 
legislation that would develop a new budgetary category for the Highway 
Trust Fund. Under their proposal, overall highway funding would 
automatically be set at the level equal to the receipts of the Highway 
Trust Fund for the prior year. Their proposal, however, does nothing to 
guarantee either mass transit or Amtrak the privileged status that 
would be granted to highways. Mr. Linton, if we follow the 
Administration's recommendation to fund mass transit entirely from the 
mass transit account of the trust fund, what would be the impact if we 
gave transit the identical treatment that is granted highways under the 
Chafee-Bond proposal?
    Answer. If the Chafee-Bond proposal was applicable to Federal 
Transit funding there would be significant short-falls in comparison to 
the proposed NEXTEA budget authority. Beginning in fiscal year 1998 FTA 
proposes to fund all of the transit programs from the Mass Transit 
Account at the proposed appropriation and obligation limitation level 
of $4.4 billion. The fiscal year 1997 estimated revenue into the Mass 
Transit Account is $3.2 billion. Therefore, in fiscal year 1998 alone 
there would be a shortfall of over $1 billion under the Chafee-Bond 
proposal.
    Our authorizing legislation, NEXTEA, proposes a total of $30.8 
billion for transit, while estimated revenues from Treasury are about 
$3.0 billion a year straight-lined into the future. Therefore, over six 
years only about $18.6 billion can be supported by yearly revenues into 
the Mass Transit Account. This would create a shortfall of over $12 
billion that would not be available for transit programs.
    Question. Wouldn't highway funding see a substantial increase while 
transit funding endured a significant cut?
    Answer. Yes, this is true. The Federal transit funding would be cut 
by over $1.2 billion a year compared to the current fiscal year 1997 
funding level of $4.4 billion. As for highways, revenue estimates are 
over $22 billion a year. This amount is over $4 billion higher than the 
fiscal year 1997 obligation limitation placed on the Federal highway 
programs. In addition, the Chafee-Bond bill does not address funding 
for Amtrak for which our authorization proposes to fund at 
approximately $800 million a year from the highway account of the 
Highway Trust Fund.
                                  cmaq
    Ms. Garvey, we have both heard assertions that the congestion 
mitigation air quality program has not really served its purpose of 
minimizing congestion and bringing about a decrease in the pollutants 
put into our environment.
    Question. What hard evidence do you have that the CMAQ program has 
succeeded in minimizing congestion and pollution?
    Answer. The CMAQ program has two requirements that other ISTEA 
programs do not have--air quality analysis of projects funded under the 
program and annual reports which document the emission benefits of 
funded projects. The most recently available annual report prepared 
jointly by FHWA and FTA indicates that about 75 percent of the reported 
CMAQ funded projects included quantitative data on air quality 
benefits; 1995 CMAQ Annual Summary of Activities. Generally, reported 
data on the air quality benefits of projects funded under the CMAQ 
program show that the benefits are commensurate with the size of the 
projects funded. Some projects, such as educational and outreach 
programs, marketing and advertising programs, do not lend themselves to 
quantitative analysis, and there are no hard data available for these 
projects.
    It is important to recognize that transportation and air quality 
improvement projects are continuing and long-term efforts, and 
resulting emissions reductions may take years to materialize. CMAQ 
funded projects are important components in the challenge to improve 
the nations' air quality. While projects and programs funded under CMAQ 
will not solve the nation air quality or congestion problems, FHWA 
believes that many of these projects will make long-term contributions 
to cleaning up the nations' air through innovative programs; for 
example, inspection and maintenance programs which can yield more that 
20 tons per day in emission reductions.
    Question. Do you have hard data as to the amount of pollutants that 
have not been released into our atmosphere as a result of the 
transportation projects funded through the CMAQ program.
    Answer. The CMAQ program has a requirement that projects which 
receive funding under the program provide an air quality analysis and 
supporting data which document its emission benefits. The air quality 
analysis allows FHWA and FTA to track and compile data on the emission 
reduction benefits of the CMAQ program. The information contained in 
these reports include: the distribution of funding among project types, 
an assessment of emissions reductions analyses as required under the 
program guidance including estimated emission reduction benefits data 
in kilograms/per day for volatile organic compounds (VOC), nitrogen 
oxides (NOX), carbon monoxide (CO) and particulate matter 
PM-10) for each project, and comments on the reported data trends.
    In 1995 alone, CMAQ funded projects accounted for reductions in 
carbon monoxide of 431 tons per day, in volatile organic compounds of 
170 tons per day, and in oxides of nitrogen of 113 tons per day. These 
benefits will continue for the life of the project.
    While most CMAQ-funded projects are small relative to the size of 
the transportation infrastructure and yield benefits commensurate with 
that size, some projects yield considerably greater benefits. 
Inspection and maintenance programs have been funded under CMAQ 
programs in at least 5 States yielding between 2 tons per day to more 
than 20 tons per day.
    CMAQ-funded projects are also critical for some nonattainment areas 
to demonstrate conformity of their transportation plans and programs, 
thus allowing States and local areas to continue their federally funded 
programs. In these and other areas, CMAQ funding also has been 
necessary to ensure funding for transportation control measures 
contained in the State air quality implementation plan, or SIP.
    Finally, the benefits of CMAQ funded projects should not be 
restricted only to air quality benefits when evaluating this program. 
Transportation projects usually meet multiple objectives, and this is 
true of CMAQ projects as well. In addition to air quality benefits, 
these projects have served to help provide congestion relief, 
environmental mitigation, economic development, and have assisted in 
meeting other environmental goals and objectives.
    Some project-level information is available on the congestion 
relief benefits of CMAQ funded projects, for example:
  --Region wide signal-timing in Denver, CO reduced 34,000 hours of 
        delay and 13,500 gallons of fuel;
  --Vanpooling in San Diego eliminated 1,000 vehicles per day from the 
        road network;
  --Parking management in Glendale, CA eliminated 140,000 car trips 
        annually;
  --Freeway Service Patrol in San Francisco, CA reduced delays by 
        90,000 hours Region wide; and
  --NYC/NJ Barge removed 54,000 truck trips annually.
                   intelligent transportation systems
    Up through fiscal year 1997, we have provided almost $1.3 billion 
in funding to explore and apply new Intelligent Transportation System 
(ITS) technologies. These technologies are expected to improve the 
performance of roads and transit systems and increase capacity and 
safety.
    Question. Based on your recent evaluations of this program, what 
concrete benefits has the nation and the taxpayers received from this 
investment?
    Answer. Several DOT reports have shown how ITS technologies can 
favorably impact transportation efficiency, productivity, safety, user 
satisfaction, and the environment. The following tables document the 
findings of eleven of the most recent major studies sponsored or 
performed by DOT. Research on the public benefits of ITS establish 
compelling national interest in deploying ITS technologies and 
infrastructure. Below are highlights of ITS benefits documented by DOT:
ITS Provides Better Traffic Management
    Abilene, Texas replaced outdated signals with a computer-based 
traffic signal system and realized $8-11 in benefits from travel time 
savings, delay reduction and increases travel speed for each dollar 
invested.
    The Automated Traffic Surveillance and Control (ATSAC) program 
controls traffic flow between freeway and parallel arterial streets in 
Los Angeles, California and surrounding areas. The program has reduced 
fuel usage by 12.5 percent, hydrocarbon emissions by 10 percent, and 
carbon monoxide emissions by 10 percent.
ITS Benefits Transit Agencies
    Four hundred New Jersey Transit buses are able to alter their 
routes and stay on schedule using real-time information they receive 
about traffic conditions.
    Baltimore, Maryland and Portland, Oregon cut travel time by 10-18 
percent, using vehicle locating technology to re-route buses and 
dispatch additional vehicle buses to keep their services on schedule.
    Kansas City, Missouri was able to eliminate 7 buses from its fleet 
of 280 by implementing advanced transit fleet management systems.
ITS Reduces the Costs of Toll Collecting
    The Oklahoma Turnpike Authority saves about $160,000 annually by 
switching from a manual to electronic toll lane. The Authority incurred 
an annual cost of $176,000 to operate an attended toll lane vs. $15,800 
to operate an automated electronic toll lane.
ITS Can Improve Safety
    Just three crash avoidance systems alone could eliminate more than 
17,500 fatalities, prevent 1.2 million accidents, and save $26 billion 
each year. (By comparison, seatbelts and airbags save 10,500 lives per 
year.)
    Incident management programs could prevent 50 to 60 percent of the 
accidents precipitated by traffic delays and congestion.
ITS Increases Traveler Convenience
    As part of the Los Angeles Smart Traveler project, information 
kiosks were located in office lobbies and shopping plazas. Between 20 
and 100 users accessed these kiosks daily, with more than half 
requesting freeway maps and bus and train information.
    Given traveler information, almost 50 percent of those surveyed in 
Seattle and Boston indicated that they changed their travel route and 
time of travel. Five to 10 percent indicated that they changed travel 
mode. Even if only 30 percent of travelers change travel plans daily, 
harmful emissions of carbon monoxide, volatile organic compounds, and 
nitrogen oxides would be reduced by 33, 25, and 1.5 percent, 
respectively.
    Question. What is the ratio of cost per benefit from these systems?
    Answer. While our level of knowledge is growing rapidly as more and 
more projects are implemented, ITS has already received more cost-
benefit and cost-effectiveness analysis than almost any other public 
program. This effort is important both to provide guidance for state 
and local agencies as they implement ITS and for national policy 
regarding investment decisions. A recent comprehensive study by ITS 
America and U. S. DOT of the potential benefit cost of deploying ITS 
infrastructure in the nearly 300 metropolitan areas in the U. S. found 
an overall benefit cost ratio of 5.7:1. In the 75 largest metropolitan 
areas, the ratio was 8.8:1.
    It is particularly interesting to note the composition of the 
benefits in this study. Conventional transportation capacity 
investments, such as lane widening, result in benefits dominated by 
congestion reduction--an average of 90 percent of all investment 
benefits. ITS investments, on the other hand, yield a more balanced 
outcome by both reducing congestion and increasing safety. These 
systems do so by reducing accidents, smoothing traffic flow, and 
reducing emergency response time. Thus, beyond being more cost-
effective than traditional capital-only solutions, ITS projects 
increase safety. Some examples of benefit-cost ratios for individual 
ITS deployments which reflect the variation of local costs and local 
benefits are presented below.
Synopsis of Selected Benefit-Cost Ratios for ITS Deployments:
    The Maryland CHART program is in the process of expanding to more 
automated surveillance with lane sensors and video cameras. The 
evaluation of the initial operation of the program shows a benefit/cost 
ratio of 5.6:1, with most of the benefits resulting from a 5 percent (2 
million vehicle-hours per year) decrease in delay associated with non-
recurrent congestion.\1\
---------------------------------------------------------------------------
    \1\ COMSIS Corporation, ``CHART Incident Response Evaluation Final 
Report,'' Silver Spring, MD, May 1996.
---------------------------------------------------------------------------
    The City of Abilene, Texas, installed a closed-loop computerized 
signal system. Their report \2\ indicates an overall decrease in travel 
time of 14 percent, a decrease in delay of 37 percent, and an increase 
in travel speed of 22 percent. Phase I of a Texas state program called 
Traffic Light Synchronization (TLS) involving 44 cities, has installed 
arterial and network signal system projects affecting 2,243 of the 
approximately 13,000 traffic signals in the state. An additional 73 
systems were installed in phase II. TLS analysis shows a benefit/cost 
ratio of 62:1,\3\ with a majority of the benefits being travel time 
reduction. ITE estimates of reduction in travel time from traffic 
signal improvements range from 8 percent to 25 percent.\4\
---------------------------------------------------------------------------
    \2\ Orcutt Associates, ``Evaluation Study, Buffalo Gap Road, 
Abilene Signal System,'' prepared for the City of Abilene, Texas, 1994.
    \3\ Benefits of the Texas Traffic Light Synchronization Grant 
Program I; Volume I, TxDOT/TTI Report #0258-1, Texas Department of 
Transportation, Austin, Texas, October 1992.
    \4\ Meyer, M., ed., A Toolbox for Alleviating Traffic Congestion, 
Institute of Transportation Engineers, Washington, DC, 1989.
---------------------------------------------------------------------------
    The HELP/Crescent Project on the West Coast and Southern border 
states represented the final stage of the HELP program that evaluated 
the applicability of four technologies to services including roadside 
dimension and weight compliance screening, pre-screening of vehicles 
with proper documents, government audit of carrier records, government 
processing of commercial vehicle operator documents, government 
planning, and industry administration of vehicles and drivers. The 
technologies included automatic vehicle identification, weigh-in-
motion, automatic vehicle classification, and integrated communications 
systems and database. The benefits data are developed as a projection 
of experience from the project and from other databases rather than 
direct measurement by the project.\5\ Impact of hazardous material 
incidents could be reduced $1.7 million annually per state. Estimates 
of reductions in tax evasion range from $0.5 to $1.8 million annually 
per state. Overweight loads could be reduced by 5 percent leading to a 
savings of $5.6 million annually. Operating costs of a weigh station 
could be reduced up to $160,000, with credentials checking adding $4.3 
to $8.6 million and automated safety inspection adding $156,000 to 
$781,000 in savings due to avoided accidents annually per state. A full 
implementation of services examined in the Crescent project would yield 
a benefit/cost ratio of 4.8 for state government over a 20-year period. 
Less complete implementations range in benefit/cost ratio from 0 up to 
12:1 for the government. The COVE Study \6\ estimates a benefit/cost 
ratio to the government of 7.2 for electronic clearance, 7.9 for one-
stop/no-stop shopping, and 5.4 for automated roadside inspections. 
Another study finds that administrative compliance costs for 
Massachusetts carriers could be reduced by $2.4 million annually using 
ITS techniques.\7\
---------------------------------------------------------------------------
    \5\ The Crescent Project: An Evaluation of an Element of the HELP 
Program, The Crescent Evaluation Team, Executive Summary and Appendix 
A, February 1994.
    \6\ Study of Commercial Vehicle Operations and Institutional 
Barriers, Appendix F, Booz, Allen & Hamilton, McLean, VA, November 
1994.
    \7\ Kiley, K., Massachusetts Metro Transportation Association, 
Presentation at the ITS America Sixth Annual Meeting, April 1996.
---------------------------------------------------------------------------
    An extensive benefit/cost analysis of CVO user services effects on 
regulatory compliance cost of motor carriers predicted a range of 
benefits. The study segmented the motor carrier industry into small 
firms (1-10 power units), medium-sized firms (11-99 power units), and 
large firms (100 or more power units) and analyzed each user service 
from the perspective of each market segment. The predicted benefit cost 
ratios are generally larger for larger firms. The benefit/cost ratio 
for commercial vehicle administrative processes range from 19.8:1 to 
1.0:1. For electronic screening the benefit/cost ratio ranges from 
6.5:1 to 1.9:1. The benefit/cost ratio for automated roadside safety 
inspection ranged from 1.3:1 to 1.4:1. The benefit/cost ratio for on-
board safety monitoring ranged from 0.49:1 to 0.02:1. For hazardous 
materials incident response, the benefit/cost ratio ranged from 2.5:1 
to 0.3:1.\8\ The narrow definition of benefits examined in this study 
indicate that these benefit estimates are conservative.
---------------------------------------------------------------------------
    \8\ ``Assessment of Intelligent Transportation Systems/Commercial 
Vehicle Operations Users Services: ITS/CVO Qualitative Benefit/Cost 
Analysis--Executive Summary,'' American Trucking Associations 
Foundation, Inc., Alexandria, VA, 1996.
---------------------------------------------------------------------------
    Electronic Information Exchange for fare payment and screening of 
commercial vehicles represent areas of high benefit potential. The 
Detroit, Michigan, to Windsor, Ontario, Canada, area experiences about 
22 million border crossings annually, with roughly 75 percent of the 
crossings being made by daily crossers.\9\ The NAFTA and development of 
local attractions such as the Windsor Casino are likely to cause 
significant increases in demand. Implementation of Automated Vehicle 
Identification (AVI) for use with Electronic Toll Collection and 
Customs and Immigration automation has the potential to benefit both 
the toll authorities and the Customs offices with payback on electronic 
equipment investment in less than five years for toll authorities and 
less than ten years for customs. If potential economic development is 
included, government payback is in one year. For auto users, delay 
costs would repay investment in about 2 years. Commercial vehicles 
would get a benefit/cost ratio of over 4:1 in a single year, again 
primarily due to delay reductions. Additional benefits would accrue in 
ability to defer infrastructure investment, with benefit/cost ratio 
estimated at between 25:1 and 34:1 depending on estimate of traffic 
growth.\10\ The Minnesota Highway Helper Program \11\ reduces the 
duration of a stall (the most frequent type of incident representing 84 
percent of service calls) by 8 minutes. Based upon representative 
numbers, annual benefits through reduced delay total $1.4 million for a 
program that costs $600,000 to operate. This represents a benefit/cost 
ratio of 2.3:1.
---------------------------------------------------------------------------
    \9\ Study of Institutional Impacts of New Technology Applications: 
St. Clair and Detroit Rivers Highway Border Crossings, Marshall Macklin 
Monaghan Limited with KPMG, JHK, & Constance Consultants, May 1994.
    \10\ Zavergiu, R., Intelligent Transportation Systems--An Approach 
to Benefit-Cost Studies, TP12695E, prepared for Transportation 
Development Centre, Transport Canada, May 1996.
    \11\ Minnesota Department of Transportation, ``Highway Helper 
Summary Report--Twin Cities Metro Area,'' Report #TMC 07450-0394, July 
1994.
---------------------------------------------------------------------------
    ITS implementation is expected to improve the safety record of 
motor carriers. Electronic screening and improved inspection procedures 
will help to eliminate major causes of accidents through better use of 
communications and information technology. Evidence of future success 
is indicated by ongoing motor carrier safety programs including the 
Motor Carrier Safety Assistance Program (MCSAP) and federal safety 
audits. The benefit/cost ratio of these programs has been estimated as 
2.5 while yielding a reduction of 2,500 3,500 accidents annually.\12\
---------------------------------------------------------------------------
    \12\ Moses, L. and Savage, I., ``A Cost-Benefit Analysis of the 
Federal Motor Carrier Safety Programs, 3rd Version,'' Department of 
Economics and the Transportation Center, Northwestern University, 
Evanston, IL, 1993.
---------------------------------------------------------------------------
    Question. What obstacles lie ahead before these ITS improvements 
can be more widely implemented? How does DOT plan to overcome these 
obstacles?
    Answer. The primary obstacles to broader ITS deployment are the 
lack of expertise among State and local officials, cost/benefit data, 
available funds, and standards. Overall, the ITS section of NEXTEA 
addresses these obstacles. In addition, we have gathered an impressive 
array of cost-benefit data, described below. Specifically:
  --Training. We have requested annual authorization of $96 million in 
        ITS Research, Training, and Technology Transfer funding. A 
        significant portion of that will go to a five year professional 
        capacity building effort aimed at our own staff, as well as our 
        state and local partners. Deployment of ITS is not unlike the 
        transition FAA went through when it went from a civil 
        engineering organization that oversaw the building of airports 
        to one that dealt with management of assets and airspace. We 
        have developed a five-year strategic plan that is now being 
        translated into a business plan and have asked for significant 
        funds--some $10 million in fiscal year 1998. Recently, we 
        launched the first of 70 overview seminars that will be given 
        to our staff and partners across the United States in the 
        coming months.
  --Standards. A significant portion of this authorization would be 
        devoted to facilitating development of industry consensus on 
        well over 100 standards. While the process will take some five 
        years, we expect draft standards critical to integration to be 
        available within the next two years. None have been completed, 
        four more draft standards will be done by the end of the year. 
        In addition, we will probably have agreement on one of the most 
        critical standards that underlies the tag and reader technology 
        in automatic toll collection before the end of the summer.
    Cost-Benefit Data. In addition, we have provided to Congress and 
the nation at large an impressive quantity of cost benefit data:
  --Savings of 35 percent nationally in the cost of providing future 
        capacity to our nation's surface system.
  --Potential savings of 17 percent in accidents from intelligent 
        vehicles.
  --A study by the FTA suggests that ITS can save transit authorities 
        between $4 billion and $7 billion over the next decade.
  --Savings in government costs related to toll collection, truck 
        regulation, and transit operations.
    The benefits are there. What is not available to local officials 
are the analytic tools necessary to demonstrate those benefits, because 
to date all of our analytic tools have focused on capital decisions 
with long range horizons. We are in the process of developing those 
tools now for use by States and metropolitan areas across the country.
    Finally, our proposal to provide an incentive to those metropolitan 
areas and states willing to deploy integrated ITS infrastructure, takes 
a scalpel approach to the funding issues, in this era of constrained 
resources. For this six year period of time only, we would offer a 
small incentive to states and metropolitan areas to go the extra mile 
to integrate ITS components, consistent with the National Architecture 
and national standards. By the end of that period we will have the 
standards program complete and will mainstream the ITS infrastructure 
program into existing funding categories, linking the use of federal 
funds to adopted standards. We have also made ITS infrastructure an 
eligible element in virtually every category of Federal-aid funding.
              elimination of transit operating assistance
    Question. New Jersey relies heavily on mass transit to provide 
essential transportation service to a great number of our citizens. 
Under transit formula grants, your NEXTEA proposal calls for Transit 
Operating Assistance to be virtually eliminated while funding for 
capital assistance would increase. Your proposal also calls for the 
permissible uses of transit capital assistance to be expanded to 
include regular maintenance activities.
    Since your budget calls for transit formula assistance to be 
essentially frozen, what is the rationale for eliminating operating 
assistance and expanding the purposes of capital assistance?
    Answer. We seek to replace the concept of operating assistance with 
a redefinition of capital which would include preventive maintenance as 
an eligible expense. Operating expenses would no longer be eligible for 
Federal reimbursement for areas over 200,000 in population.
    The changes in the reauthorization proposal provide flexibility and 
consistency that will benefit the transit industry. This change would 
bring consistency between the Federal highways and transit definitions 
of capital. That is, both capital definitions would now include 
preventive maintenance. At present, painting a bus is considered 
operating assistance under the transit program, but painting a bridge 
is considered capital under the highway program.
    The NEXTEA approach increases flexibility of grantees and 
simplifies the management of their programs. Operating assistance will 
no longer have to be tracked separately on grant applications and 
reports and more expenses can be considered within the one category of 
capital.
    Further, much debate takes place each appropriations and 
authorization cycle on the Federal role in funding operating 
assistance. The NEXTEA proposal will help us focus on capital needs and 
the funds necessary to protect those assets.
    Question. Two years ago, you requested a sizable cut in transit 
operating assistance and you asked us to expand the uses of capital 
assistance to include certain bus maintenance activities. At the time, 
you testified that the change in uses of capital assistance would 
eliminate the impacts of your proposed cut in operating assistance. 
Almost no one in the transit industry agreed with you, however. Can you 
assure me that this new proposed change in the use of transit capital 
assistance will completely mitigate the elimination of operating 
assistance?
    Answer. FTA analysis indicates that virtually all areas over 
200,000 in population will benefit from the proposed changes. These 
areas are currently reporting a level of maintenance expenses that, 
when reimbursed at the 80 percent capital rate, will exceed their 
current operating assistance caps. Likewise, areas under 200,000 in 
population will also benefit. These smaller operators will have total 
discretion in using their Federal assistance for capital, planning, and 
operating assistance, without having to manage within a specific cap on 
operating expenses.
               highway safety and drunk driving measures
    Question. In 1984, President Reagan signed into law my bill 
establishing a national 21 minimum drinking age, which imposed 
sanctions on states that did not adopt the law. In 1995, President 
Clinton signed into law the NHS bill which contained Senator Byrd's 
provision imposing sanctions on states that did not adopt ``zero-
tolerance'' legislation for underage drinking and driving. Do you 
believe that these sanctions have been effective in changing state 
policies for the better?
    Answer. State laws setting age 21 as the minimum drinking age and 
establishing ``zero tolerance'' for underage drinking and driving 
clearly are effective, life-saving policies. Minimum drinking age laws 
have reduced alcohol-related traffic fatalities among teenagers by 13 
percent. NHTSA estimates that minimum drinking age laws saved 15,667 
from 1975-1995. A NHTSA evaluation of Maryland's ``zero tolerance'' 
(.02) law showed an 11 percent decrease in the number of drivers under 
age 21 involved in crashes who police reported as ``had been 
drinking.'' A recent study of 12 states that enacted ``zero tolerance'' 
laws found a 16 percent reduction in single vehicle nighttime fatal 
crashes that involved young drivers, compared to a 1 percent increase 
in 12 comparison states.
    As a result of the National Minimum Drinking Age Law enacted in 
1984, all states and the District of Columbia now have laws 
establishing 21 years old as the minimum drinking age. When the NHS 
bill was enacted in November 1995, imposing sanctions on states that 
did not adopt ``zero-tolerance'' legislation for underage drinking and 
driving, 27 states and the District of Columbia had ``zero tolerance'' 
laws; since then, 12 states have enacted such laws. The remaining 
states are working to have .02 laws before the sanction provisions take 
effect at the beginning of fiscal year 1999 (October 1, 1998).
    Question. The NHS bill repealed the federal sanctions requiring 
states to adopt laws requiring motorcycle helmets. Since that time, 
several states have moved to repeal existing helmet laws because the 
sanction has been lifted. Dr. Martinez, why does your NEXTEA proposal 
only use financial incentives to strengthen state drunk driving laws 
rather than the imposition of sanctions?
    Answer. NHTSA's alcohol incentive grant program builds upon the 
successes gained from the Section 410 program. In addition, the States 
and safety interest groups support incentive grant programs as 
evidenced at the Department of Transportation reauthorization hearings. 
Given the present rate of progress of states enacting .08 BAC laws, the 
Department did not see it necessary at this time to adopt measures 
other the incentive program that we have proposed Incentive programs 
provide States with the utmost flexibility. States have the option to 
apply for these grants or not. If a State chooses to pursue a grant, 
the State may choose which legal and program criteria to implement. The 
alcohol incentive grant program proposed in NEXTEA is modeled on 
current and past successful incentive grant programs--most notably the 
Section 410 alcohol incentive grant program. The Department has learned 
that incentive grants are effective in encouraging states to pass 
critical laws to reduce drunk driving. Administrative license 
revocation (ALR), .08 BAC, and .02 BAC laws are criteria for Section 
410 basic grants. Since the passage of the amended Section 410 program 
in ISTEA in December 1991:
  --9 states have enacted .08 BAC laws. [A total of 14 states have .08 
        laws.]
  --36 states plus DC have enacted .02 BAC laws for drivers under age 
        21. [A total of 39 states and DC have .02 laws for drivers 
        under 21.]
  --10 states have enacted ALR laws. [A total of 39 states and DC have 
        adopted some form of ALR.]
    Question. As you know, I have introduced legislation that would 
establish a national drunk driving limit of .08 Blood Alcohol 
Concentration--BAC. Both laboratory and real world testing have proven 
that the vast majority of drivers, even experienced drivers, are 
significantly impaired at .08 with regard to the critical factors in 
vehicle control-braking, steering, turning and overall judgment. Thus 
far, only thirteen states have adopted the .08 BAC as law. But these 
states have experienced a significant reduction in alcohol related 
fatalities. Given that NHTSA, the insurance industry, highway safety 
advocates and highway safety users support lowering the limit to 0.08, 
why are so many states dragging their feet in enacting 0.08 BAC as law?
    Answer. There have been active efforts to pass 0.08 laws in several 
states this year, and Idaho has already enacted its 0.08 law. Opponents 
of 0.08 laws say that these new laws divert attention from the ``real'' 
drunk drivers at 0.15 and above, while attempting to penalize social 
drinkers who are not impaired. However, states that have passed 0.08 
laws have seen reductions in alcohol-related fatalities at all BAC 
levels. In addition, performance on driving-related tasks decreases 
substantially at 0.08, and crash-risk increases substantially at 0.08. 
Also, there is organized opposition to passage of these laws from some 
members of the alcohol and hospitality industries.
    Question. Given the states' slow pace in adopting .08, why do you 
think that financial incentives will be more effective than sanctions 
in getting the states to move?
    Answer. Given the present rate of progress of states enacting .08 
BAC laws, the Department did not see it necessary at this time to adopt 
measures other the incentive program that we have proposed. Through the 
Section 410 alcohol incentive grant program, the Department has learned 
that incentive grants are effective in encouraging states to pass 
critical laws to reduce drunk driving. Since the passage of the amended 
Section 410 program in ISTEA in December 1991:
  --9 states have enacted .08 BAC laws. [A total of 14 states have .08 
        laws.]
  --36 states plus DC have enacted .02 BAC laws for drivers under age 
        21. [A total of 39 states and DC have .02 laws for drivers 
        under 21.]
  --10 states have enacted administrative license revocation (ALR) 
        laws. [A total of 39 states and DC have adopted some form of 
        ALR.]
    The new alcohol incentive grant proposal contained in NEXTEA places 
more emphasis than the current Section 410 program on adoption of 0.08 
BAC laws as a means to receive funds. Under the current program, States 
can qualify for grant funds by implementing 5 out of 7 laws or programs 
designed to reduce drunk driving. One of the 7 requirements calls for a 
0.10 per se law, and only after 3 years of grants, is a 0.08 per se law 
required; therefore, states had many other options and several years of 
funding before considering passage of 0.08 laws as a route to receive 
incentive funds. Under the new proposal, there are three options for a 
state to qualify for funding--one option is by implementing 4 out of 5 
specified laws and programs, the second is demonstrating specific 
performance, and the third is by enacting only two key laws (1) 
administrative license revocation and (2) 0.08 BAC. States can qualify 
for funding under one, two, or all three options. However, this third 
option more clearly focuses state attention on 0.08 BAC laws as a means 
to qualify than the old Section 410 approach.
    Question. I understand the Administration will soon send up a 
separate safety title as part of your NEXTEA proposal. When will that 
come up?
    Answer. The Secretary submitted the Administration's ``Surface 
Transportation Safety Act of 1997'' on April 17, 1997.
    Question. I understand the Administration will soon send up a 
separate safety title as part of your NEXTEA proposal. Will it include 
any sanction programs, perhaps for seatbelts, or will it only provide 
more incentive programs?
    Answer. The Administration's ``Surface Transportation Safety Act of 
1997'' would establish a date certain by which all States would be 
required either to have enacted a primary safety belt use law or to 
have achieved a statewide seat belt use rate of 85 percent or higher. 
In fiscal year 2003, a State that had failed to enact such a law or to 
achieve such a seat belt use rate would have 1.5 percent of its highway 
construction funds transferred to its section 402 occupant protection 
program. The amount transferred would increase to 3 percent for later 
years.
                     new welfare to work incentive
    Question. Given the millions of welfare recipients across our 
nation that we are trying to move into paying jobs, how will this $100 
million initiative be targeted to assist those individuals that are 
most in need?
    Answer. We recognize that this $600 million initiative, which makes 
available to states and localities $100 million annually, cannot fill 
all the transportation gaps that exist in meeting the transportation 
needs of those who will be transitioning from welfare to work. This 
number is estimated at 2 million persons over the next five years. 
However, the criteria for selection spell out several indicators that 
will help us address the most severe transportation needs. The project 
selection criteria include: (1) the severity of the welfare 
transportation problem, (2) the need for additional services to 
transport economically disadvantaged persons to specified jobs, 
training and other support services, and the extent to which proposed 
services will address these needs, and (3) the extent to which the 
applicant's program addresses a comprehensive assessment of access to 
work transportation needs.
    Question. What will be the requirements for the states to 
participate in this initiative? Will they have to match any of the 
federal funds?
    Answer. We anticipate that states will act as applicants for areas 
with populations of 200,000 or below. This is consistent with current 
procedures for other Federal transit programs. In areas above 200,000, 
the lead agency will be chosen through the metropolitan planning 
process by the stakeholders involved. Applications submitted by states 
will be subject to the same selection criteria as other applicants. 
States and other applicants must match Federal funds made available by 
the Access to Jobs program. However, Federal funds flowing to state and 
local agencies from Federal programs funded by DHHS, DOL, HUD and other 
agencies can be used as part of the local match. In fact, one criterion 
for award is the extent to which the local share demonstrates a 
financial partnership with human resource agencies. These partnerships 
are an essential element of the Access to Jobs program.
    Question. Do you expect this to be a one-time initiative, or a 
continuing part of the DOT budget for the next several years?
    Answer. The Access for Jobs & Training is proposed to be available 
at $100 million annually over the life of the reauthorization, 
anticipated to be six years.
    Question. Is this initiative going to be limited to mass transit, 
or will there be steps taken to recognize that many welfare recipients 
do not have access to adequate transit opportunities?
    Answer. The intent of this legislative proposal is to develop 
additional public transportation services to meet gaps where there is 
not adequate transit service available. Service strategies may be broad 
based, including ridesharing program, employer-provided services, human 
service transportation, private paratransit service, and community-
based transportation arrangements as well as services directly provided 
by the transit agency. Since transit agencies have the infrastructure 
and experience with the Federal Transit Administration grant programs, 
it is likely that they may serve as the lead local agencies in are as 
above 200,000.
                  insufficient funding for new starts
    Question. What should each of these transit systems conclude about 
the Federal Government's commitment to completing these major transit 
projects?
    Answer. The Federal government is committed to fully funding the 
new fixed guideway systems that are currently under, or proposed for, 
Full Funding Grant Agreements (FFGA's). FTA's budget provides $634 
million for Major Capital Investments. This amount reflects budgetary 
pressures, and while this is not the annual amount for fiscal year 1998 
in the current FFGA's signed by FTA, our proposed outyear funding is 
sufficient to cover funding requirements for these 15 projects, and our 
reauthorization proposal includes a higher level of contract authority 
that could become available dependent upon future Federal budget 
decisions.
    Question. If you could do it over again, would you have signed 
fewer full funding grant agreements?
    Answer. Given the large number of worthy projects which were 
seeking federal funds, I would, without hesitation, proceed on the same 
path that I chose over the last four years. These meritorious projects 
will result in a wide spectrum of benefits to users and non-users 
alike.
    Question. Are you sure that your cuts in this area will not result 
in construction delays, making the total cost of the project more 
expensive than it would otherwise be?
    Answer. The budget request reflects current budget pressures. 
Nevertheless, it will allow these projects to initiate and continue 
scheduled start-up and/or construction activities without incurring any 
consequential delays. Localities have a variety of mechanisms which can 
successfully address any short term funding shortfall which might 
occur. These reductions, when viewed on a project-by-project amount, on 
average, to only 1.7 percent of the total project cost.
                                 ______
                                 
                  Questions Submitted by Senator Kohl
             streamlined and strengthened planning process
    Question. In what ways does NEXTEA streamline and strengthen the 
planning process?
    Answer. ISTEA continued the basic State and local decisionmaking 
framework for transportation planning adopted in the early 1970's. 
ISTEA strengthened the transportation planning process by putting 
increased emphasis on public involvement and fiscal constraint which 
have made the decision process more open and inclusive and financially 
realistic. ISTEA also strengthened the role of State and local 
officials in the decisionmaking process. NEXTEA would continue this 
same basic framework and supports the decision making efforts of State 
and local officials in the accomplishment of challenging investment 
trade-offs.
    ISTEA called for greater involvement by more interested 
stakeholders earlier in the transportation investment decision making 
process. This earlier and more meaningful involvement in both the 
statewide and metropolitan transportation planning processes should 
ultimately pay-off in reduced time for project level implementation 
efforts where delays have often occurred. NEXTEA would continue the 
philosophy that involving folks early in a meaningful way results in 
resolving troublesome issues early thereby accelerating the overall 
time frame for successfully implementing a transportation project.
    Simplification of the planning process was behind the effort in 
NEXTEA to replace the transportation planning factors (16 metropolitan 
and 23 Statewide) in ISTEA with seven goals which states and 
metropolitan areas should consider as they develop their own goals and 
objectives around which their own transportation planning process will 
be structured. The FHWA and FTA remain committed to the continued 
identification and implementation of streamlining opportunities.
                       bridge replacement program
    NEXTEA generally maintains the Bridge Replacement Program in the 
current form. Naturally, we all agree with the wisdom and necessity of 
replacing unsafe and unstable bridges across the country. On the other 
hand, transportation officials in my State have raised concerns that 
the ISTEA bridge formula actually provided a disincentive for States to 
invest in bridge repair. They argue that we worked at cross purposes by 
distributing bridge replacement program funding based on need, but then 
allowing States to transfer those needs-based funds to other non-bridge 
uses.
    Question. Does the NEXTEA modify the Bridge program in any way to 
ensure that Bridge replacement funds are used to meet the needs for 
which they have been distributed, rather than transferred to other 
accounts?
    Answer. Yes. While the NEXTEA proposal continues the flexibility 
for the States to transfer 50 percent of the Highway Bridge Replacement 
and Rehabilitation Program funds to the NHS or STP, it would required 
that funds transferred out of the bridge program in fiscal year 1998 
through fiscal year 2002 must be restored by the State to their bridge 
apportionment by the end of fiscal year 2002. Any amounts not restored 
would be deducted from the total cost of deficient bridges for that 
State in fiscal year 2003, thus reducing that State's fiscal year 2003 
bridge apportionment.
                       NONDEPARTMENTAL WITNESSES

STATEMENT OF DARREL RENSINK, DIRECTOR, IOWA DEPARTMENT 
            OF TRANSPORTATION, PRESIDENT, AMERICAN 
            ASSOCIATION OF STATE HIGHWAY AND 
            TRANSPORTATION OFFICIALS

                       Introduction of Witnesses

    Senator Shelby. The subcommittee will come back to order.
    The second panel. We have with us the surface 
transportation user groups. Darrel Rensink. Is that correct?
    Mr. Rensink. That is correct.
    Senator Shelby. Iowa Department of Transportation, 
president, also of the American Association State Highway 
Transportation Officials; Mr. William D. Fay, president and 
CEO, American Highway Users Alliance; Mr. John Collins, senior 
vice president, government affairs, American Trucking 
Association; Mr. Frederick Gruel, president and CEO, AAA New 
Jersey Automobile Club, American Automobile Association; Mr. 
William W. Millar, president, American Public Transit 
Association; and Harry Blunt, Jr., president, Concord Trailways 
New Hampshire, vice chairman of the American Bus Association.
    Welcome, gentlemen. I know you waited a while. It was a 
longer panel than usual, a lot of interest in the first one.
    All of your written statements will be made part of the 
record in their entirety, and if you will just take a few 
minutes, because there are other meetings going on, and sum up 
what you are going to tell us for the record. Then I will keep 
the record open for a lot of questions for the record that the 
staff and other members, including the chairman, will be 
wanting to ask you. We will try to expedite this as much as 
possible.
    Mr. Rensink.

                      Statement of Darrel Rensink

    Mr. Rensink. Mr. Chairman, thank you very much.
    I am Darrel Rensink, president of the American Association 
of State Highway and Transportation Officials and also director 
of the Iowa Department of Transportation.
    On behalf of AASHTO, I am pleased to accept your invitation 
to testify on issues regarding reauthorization of the Federal 
surface transportation programs.
    Mr. Chairman, the fact that you are conducting this hearing 
demonstrates that you and others on the committee are well 
aware of both the benefits from and the need for transportation 
as we head into the 21st century. The appropriations bill you 
will be considering is vitally important to the people of 
America. As members of the Appropriations Committee, you are 
faced with a difficult task of directing Federal resources 
among programs which directly affect all Americans, decisions 
which will please some and upset others.
    No other Federal investment has such far-reaching 
implications. The influence on the quality of our lives by our 
transportation systems is significant. The intermodal network 
serves all our citizens daily as they travel to their jobs, day 
care, and the market. It provides a way to move goods to 
wholesale and retail outlets. We are able to pursue recreation, 
education, and community activities.
    America's transportation network has played a major role in 
our Nation's economic success. Just as in our Nation's past, 
the future is greatly dependent on how well we support our 
transportation system. Most importantly, transportation is the 
backbone of our State, national, and international trade 
economies. Transportation is our Nation's economic engine and a 
key component to our global competitiveness. Industry, relying 
heavily nowadays on just-in-time delivery of raw materials, 
must have an effective and efficient transportation system.
    Central to the debate on reauthorization will be the level 
of funding and the funding formulas which distribute funds 
among the States. As the debate begins, we must remember that 
without modern transportation, our quality of life would 
suffer, economic development would slow, and our future would 
look rather bleak.
    I often hear that to compete in the global economy, we need 
a good transportation system, and I included that concept in my 
formal testimony submitted to your committee. However, merely 
competing in the world economy is not good enough. As in 
sports, we can compete and still lose. We cannot afford to lose 
when it comes to our transportation systems. This Nation must 
be the leader and to lead we must have a transportation system 
that is the very best. To be in the forefront, we must invest 
in our transportation systems.
    Mr. Chairman, the need for investments to adequately 
support the Nation's surface transportation system is well 
documented and far exceeds the current investment level. AASHTO 
analyzed the investment requirements of our transportation 
systems based on the information received from the U.S. DOT. 
This analysis is detailed in our report, ``The Bottom Line: 
Transportation Investment Needs 1998-2002.'' Copies have been 
provided to the committee.
    To briefly summarize the report, total highway investment 
over the next 5 years to maintain current conditions and 
performance capabilities is $264 billion. An additional 
investment of $94 billion is needed to improve the condition 
and performance of this essential system, for a total 
investment of $358 billion; transit needs identified as $39 
billion to maintain and $33 billion to improve service, for a 
total of $72 billion over 5 years.
    While the estimated amounts to improve and maintain our 
highway and transit system are daunting, significantly more 
funding is being collected from highway users that is not 
available for transportation. If we could use all the funds 
flowing into the highway trust fund and the 4.3 cents per 
gallon now supporting general fund programs, we could at least 
maintain the current conditions of our surface transportation 
system. AASHTO and the National Governors Association share 
this recommendation to fully place highway user fees on 
transportation purposes.
    Mr. Chairman, we know the budget resolution will impact the 
amount of transportation appropriations you can approve. We 
hope the budget level will reach levels I have discussed. 
Beyond that, we encourage this subcommittee to recommend that 
all funding is released without obligation ceilings to help 
meet our transportation needs.
    With regards to the administration's transportation 
reauthorization proposal, an AASHTO task force is currently 
analyzing the bill and comparing it to AASHTO's adopted 
policies.
    Our major issue of concern to AASHTO is the inadequate 
level of funding. The proposal has been described as providing 
$175 billion for surface transportation, an increase over 
ISTEA, but when the differences between the proposed 
authorization and proposed spending levels are analyzed, actual 
investment would be substantially less than the $175 billion. 
On the positive side, many ISTEA provisions which improved our 
ability to provide better transportation are continued in the 
administration's transportation reauthorization proposal.
    Mr. Chairman, I see my time is about up, so in conclusion 
as president of AASHTO, I am eager for Americans to see 
transportation's potential to make a positive impact over the 
next 5 years. I have initiated discussions between AASHTO and 
the National Governors Association to convene a national 
transportation summit this spring or summer. Our goal is clear: 
to bring together State, Federal, and local officials, along 
with the users of transportation to highlight transportation in 
the future and the future of this Nation.

                           Prepared Statement

    Mr. Chairman, that concludes my remarks, and we thank you 
very much for the invitation to present our views. I would be 
pleased to answer any questions or respond in writing. Thank 
you.
    Senator Shelby. Thank you.
    [The statement follows:]
                  Prepared Statement of Darrel Rensink
    Mr. Chairman, my name is Darrel Rensink. I am President of the 
American Association of State Highway and Transportation Officials, and 
Director of the Iowa Department of Transportation. On behalf of AASHTO, 
I am pleased to accept your invitation to testify concerning 
reauthorization of the Intermodal Surface Transportation Efficiency Act 
(ISTEA), and the Administration's proposal, which is titled the 
National Economic Crossroads Transportation Efficiency Act of 1997 
(NEXTEA).
    Mr. Chairman, we commend you and the Subcommittee for looking at 
the appropriations needed for our surface transportation program. We 
have provided to the Subcommittee copies of the documents that AASHTO 
has prepared outlining our policy on many of the issues that we will be 
addressing. In my comments today I will summarize the Association's 
views and respond to any questions that you may have.
                aashto's reauthorization recommendations
    AASHTO has been working on ISTEA reauthorization issues since 1994 
through its Reauthorization Steering Committee, on which all states as 
well as the District of Columbia and Puerto Rico are represented. With 
respect to our recommendations for reauthorization, I want to refer you 
to our Transportation for a Competitive America report, copies of which 
have been provided to the Subcommittee. This report details our 
recommendations, which are summarized in four key recommendations:
  --The maintenance needs of the nations's highways and transit systems 
        outstrip the funds currently available. The 4.3 cents per 
        gallon in user taxes collected from motorists should be 
        deposited in the Highway Trust Fund and be spent on system 
        maintenance, rather than diverted to the General Fund.
  --State and local governments should be given more flexibility in 
        determining how, when, and where transportation resources are 
        spent, to maximize the benefit to mobility, safety, and the 
        environment.
  --Many of the key concepts of ISTEA, such as State and local 
        cooperation, intermodal planning, and public participation, 
        should be retained.
  --Burdensome and unnecessary provisions imposed by ISTEA and earlier 
        laws should be eliminated or reduced. The National Highway 
        System Designation Act was a first, and major, step in this 
        direction.
    To further explain AASHTO's position on issues in reauthorization 
of the Federal highway and transit programs, we refer you to the 
attached one-page document ``Summary of AASHTO Recommendations on the 
Reauthorization of the Federal-aid Highway and Transit Programs,'' 
which was included in a brochure we recently sent to all members of the 
Congress.
    Mr. Chairman, for the record I want to state that AASHTO is making 
no recommendations as to funding formulas, leaving this to the 
Congress.
    Turning to our recommendations, the first of the four overall 
recommendations just cited is perhaps the most important, since it 
addresses the funding levels needed to adequately support our nations's 
surface transportation program.
                      highway and transit funding
    AASHTO has comprehensively analyzed the investment requirements of 
our transportation systems, based on information received from the U.S. 
Department of Transportation, including its 1995 report titled ``The 
Status of the Nation's Surface Transportation System: Condition and 
Performance''. This analysis is detailed in the AASHTO report titled 
The Bottom Line: Transportation Investment Needs 1998-2002, copies of 
which have also been provided to the Subcommittee.
    To summarize the AASHTO report, over the next five years, total 
highway investment requirements just to maintain the current condition 
and performance of the system are $264 billion. An additional 
investment of $94 billion is required to improve the condition and 
performance of this essential system, for a total investment 
requirement of $358 billion over five years. Transit investment 
requirements to maintain and improve are identified as $39 billion and 
$33 billion, respectively, for a total of $72 billion over five years.
    Simply stated, our need for investments to adequately support the 
nation's surface transportation system far exceeds current investment 
levels.
    Attached are three pages from the folder AASHTO recently sent to 
members of Congress, titled ``Our Transportation Needs.'' They provide 
more details on our findings, with the third page displaying the 
summary information in graphic form.
    While the estimated amounts to maintain and improve our highway and 
transit systems are daunting, the situation is made troublesome because 
significantly more funding is being collected by the Federal government 
from highway users than is being made available for transportation. If 
we could fully utilize the funds already going to the Highway Trust 
Fund, it would improve the situation. If we could also add to this the 
4.3 cents per gallon now used to support general fund programs, as 
shown on the attached bar graph we would then just have enough funding 
to maintain current highway and transit conditions.
    Highway users who are paying fuel and other taxes into the Highway 
Trust Fund ask, why we do not have access to all the funding that is 
being collected, when our transportation investment needs far exceed 
current funding levels? If we could simply have access to all the 
funding flowing into the Highway Trust Fund and the revenue from the 
4.3 cent tax, we could at least maintain current conditions.
    AASHTO commends Senators John Warner and Max Baucus and the many 
Senators, some of whom are on this Subcommittee, who joined them in 
writing to Senator Pete Domenici, Chairman of the Senate Budget 
Committee, seeking a highway program level of $26 billion, which has 
been demonstrated to be sustainable by the Highway Trust Fund. We also 
commend Senators Alfonse D'Amato and Daniel Patrick Moynihan for their 
similar letter, which also urges a transit program of $5 billion.
    AASHTO hopes that these funding levels will be approved, and that 
the revenue from the 4.3 cent fuel tax will be placed in the Highway 
Trust Fund and utilized to meet our highway and transit investment 
requirements.
    Mr. Chairman, we know that the budget resolution will impact on the 
amount of transportation appropriations you can approve, and we hope 
that the budget level will reach or at least approach the levels I have 
discussed. Beyond that, we hope that this Subcommittee will recommend 
that all of that funding, whatever the amount, is released without 
obligation ceilings, to help meet our transportation needs.
                     aashto and the governors agree
    AASHTO's member departments are not alone in making this plea from 
the States. The nation's Governors have also spoken out about the need 
to increase funding for surface transportation, and to fully utilize 
all available funding.
    When the nation's Governor's met in Washington in February, they 
addressed the transportation funding situation and adopted resolution 
EDC-21, ``Surface Transportation Financing.'' It included the following 
paragraphs, and a full copy of EDC-21 is attached:

          ``Growing Highway Trust Fund revenues will permit 
        significantly higher federal spending for transportation 
        programs over the next five years. A much greater share of 
        Highway Trust Fund revenues can and should be spent for 
        transportation investments than is implied in recent 
        Congressional and Administration budget proposals. Governors 
        are aware of and support the movement in Congress for increased 
        transportation spending.''
          ``Governors are aware that Federal fiscal circumstances 
        require prudence in setting spending priorities and continue to 
        support efforts to balance the budget. However, reducing 
        federal transportation investment and allowing our nation's 
        transportation infrastructure to fall further into disrepair 
        will result in lost profits, jobs, and productivity, and 
        ultimately lower tax revenues to the federal government.''

    The NGA resolution then goes on to urge that the Federal 
government:

          ``Reinstate the nation's long-standing policy of dedicating 
        federal transportation-related motor fuel taxes and excise 
        taxes exclusively for transportation purposes. If the 4.3 cents 
        per gallon of fuel tax that is currently being used for General 
        Fund purposes continues to be assessed, it should be deposited 
        in the Highway Trust Fund and used for transportation purposes.
          ``Restore the integrity of the dedicated trust fund. All 
        dedicated user fees and the interest accrued on trust fund 
        balances should be promptly distributed for their intended 
        purposes.''

    Testimony by representatives of the National Governors' Association 
(NGA) to a joint House and Senate Budget Hearing on March 12, 1997 
indicates that ``steadily growing user-tax revenues can support 
significant and much-needed increases in federal transportation 
investment. In highways alone, the annual dedicated revenues could 
support a funding level of $26 billion per year through the year 2002; 
and an additional $5 billion for mass transit programs could be 
supported by these growing revenues.'' AASHTO joins the nation's 
governors in their call for setting annual highway and transit funding 
and spending levels as high as possible.
               the benefits of transportation investments
    As members of the Transportation Appropriation Subcommittee, you 
are well aware of both the benefits and needs of transportation funding 
into the 21st century, so what I am about to say will come as no 
surprise. However, the importance of transportation for a competitive 
America and for the nation's future requires that we continue to focus 
our attention on transportation funding.
    America's transportation network has played a major role in our 
nation's economic success. Just as in the past, the future of America 
will depend to a great extent on how we support our transportation 
system. The appropriations bill you will be considering is therefore of 
great importance to the people of America as we approach the 21st 
century.
    Perhaps no other federal investment has such far-reaching 
implications on every aspect of our quality of life. Transportation 
serves all of our citizens daily in traveling to their jobs, day care 
centers and markets; in providing goods to wholesale and retail 
outlets; in traveling to recreational activities; and in a variety of 
other activities in which we all participate. Welfare reform will only 
succeed when wage-earners have access to places of employment. Quality 
health care depends upon the ability of the patient and the care-giver 
to come together.
    Most important, transportation is the backbone for our State, 
national and international economies. Transportation is our nation's 
economic engine which is built on an efficient transportation system, a 
key component to our global competitiveness. Industry, much of which 
now relies on ``just in time'' delivery of raw materials, must have an 
effective and efficient transportation system. Such a system requires 
funding to the levels I have discussed.
      the administration's transportation reauthorization proposal
    With regard to the Administration's transportation reauthorization 
proposal, Mr. Chairman, one major issue that concerns AASHTO is its 
inadequate level of funding. The proposal has been described as 
providing $175 billion for surface transportation. But if the 
differences between proposed authorization and their proposed spending 
levels is analyzed, actual funding under would be substantially less 
than $175 billion. In addition, some of the $175 billion would be spent 
on programs that are not now funded out of the Highway Trust Fund, such 
as the Appalachian Highway Program and Amtrak, and for programs not 
directly related to meeting our transportation needs.
    Even if a full $175 billion were to be provided in the legislation 
and expended on our identified highway and transit requirements, it 
would fall far short of the funding levels recommended in U.S. DOT's 
own investment requirement findings, its 1995 report titled ``The 
Status of the Nation's Surface Transportation System: Condition and 
Performance''.
    Again, Mr. Chairman, AASHTO supports efforts to get annual 
transportation funding as high as possible. The Administration's 
transportation reauthorization proposal does not do this.
    Spending down the balances in the Highway Trust Fund would permit 
an additional $4 billion annually in highway funding levels. Including 
the 4.3 cent per gallon tax in the Highway Trust Fund rather than using 
it for general fund purposes would add another $7 billion. AASHTO 
supports spending the Highway Trust Fund balances and efforts to 
deposit the 4.3 cent per gallon to Highway Trust Fund purposes.
    With regard to other components of the Administration's 
transportation reauthorization proposal, a task force of the AASHTO 
Reauthorization Steering Committee is currently analyzing the 
Administration's bill and comparing it to AASHTO's adopted policies. 
This analysis will be provided to the Subcommittee in the near future. 
For now, let me address a few program areas of concern to AASHTO.
  --AASHTO supports continued funding in the ISTEA reauthorization for 
        safety, Intelligent Transportation Systems (ITS) and research, 
        and we are pleased to see these programs contained in the 
        Administration's proposal. Safety issues are of paramount 
        importance to state transportation departments and should 
        continue to be funded. Regarding ITS, AASHTO has joined with 
        ITS America and the U.S. Department of Transportation and other 
        public and private organizations in endorsing the ``National 
        Goal for Intelligent Transportation Systems,'' to complete 
        deployment of basic ITS service for passenger and freight 
        transportation across the nation by 2001 (PR-1-96).
  --With regard to research, AASHTO continues to support the highway 
        and transit research programs that are funded in ISTEA. Also, 
        AASHTO supports federal funding for transportation data 
        services, and therefore supports continued funding for the 
        Bureau of Transportation Statistics in the ISTEA 
        reauthorization (PR-12-96). These are also included in the 
        Administration's transportation reauthorization proposal.
  --With regard to the revenue side of transportation funding, AASHTO 
        recognizes the success of the federal countermeasures to the 
        theft of motor fuel excise taxes, and urges that FHWA's Joint 
        Federal/State Motor Fuel Tax Compliance Project be reauthorized 
        at least at its current funding level. Further, AASHTO urges 
        that legislation be enacted that would allow a state 
        transportation agency, at its option, to expend up to one-
        fourth of one percent of its federal-aid highway apportionments 
        on motor fuel tax theft countermeasures.
  --In addition, AASHTO supports legislation directing the Federal 
        Highway Administration to expend no more that $15 million for 
        the development of a computerized system to account for the 
        import and refinery production of motor fuels to their 
        deliveries in accordance with the needs of the Internal Revenue 
        Service (PR-19-95).
    The Administration's transportation reauthorization proposal 
recognizes the need for these programs.
    Where I have referred to AASHTO resolutions, they are identified in 
parentheses, and copies of them are attached.
    The enacted Intermodal Surface Transportation Efficiency Act of 
1991 (ISTEA) was important legislation, and it improved our ability to 
provide better transportation in many ways. The planning and decision-
making processes for surface transportation were changed by the ISTEA, 
to move more decision making to States and localities and to encourage 
looking intermodally at the whole system. Greater flexibility in 
utilizing Federal funding was provided under the ISTEA, allowing States 
and localities to better target transportation facilities they and 
their citizens determine are priorities. And very importantly, the 
National Highway System sought by AASHTO's member departments was 
authorized in the ISTEA, and has been established by Congress with the 
enactment of the National Highway System Designation Act of 1995.
    These concepts and features have increased our ability to address 
the nation's transportation needs, and AASHTO believes that the 
reauthorization legislation should continue to support them. At the 
same time, AASHTO believes there are a number of areas that can be 
improved as the Congress considers the reauthorization of ISTEA. These 
areas are described in the policy documents we have provided to the 
Subcommittee.
                   transportation trends for america
    Mr. Chairman, we believe strongly that the next reauthorization 
bill and the funding it provides must recognize and help meet the 
transportation trends we see, looking ahead into the start of the next 
century.
    The most important of those transportation trends is that 
transportation will continue to play a major role in the well-being of 
this nation. This role is demonstrated by the growth we have seen in 
the number of drivers, vehicles and passengers on our highway and 
transit systems and the reliance of industry and economic development 
on the availability of efficient transportation.
    Vehicle miles of travel on our highways increased 40 percent in the 
1980's. If the 1990 to 1994 trend continues, total miles traveled may 
increase by more than 20 percent in the 1990's. At the present time 
over 6 billion miles of vehicle travel are logged on the nation's 
highways every day. The number of passengers utilizing transit services 
has also increased with over 6.8 million Americans using mass transit 
each day, with over 30 million people depending on it.
    Just-in-time production is one of the most significant trends in 
U.S. manufacturing in recent years. This trend has allowed many 
businesses to sharply reduce or eliminate inventories. In 1990 just-in-
time manufacturing accounted for 18 percent of U.S. production; by 1995 
this percentage had increased to 28 percent. Just-in-time production 
and reduced inventories require dependable and efficient transportation 
facilities, and are major sources of increased productivity in our 
economy.
    These trends are expected to continue, placing an ever increasing 
demand on our transportation systems.
    Our highway system is suffering from increased congestion in many 
areas of the nation. The urbanization of America is creating new 
challenges for urban areas while at the same time rural transportation 
needs are continuing to increase. New demands are being placed upon the 
highway system by shifts in both the volume and direction of world 
trade. For example, the focus of our major highways are essentially 
east-west, in keeping with the movement of goods between the east and 
west coasts. However, the North American Free Trade Agreement (NAFTA) 
has required us to evaluate and improve our systems to accommodate an 
increasing number of north-south transportation patterns.
    Our nation's transit systems remain vital in most areas of the 
nation. Today, a variety of passenger mobility needs, and efforts to 
solve our air quality problems across America, require transit to do 
even more.
    In short, Mr. Chairman, while our nation still has the best 
transportation system in the world, current trends demonstrate that it 
is aging and is not keeping up with the mobility needs of our citizens, 
our commerce, our industries and our economy.
    Throughout the history of our nation, transportation has been a key 
driving force in building and maintaining our economy. In recent years 
some have requested documentation of this statement, and in particular 
have asked whether or not our nation is receiving a fair return on its 
investment in our highway system. In response, AASHTO, through our 
National Cooperative Highway Research Program (NCHRP), the Federal 
Highway Administration, and other transportation agencies have 
sponsored many efforts to determine the economic value of 
transportation, and investments in our highway system.
    A copy of Chapters I and II of a report prepared under AASHTO's 
sponsorship by the NCHRP entitled The Economic Importance of 
Transportation: Talking Points and References is attached, without the 
voluminous materials of Chapters III and IV. The following are a few of 
the significant findings in this report, all of which demonstrate the 
benefits of transportation to our economy:
  --Reliable transportation is essential for America's businesses to 
        achieve their objectives of reduced inventories and improved 
        distribution systems. It is estimated that logistics and 
        transportation account for 20 to 25 percent of the value of a 
        product on the shelf.
  --Wal-Mart has become the largest retailer in the U.S. by demanding 
        that manufactures deliver products reliably and ready for the 
        selling floor. Wal-Mart has only about 10 percent of their 
        square footage devoted to inventory compared to 25 percent for 
        the average retailer.
  --To remain competitive, American companies and businesses demand 
        quick turnaround and are reducing the time it takes for 
        products to reach their markets.
    The NCHRP report refers to recent studies of the economic effects 
of highway investment conducted by Professor Ishaq Nadiri of New York 
University. Professor Nadiri's work indicates that investments in 
highways have a strong effect on productivity. He found that 
transportation improvements lower distribution costs, allow the 
shrinking of inventory that saves money, improves firms' access to 
labor, and lowers production costs. Overall, Professor Nadiri's studies 
show a 28 percent return per year between 1950-1989 for total highway 
capital.
    In addition to the efficiency and production benefits for the 
manufacturing sector, investments in transportation are important for 
job creation. The Federal Highway Administration's most recent report 
on job generation for highway investment finds that every $1 billion of 
investment in the Federal highway program supports more than 42,000 
full-time jobs.
    Also, according to the U.S. Department of Transportation, every 
dollar invested in the highway system will return more than $2.60 in 
benefits to the economy.
    As indicated in the few examples shown above, investing in the 
nation's transportation facilities is important to ensuring long-term 
economic growth. Americans have long believed this, and we are now 
finding through research work by several economists and other experts 
that what we intuitively believe is in fact true.
                      other transportation issues
    Mr. Chairman, I would like to identify a few additional 
transportation funding issues of concern to AASHTO. These are beyond 
the ISTEA reauthorization legislation, but are important to our members 
and fall within the responsibilities of your Subcommittee.
    AASHTO supports a multi-year reauthorization of the Airport 
Improvement Program (AIP) at a minimum of $2 billion (PR-2-96). 
However, AASHTO opposes the use of AIP funds to pay for airport 
security measures identified by the Gore Commission on Airport Security 
(PR-13-96).
    AASHTO also supports continuation of the Essential Air Service 
Program (A-7), with reasonable subsidy limits and other appropriate 
criteria geared toward a more efficient and productive expenditure of 
federal funds.
    AASHTO urges the Congress to permanently reauthorize and provide 
for an annual appropriation of funds to the Local Rail Freight 
Assistance program (PR-14-95).
    The respective AASHTO resolutions are again shown in parentheses 
above, and copies of these resolutions are attached.
                                summary
    In summary, AASHTO believes that there will be no more important 
legislation before this Congress for the future of America than the 
reauthorization and adequate funding of our surface transportation 
program.
    We must either meet our investment needs, or face a decline in 
American mobility as we enter the 21st century.
    We have provided you with AASHTO's recommendations for 
reauthorization and stand ready to provide any further information 
which would be of assistance as you move forward in the legislative 
process.
    Mr. Chairman, this concludes my remarks. Again, thank you for the 
invitation to present our views and we will be pleased to respond to 
questions now or in writing.

    [Clerk's note.--Due their length, the attachments referred 
to in Mr. Rensink's statement do not appear in the hearing 
record but are available for review in the subcommittee's 
files.]
STATEMENT OF WILLIAM D. FAY, PRESIDENT AND CEO, 
            AMERICAN HIGHWAY USERS ALLIANCE
    Senator Shelby. Mr. Fay.
    Mr. Fay. Mr. Chairman, thank you for inviting me to testify 
here today. My remarks will focus first on key issues and then 
on the administration's NEXTEA proposal.
    The Highway Users is like a consumers group. Our members 
are motorists and truckers who, as you know, are driving now 
more than ever. Our members willingly pay taxes in proportion 
to their driving, but they expect that those taxes will be 
reinvested in safe and efficient roads and bridges.
    If FHWA's needs report is correct--and that report found 
that 28 percent of our Nation's roads are in poor to mediocre 
condition, and 32 percent of our bridges are deficient--then 
these highway consumers are being ripped off.
    You know, Senator Faircloth mentioned that the Interstate 
Highway System is complete. That may be so but let us not 
forget that the Interstate System was designed in the 1950's to 
meet the needs of a 1950's economy. Nonetheless, that Federal 
creation constitutes our Nation's safest and best roads.
    The NHS, which was overwhelmingly enacted in 1995, is the 
Interstate Highway System of the 21st century. It bespeaks 
nationalism. Four percent of all roads bearing 40 percent of 
all traffic, 75 percent of commercial truck traffic, and 80 
percent of tourist traffic. These are our most vital roads and 
they draw our Nation together, boost economic productivity and 
competitiveness, create jobs, and enhance our quality of life. 
Through the NHS, the Nation can meet the exploding economic and 
interstate commerce needs of the 21st century.
    We strongly disagree with those who say that the Federal 
role should be ended and that we should go back to before 1956 
when vision did not extend beyond a State's boundaries. But 
that said, we also believe that the Federal program must 
readdress itself to defining and then adequately funding 
national priorities.
    America's highways are in the midst of a funding and safety 
crisis. The needs report that Mr. Rensink referred to 
documented roads and bridges crumbling from underinvestment. 
Forty percent of the NHS roads are still two lanes. They are 
bearing interstate traffic loads without the benefit of 
interstate safety design.
    And our highway death toll has been on the rise since ISTEA 
took effect in 1992. Last year nearly 42,000 Americans lost 
their lives on our roads. The FHWA also reported that road 
design and conditions contributed to 30 percent of these fatal 
crashes.
    So, our Government is saying, No. 1, our roads are bad, and 
No. 2, bad roads kill. Now, you would think that with those two 
studies alone, we would embark on an urgent improvements 
program, one that at least maintains the current conditions, 
but in spite of those very powerful reports, the 
administration's budget actually cuts highway investments.
    These funding and safety problems are not the result of 
insufficient revenues. Only 58 cents of every dollar of highway 
taxes is actually returned to the States for roads and bridges. 
Our problems are the result of insufficient dedication and 
conviction.
    Increased funding then has to be our top priority. 
Referring to the President's inadequate highway funding level, 
Senator Bob Graham of Florida recently said that ``starvation 
brings out the worst in all of us.'' The formula debate will 
only be salved if we first return a larger share of the money 
that each State's motorists pay in highway taxes.
    Without additional funding, our Nation simply cannot meet 
our road and bridge needs. The needs report says that we have 
to invest $20 billion more each year just to maintain the 
current conditions of our roads and $40 billion more to improve 
them. If you bridge that gap in this committee by making the 
needed capital investments for our roads and bridges, the 
dividends will be evident from a stronger economy, more jobs, 
productivity gains, fewer fatalities, and a greater overall 
quality of life.
    That is why we applaud the 59 Senators, including 8 members 
of this subcommittee, who asked the Budget Committee for a $6 
billion increase in highway funding, bringing it to $26 billion 
which is the level the CBO says we can sustain with no 
additional tax revenues.
    Next Monday Governors, labor, and industry will convene on 
Capitol Hill to hold a press conference urging you to maximize 
transportation funding.
    In a nutshell, the Highway Users proposal will do basically 
four things.
    The first is to deposit the 4.3 cents into the highway 
trust fund.
    Second, we would fund the highway program at the maximum 
level the trust fund can support. Including the 4.3 cents, that 
could be as high as $34 billion a year.
    Third, we would target 85 percent of the highway funds 
toward the NHS, bridges, safety, research and development, and 
roads on Federal lands, five programs that we think are truly 
national in scope.
    And last, we would give State officials maximum flexibility 
by eliminating most Federal mandates and set-asides and 
distributing the remaining 15 percent of highway funds to the 
States under a streamlined STP account.
    If you are looking for a plan that is the opposite of the 
proposal you just heard, you have NEXTEA. NEXTEA provides too 
little funding for too many Federal programs with too many 
strings attached. It is the opposite of a program that is 
focused on a few clear national priorities and on a commitment 
to invest in them. NEXTEA offers something for everyone with 
too little for anyone.
    For example, the President authorizes only $22 billion a 
year, but he makes several new programs eligible for this 
money. But as you know, authorizations are like monopoly money. 
The President's budget actually cuts highway funding by one-
half of a billion dollars, and under his plan the surplus in 
the trust fund will grow to a $48 billion level by 2002. In 
other words, motorists will continue to be taxed to support 
road and bridge repairs, but a substantial portion of their 
taxes will either sit in the trust fund or be diverted to pay 
for other Federal programs.
    And the President would finance Amtrak out of the highway 
account. He would expand the list of eligible projects that 
highway funds could be used for. He would continue the Federal 
funding set-asides that limit flexibility. He would allow tolls 
on the interstates and he would make truckers and bus operators 
subsidize their competitors: freight, rail, and Amtrak.

                           Prepared Statement

    Again, Mr. Chairman, I appreciate the opportunity to 
present the Highway Users views on NEXTEA and the 
reauthorization of the Federal program. We do need more money. 
As Mr. Rensink, we stand ready to assist you in any way that we 
can over the next little while.
    Senator Shelby. I agree with you we need more money and we 
are going to try to get it.
    [The statement follows:]
                  Prepared Statement of William D. Fay
    Mr. Chairman and members of the subcommittee, thank you for the 
invitation to appear before you today and the opportunity to present 
our views on S. 468, the Administration's proposed ``National Economic 
Crossroads Transportation Efficiency Act'' (NEXTEA), recently 
introduced by Senators Chafee and Moynihan.
    I am Bill Fay, President and CEO of the American Highway Users 
Alliance. The Highway Users represents a broad cross-section of 
businesses and individuals who depend on safe and efficient highways to 
transport their families, customers, employees, and products. We 
support a strong federal role in transportation policy and the prudent 
investment of scarce highway use taxes in those programs that enhance 
our economic productivity, improve roadway safety, and contribute to 
the enviable quality of life Americans enjoy.
    Our view of NEXTEA and the other major reauthorization proposals is 
based on an understanding of the appropriate federal role in 
transportation and what that role means with respect to highway funding 
and eligible uses of Highway Trust Fund dollars. I will begin today by 
outlining The Highway Users' perspective on these ``big picture'' 
issues and finish with our specific comments on NEXTEA.
            federal transportation policy at the crossroads
                              federal role
    Since 1956, the federal highway program has been largely focused on 
constructing the Dwight D. Eisenhower National System of Interstate and 
Defense Highways. Now that the Interstate System is virtually 
completed, some have questioned whether the federal government should 
continue to play a significant role in highway transportation policy. 
These same objections were raised two years ago by opponents of the 
National Highway System (NHS) legislation, and Congress answered them 
decisively with its overwhelming vote for final passage of the National 
Highway System Designation Act. With NHS designation, Congress 
recognized the federal government's continuing responsibility to foster 
interstate commerce and economic growth by ensuring that our most basic 
transportation infrastructure is maintained and improved.
    Without the NHS, many U.S. businesses could not compete in national 
and international marketplaces, military readiness would be put at 
grave risk because of the inability to mobilize quickly, and the 
ability of individual Americans to travel where they want, when they 
want would be severely hampered. To put it another way, a strong 
federal role in the development and maintenance of highways and bridges 
is essential to support economic growth, to enhance individual freedom, 
and to sustain our quality of life. Few other federal programs can 
claim such a sweeping national impact.
    But there is a lot of work ahead to make the promise of the NHS a 
reality. The nation will not only have to invest substantial financial 
resources, but invest them wisely, in order to ensure that this small 
but important network of highways becomes the engine for economic 
growth, greater personal freedom, and safer travel that we all hope it 
will be.
                                funding
    Funding, then, has to be the top priority issue. Members of this 
subcommittee understand the critical importance of increasing our 
nationwide investment in highways. As Congress works to reauthorize the 
federal highway program this year, the issue takes on even greater 
significance. First, returning to the states more of the money 
motorists pay in highway taxes will certainly help resolve many of the 
difficult issues involved in the formula debate. Second, and of equal 
importance, without additional funding our nation cannot meet its 
documented need for increased road and bridge investments.
    According to the U.S. Department of Transportation, 253,629 miles 
of Interstate and non-Interstate roads (29 percent of total pavement 
miles eligible for federal funds) are in poor to mediocre condition, 
and 186,559 bridges (32 percent of bridges over 20 feet) are deficient 
and in need of repair or replacement. We are presently investing $20 
billion per year less than is needed just to maintain current 
conditions, and a staggering $40 billion per year less than is needed 
to leave a better network of highways for the next generation.
    This startling gap between actual highway investments and the 
amount we should be spending has enormous implications for our economy, 
our travel safety, and our overall quality of life:
  --Economy--A recent study commissioned by the Federal Highway 
        Administration (FHWA) indicates that between 1950 and 1989, 
        investments in non-local roads yielded production cost savings 
        of 24 cents for each dollar spent. Amazingly, those road 
        investments paid for themselves in just over four years because 
        of the economic gains they made possible. If we fail to 
        maintain those roads, however, the gains realized could soon 
        disappear.
  --Safety--Highway fatalities have been on the rise over the past four 
        years, reversing the steady improvements of the prior four 
        years. When ISTEA took effect in 1992, 39,250 Americans died on 
        our highways. Since then, fatalities have climbed to 40,150 in 
        1993, 40,676 in 1994, and 41,798 in 1995. 1996 fatalities are 
        projected to be about the same as 1995. Substandard road 
        designs and poor road conditions are a factor in nearly 30 
        percent of fatal crashes, according to FHWA. Our failure to 
        invest in better highways will only make travel more dangerous 
        in coming years.
  --Quality of Life--Underinvesting in highways will make it more 
        difficult for working parents to get from the job site, to the 
        day care, to the grocery store, to home; will make vacations 
        more time consuming and expensive; and will make medical care 
        less accessible for many rural Americans.
    For the sake of our continued economic growth, the driving public's 
safety, and maintaining our standard of living, Congress must increase 
overall highway funding this year. That's why we applaud the 59 
senators, including eight members of this subcommittee, who signed a 
letter to the Budget Committee requesting that the highway program be 
funded at $26 billion in fiscal year 1998, a $6 billion increase over 
this year's spending level. As the letter indicates, the highway 
account of the Highway Trust Fund could sustain a program funded at $26 
billion through at least fiscal year 2002 with no additional taxes.
    The nation's governors have amplified the call for increased 
federal investment in transportation. Testifying on behalf of the 
entire National Governors' Association at a recent joint meeting of the 
House and Senate Budget Committees, Governors Paul Patton of Kentucky 
and Ed Schafer of North Dakota expressed their strong support for the 
highway funding increase requested by a clear majority of the U.S. 
Senate. Next Monday, those two governors will be back on Capitol Hill, 
joined at a press conference by industry and labor representatives, to 
reiterate the consensus among state and local governments and the 
private sector that transportation funding must be a top priority in 
the federal budget.
    America's motorists should be able to count on their highway taxes 
being used for road improvements. Highway users today are paying 
substantially more in taxes than the federal government is spending on 
highway and bridge investments. In 1996, motorists paid $31.5 billion 
in federal highway use excise taxes. Yet, highway funding for this year 
is set at just over $20 billion.
    Of course, the major reason for this disparity between what highway 
users pay and what they receive from the federal government is that not 
all of the taxes collected from highway users are deposited in the 
Highway Trust Fund, much less in the highway account of the trust fund. 
Taking the 4.3 cents per gallon tax that currently goes to ``deficit 
reduction''--which simply means the use of a regressive excise tax to 
fund general government programs--and depositing it in the Highway 
Trust Fund would go a long way towards keeping faith with the American 
driving public.
                       focus the federal program
    Just as we should increase overall highway funding this year, we 
must ensure that those limited resources are wisely invested in 
programs of vital national interest. Guided by two overriding national 
goals--improved interstate mobility and safer travel--The Highway Users 
recommends a simplified highway program that targets federal funds 
towards five program accounts. They are:
  --The National Highway System--While the NHS constitutes only 4 
        percent of the nation's road mileage, it carries over 40 
        percent of all highway travel, 75 percent of commercial truck 
        travel, and 80 percent of tourist travel. The NHS is the 215' 
        Century successor to the Interstate System and has the 
        potential to build dramatically on the national contributions 
        made by the Interstates over the past 40 years. To maintain 
        these vital interstate connectors, the FHWA estimates we should 
        be investing $18 billion annually and $24 billion annually if 
        we want to improve their condition. Yet the current federal 
        highway program provides only $6.5 billion per year for NHS 
        improvements.
  --Bridges--Both on and off the NHS, bridges are high-cost, crucial 
        links in our nationwide highway network. The FHWA reports the 
        country would need to spend $5.1 billion annually to maintain 
        current bridge conditions and $8.9 billion to improve them. The 
        current federal highway program budgets only $2.8 billion per 
        year for bridge work. If the Administration and Congress 
        seriously wish to build a bridge to the 21st Century, they will 
        have to provide more adequate funding.
  --Safety--For reasons I have already discussed, we must make a 
        renewed commitment to safety if we hope to curb the tide of 
        rising highway deaths. The federal government currently invests 
        $700 million annually in highway safety programs. As Americans 
        continue to travel more miles than ever by highway, we must 
        focus more attention and resources on safety improvements. It's 
        a nationwide challenge requiring a greater financial commitment 
        from the federal government.
  --Research and Development (R&D)--The federal government currently 
        invests approximately $400 million annually in R&D activities 
        to develop new technologies, construction materials, and 
        construction techniques that will ease congestion, make travel 
        safer, and prolong the usable life of roads and bridges. By 
        providing up-front financing, coordinating research activities 
        at sites around the country, and transferring information and 
        technologies among interested parties in the public and private 
        sectors, FHWA programs reduce the cost and enhance the benefits 
        of the nation's highway-related R&D activities.
  --Roads on Federal Lands--The federal highway program provides 
        approximately $500 million per year to improve roads on federal 
        lands, such as national parks. This program is essential to 
        provide public access to these areas and should be retained.
    By targeting at least 85 percent of federal highway funds to the 
above five program accounts, The Highway Users believes the federal 
government would significantly improve both safety and interstate 
mobility. Such a federal highway program would ensure we make 
investments in projects of truly national significance.
                            streamlined stp
    While The Highway Users seeks to target federal highway funds on 
programs of national interest, we also advocate giving state and local 
officials the latitude to plan for their regional transportation needs 
and the flexibility to direct federal highway dollars towards the 
programs they identify as priorities. The Surface Transportation 
Program (STP) was established in ISTEA to provide state and local 
governments that flexibility. While ISTEA is more flexible in terms of 
expanding the opportunities to use federal highway funds on non-highway 
projects, two of the new funding accounts established in ISTEA--
transportation enhancements and the Congestion Mitigation & Air Quality 
improvement program (CMAQ)--are quite inflexible in terms of the 
discretion granted to state and local officials to set their own 
transportation priorities.
    Specifically, 10 percent of STP funds must be set-aside and used 
only for transportation enhancement activities, such as pedestrian or 
bicycle facilities, landscaping and beautification, rehabilitation and 
operation of historic buildings, or other non-highway projects. The 
CMAQ program directs highway money, $6 billion over six years, towards 
urban areas that do not meet Clean Air Act requirements. These funds 
generally cannot be used for highway construction and maintenance, 
except High-Occupancy Vehicle (HOV) lanes.
    The Highway Users recommends that Congress continue the eligibility 
of CMAQ and transportation enhancement projects under a streamlined 
Surface Transportation Program account. The streamlined STP would allow 
state and local officials to weigh all transportation needs--air 
quality, highway capacity, historic preservation, mass transit capital, 
safety, etc.--and establish priorities without the current funding 
constraints of ISTEA. By continuing the eligibility of CMAQ and 
transportation enhancement projects but eliminating the specific 
funding categories, Congress would allow those local projects to be 
funded in areas where they are truly a priority.
                     highway users program summary
    Our proposal for the reauthorized federal highway program can be 
summarized as follows:
  --Fund the highway program at the maximum level the Highway Trust 
        Fund will support.
  --Deposit the 4.3 cents per gallon federal fuel tax in the Highway 
        Trust Fund.
  --Target the bulk of federal highway funds toward the NHS, bridges, 
        safety, R&D, and roads on federal lands.
  --Distribute the remaining federal highway funds to the states under 
        a streamlined STP account in which state and local officials 
        would be allowed to establish their own local transportation 
        priorities without the constraints of ISTEA's multiple funding 
        categories.
                                 nextea
    How does the Administration's proposal rate when measured against 
our reauthorization priorities? In a word: poorly. NEXTEA provides too 
little funding for too many federal programs with too many strings 
attached. Where we were hoping for a program focused on a few, clear 
national priorities and a commitment to invest in them, NEXTEA offers 
something for everyone with money enough for no one.
                            nextea: funding
    ``Show me the money.'' That line from a popular movie might also be 
the headline for a review of NEXTEA. Despite the fact that many in 
Congress and all of the nation's governors are calling for a $26 
billion per year highway program, NEXTEA authorizes only $22.7 billion, 
on average, including funding for several new programs not previously 
financed out of the Highway Trust Fund.
    And as members of this subcommittee certainly know, authorizations 
are akin to ``Monopoly'' money. You can't spend an authorization. The 
real money for NEXTEA is in the President's budget, which was 
transmitted to Congress in February.
    The President's budget actually cuts highway spending (i.e., 
obligation authority) by $500 million from this year's $20.3 billion 
level. While annual tax deposits (not including interest) to the 
highway account are roughly $22 billion and growing, the Administration 
proposes to hold highway funding well below that level. And of course, 
Administration officials have publicly stated the President's 
opposition to depositing revenues from the 4.3 cents per gallon motor 
fuel tax into the Highway Trust Fund.
    If highway funding is limited to the level recommended in the 
President's budget, the cash balance in the highway account of the 
Highway Trust Fund would rise from the current $13 billion to more than 
$35 billion in five years. Motorists would continue to be taxed to 
support road and bridge repairs, but a substantial portion of their 
taxes would actually be diverted to pay for other federal programs.
    As outrageous an abuse of the taxpayers' trust as that is, the cash 
balance sitting in the highway account five years from now would be 
even larger if the President were not also proposing to finance Amtrak 
entirely out of the highway account. The unprecedented proposal to pay 
the full $4.8 billion, six-year subsidy to Amtrak out of the Highway 
Trust Fund helps the Administration keep the trust fund's total 
projected cash balance below the $50 billion mark at the end of 2002. 
The Highway Users strongly opposes subsidizing Amtrak with highway 
taxes that are desperately needed to improve roads and bridges.
                   nextea: focus the federal program
    What does NEXTEA do to focus the federal highway program on clear 
national priorities? The legislation would continue funding for the 
NHS, bridges, safety, research and development, and roads on federal 
lands. Less than 60 percent of the highway funds authorized in NEXTEA, 
however, are dedicated to these top priority programs.
    In addition to targeting too small a portion of highway funds 
toward these five important program areas, the Administration also 
proposes to greatly expand the list of eligible projects for which 
these limited highway funds can be used. Both Amtrak and certain 
freight rail facilities would become eligible for funds that should be 
reserved for badly needed road safety, maintenance, and capacity 
projects, particularly on NHS routes.
                        nextea: streamlined stp
    With respect to our third priority--a streamlined Surface 
Transportation Program--the Administration simply does not propose to 
give state and local officials greater authority to establish their own 
transportation priorities. Instead, NEXTEA would continue the funding 
set-asides for CMAQ and transportation enhancement activities which, in 
both cases, limit the potential use of these funds primarily to non-
highway projects. Again, we recommend instead that Congress continue 
the eligibility of CMAQ and transportation enhancement projects under a 
streamlined STP account, thus allowing state and local officials to 
weigh all their transportation needs when making funding decisions.
    In addition, we have two specific recommendations about CMAQ and 
transportation enhancement eligibility requirements. First, the CMAQ 
program to date is focused almost exclusively on air quality projects 
with very little emphasis laid on congestion mitigation. Federal 
highway funds certainly ought to be available to improve freeway 
interchanges and other traffic bottlenecks and for simple projects such 
as lane widening or shoulder improvements that can substantially 
improve traffic flow and reduce congestion. We urge Congress to allow 
the states to more fully utilize their federal highway funds for 
congestion mitigation projects.
    Second, the transportation enhancement eligibility requirements 
have been written and interpreted so broadly that many projects funded 
to date have no transportation elements or connection. We think these 
eligibility standards should be tightened considerably. We hope to have 
completed a report in April that will highlight the extent to which 
transportation enhancement funds have been spent on non-transportation 
projects. We will deliver the report to members of this subcommittee as 
soon as it is available.
                     nextea: other specific issues
    I can summarize our comments and concerns with other specific 
elements of NEXTEA, as follows:
  --Safety--As I indicated previously, highway fatalities have 
        increased in recent years, and highway accidents result in 
        millions of injuries annually. Those traffic crashes also drain 
        over $150 billion per year from our economy, primarily by 
        increasing medical costs and lowering productivity.
      The Roadway Safety Foundation (RSF), chartered by the American 
        Highway Users Alliance to reduce the frequency and severity of 
        crashes by improving the safety of roadways, recently released 
        a report on roadway safety problems and potential solutions. 
        The report cites four major roadway safety problems, including 
        run-off-the-road crashes made more severe by roadside hazards, 
        poor quality pavements, narrow lanes and shoulders, and narrow 
        bridges.
      Those problems can be mitigated in a variety of ways--widening 
        lanes and adding or widening shoulders; ensuring that bridge 
        widths are commensurate with the width of approach lanes; 
        better pavement marking, traffic signs, and reflective devices; 
        creating open space adjacent to the roadway (clear zones) that 
        will allow motorists to regain control of their vehicles. Some 
        of these safety improvements are relatively simple; others are 
        more complex. All of them require a commitment of financial and 
        human resources.
      Unfortunately, the Administration's proposal would allow states 
        to shift up to 100 percent of their Hazard Elimination funds 
        away from these life-saving roadway improvements into Section 
        402 public education and information safety programs instead. 
        (The Administration does not propose allowing states to shift 
        funds for the ``soft safety'' education programs into the 
        ``hard safety'' hazard elimination projects.)
      All safety programs are important, and The Highway Users supports 
        a substantial increase in overall funding for highway safety. 
        The Administration's proposal, however, would take money away 
        from projects for correcting road hazards that today contribute 
        to more than 12,000 highway fatalities per year. We believe 
        that is bad public policy, and we urge Congress to retain 
        existing programs to fund both rail/highway grade crossing 
        improvements and hazard elimination projects.
      We are pleased that the Administration proposes funding for data 
        collection in Section 402(n), State Highway Safety Data 
        Improvements. Currently, law enforcement officers at the scene 
        of a crash are sometimes unable to identify the precise 
        location or the presence of roadside obstacles or other roadway 
        dangers such as sharp curves. This makes it difficult for 
        states and localities to identify roadway dangers and eliminate 
        them.
      The $12 million authorized for data collection in NEXTEA, 
        however, is simply not enough to do the job. In addition to 
        higher funding, this section should include language 
        specifically identifying roadway-related data as a priority for 
        collection. The data should include a precise description of 
        the crash location, the type of crash--rollover or collision 
        with roadside obstacles--and the presence of other roadway 
        hazards such as sharp curves.
  --Tolls--NEXTEA would eliminate the long-standing prohibition against 
        tolls on existing toll-free Interstate highways. We strongly 
        oppose this provision of NEXTEA. Taxes paid by motorists built 
        the Interstates and continue to fund improvements to Interstate 
        routes. The Administration's proposal is akin to asking a 
        person to pay rent on a home she already owns. Administration 
        officials say this is just one more tool to help states raise 
        funds for road improvements. We think the federal government 
        should fully utilize the taxes already being collected from 
        motorists before anyone starts talking seriously about 
        additional tax raising schemes.
  --Amtrak and Freight Rail Subsidies--I've already indicated our 
        opposition to the Administration's proposed direct subsidies to 
        Amtrak out of the Highway Trust Fund. We also strongly oppose 
        making Amtrak and freight rail facilities eligible for NHS or 
        other highway funds. Bus operators and truckers should not be 
        required to subsidize their competitors.
                               conclusion
    Again Mr. Chairman, I appreciate this opportunity to present The 
Highway Users' views on NEXTEA and reauthorization of the federal 
highway program. Obviously, we think the Administration's proposal 
falls short of the mark in several key areas. Whatever one's point of 
view may be with respect to the policy issues I have addressed, it is 
clear that this subcommittee can do a lot to help smooth the 
reauthorization process by providing an adequate amount of funding for 
the highway program. We look forward to working with you and members of 
the full committee toward that important end.

    [Clerk's note.--The Final Report--Improving Roadway Safety: 
Current Issues will not appear in the hearing record, but is 
available for review in the subcommittee's files.]
STATEMENT OF JOHN J. COLLINS, SENIOR VICE PRESIDENT, 
            GOVERNMENT AFFAIRS, AMERICAN TRUCKING 
            ASSOCIATIONS, INC.
    Senator Shelby. Mr. Collins.
    Mr. Collins. Mr. Chairman, thanks very much for the 
opportunity to be here. My name is John Collins. I am senior 
vice president for government affairs of the American Trucking 
Associations.
    ATA represents the Nation's trucking industries. We employ 
about 9 million people. We pay about 43 percent of the total 
amount of money that goes into the Federal highway trust fund. 
We have only about 10 percent of the vehicles. So, we are big 
payers in. We are not the largest users of the system out 
there. Those are really the auto users.
    Mr. Chairman, the American Trucking Associations and our 
industry believe that the current level of funding for roads, 
bridges, and highways is inadequate and that the 
administration's NEXTEA proposal is really a next toll 
proposal. It asks for more money in the way of tolls, while not 
really spending the amount of money we are already putting into 
the system.
    I would like to thank the members of the subcommittee who 
have joined in calling for a $26 billion per year program. 
Senator Bond is leading a separate effort to increase available 
funds for highways, and Senator Byrd is leading an effort to 
bring 4.3 cents back into the highway trust fund. I think those 
represent a growing consensus that there is a need for more 
money, as you just said, Mr. Chairman, to go into the highway 
program and there is also a will to get it done.
    The ATA proposal is very similar to the Highway Users 
proposal. We would go straight out for a $34 billion annual 
program which could be supported with the existing tax 
structure without any tax increases. With that program, we 
would see basically a two-part program. There would be a core 
program that would target money at those interstate facilities 
that are most important for moving people and moving freight, 
and then there would be a block grant proposal that would be 
turned back to States dollar for dollar for their other 
transportation needs. The vast majority of the funds would be 
dedicated to the core highway program.
    The trucking industry is very skeptical of the 
administration's reauthorization proposal. Their proposal and 
their fiscal year 1998 spending level would propose $11 billion 
less than the level that could be supported out of a fully 
funded highway trust fund program.
    Basically the highway program has been moving along at $20 
billion per year. They, in 1998, would propose to cut that $500 
million to $19.8 billion, but in fact the overall highway 
program that could be maintained would be about a $34 billion 
level.
    We strongly oppose--and Senator Faircloth I think said this 
very eloquently about the problems of putting tolls on the 
Interstate Highway System. To charge a toll for something we 
have already paid for is absolutely a travesty.
    I would like to talk to you about three things that concern 
us, and that is safety, jobs, and international 
competitiveness.
    Safety. Nearly 42,000 people die on the Nation's highways 
each year, and the trucking industry takes little comfort in 
the fact that in 88 percent of those, there is not a truck 
anywhere nearby. So, this is not a problem caused by the 
trucking industry, but we are concerned obviously with safety 
on the Nation's highway.
    We are spending billions of dollars to make our trucks 
safer, to make our drivers safer, and we need Congress' help to 
make the roads safer. We have all been on the highway where we 
have been driving down the road and suddenly the person in 
front of us swerves irrationally and it turns out they swerved 
to avoid a pothole. That is the kind of thing that creates 
havoc with the truckdriver who is trying to drive straight down 
the road and safely. We have got to put the money back into the 
infrastructure to take those kinds of problems away from us.
    We think about this is as a shopping list. For each $1 
billion that Congress can put into the highway system, that 
could upgrade 1,300 miles of rural roads into interstate 
quality roads, roads in Alabama where you could cut the 
fatality rate in half by making that kind of improvement.
    You could resurface interstate highways and rural roads, 
and by resurfacing them and getting rid of the potholes, you 
could reduce accidents by 20 or 25 percent.
    An important issue--and you certainly see it in Alabama--is 
the relationship of highways to jobs. You need good highways to 
get good jobs. Seventy-seven percent of the communities across 
America have their freight moved only over highways. The 
airplane does not land at the plant. The rail is an important 
asset but it does not bring the cargo directly to the person 
who needs it.
    And it is fashionable in some quarters to say that the 
Interstate System is built, we can pull back the Federal 
commitment to highways. But that is like saying our schools 
have been built and the textbooks have been bought and we do 
not need anything new.
    Every year in this country we add about 2.3 million people 
to our population, and by the year 2004, we will add 8 million 
more cars to our highways and rack up 30 percent more miles in 
demand for services from trucks. So, our surface transportation 
system needs every bit of money we can put into it for 
modernization.
    In international competitiveness, the FHWA has said that 
every $1 billion invested in the NHS, the National Highway 
System, creates a $240 million reduction in manufacturing 
production costs per year. So, there is a real payoff between 
the investment and the payoff back.

                           Prepared Statement

    It involves safety, jobs, and competitiveness, and really 
the challenge is to this Congress and to this committee through 
its appropriations efforts to make that money available. This 
Congress has a wonderful opportunity to earn a legacy as 
builders, builders of a better, safer, and more prosperous 
America, and I urge you to provide the funding to make that a 
reality.
    Thank you.
    [The statement follows:]
                 Prepared Statement of John J. Collins
                            i. introduction
ATA Represents the Trucking Industry
    The American Trucking Associations, Inc. (ATA) is the national 
trade association of the trucking industry. ATA's membership includes 
affiliated associations in every state, and 13 specialized national 
associations. ATA represents every type and class of motor carrier in 
the country. We are a federation of over 36,000 member companies and 
represent an industry that employs over nine million people, providing 
one out of every fourteen civilian jobs. We are a highly diverse 
industry, but we can all agree that a good system of roads is crucial 
both to our bottom line and to the safety of all drivers, including 
millions of truck drivers who deliver to all Americans their food, 
clothing, finished products, raw materials, and every other item 
imaginable. Actions that affect the trucking industry's ability to 
perform these services have significant consequences for Americans to 
do their job well and to enjoy a high quality of life.
Current Spending Levels Cannot Support a Safe and Efficient Highway 
        System
    The trucking industry contributes over $11 billion each year to the 
Federal Highway Trust Fund, about 43 percent of total receipts. As 
such, we expect a return on our investment. The user fees that we 
contribute to the trust fund should be invested in a manner that makes 
our highways both safer and more efficient.
    Investing all revenues collected is especially important given the 
tremendous pressures our highways and bridges will face in the future, 
when population and economic growth will spur tremendous increases in 
the demand for freight transportation. In 1994 the revenue generated by 
the trucking industry was $362 billion and is projected to reach $437 
billion in 2004. By this same date, the total volume of freight carried 
by trucks will reach 6.5 billion tons, 19 percent more than in 1994. 
Both the total number of miles driven and the total volume of ton-miles 
will grow 29 percent. Over the same period, more than half a million 
more trucks will be needed to meet these increased demands. This 
assumes that we will be successful in increasing intermodal business 
substantially to $12.9 billion-a 150 percent increase over today's 
levels. The safety and efficiency of the freight industry will depend 
in no small measure on the actions of this committee and the 105th 
Congress.
              ii. current funding levels are insufficient
    There are numerous Congressional initiatives underway to 
significantly increase investment in our nation's transportation 
systems. These efforts indicate both a recognition of the severe 
investment shortfall facing our transportation infrastructure and the 
emergence of broad consensus that something can and should be done to 
correct this situation. According to the Congressional Budget Office, 
spending all highway user fee revenues and drawing down the balance in 
the Highway Trust Fund, could support an annual program of $34 billion, 
without increasing taxes.
Current Spending will not Sustain Highway Infrastructure
    The trucking industry is prepared for the tremendous challenges 
posed by ever increasing demands for more efficient freight service to 
facilitate our nation's growing population and economy. However, if 
under-investment in our highways continues, it may be impossible for 
the industry to meet these challenges. The resulting productivity 
losses will take a severe human toll as stiff competition from abroad 
wipes out existing jobs and reduces the ability of our economy to 
create new jobs for an expanding population. To simply maintain 
conditions and performance on the 162,000-mile National Highway System 
(NHS), an annual Federal investment of $15.6 billion is needed. The NHS 
carries 40 percent of all traffic and 75 percent of truck traffic. Yet 
the Federal government makes just $9 billion available annually for 
funding of these most important highways. This is only 58 percent of 
the Federal investment necessary just to maintain the status quo.
    This dismal level of spending has contributed to the situation now 
faced by users of the system. The NHS has been allowed to deteriorate 
to the point where nearly half of urban Interstate miles are congested 
during peak periods. Forty percent of travel on urban NHS routes takes 
place under such congested conditions that even a minor incident can 
cause severe traffic flow disruptions and extensive queuing.\1\ 
Congestion on urban Interstates increased from about 55 percent of peak 
hour travel in 1983 to approximately 70 percent in 1989, remaining 
relatively constant since then.\2\ Travel delays in the nation's fifty 
largest urban areas as a result of increased congestion costs society 
an estimated $50 billion every year.\3\ Congestion increases the risk 
of accidents and interferes with our ability to serve our customers' 
``just-in-time'' delivery needs.
---------------------------------------------------------------------------
    \1\ FHWA 1995 Conditions and Performance Report, pp. 105-109
    \2\ Ibid, p. 110.
    \3\ Urban Roadway Congestion--1982-1993, Vol. 1: Annual Report, 
David Shrank and Timothy Lomax, Texas Transportation Institute, Texas 
A&M University, Aug. 1996, p. 62.
---------------------------------------------------------------------------
Highway Investment Saves Lives
    Adequate highway funding allows states to make roadway improvements 
that increase safety. Improved roadway characteristics such as 12-foot 
lanes and ample shoulders, gentler curves, and improved median and 
median barriers, can significantly reduce the number and severity of 
accidents.\4\ One 1995 study estimated that full funding for the NHS 
over a 10-year period would prevent 720 fatal crashes, 55,000 personal 
injury crashes, and 120,000 property damage crashes on the NHS 
alone.\5\ The report estimated average annual societal savings of $800 
million as a result of the accident prevention. Additional funding for 
other roads would increase these savings even more.
---------------------------------------------------------------------------
    \4\ McGee, H.W., W.E. Hughes, K. Daily, Effects of Highway 
Standards on Safety, Final Report to National Cooperative Research 
Program, Project 17-9, Bellomo-McGee, Inc., Dec. 1994.
    \5\ Safety Effects Resulting from Approval of the National Highway 
System. AAA Foundation for Traffic Safety. Bellomo-McGee, Inc., July 
1995.
---------------------------------------------------------------------------
    It is important to keep in mind that 43 percent of the NHS includes 
two-lane roads. These roads often have no median separation to prevent 
head-on collisions. Although lanes, shoulders and clear zones can 
provide motorists with the critical space to recover if they lose 
control of their vehicles, these features are inadequate or nonexistent 
on many NHS routes. These two-lane roads may have very tight curves 
with few warning signs and poor visibility to alert motorists before it 
is too late to adjust. FHWA crash statistics confirm the danger posed 
by the hazardous conditions on these narrow roads. While the Interstate 
System has the lowest fatality rate per 100 million vehicle miles 
traveled, NHS routes not on the Interstate have a death rate twice that 
of Interstates.\6\ Other Federal aid highways not on the NHS take an 
even higher toll.
---------------------------------------------------------------------------
    \6\ FHWA, Highway Statistics, 1994.
---------------------------------------------------------------------------
    Additional funding will allow us to make needed highway safety 
improvements. Illustratively, consider what just $1 billion dollars in 
additional highway construction investment could achieve:
  --upgrade 1,300 lane-miles of off-interstate rural principle 
        arterials to interstate standard,\7\ potentially cutting the 
        fatal accident rate on these roads in half; or
---------------------------------------------------------------------------
    \7\ FHWA, Highway Performance Monitoring System Database, 1993
---------------------------------------------------------------------------
  --add 500 new lane-miles to existing urban freeways, or 3,300 new 
        lane-miles to existing rural interstates,\8\ relieving 
        congestion and reducing accidents; or
---------------------------------------------------------------------------
    \8\ Ibid.
---------------------------------------------------------------------------
  --resurface 9,800 lane-miles of rural interstate or 5,900 lane-miles 
        of urban freeway,\9\ reducing accidents on these roads by 20 to 
        25 percent; or
---------------------------------------------------------------------------
    \9\Ibid.
---------------------------------------------------------------------------
  --build 170 new truck safety inspection stations, helping to get 
        unsafe vehicles off the highway; or
  --add 50,000 truck parking spaces at highway rest areas, allowing 
        truck drivers to pull over to a safe place when they get 
        tired.\10\
---------------------------------------------------------------------------
    \10\ ATA Foundation, Inc. No Room at the Inn, May 1996.
---------------------------------------------------------------------------
    We cannot afford to become complacent. In 1995, 41,798 people died 
on our nation's highways. The vast majority of these fatal crashes 
involved cars, motorcycles, and pickup trucks. This is equivalent to a 
Valuejet crash every single day! Safety must be given the highest 
priority, and the Federal commitment must be demonstrated through 
adequate funding and strong leadership.
Highway Investments are the Key to Economic Development and Employment 
        Growth
    According to a Federal Highway Administration (FHWA) report, 
investment in the nation's highways stimulates job growth.\11\ The 
report states that for each $1 billion in highway investment, 42,100 
full-time jobs are created and supported.
---------------------------------------------------------------------------
    \11\ Federal Highway Administration. Highway Infrastructure and Job 
Generation: A Look at the Positive Employment Impacts of Highway 
Investment, 1996.
---------------------------------------------------------------------------
    United States productivity improvements are the key to global 
competitiveness, rising standards of living, and economic growth. 
Investing in the NHS results in significant, nationwide improvements in 
productivity.\12\ In fact, every billion dollars invested in the NHS 
results in a $240 million reduction in overall production costs for 
U.S. manufacturing. These productivity improvements allow U.S. industry 
to sell more goods and services at lower prices both at home and 
abroad. More people can be employed at higher wages. Since salary 
increases are firmly tied to the increase in the amount of goods and 
services each worker produces, living standards are improved. In 
addition, these real wage increases result in elevated tax revenues.
---------------------------------------------------------------------------
    \12\ Nadiri, M. Ishad and Theofanis Mamuneous. Highway Capital and 
Productivity Growth, June 1996.
---------------------------------------------------------------------------
    Through new innovations such as just-in-time delivery, the trucking 
industry has played a vital role in improving U.S. productivity. This 
would have been difficult, if not impossible, to achieve without an 
efficient network of good roads that connects markets, centers of 
industry, and multi-modal transportation facilities. A 1994 study of 
five diverse U.S. companies demonstrates the importance of 
transportation to American businesses' daily operations.\13\ For 
instance, a reliable system of roads allows Saturn Corporation, which 
has its manufacturing and assembly plant in Spring Hill, TN, to utilize 
a just-in-time strategy. Saturn's just-in-time approach to its 
inventory control system, combined with the company's advanced 
communications system and a safe, well-functioning highway network, has 
allowed the company to reduce order cycle times and inventory costs by 
holding down in-plant inventory to an average of two days' stock.
---------------------------------------------------------------------------
    \13\ Apogee Research, Inc. The Economic Importance of the National 
Highway System, Feb. 1994.
---------------------------------------------------------------------------
A Minimum of $34 Billion Annually Can and Should be Available for 
        Investment
    Although the fees paid into the Highway Trust Fund are sufficient 
to improve conditions and performance on the National Highway System 
and related roads, not enough of the funds are being spent to even 
maintain the status quo, the status quo itself is unacceptable. If all 
funds coming into the Highway Trust Fund are spent in a timely manner, 
a $26 billion program could be sustained. A slow drawdown of the 
existing balances in the trust fund would increase revenues by 
approximately $2 billion annually, allowing a $28 billion program. 
Ensuring that all highway user fees are dedicated to transportation 
improvements, including the 4.3 cents now deposited in the General 
Fund, would make a $34 billion annual program possible. This level of 
investment would stop the deterioration of our highways and bridges, 
allowing our nation's economy to move forward, renewing our commitment 
to safer, more efficient, and less congested highways, and improving 
our quality of life. Another important benefit of a higher funding 
level is that it would diminish the contentious and divisive debate 
over funding formulas. We all support a better surface transportation 
system, and this issue is a barrier to achieving our common goals.
    Given the tremendous economic and social benefits of highway 
investment, it is illogical to fail to spend the highway user fees 
collected to correct the many deficiencies of our highways and bridges. 
By the end of the 1997 fiscal year, the unspent balances in the Highway 
Trust Fund may exceed $22 billion. Extending the Administration's 
budget proposal for fiscal year 1998, that figure could reach nearly 
$50 billion in just five more years. For many years the trucking 
industry has been a steadfast supporter of the user fee system. 
However, support for that system and the Federal program will erode if 
the balances in the Trust Fund continue to rise or if user fees are not 
invested in highways in a timely manner. We urge the committee to 
restore trust in the Highway Trust Fund by investing the maximum amount 
available with a minimum of diversions.
   iii. the administration's proposal is inadequate and unacceptable
    During recent testimony, Secretary Slater declared that ISTEA's 
successor must be judged by how it affects ``the lives of our people, 
the health of our economy, and the welfare of our Nation . . .'' I am 
sorry to say that the Administration's proposal for reauthorization, 
which is called NEXTEA, will fall far short of meeting these laudatory 
criteria.
    The Administration's fiscal year 1998 $22.8 billion budget 
authority for the Highway Account falls over $3 billion short of where 
it could be under current revenue circumstances and is $1 1 billion 
short of where it would be if the Administration made changes that 
restored the honesty and integrity of the user fee system. In addition, 
any potential for reducing highway infrastructure deterioration is 
obliterated by programmatic changes that further dilute highway 
investment. Instead of targeting limited funds where they can most 
effectively address national highway needs, NEXTEA diverts an 
additional 25 percent of user fees to programs, such as the Congestion 
Mitigation and Air Quality Program (CMAQ) and Transportation 
Enhancements Program (TEP), that will not reduce highway fatalities.
    NEXTEA also includes funding for passenger and freight rail 
facilities and operations. ATA opposes funding Amtrak operations out of 
the Highway Account because Amtrak expenditures do not measurably help 
reduce highway fatalities or reduce congestion. Moreover, Federal 
decisions to allocate funds to Amtrak create a new class of donors and 
donees--with most of the states being losers.
    Some short line railroads are proposing to fund private rail 
freight projects out of the highway account. The trucking industry has 
to pay for our vehicles, terminals and operating costs out of our 
pockets. Our competitors should not have their private costs paid out 
of the highway account. This is especially true since truckers 
typically earn two cents on the revenue dollar while some railroads 
often earn 15 cents or more. If the railroads want public funding, they 
also should pay a reasonable fuels tax and create a railroad trust fund 
account. Each one cent would raise around $30 million dollars.
    Finally, the administration has proposed turning its back on 40 
years of history by allowing tolls on the Interstate Highway System. 
Charging highway users to rent what we have already bought is a 
travesty. We are already paying more in highway taxes than we get back. 
Moreover, putting tolls on free Interstate Highways will force cars to 
slow from freeway speed, adding to safety, congestion, air pollution, 
and noise problems.
             iv. ata's proposal for highway reauthorization
    ATA's proposal is a comprehensive plan which ensures that the 
national interest in a safe and efficient system of highways is 
preserved. We propose an annual $34 billion total funding level, which 
includes $25 billion for a Core Highway Program and $9 billion for a 
highly flexible State Block Grant Program (See appendix). We propose to 
invest highway user fees in a targeted set of programs which serve 
important national needs. Our proposal creates a flexible state Block 
Grant Program and ensures that the Trust Fund balances are spent down.
    The Core Highway Program would include the NHS, a Bridge Program, a 
Federal Lands Program, a national highway safety program, and a 
Research & Technology Activity program. Investment in these areas 
ensures the preservation and improvement of a seamless national highway 
network that benefits all Americans. Funding distribution, therefore, 
would be based on national need, rather than on contributions to the 
Trust Fund.
    Concentrating funds on a Core Highway Program ensures that projects 
with national significance are given priority. The current program's 
structure fails to meet this test. For instance, the state of Alabama 
received an estimated apportionment of $270 million in fiscal year 
1996. Eighty-eight million dollars, a third of Alabama's total 
apportionment, was subject to suballocation under the Surface 
Transportation Program (STP). Of that, $11 million was suballocated to 
large urban areas. At the end of fiscal year 1996, however, $13 million 
in this category remained unobligated, a full 121. percent of the 
fiscal year 1996 funding to that category (some carries over from 
previous years). Prohibitions against apportionment transfers within 
the STP program mean that Alabama may not be able to use $13 million of 
its Federal-aid highway dollars.
    ATA's proposed Block Grant Program gives states and localities the 
flexibility to select and fund highway and transit capital projects, as 
well as congestion mitigation and air quality projects. This 
flexibility allows them to address their unique needs in a manner best 
suited to their circumstances. Funds now available for suballocation 
would continue in the same proportion. Funds in the block grant would 
be distributed to states in exactly the same proportion as the dollars 
are collected from the states, so that there would not be any donors or 
donees.
         v. other reforms will increase safety and productivity
    Several other important issues are likely to be subjects for 
discussion during reauthorization, and I will touch on them briefly.
  --The freight planning process which ISTEA set in motion needs to be 
        improved.
  --Many Metropolitan Planning Organizations have not fully addressed 
        the essential freight planning needs that are important to 
        freight mobility both in their own communities and as a link in 
        the national supply chain.
  --Current hours of service regulations, many of which have been on 
        the books since the 1930's, are too are flexible and outdated. 
        While we are not sure at this point whether a legislative or 
        regulatory approach is preferable, a new option should be 
        developed that improves highway safety, as well as industry 
        productivity and efficiency.
  --Truck drivers suffered inequitably from the cutback in the meal 
        deduction, and this should be corrected.
  --States should be given more flexibility to determine the most 
        appropriate regulations governing the size and weight of trucks 
        on highways within their jurisdiction.
    Recent research revealed a nationwide shortfall of 28,500 truck 
parking spaces in public rest areas.\14\ When truck stops are full, 
truck drivers have little choice but to either park illegally--which 
can create a severely hazardous situation--or to continue driving, 
possibly breaking hours-of-service laws or becoming so fatigued that 
they put themselves and other motorists at risk of an accident. Neither 
choice is acceptable. The total nationwide cost to develop the 
necessary parking spaces is estimated to be $489 million to $629 
million. We will request funding eligibility for rest area 
construction, expansion, improvement, and access under all major 
categories of the Federal-aid highway program.
---------------------------------------------------------------------------
    \14\ The ATA Foundation.Inc. No Room at the Inn, May 1996.
---------------------------------------------------------------------------
    ATA will also request funding eligibility under all major 
categories for state enforcement of Federal truck size and weight 
regulations at weigh stations, including construction of safety 
inspection and weight enforcement facilities. In addition, we will 
request the same eligibility for states' procurement and operation of 
portable weigh scales. These investments are essential to states' 
ability to ensure that unsafe and illegal trucks are taken off the.
    Finally, ATA plans to work with the U.S. Department of 
Transportation to develop a multi-year highway safety program designed 
to further promote the safe operation of commercial motor carriers and 
maintenance of equipment through education, research & development, and 
technology transfer activities. This program also will require Federal 
funding.
                             vi. conclusion
    A few weeks ago, Deputy Transportation Secretary Mort Downey 
testified that, given current investment levels and travel growth 
projections, 9,500 more people will die on our nation's highways in 
2005 than in 1996. In the face of such a grim statistic, the 
Administration offers a proposal that would decrease funding for 
investment in highways and increase diversion of highway user fee 
revenues to non-highway purposes, further straining the highway 
system's ability to safely transport people and goods. This, despite 
the fact that sufficient revenue is readily available. ATA's proposal 
makes targeted, nationally significant investments which would both 
improve highway safety and spur economic growth It also gives states 
and localities unprecedented resources and flexibility to address their 
unique surface transportation needs in the most creative and effective 
manner possible.
    I look forward to working with the members of this committee as you 
strive to meet the many challenges ahead. I hope ATA's proposal can 
serve as a basis for discussion during reauthorization of the highway 
program. Thank you.
[GRAPHIC] [TIFF OMITTED] T12AP10.001

STATEMENT OF FREDERICK L. GRUEL, PRESIDENT AND CEO, AAA 
            NEW JERSEY AUTOMOBILE CLUB
    Senator Shelby. Mr. Gruel.
    Mr. Gruel. Thank you, Mr. Chairman. I appreciate the 
opportunity to testify today. I am Fred Gruel, president and 
chief executive officer of the AAA New Jersey Automobile Club 
and vice chair of AAA's Public and Government Relations 
Committee. Today I bring you the views of the entire American 
Automobile Association, a federation of 99 independent clubs 
across North America with nearly 40 million members.
    I want to briefly review AAA's position on the 
reauthorization of ISTEA with a focus on the tolling provisions 
in the administration's NEXTEA proposal.
    First, AAA strongly believes funding levels for highways 
and bridges should be significantly increased.
    AAA also believes that a strong but responsible Federal 
role in transportation policy and financing should be 
maintained. The preservation of a national transportation 
system is in everyone's interest. That is why we have serious 
concerns about proposals to turn back or devolve Federal taxing 
authority to the States.
    Safety is another key component that should be improved in 
the next ISTEA. We urge you to consider an increase in overall 
safety investments.
    In addition, the majority of AAA members oppose any 
congressional change in the size and weight of trucks and 
support the continued freeze on longer combination vehicles.
    This leads me to a final issue that is of concern to AAA 
during ISTEA reauthorization and that is tolls.
    One of the most controversial provisions of NEXTEA would 
allow a State to finance the reconstruction of a previously 
free interstate highway with tolls. The interstates were built 
with highway user gas taxes. Now the administration is asking 
these users to pay again with a toll even though there is $20 
billion sitting unused in the highway trust fund.
    AAA opposes toll roads as a general principle, believing 
that to the maximum extent possible, all highway facilities 
should be toll free. This position is not a new one. In 1936, 
AAA's bill of rights for motorists referenced tolls. It said we 
must have roads suitable and adequate for the movement of 
modern motor traffic with safety. They must be free and not 
toll roads. As early as 1940, AAA policy vigorously opposed the 
levying of tolls on existing free highways.
    AAA policy remains the same today: The use of tolls results 
in the double taxation of motorists, once in the form of 
gasoline taxes and again when motorists drive on a toll road.
    For over 80 years, the underlying principle of the Federal-
State highway program has been developing and preserving this 
Nation's vast network of quality, toll-free highways. Proposals 
to toll existing Federal-aid highways, including the Interstate 
System, represent a major change in course. Instead of a pay-
as-you-go highway network based on fuel taxes already collected 
from motorists, responsibility for funding highway maintenance 
and construction would be loaded onto future trips of highway 
users--build now, pay now, and pay later.
    AAA has some specific concerns about the use of tolls and 
toll roads. I will outline them for you briefly.
    They are expensive.
    They represent a breach of trust.
    They are inefficient.
    They are inconvenient.
    They delay the movement of people and goods.
    And they offer little choice to the consumer as to 
available services.
    AAA believes that if Congress adopts the administration's 
toll proposal for interstates, it could destroy the user fee 
structure that has brought our Nation the best and safest 
highway system in the world.
    AAA believes most Americans consider their freedom of 
mobility as a constitutional right. Telling Americans that they 
have to pay tolls on interstates they have already paid for 
does not meet their idea of freedom of mobility. In fact, AAA 
surveys consistently find more than 70 percent of drivers 
oppose tolling.
    AAA would like to propose an alternative to tolls. Take the 
highway trust fund off budget and transfer the 4.3 cents per 
gallon to the highway trust fund. If these two steps were 
taken, we would not need to toll our interstates.
    A total of 59 Senators, 8 from this subcommittee, have 
signed the Warner-Baucus letter to the Budget Committee 
Chairman Domenici requesting an annual investment of $26 
billion in highways. That is the minimum required to fix our 
Nation's highways and bridges to make them safer. Taking the 
highway trust fund off budget and transferring the 4.3 cents 
per gallon gas tax to the trust fund could provide more than 
$30 billion annually.

                           Prepared Statement

    Rather than asking AAA members and all motorists for more 
money in tolls, AAA asks you to invest the money we have 
already paid on what you told it would be used for. Fix our 
highways and bridges and invest our gas taxes in safety.
    Thank you, Mr. Chairman.
    [The statement follows:]
                Prepared Statement of Frederick L. Gruel
    Mr. Chairman and members of the Committee, I am Fred Gruel, 
president and chief executive of ricer of the AAA New Jersey Automobile 
Club and Vice Chair of AAA's Public & Government Relations Committee. 
Today I bring you the views of the entire American Automobile 
Association. AAA is a federation of 99 independent clubs across North 
America with nearly 40 million members.
    I want to briefly review AAA's positions on the reauthorization of 
the Intermodal Surface Transportation Efficiency Act (ISTEA) with a 
focus on the tolling provisions in the Administration's NEXTEA 
proposal.
    First, AAA strongly believes funding levels for highways and 
bridges should be significantly increased. An increase in funding could 
be facilitated by taking the Highway Trust Fund ``off-budget,'' as 
Congressman Shuster's bill H.R. 4 would do; by investing the unspent 
balance in the Fund on transportation; and by redirecting to the 
Highway Trust Fund the 4.3 cents per gallon motor fuels tax now going 
to deficit reduction.
    AAA also believes that a strong but responsible federal role in 
transportation policy and financing should be maintained. The 
preservation of a national transportation system is in everyone's 
interest. That's why we have serious concerns about proposals to ``turn 
back'' or ``devolve'' federal taxing authority to the states.
    Safety is another key component that should be improved in the next 
ISTEA. We urge you to consider an increase in overall safety 
investments.
    In addition, the majority of AAA members oppose any Congressional 
change in the size and weight of trucks and support the continued 
freeze on longer combination vehicles (LCV's).
    This leads me to a final issue that is of concern to AAA during 
ISTEA reauthorization--and that is tolls.
    One of the most controversial provisions of NEXTEA would allow a 
state to finance the reconstruction of a previously free Interstate 
highway with tolls. The Interstates were built with highway user gas 
taxes. Now, the Administration is asking these users to pay again with 
a toll. Even though there is $20 billion sitting unused in the Highway 
Trust Fund.
    AAA opposes toll roads as a general principle, believing that to 
the maximum extent possible, all highway facilities should be toll-
free. This position is not a new one. In 1936 AAA developed a ``Bill of 
Rights'' for motorists that included a reference to tolls. It said, 
``We must have roads suitable and adequate for the movement of modern 
motor traffic with safety. There must be multiple-lane highways with 
opposing traffic streams divided. They must be free and not toll roads. 
. . .'' As early as 1940, AAA policy . . . ``vigorously oppose(d) the 
levying of tolls on existing free highways . . . privately-owned toll 
roads, and transcontinental toll superhighways. . . .'' AAA policy 
remains the same today: The use of tolls results in the double taxation 
of motorists, once in the form of gasoline taxes, and again when 
motorists drive on a toll road.
    For over 80 years, the underlying principle of the federal-state 
highway program has been developing and preserving this nation's vast 
network of quality, toll-free highways. Proposals to toll existing 
federal-aid highways--including the Interstate System--represent a 
major change in course. Instead of a pay-as-you-go highway network 
based on fuel taxes already collected from motorists, responsibility 
for funding highway maintenance and construction would be loaded onto 
future trips of highway users--``build now, pay now, and pay later!''
    AAA has some specific concerns about the use of tolls and toll 
roads. I will outline them for you briefly:
  --They are expensive: Toll road construction will probably cost as 
        much as three to four times as much as free roads because of 
        bond interest charges and toll collection costs.
  --They represent a breach of trust: Highway users have already paid 
        hundreds of billions of dollars to construct one of the world's 
        finest highway networks. Why should they, and their children, 
        now be charged to use it?
  --They are inefficient: About fifteen percent of toll revenues are 
        needed for the collection process while only about one percent 
        of motor fuel taxes are devoted to that purpose.
  --They are inconvenient: Toll roads often provide few entrances and 
        exits in order to minimize the number and thereby the costs of 
        toll personnel. Users are limited to those on or off ramps 
        which may not be near where they want to go.
  --They delay the movement of people and goods in two ways: First, by 
        slowing the flow of traffic, leading to aggravation and 
        possible safety hazards, and second, by causing congestion at 
        toll plazas.
  --They offer little choice to the consumer: Toll roads are often 
        locked into higher-priced service stations, food establishments 
        and other services. The highway user has little choice among 
        concessionaires and prices.
  --They can be self-perpetuating: It's rare that tolls are ended after 
        the debt service is retired.
    AAA believes that if Congress adopts the Administration's toll 
proposal for Interstates, it could destroy the user fee structure that 
has brought our nation the best and safest highway system in the world.
    AAA believes most Americans consider their freedom of mobility as a 
``constitutional right.'' Telling Americans that they have to pay tolls 
on Interstates they have already paid for doesn't meet their idea of 
freedom of mobility. You may be interested to know that AAA surveys 
consistently find more than 70 percent of drivers oppose tolling.
    AAA would like to propose an alternative to tolls: Take the Highway 
Trust Fund off-budget and transfer the 4.3 cents per gallon to the 
Highway Trust Fund. If these two steps were taken, we wouldn't need to 
toll our Interstates.
    Fifty-seven Senators--eight from this subcommittee--have signed the 
Warner/Baucus letter to Budget Committee Chairman Domenici requesting 
an annual investment of $26 billion in highways. That is the minimum 
required to fix our nation's highways and bridges to make them safer. 
Taking the Highway Trust Fund off-budget, and transferring the 4.3 cent 
per gallon gas tax to the trust fund, could provide more than $30 
billion annually.
    Rather than asking AAA members and all motorists for more money--in 
tolls--AAA asks you to invest the money we have already paid what you 
told us it would be used for. Fix our highways and bridges and invest 
our gas taxes in safety.
    Thank you Mr. Chairman.
STATEMENT OF WILLIAM W. MILLAR, PRESIDENT, AMERICAN 
            PUBLIC TRANSIT ASSOCIATION
    Senator Shelby. Mr. Millar.
    Mr. Millar. Thank you, Mr. Chairman and I am very pleased 
to be with you today. I am William Millar. I am the president 
of the American Public Transit Association, and I appear here 
today on behalf of our 1,100 member organizations from 
throughout the United States and Canada.
    We believe very strongly that there needs to be a continued 
strong Federal role in a balanced transportation system for all 
Americans.
    We believe, as my colleagues have spoken here today, that 
we simply have to have an increased investment in our surface 
transportation system, that the money we are spending now is 
simply not enough for our Nation.
    And finally, we believe that proper investment in the 
infrastructure will allow for a growing economy and to meet the 
variety of Federal objectives that the Congress has set out for 
us over the years.
    You invited us here today to comment on the 
administration's NEXTEA proposal, and I want to describe to you 
the criterion we have used in evaluating their proposal and 
that we would use in evaluating any other proposals.
    First, we believe that ISTEA has worked well and, 
therefore, we consider the preservation of the general program 
structure, including giving States and localities flexibility 
in how they spend their funding, to be an essential part of any 
new legislation.
    Second, we believe that any new legislation, as you said, 
Mr. Chairman, has to include adequate funding levels for both 
transit formula, transit discretionary programs, and flexible 
funds.
    Third, we believe there has to be fair and equitable 
treatment for transit agencies and communities of all sizes as 
we look at the distribution of funds.
    Let us take these principles, apply them to the 
administration's NEXTEA proposal, and see how we measure up.
    On the first principle with regard to program structure and 
flexibility, we believe generally their proposal does a good 
job in adhering to this principle. We think it recognizes that 
there are strong Federal reasons through strong national 
objectives to keeping Federal involvement in surface 
transportation, and we believe that their proposal retains some 
of the planning requirements and some of the decisionmaking 
processes and State allocations that have been useful and have 
been used in innovative ways. So, in general, on the first set 
of criterion, we believe that the administration's proposal 
does pretty well.
    However, the second set of principles that relate to the 
need for additional investment in surface transportation we 
believe the NEXTEA proposal falls far short of this. It simply 
does not provide for even the minimum levels of funding the 
administration's own studies show. I would agree with Mr. 
Rensink's determination and the information he put in the 
record about the need for additional investment. The 
administration proposal does not even measure up to that, and 
their measurements are very, very conservative indeed.
    While the administration proposal could conceivably make at 
least a little bit of money more available for highways, it in 
fact, as one of the earlier comments from one of the earlier 
Senators had said, would decrease the funding for public 
transit if you look at the authorized levels. We think that is 
not fair. We think that is not appropriate.
    Finally, although the administration claims that NEXTEA 
would increase formula capital funds, for example, once you 
take certain proposals of theirs off the top, for example, the 
access to jobs, which we generally support, and the fixed 
guideway modernization programs that are moved over into a new 
category--once you--you may take apples and oranges and now 
make them apples and apples. There really is not any increase 
of any significance in funding for public transit. So, we think 
that on this second basis, the administration's proposal fails 
rather miserably, to be honest about it.
    We do strongly support the administration's proposal to 
switch from a Rostenkowski test to a Byrd solvency test as far 
as public transit money goes. We think that is important in the 
mass transit account and speaks to equity between highways and 
transit. We would like to see that the revenues that are 
collected, as my colleagues have said, from the American people 
for surface transportation be spent on surface transportation.
    We would strongly support the effort to bring the 4.3 cents 
over from deficit reduction and put it in the highway trust 
fund and allocate it to the various accounts as would be 
appropriate under the traditional relationships.
    And we support efforts to move the trust fund off budget so 
that we can get on with the business of measuring 
infrastructure in multiyear segments as the capital 
improvements that they really represent. So, we think that that 
is pretty important to do.
    With regard to our third principle of fair and equitable 
treatment of transit agencies, large and small, we think the 
NEXTEA proposal has a mixed record in that regard. We oppose 
the elimination of the bus discretionary program. It is 
particularly important to smaller communities that they have 
the opportunity to, let us say, have a sufficient amount of 
money for a major bus purchase or a major facility improvement 
that they would not get through a formula.
    We oppose the folding of the fixed guideway formula into 
the traditional urban formula. We think that makes an 
unwarranted shift from bus to rail investment and throws a 
number of the relationships in the bill out of kilter, so to 
speak, on that.
    And we are particularly concerned about rural transit 
providers. We think the NEXTEA proposal may put their customers 
at risk simply by reduced authorizing levels, as well as a 
lower percentage of the formulas that are going to be there, 
and then finally, it would take away certain guarantees that 
rural communities now have. So, we are very concerned about 
that.
    As I conclude, I must say on the positive side, we agree 
strongly with the administration's proposal on expanding the 
definition of capital when dealing with the operating 
assistance issues. We agree strongly with the research proposal 
that is there. We agree strongly with further investment in an 
intelligent transportation system and the State infrastructure 
bank program.

                           Prepared Statement

    We believe that it is the basis for a good discussion, but 
it is a bill that should not be passed in its entirety at the 
moment. We look forward to working with you and the committee 
and everyone in Congress in making improvements to that 
proposal so we can get a good reauthorization of the ISTEA 
legislation.
    Thank you, Mr. Chairman.
    Senator Shelby. Thank you.
    [The statement follows:]
                Prepared Statement of William W. Millar
    The American Public Transit Association (APTA) appreciates the 
opportunity to testify on the Administration's ISTEA reauthorization 
proposal, the National Economic Crossroads Transportation Efficiency 
Act (NEXTEA). But first, Mr. Chairman, we want to commend you for your 
leadership in holding this hearing. Because the Congress is likely to 
pass the fiscal year 1998 Transportation Appropriations Act before it 
finishes action on legislation to reauthorize ISTEA, it is particularly 
important that you now gather views on that important legislation.
                                overview
    APTA supports ISTEA. We supported its enactment in 1991 and over 
the last six years our experience has demonstrated that it provides the 
benefits we had hoped for. Toward this end, APTA has adopted a 
comprehensive ISTEA reauthorization working proposal that would 
preserve and build on the ISTEA and transit program structures, expand 
opportunities for flexible funding--both highway to transit and transit 
to highway--and support ISTEA's planning provisions and transit 
research and development.
    At the same time, we oppose efforts to repeal federal gas taxes 
that support investment in the nation's transportation infrastructure, 
or to eliminate the existing federal partnership with state and local 
governments. We are not opposed to efforts to modify the highway 
funding formula, but we believe that a fair distribution of highway 
funds can be accomplished within the current ISTEA program structure. 
We also strongly support the ``level playing field'' provisions between 
highway and transit investments established under ISTEA, including the 
roughly four to one funding ratio. Without these provisions, modal 
balance--an important ISTEA hallmark--will be jeopardized.
                         nextea: an assessment
    There are three primary principles that APTA uses to evaluate the 
merits of NEXTEA and other reauthorization proposals. They are: 1) 
preservation of ISTEA's program structure and flexible funding 
provisions, 2) provision of adequate funding levels for transit formula 
and discretionary programs, and 3) provision of fair and equitable 
treatment for transit agencies of all sizes.
NEXTEA Preserves the ISTEA Structure and Flexible Funding Program
    The first principle is important because ISTEA's program structure 
and flexible funding provisions promote balanced investment among modes 
and require a coordinated approach to major transportation investments. 
APTA firmly believes that federal interests are best served by a 
balanced transportation system. ISTEA's program structure and flexible 
funding provisions allow federal, state, and local resources to be used 
on a range of transportation alternatives, which permits state and 
local authorities to choose alternatives that best meet their 
particular objectives. This structure also allows transportation policy 
to address national and local needs while recognizing that 
transportation is linked to other factors that affect each community's 
economy and quality of life.
    NEXTEA generally does a good job adhering to the first principle. 
It retains a strong federal role in surface transportation and in 
assuring minimum investment levels for all transportation modes by 
maintaining most of the current ISTEA program structure and 
requirements. It retains current flexible funding programs, the 
existing planning and decision-making process, and current metropolitan 
suballocations. Furthermore, NEXTEA would expand the size of the 
flexible Surface Transportation Program (STP) and Congestion Mitigation 
and Air Quality (CMAQ) programs, and make intercity passenger rail 
service an eligible expense under surface transportation programs. In 
addition, the federal share of most transit capital expenditures would 
remain at 80 percent and at 90 percent for Clean Air Act and Americans 
with Disabilities Act (ADA) compliance efforts.
NEXTEA's Transit Funding Levels Fall Short of ISTEA Levels
    The second principle is critical because additional investment in 
the nation's surface transportation network is necessary to provide a 
solid foundation for economic growth. For instance, in Paul Weyrich's 
recent analysis of mass transit, he notes that transit investment has 
generated substantial economic benefits, including increased tax 
revenues, jobs, and related development. An adequate federal 
commitment, along with efficient management and state and local 
participation is the key to these results.
    NEXTEA falls short in addressing this second principle. The problem 
is underinvestment in our nation's transportation infrastructure. The 
U.S. Department of Transportation (DOT) estimates that more than $400 
billion in capital funding is needed over six years just to maintain 
the current systems. The Administration's response is to provide flat 
funding. The NEXTEA proposal would authorize $166 billion to meet 
highway and transit needs over six years.
    Additionally, NEXTEA authorizes $30.5 billion for transit, a three 
percent drop from ISTEA's six-year total of $31.5 billion. In contrast, 
the highway program would receive $135.8 billion over six years, up 10 
percent from ISTEA's $123.3 billion.
    APTA's reauthorization proposal would respond to these needs by 
providing increased resources. Our proposal deposits revenues from the 
``deficit reduction'' 4.3 cents gas tax into the Highway Trust Fund and 
calls for the use of existing balances in the MTA to meet these needs. 
It also maintains some general fund support for transit activities.
    Formula funding under NEXTEA would appear to increase as a share of 
total transit program funding, but several caveats are in order. First, 
each year, $100 million would be taken off the top for a new Access to 
Jobs and Training Program. Second, the Fixed Guideway Modernization 
(FGM) Program would be funded at the same level as the New Start 
program, but would be shifted to the formula program. Formula funding 
would be distributed under the current formula. It should also be noted 
that the current discretionary bus/bus facilities grant program (funded 
at $360 million in fiscal year 1997) is eliminated and funding that 
previously went to that program is apportioned under the urban formula 
program. In short, funding for the current urban formula program would 
barely change. ISTEA authorized $17.46 billion in formula funds over 
six years; NEXTEA would authorize $17.55 billion in formula funds over 
six years once the Access to Jobs and FGM funds are taken off the top. 
If the discretionary bus program were not incorporated into the formula 
program, formula funding would actually decline.
    We strongly support the Administration's proposal to switch from 
the Rostenkowski Highway Trust Fund solvency test to the Byrd solvency 
test for gauging the commitments from the Mass Transit Account (MTA) of 
the Highway Trust Fund. This change would apply the same spending test 
to the Mass Transit and Highway Accounts and permit additional spending 
from the MTA. We have some concerns about the proposal to fund the 
entire transit program from the Mass Transit Account, because the 
revenues now deposited in the MTA would not sustain current program 
levels--let alone increases--for the transit program. While APTA also 
supports the use of existing balances in the MTA, these balances could 
be spent down quickly and current revenues dedicated to the MTA cannot 
meet the long-term funding needs of the federal transit program. More 
funding must be placed in the MTA.
NEXTEA Would Modify the Transit Program Structure
    NEXTEA does a mixed job of meeting the third principle, provision 
of fair and equitable treatment for transit agencies in large, medium-
sized, and small urbanized and in rural areas. APTA fully supports the 
existing funding ratios within the ISTEA transit program. First, we 
support the current ratio of $1.36 in formula funding for every $1 in 
discretionary funding. This provides an equitable distribution among 
all transit needs. In addition, APTA urges Congress to retain the 
existing distribution of funds within the discretionary capital 
program. Current law dictates that 40 percent of this program goes to 
new rail starts, 40 percent goes to rail modernization, and 20 percent 
goes to the bus/bus facilities.
    We oppose the proposal to eliminate the Bus Discretionary program 
and to fold the Fixed Guideway Modernization program into the formula 
program. Moving the Bus and Fixed Guideway Modernization programs into 
the formula program would upset the current relationship among new 
starts, rail modernization, and bus under the current discretionary 
capital program. These programs address special needs, have worked 
extremely well in their current form, and do not need to be changed. 
Also shifting the rail modernization program to the formula program 
would change the allocation of funds between bus and rail, increasing 
the latter at the expense of the former.
    On the positive side for urbanized areas of all sizes, NEXTEA would 
expand the definition of eligible capital expenditures to be more 
consistent with permissible expenditures in the highway program, 
including preventive maintenance. These changes, along with certain 
changes that would permit the use of capital funds to meet ADA costs, 
would allow elimination of operating assistance for areas of 200,000 or 
more in population.
    APTA also strongly supports the provision to permit urbanized areas 
(UZA's) with less than 200,000 in population to have the flexibility to 
use formula funds for capital or operating purposes at their 
discretion.
    For rural transit providers the NEXTEA proposal reduces authorized 
funding and places service to customers at risk. The Non-urban program 
(formerly section 18) would receive 3.75 percent of an expanded formula 
program--a lower percentage than the current 5.5 percent of the 
combined total for urban and rural formula funds. Of the total, 4 
percent would go to the Rural Transportation Assistance Program, which 
is now funded through the Research program. The elimination of the Bus 
Discretionary Program would take away a guaranteed 5.5 percent share of 
that program for rural communities.
Other NEXTEA Provisions
    The NEXTEA proposal includes a $100 million per year Access to Jobs 
and Training Initiative. In general we support this program, but oppose 
taking the funding as a takedown from the existing formula program. 
Such an important national priority deserves new resources. We also 
support NEXTEA's Intelligent Transportation System provisions and 
proposed expansion of the State Infrastructure Bank (SIB) program that 
would allow all states to participate, although we do note that 
flexible highway funds placed in the SIB can only be used initially for 
highway projects, which is inconsistent with the ``level playing 
field'' principles of ISTEA. In addition, we support the creation of a 
new Infrastructure Credit Enhancement Program to encourage public-
private partnerships to speed the completion of major highway, bridge, 
transit, and rail projects.
                           the apta proposal
    We have previously submitted to you APTA's reauthorization proposal 
and we are pleased to note that many of APTA's recommendations, 
including elimination of the operating cap for small urbanized areas 
and inclusion of an expanded definition of what constitutes a capital 
expenditure, are included in the NEXTEA proposal. We would be pleased 
to provide you with additional copies of our detailed proposal.
Expand Opportunities for Flexible Funding
    The APTA proposal also calls for an increase in the authorized 
funding level for the Surface Transportation Program using resources 
from the Highway Trust Funds's Highway Account (HA) and Mass Transit 
Account (MTA). After the transit core program has been funded at our 
recommended level of $6.25 billion in fiscal year 1998, additional MTA 
funds would go to a new STP-transit program. For each $1.00 of MTA 
funds that go to the STP-transit program, an additional $2.00 in 
Highway Account funds would go to the STP-highway program. Funding for 
each program would be apportioned in the same manner as the existing 
STP program, would include metropolitan area suballocations, and would 
be subject to the same planning standards.
4.3 Cents/Gallon Revenue
    Additional resources for the expanded STP program would be provided 
by depositing revenue from the 4.3 cents per gallon ``deficit 
reduction'' motor fuels tax into the Highway Trust Fund and by applying 
the Byrd rule solvency test to the Mass Transit Account of the Highway 
Trust Fund. APTA's proposal would allocate one-half-cent of the 4.3 
cents per gallon gas tax revenue for a new intercity passenger rail 
account and the revenue from 20 percent of the remaining 3.8 cents to 
the Mass Transit Account.
Fixed Guideway Modernization Program Recommendations
    APTA's proposal calls for a modification of the existing Fixed 
Guideway Modernization formula. The Fixed Guideway Modernization 
program should be retained as a distinct program within the Major 
Capital Grant program (formerly Section 3). This program addresses a 
specific need to modernize aging fixed guideway systems. Funding levels 
for the New Starts, Fixed Guideway Modernization, and Bus/Bus 
Facilities programs should be funded on the current 40/40/20 basis, 
with funding for the Fixed Guideway Modernization program set at $1 
billion in fiscal year 1998.
    With regard to the distribution of Fixed Guideway Modernization 
funds we have a detailed proposal that would largely retain the current 
formula distribution, with some modifications, up to the current 
funding level of $760 million, but would increase the share of 
modernization funds that goes to areas with newer fixed guideway 
systems as funding rises above the current level. We will submit to the 
Committee under separate cover copies of our Fixed Guideway 
Modernization proposal.
                               conclusion
    Mr. Chairman, APTA strongly supports a continued federal role in 
funding surface transportation. ISTEA has worked well and must be 
continued. While we recognize the need to control spending and reduce 
the deficit, increased investment in the transportation infrastructure 
is needed to facilitate economic growth, international competitiveness, 
successful welfare reform, and other national goals. Putting off 
necessary investment will only increase federal costs in the long run. 
We urge this Committee to support authorization levels that reflect 
these important policy goals by appropriating federal user taxes the 
American people are already paying. The Administration's NEXTEA 
proposal is a good start, but does not include adequate funding levels 
for surface transportation in general and public transportation in 
particular.
STATEMENT OF HARRY W. BLUNT, JR., PRESIDENT, CONCORD 
            COACH LINES, INC., VICE CHAIRMAN, AMERICAN 
            BUS ASSOCIATION
    Senator Shelby. Mr. Blunt.
    Mr. Blunt. Thank you, Senator. On behalf of the American 
Bus Association, I think we can address the core issues of 
ISTEA reauthorization quite quickly.
    We support the administration's proposal on the National 
Highway System Program. Two years ago we were active in the 
passage of the NHS legislation. For the first time the focus 
was on connectability in our transportation system. The bus 
industry fought to get our terminals onto the NHS system map. 
The administration proposal under NEXTEA will now make funding 
available for intermodal terminal facilities. We think that is 
very important.
    Second, we support the administration's proposal in the 
surface transportation program to make capital funds available 
to bus companies to acquire vehicles and to enhance public 
transportation over the highway network.
    Third, ABA opposes the administration plan to eliminate the 
rural intercity bus program contained in section 18(i) of the 
Federal Transit Act. Our industry is beginning to work with 
many States to help provide essential ground transportation to 
small rural communities through 18(i) funding. This is a very 
small piece of the overall funding. Yet, the administration has 
chosen to take it out. We think this is wrong. If this funding 
is lost, communities in small rural America will lose all 
connection to any public transportation.
    Fourth, ABA supports removing the highway trust fund from 
the unified budget and believes that all funds that are 
collected should be used as promised to the American taxpayer 
for highway transportation systems. We oppose the diversion of 
highway trust fund revenues to nonhighway users.
    ABA supports the repeal of 4.3 cents per gallon Federal 
fuel tax that presently goes to the general fund for deficit 
reduction. However, if these funds were placed in the highway 
trust fund, we would support that. We just do not believe that 
the highway trust fund should be used for budget balancing.
    We support a continued role in highway planning and funding 
on behalf of the Federal Government. Our highway system is a 
national system with regional and national interests that must 
play a role in its operation.
    ABA takes no position on the various proposals to amend the 
current formula funding for distribution of Federal highway 
funds to the States. Our concern is to increase the overall 
level of funding in the program and to address the 
deteriorating infrastructure of our National Highway System.
    In closing, let me speak for a minute about a positive. I 
arose this morning at 4:20 a.m. in New London, NH, a city that 
is over 500 miles from here. I took a quick shower, grabbed a 
cup of coffee, and jumped in my car. In 5 minutes I was in a 
park-and-ride lot where I got on a bus that took me directly to 
Manchester Airport. I was in Washington at quarter of 8 and in 
center city Washington by 10 after 8. In just under 4 hours, I 
was from the shower to the Senate, an amazing feat in this 
Nation.

                           Prepared Statement

    We are the envy of the world in our transportation system, 
and I strongly urge you to continue to support that and fully 
fund it.
    Thank you, Senator.
    [The statement follows:]
               Prepared Statement of Harry W. Blunt, Jr.
    Mr. Chairman and Members of the Subcommittee: My name is Harry 
Blunt. I am the President of Concord Coach Lines, Inc., of Concord, New 
Hampshire. I also serve as the Vice Chairman of the Board of Directors 
for the American Bus Association (ABA), and I am here today to present 
ABA's views on reauthorization of the federal aid highway and highway 
safety programs as proposed in the Administration's National Economic 
Crossroads Transportation Efficiency Act of 1997 (NEXTEA).
    ABA is the national trade association of the intercity bus 
industry. We have about 3,000 members, some 700 of whom are bus 
operators. They offer a variety of bus services:
  --regular route intercity service between fixed points on set 
        schedules;
  --charter service, where a group of passengers (such as a church or 
        organization) purchases all of the seats on a bus for exclusive 
        use on a particular trip;
  --tour service, which usually includes stops for sightseeing and 
        recreational purposes;
  --commuter bus services, generally from the suburbs into urban areas; 
        and
  --special operations, which is scheduled service to enhance public 
        transportation systems (such as bus service from a city to an 
        airport), or may be connected with a special event or 
        attraction at the destination.
    The rest of ABA's members include representatives of the travel and 
tourism industry, and the manufacturers and suppliers of products and 
services used by the bus industry.
    Intercity bus service is the primary system of low cost intercity 
passenger transportation in this country. In rural areas, bus service 
is virtually the only transportation network available to the public. 
Yet public policy as set out in the federal-aid highway and mass 
transit programs over the years has not reflected the overriding 
importance of the bus industry in passenger transportation, and in 
fact, has discouraged low cost bus transportation in favor of higher 
cost alternatives. This must change; Congress must give the intercity 
bus industry a more central role in providing essential intercity 
public transportation.
    ABA's positions on the core funding issues in the reauthorizing 
debate can be summarized as follows:
    1. ABA supports removing the Highway Trust Fund from the unified 
budget as a mechanism to ensure that monies collected for highway 
construction, maintenance and repair, and highway safety programs are 
spent as promised.
    2. ABA supports increased funding for highway programs to address 
the deteriorating infrastructure of our national highway system.
    3. ABA supports the Administration's proposal in the National 
Highway System Program to make funds available for capital investments 
in publicly-owned intercity bus or intermodal terminals.
    4. ABA also supports the Administration's proposal in the Surface 
Transportation Program to make capital funds available for privately-
owned intercity bus companies to acquire vehicles and facilities.
    5. ABA opposes the Administration's proposal to eliminate the rural 
intercity bus program contained in section 18(i) of the Federal Transit 
Act as amended by the 1991 Intermodal surface Transportation Efficiency 
Act (ISTEA) (49 U.S.C. 5311(f)).
    6. ABA supports repeal of the 4.3 cents per gallon diesel fuel tax 
that presently goes into the general fund. Alternatively, ABA would 
support placing these revenues in the Highway Trust Fund to be spent on 
highway programs.
    7. ABA opposes the diversion of any Highway Trust Fund revenues for 
non-highway purposes.
    8. ABA supports continued federal role in highway planning and 
funding, and opposes efforts to return the federal-aid highway system 
to the states.
    9. ABA takes no position on the various proposals to amend the 
current funding formulas for distribution of federal highway funds to 
the states--our concern is to increase the overall level of funding in 
the program.
    Several salient statistics underscore the obvious importance of bus 
travel in the national transportation network when compared to 
transportation by Amtrak or commercial airlines, its two modal 
competitors for intercity public transportation of passengers.
    Intercity buses serve many more points than either Amtrak or 
airlines.--Table 1 shows, on a state by state basis, the number of 
communities served by the intercity bus industry as compared with 
Amtrak and commercial airlines. In every state, the bus industry serves 
many more cities and towns than the competing modes. In my home state 
of New Hampshire, for instance, Amtrak serves one point and the 
airlines serve three points, while the bus industry serves 33 
communities with scheduled service. In your home state of Alabama, Mr. 
Chairman, Amtrak serves ten points, the airlines serve nine points, and 
the bus industry serves 110 communities with daily service.
    Figure 1 is a bar graph showing the number of communities served 
nationwide by Amtrak, the airlines, and the bus industry. Cumulatively, 
Amtrak serves 511 communities, the airlines serve 758 communities, and 
the intercity bus industry serves 4,274 communities on a daily basis 
with scheduled regular route service.\1\ (This bus figure does not 
include ``flag stops,'' at which a passenger may flag down a bus to 
stop for embarking passengers even though no stop is scheduled at that 
point.)
---------------------------------------------------------------------------
    \1\ Sources: Amtrak Schedule, Official Airlines Guide for North 
America, and Russell's Guide.
---------------------------------------------------------------------------
    Intercity bus service is much more frequent than Amtrak or airline 
service.--Generally, buses not only serve more points than their 
competitors, but where the modes do compete the bus service is much 
more frequent than either Amtrak or airline service.
    Intercity bus service is the most affordable transportation.--Bus 
service is also generally less expensive than Amtrak or the airlines. 
Even with discount fares, Amtrak and the airlines cannot compete on 
price with intercity bus service, which remains the most economical 
method of transportation. For example, on the Birmingham-Atlanta route, 
Delta Airlines quotes an unrestricted round trip fare of $550.00, and 
Amtrak's regular round trip fare is $78.00, while Greyhound's regular 
round trip fare is $47.00.
    Low cost service is why buses are the mode of choice for the 
elderly, students, members of the military, and those at the lower end 
of the income spectrum. Greyhound Lines, Inc. has discovered through 
surveys that some 44 percent of its passengers have annual incomes of 
less than $15,000.
    In other words, buses are the only mode that take you where you 
want to go, when you want to go, and at a price you can afford.
    Notwithstanding the essential nature of the bus industry compared 
to other modes, and the fact that buses carry the old, the young, the 
poor, and those in rural America, federal transportation programs have 
ignored the bus industry while heavily subsidizing our competitors. The 
bus industry receives no direct operating subsidies, and very little 
federal support of any kind.
    Robert R. Nathan Associates Inc. has conducted an exhaustive study 
of the total federal subsidies, net of user fees, received by each 
passenger transportation mode from 1960 through 1993.\2\ This study 
aggregated outlays from federal funds and trust funds for each major 
passenger transportation system--air, highway, intercity rail, and mass 
transit, according to the cost responsibility of each mode. In 
addition, the study attributed receipts into the Airport and Airways 
Trust Fund and the Highway Trust Fund paid by airlines and the bus 
industry, respectively, and into the general fund by all modes. 
Subsidies were then measured by subtracting the allocated receipts from 
the allocated federal outlays for each mode.
---------------------------------------------------------------------------
    \2\ The Impact of Higher Motor Fuel Taxes on the Intercity Bus 
Industry, Robert R. Nathan Associates, Arlington, Va. (July 1995). This 
was an update of an earlier work, Federal Subsidies for Passenger 
Transportation. 1960-1988: Winners, Losers, and Implications for the 
Future, Robert R. Nathan Associates, Inc., Arlington, Va. (1989).
---------------------------------------------------------------------------
    The results are striking. As shown in Figure 1, from 1960 to 1993, 
measured in constant 1993 dollars, mass transit has received a net 
subsidy of $91.2 billion, aviation has received a net subsidy of $104.5 
billion,\3\ and Amtrak has received a net subsidy of $24.6 billion. The 
intercity bus industry, in marked contrast, from 1960 through 1993 
received a net subsidy of only $600 million. While Amtrak and the 
commercial airlines combined received more than $79 billion in net 
subsidies from the federal government, the bus industry received less 
than one percent of that amount. Yet the bus industry is expected to 
compete on an equal footing with air and rail transportation.
---------------------------------------------------------------------------
    \3\ Of this total, $52.3 billion of the net subsidy went to 
commercial air carriers and $52.2 billion of the subsidy went to 
general aviation.
---------------------------------------------------------------------------
    The disparity in federal subsidies by mode is even more outrageous 
when viewed per passenger trip. Figure 2 shows that commercial airline 
passengers have received a net subsidy of $6.38 per trip, mass transit 
passengers have received a net subsidy of $0.33 per trip, Amtrak 
passengers received a net subsidy of $54.88 per trip, and intercity bus 
passengers received a net subsidy of five cents per trip. Bus 
passengers get a nickel from the federal government while Amtrak 
passengers get $54.88 from the federal government for every trip they 
take.\4\
---------------------------------------------------------------------------
    \4\ A recent study by the Cato Institute estimates an even higher 
per passenger subsidy for Amtrak riders. According to Jean Love, 
Wendell Cox, and Stephen Moore, ``Amtrak at Twenty-Five, End of the 
Line for Taxpayer Subsidies,'' Cato Institute, Policy Analysis No. 266, 
Washington, D.C. (December 19, 1996), the average taxpayer subsidy per 
Amtrak rider is $100, or 40 percent of the total per passenger cost. On 
some of the long-distance routes, such as Los Angeles to New York, the 
study found that the per passenger subsidy exceeds $1,000.
---------------------------------------------------------------------------
    This is public policy at its worst. The federal government should 
not pick and choose winners in the passenger transportation industry 
any more than it should determine winners and losers in any other 
markets. Yet by heavily subsidizing Amtrak and commercial airline 
passengers, but not bus passengers, federal policy has created an 
atmosphere so financially skewed that bus operators find it extremely 
difficult to compete effectively with other modes.
    Reauthorization of ISTEA presents an opportunity to level the 
playing field for passenger transportation. ISTEA as enacted in 1991 
began this process. The intercity bus industry made considerable gains 
as a result of that legislation, but they represent only a start. The 
Administration's NEXTEA proposal builds on this beginning by expanding 
the scope of intercity bus projects eligible for federal funding.
    intermodal transportation centers and rolling stock acquisition
    The intercity bus industry's greatest need, and the most promising 
area for public policy successes, is the continued development and 
funding of intermodal transportation centers. ISTEA contained several 
provisions that allow states to fund intermodal transportation centers. 
Section 133 of title 23, United States Code currently permits states to 
obligate funds apportioned under the Surface Transportation Program for 
capital costs for ``publicly owned intracity or intercity bus terminals 
or facilities.'' Additionally, section 134 of title 23 directs 
metropolitan planning organizations to develop plans and programs to 
provide for facilities that will function as an ``intermodal 
transportation system'' for the state.
    There have been some success stories as a result of these 
provisions. South Station in Boston shows the promise of becoming a 
highly efficient intermodal transportation facility. The station serves 
Amtrak as well as my bus company, Concord Trailways, along with 
Greyhound Lines, Peter Pan Trailways, Bonanza Bus Lines, and Plymouth & 
Brockton Street Railway Company (another bus carrier). The bus portion 
of the terminal opened on November 1, 1995, and the bus carriers now 
provide connecting service to the Amtrak schedules, and vice versa. In 
addition, there is a subway stop on the MBTA line at the station, and 
the station is also a terminal for intracity transit buses.
    When the Central Artery project in Boston is completed, there will 
also be a direct shuttle bus service from South Station to Logan 
Airport, using a new tunnel under Boston Harbor.
    At present, the South Station is a tremendous improvement over the 
prior connections. Previously, bus carriers had to park vehicles and 
discharge passengers across the street from the train station. When the 
South Station is completed, bus passengers will be carried on a people 
mover to the train portion of the station, for easier connections 
without going out into the elements.
    South Station is also a success because of the federal-state 
partnership that funded and developed the project. In addition, the 
fact that the station is operated by the Massachusetts Bay 
Transportation Authority eliminates the competitive concerns about 
terminal access and rent that plague carrier-owned and operated 
stations where competitors rent space and services from other carriers. 
Multi-purpose stations, run by state or local government entities, with 
access for all modes, in a favorable location close to highway, rail 
and air connections, are the best possible method of achieving the goal 
to facilitate intermodal passenger transportation as set out in ISTEA. 
The reauthorizing bill should continue this approach.
    These facilities are win-win-win scenarios. The public sector wins, 
because the carriers pay rent to fund the capital investment necessary 
to build the structures. The private sector wins, because the carriers 
do not need to generate the substantial amounts of construction 
capital. And the passengers win, because they benefit from improved 
service and streamlined connections.
    The only problem with South Station is that there are not more 
examples of this facility built as a result of ISTEA funding and 
directives. Under Sec. 1003(a)(4) of the Administration's NEXTEA 
proposal, ``publicly owned . . . intercity passenger rail or bus 
terminals'' would be eligible for capital funding in the National 
Highway System program. ABA supports this proposal, but encourages 
Congress to do more to ensure that a portion of state funds allocated 
under this program be used to construct, maintain and operate 
intermodal passenger facilities. The metropolitan planning 
organizations need some incentives or directives to include intermodal 
facilities in their plans, and Congress should plainly provide that 
federal funds are to be used for such projects.
    Moreover, the National Highway System funds should be available for 
privately owned and operated terminals as long as the operator grants 
access to all carriers, whether or not competitors, without 
discrimination, as allowed by space constraints. The private sector can 
effectively leverage federal funds to construct, maintain and operate 
intercity passenger terminals for bus and rail transportation. With 
adequate federal supervision, there is no compelling policy reason to 
exclude privately-owned facilities from receiving funds under this 
program as well.
    ABA further supports the Administration's proposal in Sec. 1014(a) 
of NEXTEA to expand the funding eligibility in the Surface 
Transportation Program to include privately-owned intercity bus 
companies to acquire vehicles and facilities on the same basis as 
capital projects under the current 49 U.S.C. Sec. 5302(a)(1). This will 
encourage private sector intercity bus companies to develop additional 
service in conjunction with rail and intracity passenger transportation 
providers.
           section 18(i) intercity bus transportation funding
    Section 18(i) of the Federal Transit Act, as amended in ISTEA, 
directs states to spend 15 percent of their rural transit funds each 
year to ``develop and support intercity bus transportation.'' See 49 
U.S.C. Sec. 5311(f). This was the first time that states were actually 
directed by Congress to expend highway funds to promote intercity bus 
service. Under that provision, however, a state need not spend these 
funds on bus transportation, if the Governor of the state certifies to 
the Secretary of Transportation that ``the intercity bus service needs 
of the State are being adequately met'' in that particular fiscal year.
    ABA does not believe that there are any states in which there are 
no unmet intercity bus service needs. Nevertheless, in the first few 
years under ISTEA many states routinely certified that there were no 
unmet intercity bus service needs, and therefore avoided using the 
section 18(i) funds for intercity bus purposes. ABA member companies 
have begun an educational process in many states to discuss their rural 
transportation needs, and the results are encouraging.
    In Texas, for example, the Governor certified for several years 
that there were no unmet intercity bus service needs, even though Texas 
has one of the largest populations of rural, poor bus passengers in the 
country. A couple of years ago, Kerrville Bus Company in Kerrville, 
Texas began meeting with the Texas Department of Transportation to 
explore ways to use the section 18(i) funds as Congress intended. As a 
result of those meetings, three new bus terminals are either operating 
or under construction in rural areas.
    The Brazos Valley Transit Authority used a section 18(i) grant to 
purchase a property and building in Lufkin, Texas and converted it into 
a combination transit and intercity bus terminal. Similarly, the City 
of Del Rio, Texas used state funds under section 18(i) to construct a 
combination bus terminal. The City of Fredricksburg, Texas is also 
using section 18(i) funds to build a combination terminal, and 
Kerrville Bus Company is contributing $20,000 of its own capital 
towards the construction costs. Of course, Kerrville will also pay rent 
to use these facilities, and the bus passengers in rural Texas have 
three new terminals for intercity service.
    ABA strongly supports continuation of the section 18(i) set aside 
program in the reauthorization legislation. Some $17 million was 
appropriated by Congress for fiscal year 1997, which is de minimis in 
the context of the entire transit appropriation, but tremendously 
important to those passengers who depend on intercity bus 
transportation.
    The Administration has proposed to eliminate the section 18(i) set 
aside program, citing the expanded eligibility for facility and vehicle 
funding under the National Highway System and Surface Transportation 
Programs as an adequate replacement.
    Without a specific set aside, intercity bus carriers in many states 
will not be able to beat competing interests for these funds, and the 
needs of rural passenger transportation will not be met. Although the 
Administration's bill does expand the types of projects eligible for 
federal funds, there is no assurance that these projects will actually 
be funded. The section 18(i) set aside was the only program that 
directed states to spend money on rural intercity bus transportation, 
and, as outlined above, many states have avoided funding intercity bus 
projects even under that program. ABA urges Congress to retain the 
section 18(i) program.
                       highway trust fund issues
    ABA supports congressional efforts to take the Highway Trust Fund 
off the unified budget so that the annual trust fund surplus is not 
used to mask the size of the federal budget deficit. The Highway Trust 
Fund taxes were not intended to serve as general fund taxes that might 
be raised or lowered according to overall spending needs. Rather, the 
Highway Trust Fund taxes were intended to support a federal-aid highway 
and bridge program that benefits all highway users and serves as a 
catalyst for national economic growth.
    Since the inception of the Interstate Highway System in 1956, all 
federal fuel taxes were paid into the Highway Trust Fund and then 
disbursed to the states for highways and bridges. Highway users, 
including the intercity bus industry, were willing to pay their federal 
fuel taxes as an investment in the nation's infrastructure. This trust 
fund system has provided a nationwide highway system that has played a 
critical role in the economic development of this country and 
contributed dramatically to the mobility of Americans.
    By refusing to spend some of the trust fund revenues, Congress and 
the Administration have transformed the Trust Fund into a general fund, 
to be spent or not spent as other federal budget priorities dictate. 
This breaks the faith with all highway users who pay into the Trust 
Fund, only to see their tax dollars spent on projects other than the 
highway program. ABA urges Congress to restore the Trust Fund concept 
by removing the Fund from the unified federal budget, and allowing all 
highway tax revenues to be spent for highway purposes.
    ABA also strongly opposes continuing the 4.3 cents per gallon tax 
on diesel fuel if the revenue flows into the general fund for deficit 
reduction purposes. The intercity bus industry pays approximately $7.4 
million per year in additional taxes because of the 4.3 cents per 
gallon surtax.\5\ This money is not being used for highway purposes.
---------------------------------------------------------------------------
    \5\ The intercity bus industry operates approximately 945 million 
bus miles and consumes about 172 million gallons of diesel fuel per 
year. The number of gallons multiplied by 4.3 cents per gallon yields 
an annual tax revenue of $7.4 million.
---------------------------------------------------------------------------
    The trust fund concept was again breached in 1993 by the Omnibus 
Budget Reconciliation Act (OBRA), which imposed the 4.3 cents per 
gallon federal fuel tax but diverted the revenue to the general fund to 
reduce the size of the federal budget deficit.
    If the highway system were in adequate repair, this diversion might 
not present such a critical issue to the intercity bus industry and 
other highway users. But by any measure, the infrastructure of highways 
and bridges in this country are deteriorating, and the trust fund 
spending is falling farther behind investment needs each year.
    ABA believes that all revenues from federal fuel taxes on highway 
vehicles should go into the Highway Trust Fund to ensure that the 
investment in the nation's highway system does not fall prey to short 
term attempts to reduce the federal deficit. Moreover, Congress and the 
Administration have failed to spend the full amount of highway tax 
revenues collected in the Highway Trust Fund, thereby generating a 
substantial surplus in the Trust Fund. It makes no sense to impose a 
4.3 cents per gallon surtax on highway users when the other highway tax 
revenues are not fully allocated for their intended purpose each year. 
For these reasons, ABA supports repealing the 4.3 cents per gallon fuel 
tax for deficit reduction. As an alternative, ABA would support placing 
the revenues from this 4.3 cents surtax into the Highway Trust Fund.
    Finally, ABA strongly opposes the Administration's proposal for 
operating grants to Amtrak out of the Highway Trust Fund. The 
Administration proposes a grant of $344 million in fiscal year 1998 
alone, and total grants of $1.354 billion in operating subsidies over 
the six-year life of the program. In addition, the Administration 
proposes capital investment grants for Amtrak out of the Highway Trust 
Fund in the amount of $423,450,000 per year for six years, and 
supplemental capital investment grants totalling $874 million over the 
life of the program.
    As discussed in detail above, the intercity bus industry competes 
directly with Amtrak for passengers on all routes and in all corridors. 
Over its 25-year history, Amtrak has received an extraordinary federal 
subsidy for both capital and operating costs. Now the Administration is 
proposing a further capital and operating subsidy for Amtrak out of 
Highway Trust Fund revenues. If this provision were enacted, a portion 
of the intercity bus industry's federal highway use taxes would be used 
to subsidize a competitor instead of being spent, as intended 
initially, on highway construction, repair and maintenance.
    ABA opposes funding Amtrak out of Highway Trust Fund revenues, and 
at the very least recommends that the intercity bus industry be 
exempted from paying taxes that would be used to support competition 
from Amtrak. Alternatively, ABA supports a dedicated source of funding 
for Amtrak only through a Surface Transportation Trust Fund in which 
the intercity bus industry is eligible for similar types of capital and 
operating grants. Further, any monies expended for Amtrak should be 
subject to annual appropriations, and not the contract authority 
envisioned in the Administration's bill.
    In addition to Amtrak, the intercity bus industry must also compete 
with commercial airline service that has been subsidized under the 
Essential Air Service program for almost 20 years. In the Federal 
Aviation Authorization Act of 1996, Congress directed that $50 million 
be set aside and made available to carry out the EAS program for fiscal 
year 1997.
                         funding formula issues
    ABA takes no position on the various proposals for changing the 
allocation formulas under which states receive federal-aid highway 
money. As stated above, ABA's primary concern is that the amount of 
money expended on highways increases to keep pace with infrastructure 
needs.
    ABA does, however, believe that there is a need for a fundamental 
federal role in the highway program, and that the entire authorization 
and taxation program should not be merely turned back to the states as 
a means of avoiding the allocation debate.
    The federal government has played a guiding role in establishing a 
national infrastructure of highways and bridges. There is no guarantee 
that states would cooperate sufficiently to maintain such a system. Nor 
is there any assurance that if the federal highway taxes were repealed 
or reduced that the states would be able to raise their state taxes 
correspondingly to account for the revenue shortfall. The federal-aid 
highway program has a long history of success that should not be 
ignored merely because of issues regarding the proper allocation 
formulas.
    I appreciate the opportunity to testify on this legislation, and I 
will attempt to answer any questions you might have or supply you with 
any additional information you might need.

     TABLE 1.--NUMBER OF COMMUNITIES SERVED, BY MODE, BY STATE, 1996    
------------------------------------------------------------------------
                                    Intercity                 Commercial
              State                    bus         Amtrak      airlines 
------------------------------------------------------------------------
Alabama..........................          110           10            9
Alaska...........................          n/a  ...........          236
Arizona..........................           77           10           15
Arkansas.........................           82            6            9
California.......................          277          128           32
Colorado.........................           80           11           15
Connecticut......................           25            9            5
Delaware.........................           16            1  ...........
Florida..........................          131           37           22
Georgia..........................          111            5           10
Hawaii...........................          n/a  ...........           12
Idaho............................           47            7            6
Illinois.........................           65           34           19
Indiana..........................           64           11            9
Iowa.............................           44            6           10
Kansas...........................           88            7           11
Kentucky.........................           32            4            4
Louisiana........................          107            4            4
Maine............................           34  ...........            8
Maryland.........................           27            6            4
Massachusetts....................           77            7            7
Michigan.........................          137           23           20
Minnesota........................          141            7           15
Mississippi......................           99           14            9
Missouri.........................           77           14            9
Montana..........................           90           13           14
Nebraska.........................           38            5           11
Nevada...........................           42            9            6
New Hampshire....................           33            1            3
New Jersey.......................           90            5            4
New Mexico.......................           76            8           12
New York.........................          361           31           24
North Carolina...................          121           17           13
North Dakota.....................           47            7            8
Ohio.............................           58            8            8
Oklahoma.........................           71  ...........            5
Oregon...........................          116           14            7
Pennsylvania.....................          234           18           17
Rhode Island.....................            5            1            3
South Carolina...................           53           11            6
South Dakota.....................           41  ...........            9
Tennessee........................           60            3            6
Texas............................          440           20           28
Utah.............................           30            6            7
Vermont..........................           50           10            2
Virginia.........................           73           15            7
Washington.......................           57           21           23
West Virginia....................           16           11            8
Wisconsin........................           94           10           12
Wyoming..........................           30            8           10
                                  --------------------------------------
      Total......................        4,274      \1\ 619      \2\ 758
------------------------------------------------------------------------
Sources: Russell's Guide, 1996; Amtrak Summer Schedule, 1996; and       
  Official Airline Guide, North American Ed., May 1, 1996.              
                                                                        
\1\ Includes 108 points served by Amtrak contract bus service.          
\2\ Includes the two airports serving the District of Columbia.         

[GRAPHIC] [TIFF OMITTED] T12AP10.002

[GRAPHIC] [TIFF OMITTED] T12AP10.003

           National Center for Missing and Exploited Children

    Senator Shelby. That is an amazing morning. [Laughter.]
    Mr. Gruel, Senator Lautenberg wanted me to tell you that he 
very much--he was here earlier, as you will recall--wanted to 
be here for your testimony, but he is required to be--he is a 
senior member of the Budget Committee--in some meetings with 
the White House. He wanted to say this to you.
    Mr. Gruel. Thank you, Mr. Chairman.
    Senator Shelby. I have got a statement.
    And I am going to keep the record open because I have a 
number of questions to all of you for the record and I know 
Senator Byrd, Senator Lautenberg, and others would too. And we 
will move on with the panel from there.
    The six of you here represent a significant portion of the 
surface transportation industry in America, and I want to take 
this opportunity to draw to your attention an effort that I 
would encourage all of you to explore and see if there is a way 
that your groups might get involved. A lot of you are probably 
already involved.
    And the effort is the National Center for Missing and 
Exploited Children, and they are people who place the pictures 
of missing children on milk cartons, on the flyers you receive 
in the mail--we are all aware of this--on the kiosks, and some 
of our transportation hubs. And it is working. It is working 
for parents. It is working for children. It is working for all 
America.
    Transportation, as you know from being here today, can play 
a significant role in identifying and recovering missing 
children. Transportation touches virtually every American's 
life on an almost daily basis, and if we, through the 
transportation system that you represent, can encourage people 
not to forget these missing and exploited children, we might be 
able to find more of those lost children.
    I know you would join me in this effort because you 
together can make a difference and are probably already making 
a difference collectively. I know a number of your 
organizations and member companies are already participating in 
this effort, and I want to commend you for it, congratulate you 
for it. But if there are ways to take advantage of the 
communication channels that you already utilize to your 
membership, to your passengers, to your customers, it is really 
worth looking into because all Americans will benefit from 
this. I think it is a very worthy project, and you have seen 
the results from it.
    If you have, I commend you. If you will consider it, I 
congratulate you because it will make a difference in families' 
lives and children's lives if we can do it.
    I appreciate all of you coming here. I am sorry that this 
went on so long this morning.

                          Subcommittee Recess

    This hearing of the Subcommittee on Transportation is now 
recessed. The next subcommittee hearing will be held on 
Wednesday, April 16, at 10 o'clock in Dirksen 124. The topic of 
the hearing will be aviation safety and security.
    Thank you, gentlemen.
    [Whereupon, at 12:48 p.m., Thursday, April 10, the 
subcommittee was recessed, to reconvene at 10:01 a.m., 
Wednesday, April 16.]



         MATERIAL SUBMITTED SUBSEQUENT TO CONCLUSION OF HEARING

    [Clerk's note.--The following material was not presented at 
the hearing, but was submitted to the subcommittee for 
inclusion in the record subsequent to the hearing:]
                   Association of American Railroads
  Prepared Statement of Karen Borlaug Phillips, Senior Vice President
                              introduction
    Mr. Chairman and members of the Subcommittee, my name is Karen 
Phillips. I am Senior Vice President of the Association of American 
Railroads (AAR).\1\ I appreciate the opportunity to present this 
statement to the Subcommittee concerning AAR's views on the 
reauthorization of the Intermodal Surface Transportation Assistance Act 
(ISTEA).
---------------------------------------------------------------------------
    \1\ AAR is a trade association whose members account for 75 percent 
of total rail line-haul mileage, produce 93 percent of total rail 
freight revenues, and employ 91 percent of the freight railway work 
force.
---------------------------------------------------------------------------
    I would like to discuss four particular issues of significant 
concern to the railroad industry. The first of these issues is one of 
overriding interest to all of us--transportation safety, and in this 
instance safety at highway-rail grade crossings. The second issue 
involves an essential element in any serious effort to continue to 
improve the movement of freight in this country and in the global 
marketplace--intermodalism, and specifically the important connections 
between different transportation modes. Third, I would like to address 
the roles of States and MPO's in effective transportation planning, 
and, finally, I will briefly discuss the important issue of federal 
truck size and weight standards.
                      highway-rail grade crossings
    There has been an extremely successful partnership among federal 
and state governments, the railroad industry, and other transportation 
safety interests for many years. This partnership has resulted in a 
reduction in annual public grade crossing accidents of over 65 percent 
since the early 1970's. This success has been accomplished primarily as 
a result of engineering improvements carried out under the federal 
Section 130 Program, and the driver education/public information and 
traffic law enforcement efforts of the Operation Lifesaver Program. In 
fact, the Federal Highway Administration estimates that the Section 130 
Program and Operation Lifesaver efforts have prevented over 8,500 
fatalities and 38,900 serious injuries since 1974.
    Despite the impressive safety improvement, the record of 3,697 
accidents and 432 fatalities at public grade crossings in 1996 is 
unacceptable. More must be done to eliminate these tragic accidents, 
and the partnership among the involved interests must be strengthened. 
AAR is proposing four initiatives which it believes will result in a 
significant improvement in highway-rail grade crossing safety:
    1. The federal government should continue and increase funding for 
the Section 130 Grade Crossing Improvement Program.--The historic 
Highway Safety Act of 1973 created and funded a national highway safety 
program specifically dedicated to enhanced safety at highway-rail 
crossings by providing for needed engineering and warning device 
improvements (Section 130 Program). In fiscal year 1997, approximately 
$150 million in highway user revenues was apportioned to the states to 
carry out this important program. As mentioned earlier, as a direct 
result of the earmarked federal funding for highway-rail crossing 
improvements, the annual crossing accident rate has been reduced by 
over 65 percent. This substantial reduction in accidents has occurred 
despite significant increases in both highway and rail traffic.
    Without funding dedicated or earmarked for the Section 130 Program, 
crossing projects rarely compete successfully with more traditional 
highway needs, such as highway capacity improvements and highway 
maintenance. In fact, this problem was the primary reason a separate 
crossing improvement program was established in 1973. Despite the 
proven success of the Section 130 Program, however, many states 
continue to assign an extremely low priority to crossing improvement 
projects. Through the end of 1996, over $227 million of Section 130 
Program funds remained unspent by the states, and approximately $230 
million had been transferred to other federal-aid highway program 
categories.
    Earmarked funding for the Section 130 Program should be continued, 
and the annual funding level should be increased to at least $185 
million. The ``Rail-Highway Crossing Study'' completed by the U.S. 
Department of Transportation in 1989 found that:

          ``For warning systems, an estimated annual investment of $185 
        million in improvements is necessary to maintain current 
        overall safety performance. . . . An initiative to cost 
        effectively reduce current accident levels would require 
        another $30 million annually.''

    Additionally, in order to increase state priority for Section 130 
Program projects and assure crossing improvement spending, the 
authority to transfer Section 130 Program funds to other federal-aid 
highway program categories should be restricted and obligation 
authority should be specifically reserved for the Section 130 Program.
    2. The federal government should establish a national mandate and a 
uniform process for closing unnecessary public grade crossings.--
Highway and rail safety officials have long advocated the closure of a 
large proportion of the public highway-rail grade crossings in the 
United States. Many grade crossings are redundant, serve no significant 
transportation mobility or access purpose, and continue to constitute a 
rail and highway safety hazard.
    However, closing grade crossings is often not an objective 
transportation safety decision because the issue causes local 
emotional/political confrontations. The railroads support the 
establishment by Congress of a federal crossing closing program 
implemented through a uniform nationwide process. Such a process should 
require state transportation agencies to identify and evaluate 
candidate crossings for closure, utilizing uniform criteria established 
by the U.S. Secretary of Transportation, and to develop and implement a 
statewide crossing closing plan. Active participation in this National 
Grade Crossing Closure Program should be required of all states. DOT 
should also develop guidelines which states would be required to follow 
in deciding whether to permit the opening or creation of any new grade 
crossings.
    3. The federal government should finance a multi-year national 
grade crossing safety education and public awareness campaign to be 
conducted by Operation Lifesaver. Inc.--Since motorists frequently are 
unaware of the grave dangers of their behavior, government should take 
responsibility for a major, multi-year public awareness campaign 
designed to illustrate the life-or-death consequences of motorists' 
behavior at grade crossings. ISTEA authorized $300,000 annually for the 
National Operation Lifesaver Program to increase public awareness of 
the grade crossing safety problem. Additional funds to support 
Operation Lifesaver are generally included in annual Federal Railroad 
Administration appropriations. However, a substantially increased 
commitment of resources is required to ensure the broadest 
understanding of the inherent danger of highway-rail grade crossings 
and the critical responsibility of motorists and the public to exercise 
appropriate care.
    This expanded national Operation Lifesaver campaign must garner the 
same universal recognition and acceptance that Mothers Against Drunk 
Driving (MADD), for example, enjoys for its attack on drunk driving. 
The need to ``Look, Listen . . . and Live'' at grade crossings must be 
as familiar to the general public as ``Friends Don't Let Friends Drive 
Drunk''.
    As an example of a possible component of such a national campaign, 
Operation Lifesaver--joined by FRA and various state agencies--is 
sponsoring a national campaign called ``Highway or Dieways.'' AAR is 
giving significant support to this campaign. This is a very graphic and 
hard-hitting public service advertising campaign promoting highway-rail 
grade crossing safety. The campaign consists of television and radio 
spots, print advertising, and billboards. The strategy is to introduce 
the campaign in every state through Operation Lifesaver state 
coordinators. Begun in 1996, it has been introduced in five states, 
Texas, Georgia, South Carolina, Alabama, and Missouri, and has received 
significant media interest. The campaign will also will begin this 
month in Ohio and California.
    4. The federal government should create a national grade crossing 
warning device problem alert system.--Despite regular and thorough 
grade crossing warning device testing, inspection, and maintenance 
conducted by railroad personnel, the industry has occasionally 
experienced problems in receiving timely and accurate notification when 
warning device problems occur. To address this problem, in 1982, the 
Texas legislature created the Texas 1-800 Number Rail-Highway Crossing 
Notification Program. Texas has installed signs at public crossings 
encouraging the public to call the 1-800 telephone number in the event 
of a crossing warning device problem. The calls are received by the 
Texas State Police, which in turn alert the appropriate railroad 
personnel.
    The railroad experience with the Texas 1-800 System has been 
generally positive. Although occasional ``crank'' calls are received 
and the public's perception of a warning device problem may be 
inaccurate, the system continues to provide valuable and timely 
information concerning warning device problems to appropriate railroad 
maintenance personnel.
    The railroad industry supports the creation of a publicly funded, 
nationwide grade crossing warning device problem alert system operated 
by appropriate state agencies. The federal government should evaluate 
the feasibility of a variety of possible nationwide alert systems, and 
adopt and implement an effective system.
    These four grade crossing safety initiatives will significantly 
enhance safety at highway-rail grade crossings and strengthen the 
essential partnership between the railroad industry and government. I 
urge the Congress to include these recommendations in ISTEA 
reauthorization legislation.
                         intermodal connectors
    I would now like to discuss briefly the second issue of concern to 
the railroad industry--intermodalism and intermodal connector highways.
    In ISTEA, Congress declared that:
    It is the policy of the United States to develop a National 
Intermodal Transportation System . . . The National Intermodal 
Transportation System shall consist of all forms of transportation in a 
unified, interconnected manner . . .
    In an effort to achieve that important objective, the Congress 
established the National Highway System, and determined that:

          The purpose of the National Highway System is to provide an 
        interconnected system of principal arterial routes which will 
        serve major population centers, international border crossings, 
        ports, airports, public transportation facilities, and other 
        intermodal transportation facilities . . .

    The importance of the interconnectivity of our transportation modes 
and systems was subsequently underscored by the National Commission on 
Intermodal Transportation when it found that:

          Barriers to safe and efficient movement of freight occur at 
        connections between modes . . . For example, inadequate roadway 
        access to freight terminals is a barrier to the intermodal 
        freight system and a major contributor to urban congestion. The 
        lack of adequate connectors between the interstate highway 
        system and the Nation's port, rail, airport, and truck 
        terminals results in urban congestion, air pollution, negative 
        impacts on adjacent neighborhoods, and delivery delays for 
        shippers.

    On May 24, 1996, then-Transportation Secretary Pena sent to the 
Congress a recommended list of highway connectors to major intermodal 
freight and passenger terminals. In his letter of transmittal, 
Secretary Pena observed:

          The Congress, in creating the NHS, recognized that the 
        Nation's transportation infrastructure must be viewed as a 
        single system with each mode complementing the others. With the 
        NHS and its connections to major intermodal terminals as the 
        united force, our national transportation network will sustain 
        economic growth, increase our competitiveness in the 
        international marketplace of the 21st century, and enhance the 
        personal mobility of every American.

    Representing our major freight railroads, I can assure you that 
these observations and findings concerning intermodal highway 
connectors are absolutely correct. These essential highways are the 
glue that holds much of this country's intermodal transportation system 
together. Without first rate connections, trains, trucks, barges, and 
planes are condemned to operate separately and inefficiently. 
Government and America's private transportation companies can provide 
the finest transportation systems and services in the world--and that 
is occurring--but a completely efficient intermodal transportation 
system can never be realized without quality connections.
    During ISTEA reauthorization these important intermodal connectors 
are to be considered for inclusion on the National Highway System 
(NHS). AAR enthusiastically supports improvement of intermodal 
connectors and urges their addition to the NHS.
                        transportation planning
    ISTEA attempted to establish a new approach to transportation 
throughout the country, by striving to break out of traditional, but 
limiting, perspectives. Transportation after ISTEA would no longer 
suffer from historic compartmentalization. The interests and concerns 
of both public and private providers of transportation facilities and 
services would be considered jointly and cooperatively. Passenger and 
freight transportation needs would both receive adequate attention and 
an appropriate allocation of resources. State, local, and metropolitan 
transportation interests would each have an appropriate and important 
role in planning and resource allocation. These goals of ISTEA have not 
yet been achieved, but that should in no way tarnish the vision or 
diminish our efforts.
    Private railroads are working closer than ever, and more 
successfully, with states and MPO's to develop effective transportation 
plans and programs. It has been an evolutionary process, primarily 
because all participants have had a great deal to learn about each 
other and about just how to integrate our respective interests and 
needs into a truly comprehensive transportation planning process. But 
the learning and improving is happening, and transportation in this 
country is winning as a result.
                         truck size and weight
    AAR supports the status quo on truck size and weight limits. Of 
particular concern are any efforts which may be made to thaw or 
otherwise modify the freeze on the expanded use of longer combination 
vehicles (LCV's) \2\ that was included in ISTEA.
---------------------------------------------------------------------------
    \2\ Longer combination vehicles, or LCV's, include three main truck 
types: triple 28 foot trailer combinations or triples; twin 48' or 53' 
tractor trailer combinations, also knows as long or turnpike doubles; 
and Rocky Mountain Doubles, combinations with one long and one short 
trailer. The 1991 ISTEA defines LCV's as combinations with two or more 
trailers operating at weights above 80,000 pounds.
---------------------------------------------------------------------------
    The railroad industry has, of course, a vital stake in truck size 
and weight policy. Larger, heavier trucks--especially LCV's--would 
cause serious traffic and revenue losses to the U.S. railroad industry. 
This is obviously a grave concern for the railroad industry. This vital 
interest extends not just to the rail companies themselves, but also to 
the 213,000 rail employees, rail shippers, and the railroad supply 
industry. Additionally, there is strong evidence that heavy trucks pay 
user charges far less than the costs they impose on our highways and 
our society. This underpayment enables them to reduce rates and divert 
traffic from railroads. In the absence of full cost recovery, the 
further diversion from rail that will result from expanded use of LCV's 
is likely to mean a significant net economic loss not only to 
railroads, but also to society.
    The public strongly supports federal truck weight standards. Sixty-
eight percent of Americans endorse a federal weight freeze on trucks, 
according to a April, 1995, nationwide poll conducted by The Tarrance 
Group. Further, by exercising control over the nation's infrastructure 
through continuation of current truck size and weight standards and the 
LCV freeze, Congress can prevent highway infrastructure damage and 
congestion, increased highway safety problems, and exacerbated harm to 
the environment.
    Advocates of increased LCV use are now proposing a ``State Option'' 
regime in place of the current federal LCV freeze. Under ``State 
Option'', States without LCV's would come under intense pressure to 
allow bigger trucks as they spread to neighboring jurisdictions. 
Stopping this ``upward ratchetting'' of truck size and weight limits 
was the reason for the 1991 LCV freeze. Ending the current freeze 
through such a ``State Option'' approach would mean a rapid spread of 
LCV's throughout the United States.
    The truck size and weight status quo--including the LCV freeze--is 
also threatened by the negotiations on standardizing truck size and 
weight limits which are being held with our NAFTA partners, Canada and 
Mexico. Last summer, 57 members of the Senate and 232 House members 
signed a letter to then-DOT Secretary Pena, urging him not to allow the 
NAFTA negotiations to be a vehicle for truck size and weight increases 
in the United States. AAR commends those members who signed the letter 
to the Secretary and the railroad industry hopes that Congress will 
continue to oppose larger and heavier trucks not just in NAFTA 
negotiations, but also in the ISTEA reauthorization.
    In conclusion, ISTEA is working, because all parties are truly 
working together. AAR is convinced that America must continue the 
progressive agenda established by the Intermodal Surface Transportation 
Efficiency Act into the 21st Century.
    Thank you for allowing me to present the AAR's views on ISTEA 
reauthorization.
                                 ______
                                 
              National Association of Independent Insurers
Prepared Statement of Gerald W. Bell, Director, Commercial and Property 
                                 Lines
    The National Association of Independent Insurers is the nation's 
leading property casualty insurance company trade association with more 
than 560 member companies which write about one-third of the private 
passenger and commercial automobile insurance in the country. NAII is 
an active member of the American Highway Users Alliance and Roadway 
Safety Foundation, and we endorse the AHUA testimony supporting 
reauthorization of the federal highway program with increased funding 
for highway building, roadway maintenance, and safety programs. NAII is 
submitting this additional written statement to highlight the need for 
adequate funding to assist border states for infrastructure and 
inspection systems to assure highway safety once Mexican and Canadian 
trucks are permitted to operate fully in this country as a result of 
NAFTA.
    The NAII is greatly concerned that unless the Congress approves, at 
a bare minimum, 100 percent of the appropriation proposed by NEXTEA 
under Title IV--Motor Carrier Safety, the economic downside to the 
nation will be even more costly for Americans.
    Increased Motor Carrier Safety Assistance Program (MCSAP) funding 
must be provided so that officials can recruit, train, and deploy 
greatly increased numbers of motor carrier safety enforcement personnel 
to the United States-Mexican border states of California, Arizona, New 
Mexico, and Texas. The number of vehicle inspections possible with 
current physical and manpower resources is insufficient to act as a 
deterrent to those who would scoff at current statutes and regulations. 
It is essential that vehicles entering the United States commercial 
zone are in full compliance with all applicable vehicle and driver 
safety requirements before any serious thought can be given to lifting 
the moratorium and allowing non-complying vehicles ever farther into 
the U.S. interior.
    NAII supports the Preamble and Objectives (Part One, Chapter One, 
Article 102) of the NAFTA. Nonetheless, our Association is greatly 
concerned that the current reality falls alarmingly short of these 
stated ideals . . . short enough, in fact, to conclude that it would be 
irresponsible to lift the moratorium at this time. The threats to life 
safety, the environment, and the infrastructure are simply too great.
    The NAFTA requires the parties to work together to enhance the 
level of safety and of protection of human, animal and plant life and 
health, the environment and consumers (Article 906.1). Compatibility of 
standards is to be achieved to the greatest extent possible, without 
reducing the level of safety (Article 906.2.). In other words, as The 
Honorable Ileana Ros-Lehtinen, Chair, House Subcommittee on 
International Economic Policy and Trade said in her March 5th statement 
before her Subcommittee, ``[T]he minimum requirement of NAFTA, and of 
any other trade agreement that the U.S. enters into, is that it `do no 
harm'--that is, even if the U.S. does not benefit from it, at least it 
should not suffer for it.'' Unfortunately, without greatly augmented 
U.S. border resources Americans will be harmed.
    Parties to the Land Transportation Standards Subcommittee and to 
its Technical Advisory Groups have worked diligently to negotiate 
agreements and to achieve compatibility on many issues. That is 
laudable. However, the reality is that the level of safety has not been 
significantly enhanced since the NAFTA went into effect three years 
ago.
    The United States General Accounting Office testified on March 6th 
before the House Subcommittee on Transportation, Committee on 
Appropriations that, ``[F]rom January through November 1996, federal 
and state officials carried out more than 20,000 inspections of trucks 
entering from Mexico resulting in about 45 percent of the vehicles 
being placed out of service for serious safety violations. Our ongoing 
work shows that, while the number of truck inspectors at major southern 
border crossings has increased and two large permanent inspection 
facilities have been opened, the results of increased inspections do 
not show a clear trend that Mexican trucks are becoming safer.''
    Let's look at some facts:
    Over 11,000 trucks enter the United States border zone each day. 
They cross at any of 28 highway points of entry. More than 4,000 of 
those trucks enter at Laredo, Texas, the busiest point. Concern about 
the potential environmental impact of a hazardous material spill from 
incoming Mexican trucks is so great in Laredo, Texas, that the local 
television stations run frequent public service videos warning 
residents about the threat.
    The United States Department of Transportation has once again 
entered into agreement with Mexican officials to provide training for 
Mexican enforcement personnel regarding U.S. motor carrier standards 
for vehicles and operators. A February 1996 General Accounting Office 
report advises that since 1993 U.S. officials trained 285 Mexican 
personnel to inspect trucks. Those personnel were to have become the 
trainers in Mexico, but most have left the program according to Mexican 
officials. Why should we believe that this new effort will bear a 
different result?
    The Governors of the four U.S. border states have widely proclaimed 
that their states are ready for the moratorium to be lifted and that 
unsafe Mexican trucks will be weeded out, but we are not convinced that 
effective systems are in place yet to assure safety. None of the border 
states appear to have the requisite number of enforcement personnel to 
assure that even the majority of unsafe Mexican trucks will be weeded 
out.
  --If the four border state governors are correct about their 
        collective resources to assure motor carrier safety then why 
        did 201 bipartisan House lawmakers (34 Republicans, 167 
        Democrats) send a letter to President Clinton on March 21st 
        warning him not to open the U.S. border until a stronger safety 
        regime is in place?
  --More than 20,000 inspections of trucks entering from Mexico 
        resulted in about 45 percent of the vehicles being placed out 
        of service for serious safety violations. This compares 
        unfavorably to the 28 percent out-of-service rate for U.S. 
        trucks inspected in the United States. This begs the question: 
        if the December 18, 1996 joint letter from Governors Bush (TX), 
        Johnson (NM), Wilson (CA), and Symington (AZ) is correct in 
        claiming ``that there is no reason for further delay in lifting 
        the moratorium,'' why doesn't the data show that incoming 
        trucks are becoming safer?
  --Texas Attorney General Dan Morales reported in early 1996 that of 
        the 5,000 commercial vehicles entering Texas each day that only 
        about 150 are stopped and inspected by Texas Department of 
        Public Safety troopers.
  --Karen Hughes, a spokesperson for the Governor, is quoted in the 
        November 30, 1996, Fort Worth Star Telegram as saying, ``The 
        Texas Department of Public Safety is fully prepared to make 
        sure that all the trucks meet safety standards.'' Ms. Hughes 
        remark seems inconsistent with a comment by the Governor on 
        January 28th that 109 additional troopers will be added to the 
        Public Safety Department in order to enforce safety and weight 
        laws.
    Even Mexican business community spokespersons are having second 
thoughts about the NAFTA.
  --On February 3rd, Alfredo Cardenas, Vice President of Mexico's 
        National Chamber of Cargo Transport was quoted by Reuters News 
        Service as saying, ``I believe it will be negative to open the 
        border because the economic conditions between the countries 
        are very different.''
  --The news service also quoted Cardenas, speaking in his capacity as 
        director of Mexico's fourth-largest trucking company, as 
        saying, ``It will damage Mexicans because no Mexican can 
        compete with the Americans. It should wait until our economy 
        recovers in three to five years more.''
  --Bernardo Lijtzain Bimstein, President of the Mexican national 
        trucking association known as CANACAR, was quoted by the 
        Journal of Commerce as saying, ``We are not in a position to 
        compete with the Americans. The longer the opening is put off, 
        the more time we have to prepare.''
    The true economic impact of the NAFTA must take into consideration 
the costs expended by the federal and state governments to enforce 
vehicle and driver safety standards.
  --The state of California constructed new Highway Patrol Inspection 
        facilities at Otay Mesa and at Calexico at a cost of $30 
        million.
  --Texas is adding 109 State Troopers at a cost estimated to exceed $4 
        million.
  --The United States Customs Service has installed the world's largest 
        (and presumably among the most expensive) X-ray machines at its 
        Otay Mesa facility, capable of X-raying an entire 53 foot semi-
        trailer at one time.
  --Texas has constructed a new roadside enforcement facility at El 
        Paso at an estimated cost of $700 thousand.
  --New Mexico has constructed a new inspection facility at Anthony at 
        an approximate cost of $9 million.
    The NAFTA provides that each party will comply with the laws of its 
tri-lateral trading partners. These include laws relating to commercial 
motor vehicle, drivers, and the environment. The reality however is 
that Mexican trucks and their operators enter the U.S. out of 
compliance with applicable statutes and regulations with relative 
impunity. While the training and proficiency of U.S. and state 
enforcement personnel is high they are dangerously understaffed. Only a 
minuscule number of Mexican trucks can be inspected each day--too small 
a percentage to serve as a deterrent to those who see the chance of 
their getting caught to be minimal.
  --The maximum legal weight limit for a truck engaged in interstate 
        commerce is 80,000 pounds. Rob Harrison, associate director of 
        the transport research center at the University of Texas is 
        quoted in the January 17, 1997, Journal of Commerce as saying, 
        ``Some loads entering the border zone approach 150,000 
        pounds.'' It has long been reported that Mexican officials have 
        not aggressively enforced weight limits. Roadside scales are 
        virtually nonexistent.
  --Mexican environmental law provides for a maximum sulfur content in 
        diesel fuel. The national oil company, Pemex, produces diesel 
        containing 50 percent more sulfur content than permitted by 
        Mexican law (300 percent more than permitted by U.S. 
        standards). Pemex is the sole source of diesel fuel in Mexico. 
        Trucks incoming from Mexico will be belching their hazardous 
        fumes into the U.S. environment, thus exacerbating existing 
        acid rain, respiratory, and other health concerns.
  --The Otay Mesa port of entry is the busiest in California. From the 
        seven month period December 1, 1995, through June 30, 1996, 
        250,613 Mexican trucks passed through the California Highway 
        Patrol Inspection Facility. All vehicles passed over the 
        scales. However, only 5,744 trucks (2.3 percent) were 
        physically inspected. Of these 5,744 inspections, 3,567 (62 
        percent) resulted in citations for one or more violations. 
        1,412 (25 percent) of the inspected vehicles were placed out-
        of-service on the spot.
  --At the Calexico, California, port of entry the percentage of 
        inspected commercial vehicles placed out-of-service is 30 
        percent according to Vince Calderon, a California Highway 
        Patrol inspection officer.
    Were the NAII to issue a NAFTA report card, these would be the 
grades: `A' for good intentions, desires, determinations, resolutions, 
agreements, alliances, accords, assurances, and promises. `F' for 
significant results that currently reduce the quadruple threats . . . 
life safety, environment, infrastructure, insurance cost escalation.
    In conclusion, NAII urges Congress to closely monitor the 
implementation of NAFTA to assure safety is not compromised. We also 
urge Congress to assist the states financially as they seek to build 
the necessary infrastructure and safety inspection teams for border 
crossings so we can be certain that Mexican trucks coming into the U.S. 
will pose no greater threat to safety than U.S. trucks.
                                 ______
                                 
                American Association of Port Authorities
              Prepared Statement Kurt J. Nagle, President
    Please accept this statement for the record for the Subcommittee's 
April 10 hearing on fiscal year 1998 Transportation Appropriations. The 
American Association of Port Authorities was founded in 1912 and today 
represents more than 140 public port authorities in the United States, 
Canada, the Caribbean and Latin America. The following represents the 
views of our U.S. members.
    U.S. public port authorities have for years expressed concerns that 
critical transportation infrastructure needs have not been adequately 
recognized through federal transportation funding. Although the 
authorization of Intermodal Surface Transportation Efficiency Act of 
1991 initiated for the first time transportation planning that includes 
planning for goods movement in addition to people movement, in reality, 
ISTEA had many shortcomings in meeting the needs of the freight 
community. A copy of AAPA's Platform on ISTEA is enclosed.
    The reauthorization legislation for ISTEA should improve upon the 
positive policy changes made in the first ISTEA, but should also seek 
to address ISTEA's shortcomings in meeting the needs of America's 
freight community, which provides great economic benefit to the country 
and its consumers. Following the unveiling of the Administration's 
proposal to reauthorize ISTEA (NEXTEA), U.S. members of the American 
Association of Port Authorities (AAPA) indicated strong support for 
provisions designed to maintain the intermodal focus of the bill and 
expand eligibility and funding opportunities for port access and 
freight mobility projects. AAPA is encouraged that the Department of 
Transportation has cited specific ideas to improve the transportation 
planning process.
    U.S. ports are particularly pleased with several features in 
NEXTEA,including (1) designation of intermodal connectors as part of 
the National Highway System (NHS), (2) NHS eligibility for publicly-
owned intermodal surface freight transfer facilities, including 
publicly-owned rail access lines or roads to a seaport, (3) Surface 
Transportation Program Fund eligibility for publicly-owned rail freight 
facilities, (4) expansion of the State Infrastructure flank program, 
and (5) creation of a Transportation Infrastructure Credit Enhancement 
Program to benefit large, capital-intensive projects.
    Under the proposal, state and metropolitan transportation planning 
would consider the economic viability of the state or metropolitan 
area, especially global competitiveness, productivity and efficiency, 
as well as how to enhance the integration and connectivity of 
transportation across and between modes for people and freight. It 
specifically provides that state transportation plans be developed in 
consultation with freight shippers as well as other interested parties.
    Although AAPA agrees with these policy changes, public ports do not 
feel that the Administration's proposal for the reauthorization of 
ISTEA is sufficiently funded. AAPA supports legislation to take the 
four transportation trust funds off budget, providing much needed 
funding for harbor maintenance as well as surface transportation for 
port access. The U.S. lags far behind its trading partners in 
infrastructure investment, and as such, AAPA supports legislation to 
provide for full funding of transportation programs.
    Thank you for your consideration of the views of the public port 
industry regarding this important issue. We look forward to working 
with you toward the development of a national transportation bill that 
effectively addresses the nation's needs.
                         AAPA Platform on ISTEA
    U.S. public ports strongly supported the provisions of ISTEA that 
recognize the need to expand the scope of U.S. transportation planning 
and funding to include the needs of intermodal freight transportation 
as incorporated in the goals and provisions of ISTEA. Economic growth 
and quality of life are dependent upon a transportation system that 
moves people and goods efficiently. Public ports provide the nation 
with its highways to the world, linking every community in the U.S. to 
the world market. In 1994, ports and port users generated 15.9 million 
jobs, contributed $783 billion to the Gross Domestic Product, and 
provided $210 billion in taxes at all levels of government. Ports 
provided these benefits in 1994 while themselves investing over $929.6 
million in new and modernized terminal facilities to better serve 
businesses and consumers in the global marketplace. Planning for 
landside access to U.S. ports is a key component of the nation's 
ability to compete globally and ultimately provides for maximum trade 
and economic growth.
    Yet with ISTEA up for reauthorization in 1997, ports are finding 
that freight projects, particularly those meeting regional or national 
transportation needs, still are not competing well for a fair 
allocation of ISTEA funding. A recent General Accounting Office report 
identified that freight projects received less than 1 percent of the 
total highway and nontransit infrastructure money apportioned to states 
during the first 4 years of ISTEA. (Intermodal Freight Transportation; 
Projects and Planning Issues, GAO/NSIAD-96-159.)
    The need to increase the focus on freight and afford it the 
priority it deserves was clearly voiced in Department of Transportation 
outreach meetings on ISTEA held last year as well as in 1993. A March 
1994 report issued by DOT summarizing the first round of ISTEA outreach 
meetings states that ``[t]hroughout the country, the message was clear: 
freight movement must be given a higher priority in the planning and 
funding allocation process under ISTEA.''
    AAPA will support continuation of the structure envisioned by 
ISTEA, with decisionmaking authority primarily at the local level, if 
changes are made to permit freight projects to fairly compete for 
funding. It must be recognized that local decisionmaking favors 
passenger needs, and that freight projects, particularly those meeting 
regional or national needs, have difficulty obtaining finding. The 
National Commission on Intermodal Transportation's 1994 report found 
that ``ISTEA's emphasis on local and State decisionmaking means that 
projects of national significance, which sometimes largely provide 
benefits beyond local or State jurisdictions, may not receive 
appropriate funding priority.''
    AAPA strongly supports full funding of ISTEA and investigating new 
funding sources to increase available resources, as well as taking 
trust funds off budget in order to ensure that transportation user fees 
are used for infrastructure, not deficit reduction. Providing funding 
for adequate transportation infrastructure investment protects the 
nation's competitive position in the global marketplace and provides a 
local economic return on investment. To maintain a modern and 
competitive transportation system, Congress should:
  --Provide full funding to transportation legislation, including 
        ISTEA's successor.
  --Take Transportation Trust Funds off-budget so that funding may be 
        allocated in a way which provides the greatest economic benefit 
        for the investment.
    There is clearly a vital role for USDOT in freight projects that 
cross multiple jurisdictions and that meet regional and national needs. 
To reinforce the national interest in such projects, the next 
generation of ISTEA should accomplish the following:
  --Enhance the ability of the Federal government to provide innovative 
        financing for projects of regional and national significance, 
        including highway corridors of national significance under 
        section 1105 or other major freight projects.
  --Break down the Administration's modal walls and create an 
        Intermodal Transportation Administration with a specific goods 
        movement of rice. At a minimum, the role of the Office of 
        Intermodalism should be enhanced to include advocacy for 
        freight needs.
    ISTEA should provide for goods movement to be an integrated 
component of transportation system planning. Despite public 
participation provisions, freight interests are not at the table and 
project selection criteria often do not take freight mobility into 
account. In order to ensure that effective transportation planning be 
conducted, ISTEA's successor should:
  --Specify that project selection criteria to be used by States and 
        MPO's must fairly consider freight projects and must include 
        direct and indirect economic benefits, job creation, congestion 
        reduction, and enhancement of freight mobility.
  --Require MPO's to develop a 5-year capital improvement plan to 
        identify high priority freight mobility projects, including an 
        implementation schedule, within two years after ISTEA is 
        reauthorized. Plans would have to be approved by the USDOT, and 
        USDOT would have to report back to Congress on the progress in 
        this area. Plans must be developed in conjunction with local 
        freight interests and must include a market analysis as the 
        basis for determining the need for improvements. Corridors of 
        national significance should be included. If a plan is not 
        submitted as of the statutory deadline, states should lose a 
        portion of their funding. The capital improvement plan must be 
        updated every year.
  --Stress that transportation planning at the state and local level 
        should consider waterside access as an integral portion of the 
        system to be connected.
  --Require metropolitan planning organizations (MPO), or appropriate 
        transportation funding agencies, if not the NIPO, with a public 
        port authority within their boundaries to include the port 
        agency as a voting member of the MPO, as are numerous other 
        state and local public agencies.
  --Require MPO's to have freight interests of all modes represented on 
        their policy and technical committees, and encourage the 
        creation of goods movement task forces. Stress the need for 
        MPO's to actively seek public participation by freight 
        interests and to educate themselves about goods movement.
    AAPA supports policy changes in ISTEA reauthorization that provide 
for the selection of the best mode of transportation for the most 
efficient movement of goods. AAPA also supports the objectives of 
environmental and sound economic development. In line with increased 
flexibility of funding, ISTEA's successor should accomplish the 
following:
  --Expand the eligibility and flexibility of ISTEA funding to include 
        rail freight and other intermodal projects which reduce 
        congestion and create economic benefits.
  --Enhance flexible funding for port infrastructure projects by 
        expanding the use by public agencies of tax exempt bond 
        authority for cargo transportation purposes. Proposals in 1996 
        included H.R. 1790 (Hoary, R-CA) and S. 1199 (Boxer, D-CA), 
        legislation to amend the Internal Revenue Code to permit the 
        use of private activity bonds to finance trackage and rail 
        facilities, in addition to docks and wharves, in [united 
        circumstances.
    Founded in 1912, the American Association of Port Authorities 
(AAPA) represents virtually every U.S. public port agency as well as 
the major port agencies in Canada, Latin America and the Caribbean. 
This policy paper reflects the views of the AAPA's United States 
delegation.
                                 ______
                                 
              National Association of Railroad Passengers
        Prepared Statement of Ross B. Capon, Executive Director
    Our non-partisan association--whose members are individuals--has 
worked since 1967 towards development of a modern rail passenger 
network in the U.S. We appreciate this opportunity to provide our views 
for the record. The subcommittee has heard oral testimony from some 
organizations strongly opposed to federal funding for Amtrak. We 
request a similar opportunity to testify at the earliest possible 
opportunity.
    We support NEXTEA's overall general approach to transportation. We 
applaud giving states the right to use flexible gasoline-tax funds for 
intercity passenger rail. We support creation of a dedicated funding 
source for Amtrak, such as through S. 436 (including the earmarking of 
1 percent of the funds for states with no Amtrak service). We think the 
public wants the enhanced travel choices and balanced transportation 
system such legislation would promote. Section IV (pages 4-6) lists 
benefits of intercity passenger rail. Finally, we endorse Amtrak's 
appropriations request.
                  i. poll by bruskin goldring research
    On May 19-21, 1995, in a national probability sample of 1,006 
adults (524 women, 482 men), age 18 and over--by telephone--Bruskin 
Goldring Research, Inc., of Edison, New Jersey, found:
  --63 percent support for earmarking a full penny of existing federal 
        gasoline tax ``to create a trust fund to pay for long-term 
        Amtrak improvements''; and
  --63 percent support for letting states ``use, for intercity rail 
        passenger service, a portion of their federal transportation 
        funds now restricted to highways, mass transit and recreational 
        trails.''
    (See Appendix I for the full text of the poll questions.)
    It is noteworthy that:
  --``Yes'' responses were the majority in all geographical sections of 
        the nation, even where Amtrak service is sparse. The ``yes'' 
        showing ranged from 58-59 percent (penny/flexibility) in the 
        South to 70-67 percent in the Northeast.
  --For both questions, only 10 percent of women and 16 percent of men 
        were ``strongly'' opposed.
    The poll suggests to us that the public does not view gasoline 
purchases strictly as votes for more roads. America is in love with 
travel, not with the automobile. In spite of a woefully inadequate 
advertising budget, and competition from airlines whose huge ad budgets 
are mutually reinforcing, modern passenger trains of all types are well 
used in most places where they exist.
    Americans often ask why ``we can't have a train network as good as 
they have in Europe.'' One answer: you get what your leaders buy. The 
U.S. spends far more of its gas taxes on roads than do many other 
countries. Netherlands and Great Britain spend about 25 percent--most 
other European countries about 33 percent--of road taxes on roads 
(National Transportation Strategic Planning Study, U.S. Department of 
Transportation, March 1990). At the same time, intercity passenger rail 
investment is tiny and has been declining, both in absolute terms and 
as a share of federal transportation spending (see appendices).
                   ii. the public votes with its feet
    The traveling public generally responds positively whenever modern 
intercity passenger rail is provided (see table on next page). The most 
up-to-date statistics also are encouraging. Compared with the year-
earlier months, during the first six months of Fiscal 1997 (October-
March), travel is up 3 percent systemwide and 5 percent at the 
Intercity unit (which operates most long-distance trains and all 
Chicago-based corridors). [The percentage changes are of passenger-
miles. A passenger-mile is one passenger traveling one mile.]
    Much has been made of Amtrak's small share of total intercity 
travel. However, this should not obscure the critical role that Amtrak 
plays where it operates and the fact that this role will become even 
more critical in the future (see #1, section IV). Amtrak handles about 
44 percent of air-plus-rail traffic in the New York-Washington city-
pair market; this figure rises to about 70 percent if we include 
intermediate points--such as Philadelphia, Baltimore and Wilmington. 
However, Amtrak's share is impressive even as a per cent of total 
travel: Amtrak has 23 percent of all Philadelphia-Washington travel, 16 
percent of New York-Washington and 13 percent of New York-Albany, the 
latter despite an average speed of just 58 mph (vs. 76 and 66 mph, 
respectively, on most New York-Washington Metroliners and conventional 
trains). The auto market share is 70 percent in the two shorter 
markets, 50 percent New York-Washington. Investments under way will 
bring similar benefits to the Boston-New York corridor. Currently, 
Amtrak has only 7 percent of all travel in the New York-Boston city-
pair market; today's average speeds range from 45 to 54 mph.

                              AMTRAK USAGE--RIDERSHIP ON SELECTED CORRIDOR SERVICES                             
----------------------------------------------------------------------------------------------------------------
                                                                                                      Change    
                              Route                                    1982            1996          (percent)  
----------------------------------------------------------------------------------------------------------------
Pacific Northwest...............................................          73,670         303,700          +312.2
San Joaquin Valley..............................................         181,074         567,400          +213.4
Chicago-Milwaukee...............................................         142,350         320,200          +124.9
Metroliners (New York-Washington)...............................       1,060,098       2,011,200           +89.7
San Diego-Los Angeles (-Santa Barbara)..........................       1,190,287       1,565,700           +31.5
New York-Albany-Buffalo.........................................         768,071         978,900           +27.4
----------------------------------------------------------------------------------------------------------------


                                                 PASSENGER-MILES                                                
                                                   [Billions]                                                   
----------------------------------------------------------------------------------------------------------------
                                                                                                      Change    
                             Segment                                   1982            1996          (percent)  
----------------------------------------------------------------------------------------------------------------
Nationwide......................................................             4.2             5.1             +21
Long-Distance Trains Only.......................................             2.5             2.8             +13
----------------------------------------------------------------------------------------------------------------
Prepared by National Association of Railroad Passengers, 2/97.                                                  

  iii. the half cent: higher ridership, lower federal operating grant
    The half cent and the ability to spend it would enable Amtrak to 
improve service quality and to provide more service. New rolling stock, 
improved maintenance facilities and stations, more track capacity (a 
new siding on the single-track Los Angeles-San Diego line, for example) 
and completion of the Boston-Washington high speed project would 
directly benefit passengers and increase ridership. Rehabilitation of 
the New York-Washington electrification is necessary to retain existing 
ridership. New mail-and-express facilities also would enhance Amtrak's 
efforts to meet its zero-operating-grant-by-2002 goal.
                         iv. benefits of amtrak
    1. In crowded corridors, passenger trains represent vital people-
moving capacity and help relieve air and road congestion. This benefit 
will grow over time as travel demand continues to grow while airport 
and highway construction face more intense local opposition and ever-
tighter limits on funding and sheer availability of land.
    2. Amtrak is far safer than auto travel.
    3. During inclement weather, Amtrak is safer and usually more 
reliable than airplanes and buses.
    4. Amtrak is 45 percent more energy-efficient than domestic 
commercial airline service (2,351 BTU's per passenger-mile v. 4,304.2) 
and 76 percent more energy-efficient than general aviation (9,825 BTU's 
per passenger-mile). Source: Oak Ridge National Laboratory's 
Transportation Energy Data Book Edition 16, July 1996. This 1994 data 
understates Amtrak's efficiency because it:
  --reflect operation of a large fleet of old, relatively energy-
        intensive cars, almost all of which Amtrak has since retired.
  --do not reflect Amtrak's positive impact on energy-efficient 
        downtown development and mass transit (see #6, below).
    [Note: Earlier Oak Ridge reports included Northeast Corridor 
electricity consumed by Maryland, SEPTA and New Jersey Transit commuter 
trains using Amtrak-owned tracks but excluded the passenger-miles those 
trains generated. This partly explains Amtrak's relative improvement 
from, say, 1992, when Amtrak was ``only'' 42 percent and 70 percent 
more energy-efficient than commercial and general aviation, 
respectively.]
    5. Amtrak is much less polluting than airplanes. (Energy efficiency 
is a good proxy for air pollution--see #4, above.)
    6. In most cities, Amtrak helps mass transit, downtown areas and 
transit-dependent people by serving--and increasing the visibility and 
economic viability of--transit-accessible downtown locations. Amtrak 
feeds connecting passengers to transit. Amtrak shares costs with 
transit at joint-use terminals and on joint-use tracks. Positive 
impacts have been observed even in small cities with minimal Amtrak 
service. Mayor John Robert Smith of Meridian, Mississippi--on Amtrak's 
New York-Atlanta-New Orleans run, with but one train per day in each 
direction--says property values have tripled in recent years around the 
railroad station, where a new intermodal terminal is under 
construction.
    By contrast, new airports intensify energy-inefficient suburban 
sprawl and stimulate auto-dependent development. This leads to the 
social costs of getting transit-dependent people to work, or the need 
to address the consequences of their not working.
    7. Amtrak serves many communities where alternative transportation 
either does not exist, is not affordable or only serves different 
destinations. Trains can make intermediate stops at smaller cities at 
minimum cost in energy and time. This is apparent in corridors--where 
benefits go to such cities as Jefferson City, Lancaster, Trenton, 
Kalamazoo, Wilmington, Bloomington/Normal and Tacoma. It also means, 
for example, that the Empire Builder can stop at eight small cities in 
Washington (plus Seattle and Spokane), 12 in Montana and seven in North 
Dakota without compromising the train's appeal to those riding between 
Chicago or Minneapolis and Seattle or Portland. Similarly, the 
California Zephyr serves five Colorado points (plus Denver) and five 
points each in Iowa and Nebraska. Also, Amtrak serves 14 North Carolina 
points.
    Here is one example of long-distance travel that I encountered on 
the Southwest Chief in March, 1995: a mother and her 14-month-old child 
rode from Garden City, Kansas, to Barstow, California. The family was 
moving to California; the husband was driving the U-Haul; the wife and 
child were on the train ``so the move would not be so traumatic'' for 
the child. They did not consider the plane because they felt it would 
be too cramped for the child. Also, the Garden City-Ontario, California 
air fare was $450 round-trip with a change of planes in Denver; the 
train was $188 round-trip (in coach) and went direct.
    8. Amtrak is important to those who cannot fly due to temporary or 
permanent medical problems, and to those for whom physical and 
financial considerations rule out driving long distances, for example, 
seniors and students. (The editor of Frequent Flier, forced by doctor's 
orders to take the train to Florida, wrote a favorable column about the 
trip.) Nonetheless, a large proportion of Amtrak riders do own cars or 
could fly but instead chose the train.
    9. Thanks to a growing array of connecting buses available with 
train travel in a single ticket transaction, Amtrak puts people on 
intercity buses who would not otherwise have considered using them. 
This trend first developed in a big way in California, where the state 
underwrites an impressive network of dedicated, feeder buses. (The 
Winter 1996-97 Bus World cover article, ``Amtrak California's Buses,'' 
reports: ``Currently, there are contracts with six independent bus 
operators operating 16 routes. . . . About half of the San Joaquin 
train riders use a bus for part of their journey.'')
    However, for a growing number of bus connections across the nation, 
the private bus companies bear any financial risks themselves. These 
companies highly value their Amtrak-related revenues. Another article 
in the same Bus World, ``Training Greyhound,'' states: ``Former 
antagonists--Greyhound and Amtrak--are cooperating to combat the real 
competitor, the private automobile.'' The article says ``six 
significant bus enhancements to the Amtrak timetable'' took effect 
November 10, linking Amtrak to such places as Cocoa and Melbourne, 
Florida; Macon, Georgia; Louisville, Kentucky; Columbus, Ohio; and 
Laredo, Texas. A link to Key West was added earlier last year.
    10. Amtrak is part carrier (like United and Greyhound) and part 
infrastructure. Thus Amtrak provides important passenger-moving 
capacity, unlike airlines and bus companies. In much of the Northeast 
Corridor and a few other places, Amtrak is the rail equivalent of the 
air traffic control system, airport authorities and airlines. (Among 
the ``other places'': the Chicago terminal, part of the Chicago-Detroit 
line and the track between Albany, New York, and the Massachusetts 
state line.) Elsewhere, Amtrak is the only carrier with legal access to 
freight railroads' tracks--a quid pro quo for relieving the railroads 
of their passenger-train obligations in 1971.
    11. Amtrak over much of its network enables one to enjoy gorgeous 
scenery in total comfort. Some examples: the Connecticut and California 
coastlines, the Hudson River in New York, the Colorado Rockies, the 
mountains of Vermont and northern New Mexico, Glacier Park in Montana 
and West Virginia's New River Gorge.
    12. Amtrak's long-distance trains are transportation ``melting 
pots.'' The majority of passengers on these trains ride coach. Surveys 
have indicated that, for 30 percent of coach passengers traveling over 
12 hours, average income is less than $20,000 (for 11 percent, it is 
less than $10,000). Obviously, most standard- and deluxe-room sleeping 
car passengers have considerably higher incomes and pay much higher 
fares. Nonetheless, anyone who characterizes these trains as land 
versions of cruise ships should try walking the coaches, especially at 
night.
    13. Trains, especially on longer trips, offer a form of social 
contact almost lost in this country today--the opportunity to meet and 
relax with total strangers that one may or may not ever see again.
                    v. of trust funds and subsidies
    Today's transportation system is largely a function of the policies 
of years past. Some salient parts of that history follow:
    1. Railroad passengers paid $2.0 billion (not inflation-adjusted) 
in federal ticket taxes from 1942 to 1962, money that simply went to 
the U. S. Treasury (general revenues). The Doyle Report to the Senate 
Commerce Committee (National Transportation Policy, June 26, 1961) 
cited this tax as ``one of the factors under Federal control which 
favors the growth of private transportation and makes the preservation 
of public service more difficult.'' Had this rail passenger tax been 
earmarked for rail passenger improvements, it is unlikely that the 
business would have fallen to the depths it reached by the time Amtrak 
began operating in 1971.
    2. Federal aviation subsidies through mid-1988 totaled $32.8 
billion, as follows:
  --``Airport and airway development costs incurred prior to the 
        assessment of user charges in 1971 have been treated as sunk 
        costs, none of which have been or will be paid for by air 
        carriers and other system users . . . these sunk costs total 
        $15.8 billion.'' Source: Study of Federal Aid to Rail 
        Transportation, U.S. Department of Transportation, under 
        President Ford's Secretary Coleman, January 1977.
  --From the time aviation user charges were imposed (1971) through 
        mid-1988, private-sector air system users ``received a general 
        fund subsidy of $17 billion, which is equal to the difference 
        between the private-sector share of FAA spending and aviation-
        related excise taxes since the start of the trust fund.'' 
        Source: The Status of the Airport and Airway Trust Fund, 
        Congressional Budget Office special study, December 1988.
    3. Federal transportation taxes are mode-specific, except that--in 
recent years--certain highway taxes have gone to mass transit and, 
since 1991, to recreational trails. Intercity passenger rail has been 
completed excluded, although the original, Senate-passed ISTEA in 1991 
would have corrected this. The selective imposition of mode-specific 
taxes biases policy makers at all levels of government in favor of more 
roads and airports. Road and aviation investment goes forward absent 
analysis of the merits of intercity passenger rail improvements and the 
impact they might have on road and air needs.
    4. Federal matches are at 80 percent plus for most highway and 
aviation projects. State and local officials are eager to maximize 
federal aid. There is no serious accounting of the huge external costs 
of air and especially highway transportation. The result is an 
overwhelming incentive for states and cities to invest in aviation and 
highways, regardless of the merits of intercity passenger rail. That so 
many states nevertheless make some rail investments is encouraging, but 
such investments generally will be aimed only at projects or routes 
where the benefits are largely or exclusively within one state.
    In short, today's transportation system reflects the manipulation 
of free market forces almost to the point of strangling the passenger 
train. The half cent and full funding of Amtrak's appropriations 
request would help offset this manipulation.
    Thank you for considering this statement. I would be pleased to 
provide any further information the committee might request.
                               appendix i
                   Poll by Bruskin Goldring Research
    Question one: Amtrak was created by Congress to provide intercity 
rail passenger service. Amtrak currently receives passenger fares and 
federal grants. You currently pay a federal fuel tax, most of which 
goes to the Highway Trust Fund to be spent on roads and mass transit. 
The need for a more stable funding source for Amtrak--comparable to the 
highway and aviation trust funds--has prompted a proposal that one 
penny of the fuel tax be used to create a trust fund to pay for long-
term Amtrak improvements. This would not result in your paying any 
additional taxes, but would reallocate a small percentage of the total 
funds to Amtrak. Please tell me which of the following best describes 
your feelings about this proposal.

                                                                 Percent
Support...........................................................    63
Oppose............................................................    26
No opinion........................................................    11

    Question two: It also has been suggested that states be allowed to 
use, for intercity rail passenger service, a portion of their federal 
transportation funds now restricted to highways, mass transit and 
recreational trails.

                                                                 Percent
Support...........................................................    63
Oppose............................................................    27
No opinion........................................................    10
                              appendix ii

                    APPROPRIATIONS AND OBLIGATION LIMITATIONS IN FEDERAL APPROPRIATIONS ACTS                    
                                              [Dollars in billions]                                             
----------------------------------------------------------------------------------------------------------------
                                                                                                      Rail as   
                                                                                                    percent of  
                                                     Highways        Aviation      Amtrak/H.S.R.   road-air-rail
                                                                                                       total    
----------------------------------------------------------------------------------------------------------------
1997............................................         $20.365          $8.489          $0.867             2.9
1996............................................          19.970           8.216            .774             2.7
    (In 1996 dollars)...........................       (319.970)         (8.216)          (.774)  ..............
1995............................................          19.879           8.392           1.017             3.4
    (In 1996 dollars)...........................        (20.440)         (8.629)         (1.046)  ..............
1994............................................          19.938           8.645            .912             3.1
    (In 1996 dollars)...........................        (21.082)         (9.141)          (.964)  ..............
1993............................................          18.254           8.862            .896             3.2
    (In 1996 dollars)...........................        (19.795)         (9.610)          (.972)  ..............
1992............................................          18.585           8.887            .860             3.0
    (In 1996 dollars)...........................        (20.757)         (9.926)          (.961)  ..............
1991............................................          15.088           8.137            .815             3.4
    (In 1996 dollars)...........................        (17.359)         (9.362)          (.938)  ..............
1990............................................          13.560           7.141            .629             2.9
    (In 1996 dollars)...........................        (16.257)         (8.562)          (.754)  ..............
1989............................................          12.242           6.390            .604             3.1
    (In 1996 dollars)...........................        (15.470)         (8.075)          (.763)  ..............
1988............................................          11.967           5.714            .609             3.3
    (In 1996 dollars)...........................        (15.851)         (7.569)          (.807)  ..............
1987............................................          13.035           5.170            .619             3.3
    (In 1996 dollars)...........................        (17.980)         (7.132)          (.854)  ..............
1986............................................          13.562           4.640            .603             3.2
    (In 1996 dollars)...........................        (19.390)         (6.634)          (.862)  ..............
1985............................................          14.189           5.184            .712             3.5
    (In 1996 dollars)...........................        (20.663)         (7.550)         (1.037)  ..............
1984............................................          13.259           4.065            .816             4.5
    (In 1996 dollars)...........................        (19.997)         (6.131)         (1.231)  ..............
1983............................................          13.465           4.031            .815             4.5
    (In 1996 dollars)...........................        (21.184)         (6.342)         (1.282)  ..............
1982............................................           8.533           2.930            .905             7.3
    (In 1996 dollars)...........................        (13.856)         (4.758)         (1.470)  ..............
----------------------------------------------------------------------------------------------------------------
Change 1982-97, current dollars (percent).......          +138.7          +189.7            -4.2  ..............
Change 1982-97, in 1996 dollars--a reflection of                                                                
 purchasing power (percent).....................           +47.0           +78.4           -41.0  ..............
----------------------------------------------------------------------------------------------------------------
NOTE: For each year shown, first line is for current year dollar amounts. Second (in parentheses) line is the   
  same amount in 1996 dollars.                                                                                  
                                                                                                                
Sources: U.S. Department of Transportation Budgets in Brief, 1982-96. Prepared by the National Association of   
  Railroad Passengers.                                                                                          

                              appendix iii
[GRAPHIC] [TIFF OMITTED] T12AP10.004

                              appendix iv
    Passenger rail usage did not decline mid-century just because 
people suddenly ``decided'' trains were passe, and other modes were 
better. Government policy played a tremendous role in travelers' 
decisions. This chart shows that as road spending (annual dollars per 
capita, all levels of government, adjusted for inflation) grew, so 
did--not coincidentally--passenger rail (intercity and commuter) 
passenger-miles per capital decline.
[GRAPHIC] [TIFF OMITTED] T12AP10.005

                               appendix v

             World Mainline Rail Capital Spending Per Capita

[Selected Countries, U.S. Dollars, 1994 Spending by Central Governments 
                   and/or Public Sector Railways] \1\

Switzerland...................................................   $228.29
Sweden........................................................    146.55
Austria.......................................................    132.03
Germany.......................................................    110.84
Netherlands...................................................     84.97
Denmark.......................................................     79.97
Norway........................................................     58.27
Finland.......................................................     51.85
France........................................................     51.48
Portugal......................................................     40.34
South Korea...................................................     31.36
Belarus.......................................................     25.96
Greece........................................................     24.23
Hungary.......................................................     24.19
Botswana......................................................     22.65
Ireland.......................................................     18.38
Britain.......................................................     13.74
Slovakia......................................................     13.61
New Zealand...................................................      6.23
Latvia........................................................      5.93
Belgium.......................................................      4.89
Bulgaria......................................................      4.62
Venezuela.....................................................      4.20
Indonesia.....................................................      4.00
Iran..........................................................      4.00
Namibia.......................................................      3.71
South Africa..................................................      3.58
Colombia......................................................      3.38
Mexico........................................................      3.24
Myanmar.......................................................      2.53
India.........................................................      2.27
Thailand......................................................      2.07
Guinea........................................................      1.80
Bolivia.......................................................      1.75
United States.................................................      1.64
Turkey........................................................      1.43
Canada........................................................      1.16
Malawi........................................................      1.02
Romania.......................................................       .88
Zimbabwe......................................................       .88
Albania.......................................................       .45
Bangladesh....................................................       .45
Pakistan......................................................       .30
Phillipines...................................................       .29

\1\ Does not include private sector spending, which is more important in 
the United States and Canada than elsewhere.

Sources: National Association of Railroad Passengers, International 
Railway Journal.
---------------------------------------------------------------------------
                                 ______
                                 
    Prepared Statement of the Institute of Transportation Engineers
    The Institute of Transportation Engineers (ITE) is an organization 
of over 15,000 transportation professionals in some 80 countries. On a 
day-to-day basis ITE's 11,500 U.S. members are responsible for keeping 
the nation's surface transportation systems operating in the safe, 
efficient, and reliable fashion which our mobile society demands.
    ITE members plan, design, operate, maintain, and build the 
infrastructure that supports 17 percent of America's gross national 
product. The Institute has members working for virtually every state 
Department of Transportation, almost 600 municipalities, over 175 
counties, and some 100 metropolitan planning organizations. In 
addition, ITE members are employed by hundreds of consulting firms, 
universities, and equipment manufacturers and suppliers throughout the 
United States.
    The Intermodal Surface Transportation Efficiency Act (ISTEA) of 
1991 has been a success, and it should be reauthorized without radical 
changes to its existing programs. Enhancement of ISTEA programs can be 
achieved by moving away from a system that is driven by process to one 
that is driven by results. Transportation programs should not be judged 
on how they are carried out, but rather on what they accomplish and 
contribute toward a national intermodal transportation system that is 
safe, economically efficient, and environmentally sound.
    ITE believes that the Administration's National Economic Crossroads 
Transportation Efficiency Act (NEXTEA) is a solid step towards a 
reauthorization bill that will effectively carry the nation's 
transportation system into the 21st Century. However, while the 
Institute was generally pleased with the overall structure of the 
Administration's reauthorization proposal, it was disappointed with the 
overall funding level included in the proposal.
    The Institute believes that NEXTEA should set a highway trust fund 
spending level of at least $26 billion. ITE believes that this funding 
level will help provide transportation professionals with resources 
necessary to meet the nation's future transportation needs.
    The critical importance of transportation should not be lost as 
Congress and the Administration struggle to balance the federal budget. 
With NAFTA passed and a western hemisphere free trade agreement in the 
works, the U.S. transportation system will be even more vital to the 
delivery of goods and services. The European Commission is taking an 
increasingly stronger role in ensuring a seamless and more efficient 
transportation system throughout Europe. The U.S. can do no less.
    ITE encourages Congress and the Administration to recognize that 
money spent on our nation's transportation systems is in fact an 
investment in the American economy. This investment not only directly 
puts people to work, but through improving the efficiency and safety of 
moving our workers and our products, it enhances the productivity and 
competitiveness of America's businesses. The resulting economic 
vitality creates a positive return on investment to the federal 
government and its citizenry.
    About $57 billion should be invested annually in roads, bridges, 
and transit capital just to keep the systems performing at their 
current level of service. Unfortunately, the United States is actually 
investing less than $41 billion each year, only two-thirds of the 
nation's needs. As a result, the transportation infrastructure is not 
able to keep up with demand. Cutting transportation funding will not 
cut transportation needs. Providing funding levels to maintain current 
conditions should be the minimum goal for lawmakers.
    To ensure an adequate and predictable revenue stream for 
transportation investment, Congress should consider:
  --Funding ISTEA 2 programs entirely from transportation user fees.
  --Shifting the 4.3 cents per gallon motor fuel tax currently going to 
        deficit reduction to the highway trust fund.
  --Removing the highway Oust fund from the unified federal budget.
  --Adopting a federal capital budget and/or other measures to achieve 
        this objective.
  --Expanding efforts to combat motor fuel tax evasion.
  --Giving state and local agencies increased flexibility to implement 
        innovative financing mechanisms.
  --Requiring that any revenue from tolls on any highway facility be 
        used solely for surface transportation purposes.
  --Eliminating the practice of specifying funding for specific 
        projects in federal transportation legislation.
    In addition to increasing the overall funding level available for 
transportation investment, lawmakers must find ways to make those 
investment more productive.
    The Administration's NEXTEA expands the eligible uses of 
transportation funding to include operations and maintenance costs that 
were not included under ISTEA. ITE supports these efforts. 
Transportation efficiencies cannot be realized if transportation 
facilities and equipment are not properly operated and maintained.
    The Administration's proposal to reauthorize the Intelligent 
Transportation System (ITS) program is a good next step in a program 
that holds significant benefits for the nation's transportation system. 
With some changes, ITE recommends that the Administration's ITS 
proposal contained in NEXTEA be accepted by Congress. However, while 
ITE generally supports the structure of the ITS program as developed by 
the Administration, the Institute believes that annual funding of the 
program at $250 million is not sufficient considering the benefits the 
program has to offer. Therefore, ITE recommends that the committee 
increase funding for the Administration's ITS proposal to $400 million 
per year.
    In addition, ITE recommends that Congress not accept limitations on 
the federal match for ITS projects that the Administration would set at 
no greater than 80 percent. The U.S. DOT estimates that, over the next 
20 years, ITS will be able to meet two-thirds of the nation's highway 
capacity needs at one-fifth the cost of building additional capacity. 
One way that the federal government can encourage swift implementation 
of ITS is by allowing ITS projects to be eligible for 100 percent 
federal funding. This incentive is needed in order to help level the 
playing field for ITS projects as they compete for funds with more 
visible construction projects.
    Transportation efficiencies are also impacted by safety. The 
Institute supports reauthorization of the current 10 percent set-aside 
of the Surface Transportation Program (STP); however, the 
Administration has chosen to replace this program with a set $3.2 
billion Infrastructure Safety Program.
    During fiscal year 1997, states will receive a total of some $601 
million in safety set-aside apportionments. NEXTEA is a retreat on 
current funding levels under this program. In addition, removal of 
safety funding as a percentage of the STP program eliminates the 
possibility of future funding growth for safety in the event of 
increased out-year transportation investments. For instance, over the 
last five years, annual safety set-aside apportionments have increased 
$180 million.
    This funding reduction could be exacerbated if states are allowed 
to shift funding out of the new highway infrastructure safety program 
to the extent that the number of rail crossing collisions are reduced. 
The shifting of safety funds away from safety initiatives should not be 
allowed. While safety improvements are somewhat invisible compared to 
most capital projects, their impacts are significant and extremely cost 
effective.
    Finally, ITE opposes NEXTEA provisions that would allow the use of 
safety funds for uses beyond those allowed under the existing STP 
safety set-aside program. Every transportation project has an element 
of safety involved. Current guidelines discourage the use of safety 
funding for these normal activities and encourage safety enhancement 
activities that might not have been undertaken without the STP safety 
set-aside incentive. Using highway safety funds for non-traditional 
purposes, such as structural repairs to bridges, may improve the 
structural safety of these facilities, but it does not have a direct 
bearing on highway safety.
    The Institute supports the creative financing provisions in NEXTEA 
and notes the efforts that this committee has taken in the past to 
promote creative financing proposals. ITE hopes that support will 
continue.
    The Institute of Transportation Engineers appreciates the 
opportunity to submit these comments to the committee as it examines 
the funding requirements for reauthorization of the nation's surface 
transportation system. While Americans do want streamlined and better 
government, they do not want crumbling highways and bridges, broken 
down buses, or more accidents. Americans expect that their government 
will provide proper levels of investment in capital, operations, and 
maintenance programs, as well as encourage and promote ways to expand 
existing resources and protect the driving public.
    Along with this testimony, the Institute has provided the committee 
with copies of ``Recommendations for ISTEA 2.'' This document outlines 
in detail all the Institute of Transportation Engineers' 
recommendations for reauthorization of the nation's surface 
transportation programs. It is provided for the committee's 
information, and it is not necessary to be published in the record.
    The Institute appreciates the opportunity to provide this testimony 
to the committee. Questions relating to this testimony should be 
directed to Mr. Thomas W. Brahms, Executive Director of the Institute 
of Transportation Engineers at 202-554-8050 ext. 111 or to Russell 
Houston, ITE's Government Relations Associate at ext. 144.
                                 ______
                                 
                              NATSO, Inc.
        Prepared Statement of W. Dewey Clower, President and CEO
    On behalf of the 1,100 NATSO member travel plazas and truckstops 
nationwide, I respectfully request this correspondence be submitted for 
the April 10, 1997, hearing record on fiscal year 1998 transportation 
appropriations.
    During the hearing before your subcommittee, John Collins, Senior 
Vice President, Government Affairs, American Trucking Associations, 
testified that there is a nationwide truck parking space shortage. As 
the largest provider of truck parking in the country, NATSO believes 
our industry's perspective is valuable to any discussion of this issue.
    First, there is no nationwide parking shortage. Mr. Collins 
testified there is a 28,500-space shortfall, as estimated by a 1996 
federally-funded report entitled ``Commercial Driver Rest & Parking 
Requirements: Making Space for Safety,'' prepared by the American 
Trucking Association's Trucking Research Institute. The report counted 
the number of rest area parking spaces available for trucks, but did 
not consider even one of the private sector spaces when formulating the 
rest area parking demand model.
    Using the ``American Trucker's Guide to Truckstops,'' published by 
Interstate America, NATSO estimates that truckstops provide nearly 
220,000 truck parking spaces nationwide. ATA acknowledges private 
truckstops plan to increase their parking by 28,000 spaces over the 
next three years. Why should the federal government pay to build these 
spaces when the private sector, according to the ATA's own research, 
plans to increase parking by that same amount?
    There may be parking problems in certain areas of the country, 
especially near metropolitan areas, where drivers of all types of 
vehicles experience difficulty finding a place to park. Contributing to 
this problem is the trucking industry's need for a place to ``stage'' 
trucks, since many companies require truck drivers to make their 
deliveries within a narrow time frame. This practice requires a truck 
driver who arrives near his destination (often an urban area) to wait 
hours or days before making his delivery. While this may be a dilemma 
for the trucking industry, we do not feel it justifies federally funded 
parking lots.
    Second, no link has been established between truck parking and 
fatigue-related accidents. The Trucking Research Institute's study 
identified the number of parking spaces available at public rest areas; 
it did not study the causes of fatigue-related truck accidents. There 
is absolutely no evidence to suggest that parking has any effect 
whatsoever on these accidents. In fact, a National Transportation 
Safety Board (NTSB) report (NTSB/SS-95/01) on 113 heavy truck accidents 
never once cited a lack of parking as a contributing factor in fatigue-
related accidents. The NTSB's comprehensive list of suggested solutions 
does not include increasing truck parking. The NTSB stated that while 
they commend efforts such as this truck parking study, ``the Safety 
Board believes that the results of this study [the NTSB study] of 
actual accidents provides concrete evidence of the measures that affect 
fatigue in the accident environment.''
    ATA further maintains that public safety is compromised when truck 
drivers seek parking along highway shoulders and exit ramps. However, 
the report's direct observation of a 200-mile segment of I-81 
contradicts this conclusion. The parking study found that Large numbers 
of trucks parked illegally on shoulders and ramps of rest areas. This 
often occurred before the corridor [I-81] reached capacity and even 
when legal parking spaces were available at a rest areas This suggests 
there could be convenience-based reasons for a driver choosing to park 
on a shoulder at an exit ramp.
    Third, the overwhelming majority of truck drivers have no interest 
in using public rest areas for anything but a quick nap, so more money 
for rest area parking will be a waste of valuable transportation 
dollars. Perhaps the most sensible reason for not building more truck 
parking is that drivers simply won't use them. The Trucking Research 
Institute's rest area study found that 85 percent of drivers prefer 
truckstops to meet their long-term rest needs over public rest areas. 
Only 15 percent of these drivers expressed a preference to rest or 
sleep long-term at public rest areas.
    NATSO believes that investing in more truck parking at rest areas 
is a colossal waste of money that will do nothing to increase public 
safety. In this era of fewer dollars, there are many other projects 
that are more deserving of federal funding.



 DEPARTMENT OF TRANSPORTATION AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 1998

                              ----------                              


                       WEDNESDAY, APRIL 16, 1997

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10:01 a.m., in room SD-124, Dirksen 
Senate Office Building, Hon. Richard C. Shelby (chairman) 
presiding.
    Present: Senators Shelby, Gorton, Bennett, Lautenberg, and 
Byrd.

                  NATIONAL TRANSPORTATION SAFETY BOARD

STATEMENT OF JAMES EVAN HALL, CHAIRMAN
ACCOMPANIED BY:
        VERNON ELLINGSTADT, OFFICE OF RESEARCH AND ENGINEERING
        TOM HAUETER, OFFICE OF AVIATION SAFETY

                            Opening Remarks

    Senator Shelby. The subcommittee will come to order.
    In 1996 we saw the highest fatality rate for commercial air 
passengers in the last 15 years. Two of the worst air crashes 
in aviation history occurred. First the ValuJet crash into the 
Florida Everglades on May 11 where 110 people were killed, and 
then the TWA Flight 800 explosion on July 17, which left 230 
dead in the Atlantic Ocean off Long Island.
    In response to these tragedies the White House Commission 
on Aviation Safety and Security, chaired by Vice President 
Gore, was chartered in August 1996 to conduct an extensive 
inquiry into civil aviation safety, security, and air traffic 
control modernization. Twenty commissioners and staff from a 
broad range of aviation specialties, Federal agencies, consumer 
groups, and the industry, worked to form a set of 
recommendations to improve the safety and the security of the 
Nation's air transportation system.
    The Gore Commission agreed on 53 recommendations in four 
areas: One, improving aviation safety; two, making air traffic 
control safer and more efficient; three, improving security for 
travelers; and four, responding to aviation disasters. About 
one-half of the recommendations are solely within the FAA's 
area of responsibility. The rest of the Gore Commission's 
recommendations are either jointly shared with other 
departments which include Defense, Justice, Energy, NASA, 
Treasury, or industry. Or these recommendations are tasked to 
non-DOT agencies such as the FBI, Postal Service, Customs 
Service, or NTSB. Very few of the recommendations require new 
legislation.
    We are pleased to welcome Mr. Carl Vogt, who with short 
notice, has made time in his busy schedule to join us here 
today. Mr. Vogt served as Commissioner on the White House 
Commission on Aviation Safety and Security. From 1992-94 Mr. 
Vogt was Chairman of the National Transportation Safety Board. 
Filling out our first panel we are joined by the current NTSB 
Chairman, Mr. Jim Hall. I want to thank you both for being here 
today.
    Between the two aviation safety experts, I expect that the 
first part of today's hearing will provide a clear picture of 
the status of safety and security on America's air 
transportation system. I hope that both Mr. Vogt and Mr. Hall 
will tell the subcommittee what they view as the most pressing 
improvements that need to be made.
    The second panel is made of Federal Aviation Administration 
officials, all of whose jobs relate in some way to ensuring 
safety. We will discuss with the six FAA witnesses the 
contributions toward improved safety and security that are made 
by each of the offices represented. Specifically, we will talk 
about how the recommendations of the Gore Commission and the 
NTSB's most wanted safety recommendations are being implemented 
in each of these offices, how these initiatives affect the way 
FAA does its job, and how much it will cost to do that job.
    The agency is undergoing many changes, both in its 
organization and personnel. Most dramatically, FAA has been 
without an Administrator since November 8, 1996. This 
committee's job is to make sure that FAA is given the funding 
it needs in order to run a sound and effective aviation 
management system.
    But money alone does not buy good management, nor does 
money necessarily buy safety. That takes an organized systemic 
approach, with clear goals and benchmarks along the way. It is 
the agency's job to show Congress that the funds requested by 
the administration will go forward toward this kind of 
successful organization.
    Safety is an integral part of the jobs of all the panelists 
we will hear from today. Mr. Hall is tasked with investigating 
the failures of our transportation system and suggesting 
measures to improve it. Mr. Vogt most recently served on the 
Gore Commission, which was tasked with looking at changing 
security threats to air passenger safety, examining changes in 
the aviation industry, and looking at the technological changes 
coming to air traffic control, with an eye to improving 
aviation safety and security.
    The FAA offices represented by the panel we will hear from 
today deal with safety in complementary and interdependent 
ways. If we lack sufficient resource commitment for any of 
these offices, airport security, research and acquisition, or 
regulation and certification, the entire system is compromised. 
All these areas are vital to ensuring the long-term safety of 
the system.
    This now brings me to user fees. The subcommittee will be 
holding a separate hearing on May 7 regarding transportation 
infrastructure financing, including the many user fee proposals 
contained in the President's fiscal year 1998 DOT budget 
request. New FAA user fees are projected to offset $300 million 
of the agency's cost of operations. Now, this subcommittee has 
had a little experience with FAA user fees, since we included 
the $75 million FAA operations user fees in the 1997 
transportation appropriations bill for foreign carrier 
overflights of U.S. traffic control space. This user fee 
requested by the FAA was signed into law September 30, 1996.
    According to FAA, the overflight fee will be instituted on 
May 19. FAA will not be able to collect anywhere near $75 
million in the reigning 4.5 months of fiscal 1996. Now FAA is 
asking for the authority to collect $300 million in new user 
fees. What are these fees? We do not know. We will not know 
until later this summer at the earliest, if the National Civil 
Aviation Review Commission completes a draft proposal for long-
term financing of FAA operations and modernization by that 
time.
    These new fees would then be subject to authorization. At 
what point during fiscal year 1998 will these fees be 
authorized and instituted by the FAA? How much of the $300 
million projected will the agency actually be able to collect? 
And I will not even mention that the administration's 5-year 
budget plan suggests by the year 2002 FAA will completely fund 
its entire $8 billion-plus budget from user fees. As chairman 
of this subcommittee I will be taking a long, hard look at the 
FAA's budget request to ensure that important safety 
initiatives and the funds to implement these initiatives are 
included in that budget in a systematic and logical way.

                           Prepared Statement

    I look forward to hearing your testimony, and having a 
frank and candid exchange of views here. We must always keep in 
mind, I believe, that the aim of every witness and member 
present today is ensuring the very highest level of safety and 
security for the American citizen traveling by air.
    [The statement follows:]

                  Prepared Statement of Senator Shelby

    Good morning. This hearing will now come to order.
    In 1996, we saw the highest fatality rate for commercial 
air passengers in the last fifteen years. Two of the worst air 
crashes in aviation history occurred--first, the ValuJet crash 
into the Florida Everglades on May 11, where 110 people were 
killed, and then the TWA flight 800 explosion on July 17, which 
left 230 dead in the Atlantic Ocean off Long Island. In 
response to these tragedies, the White House Commission on 
Aviation Safety and Security, chaired by Vice President Gore, 
was chartered in August 1996 to conduct an extensive inquiry 
into civil aviation safety, security, and air traffic control 
modernization. Twenty commissioners and staff from a broad 
range of aviation specialties, federal agencies, consumer 
groups, and industry worked to form a set of recommendations to 
improve the safety and security of the nation's air 
transportation system. The Gore Commission agreed on 53 
recommendations, in four areas: (1) improving aviation safety; 
(2) making air traffic control safer and more efficient; (3) 
improving security for travelers; and (4) responding to 
aviation disasters.
    About half the recommendations are solely within the FAA's 
area of responsibility. The rest of the Gore Commission's 
recommendations are either jointly shared with other 
departments (Defense, Justice, Energy, NASA, and Treasury) or 
industry; or are tasked to non-DOT agencies, such as the FBI, 
Postal Service, Customs Service, or NTSB. Very few of the 
recommendations require new legislation.
    We are pleased to welcome Mr. Carl Vogt, who has made time 
in a busy schedule on short notice to join us here today. Mr. 
Vogt served as a Commissioner on the White House Commission on 
Aviation Safety and Security. From 1992 to 1994, Mr. Vogt was 
Chairman of the National Transportation Safety Board. Filling 
out our first panel, we are joined by the current NTSB 
Chairman, Mr. Jim Hall. Thank you both for being here today. 
Between these two aviation safety experts, I expect that the 
first part of today's hearing will provide a clear picture of 
the status of safety and security on America's air 
transportation system; and that both Mr. Vogt and Mr. Hall will 
tell the subcommittee what they view as the most pressing 
improvements that need to be made.
    The second panel is made up of Federal Aviation 
Administration officials, all of whose jobs relate in some way 
to ensuring safety. We will discuss with the six FAA witnesses 
the contributions toward improved safety and security that are 
made by each of the offices represented. Specifically, we will 
talk about how the recommendations of the Gore Commission and 
the NTSB's ``Most Wanted'' safety recommendations are being 
implemented in each of these offices; how these initiatives 
affect the way FAA does its job; and, how much it will cost to 
do that job.
    The agency is undergoing many changes, both in its 
organization and personnel. Most dramatically, FAA has been 
without an administrator since November 8, 1996.
    This Committee's job is to make sure that FAA is given the 
funding it needs to run a sound and effective aviation 
management system. But money alone doesn't buy good management, 
nor does money necessarily buy safety. That takes an organized, 
systemic approach, with clear goals and benchmarks along the 
way. It is the agency's job to show Congress that the funds 
requested by the administration will go toward this kind of 
successful organization.
    Safety is an integral part of the jobs of all the panelists 
we will hear from today. Mr. Hall is tasked with investigating 
the failures of our transportation system and suggesting 
measures to improve it. Mr. Vogt most recently served on the 
Gore Commission, which was tasked with looking at changing 
security threats to air passenger safety, examining changes in 
the aviation industry, and looking at the technological changes 
coming to air traffic control, with an eye to improving 
aviation safety and security.
    The FAA offices represented by the panel we will hear from 
today deal with safety in complementary and interdependent 
ways. If we lack sufficient resource commitment for any one of 
these offices--airports, security, research and acquisition, or 
regulation and certification--the entire system is compromised. 
All these areas are vital to ensuring the long-term safety of 
the system.
    Which brings me to user fees. The subcommittee will be 
holding a separate hearing on May 7th regarding transportation 
infrastructure financing, including the many user fee proposals 
contained in the President's fiscal year 1998 DOT budget 
request. New FAA user fees are projected to offset $300 million 
of the agency's cost of operations. Now, this subcommittee has 
had a little experience with FAA user fees, since we included a 
$75 million FAA operations user fee in the fiscal year 1997 
transportation appropriations bill for foreign carrier 
overflights of U.S. air traffic controlled space. This one user 
fee, requested by the FAA, was signed into law September 30, 
1996. According to the FAA, the overflights fee will be 
instituted on May 19, 1997. FAA won't be able to collect 
anywhere near $75 million in the remaining four and a half 
months of fiscal 1997.
    Now, FAA is asking for the authority to collect $300 
million in new user fees. What are these fees? We won't know 
until later this summer at the earliest, if the National Civil 
Aviation Review Commission completes a draft proposal for long-
term financing of FAA operations and modernization by that 
time. These new fees would then be subject to authorization. At 
what point during fiscal year 1998 will these fees be 
authorized and instituted by the FAA? How much of the $300 
million projected will the agency actually be able to collect? 
And I won't even mention that the administration's 5-year 
budget plan suggests that by the year 2002, FAA will completely 
fund its entire $8 billion plus budget from user fees.
    As chairman of this subcommittee, I will be taking a long, 
hard look at FAA's budget request, to ensure that important 
safety initiatives--and the funds to implement these 
initiatives--are included in that budget in a systematic and 
logical way. I look forward to hearing your testimony, and 
having a frank and candid exchange of ideas. We must always 
keep in mind the aim of every witness and member present here 
today--ensuring the very highest level of safety and security 
for the American citizens traveling by air.
    Senator Lautenberg, do you have an opening statement you'd 
like to make?

                    STATEMENT OF SENATOR LAUTENBERG

    Senator Shelby. Senator Lautenberg.
    Senator Lautenberg. Thank you very much, Mr. Chairman, and 
I commend you for getting this subcommittee hearing going, 
because a primary subject for us and the entire country has to 
be our progress in aviation safety. And this is an oversight 
responsibility that is important and worth the subcommittee's 
time and effort.
    The Federal Aviation Administration has provided us with 
the safest air transport system in the world. But there are 
still, as we say, holes in the safety net. The tragic, highly 
publicized aviation accidents of the last year sparked 
considered scrutiny by the administration, Congress, industry, 
and academia on how FAA does business and the steps necessary 
to strengthen the safety net.
    The FAA concluded a 90-day safety review following the 
ValuJet crash, which was supplemented by reports from the GAO, 
the inspector general, Coopers & Lybrand, and the National 
Transportation Safety Board, among others. In wake of the TWA 
800 tragedy, Vice President Gore's Aviation Safety and Security 
Commission provided further momentum for aviation safety 
enhancements. And I was very supportive of the Commission's 
mandate, and pleased that the President accepted every one of 
the recommendations of the Gore Commission.
    Since serving on the Aviation Security Commission after Pan 
Am 103, I have sought to ensure that adequate attention and 
funding were focused on aviation security. Unfortunately, it 
took the tragedy of TWA 800 to once again bring these concerns 
to the forefront. Between the recommendations of the NTSB, the 
Gore Commission, the Administrator's 90-day safety review 
panel, and other studies, we are knee-deep in suggestions on 
how to improve our aviation system. And this subcommittee, Mr. 
Chairman, has been aggressive in following up.
    Even after we completed action on the fiscal year 1997 
transportation appropriations bill last year, this subcommittee 
added more than $225 million to the CR, to the continuing 
resolution, to fund recommended enhancements for aviation 
safety and security. This funding provided for additional 
inspectors, explosives detection equipment, aviation security 
specialists, and individual airport threat assessment. It was 
added on top of increased funding in the regular appropriations 
bill for additional air traffic controllers.
    Mr. Chairman, the FAA has been given significant resources 
to enhance safety, and it is now up to the FAA and the industry 
to implement improvements in the shortest possible time. In 
this regard, I am disappointed that FAA is still without 
permanent leadership, either at the Administrator or Deputy 
Administrator level. And I want to add that those folks, Mr. 
Valentine and others, who are filling in at these posts are 
doing an excellent job. The question is what do we do in terms 
of fulfilling our long-term policy commitment to aviation 
safety and development of this very important department? I 
hope that the President will act expeditiously to select 
nominees, get them to the Hill as soon as possible.
    And, Mr. Chairman, I want to commend you also for having 
Mr. Hall and Mr. Vogt here. These are two very experienced 
people, and we are pleased to see them as witnesses.
    Thank you.
    Senator Shelby. Senator Bennett.
    Senator Bennett. Thank you, Mr. Chairman. I have no opening 
statement.
    Senator Shelby. Senator Byrd.

                       STATEMENT OF SENATOR BYRD

    Senator Byrd. Thank you, Mr. Chairman, Senator Lautenberg.
    Thank you for convening this very important hearing on the 
safety of our aviation system. In West Virginia we have always 
faced natural challenges in maintaining the highest levels of 
safety, challenges such as unpredictable weather, where fog and 
freezing rain can roll in taking a pilot's visibility down to 
zero with little or no warning. We face the natural challenges 
posed by our mountainous terrain. In order to build one of the 
principal airports in our State we were required to level off 
several mountains and dump the earth into the adjacent valleys, 
simply to create a sufficient stretch of land for the runway.
    But these natural challenges to safety may have been 
exacerbated over the last decade or so by the changes in the 
quality and the mix of aviation services in my State. Over the 
last 10 years the Nation has seen air passenger traffic 
increase almost 50 percent. When one looks at the components of 
this increase, one will see that emplanements on major 
airliners have gone up roughly 39 percent, while emplanements 
on commuter aircraft has grown by over 150 percent.
    Over the last 10 years, total emplanements in West Virginia 
have actually declined over 6 percent, and this decrease is 
comprised of an almost 50 percent cut in the number of 
passengers traveling on larger airplanes, while the number of 
passengers required to fly on smaller commuter aircraft has 
grown by over 100 percent.
    Looked at in another way, the forces of the market in an 
unregulated aviation industry have resulted in my constituents 
being increasingly relegated to smaller commuter aircraft. And 
it is for that reason that I was pleased with the initiative of 
the Clinton administration to finally require one level of 
safety on the part of all passenger aircraft. I doubt that the 
average passenger on a 20-seat commuter aircraft appreciated 
the fact that that aircraft was being held to a lesser standard 
of safety by the FAA than the standard applying to a larger 
aircraft, perhaps 37-seat aircraft.
    The FAA's requirement for a single level of safety was 
implemented in the wake of some notable commuter aircraft 
accidents. When the initiative was announced at the end of 
1995, the commuter aircraft industry was given a period of time 
to come into full compliance with the more stringent safety 
standard. The deadline for full compliance by the commuter 
airline came less than a month ago. So now is the time to ask 
our Federal officials whether we have seen the full benefits of 
one level of safety, whether we have seen a lesser number of 
incidents and accidents involving commuter aircraft. Perhaps we 
have not had enough time pass.
    Based on the FAA's own assessment of its deficiencies 
issued in the wake of the ValuJet tragedy, I think it is 
appropriate to ask whether our inspection system is adequate to 
determine whether all commuter operators are indeed in full 
compliance. Are the FAA's inspections of these aircraft 
diligent and thorough, or do they take the form of just another 
paperwork exercise that masks the true problem? Is the safety 
oversight of the commuter industry within the FAA adequately 
financed?
    When we speak of the importance that critical spending by 
the FAA is within our budget, many individuals talk of the 
investments of hundreds of millions of dollars in new high 
technology air traffic control equipment or the construction or 
expansion of airports like Denver International and Dallas-Fort 
Worth. When I talk of critical aviation spending, I am talking 
about inspectors, weather forecasting capabilities, and small 
capital improvements at airports with names like Greenbriar 
Valley, Wood County, Beckley, Bluefield-Princeton, Elkins, 
Clarksburg, Huntington, and Morgantown, and so I am especially 
glad that we will hear testimony this morning from the chairman 
of the National Transportation Safety Board, Mr. Jim Hall.
    The Safety Board is charged with evaluating the FAA's 
performance and regulations with single criterion in mind--
safety. So I look forward to hearing his views on the safety of 
the commuter aviation industry, as well as the views of our 
representatives from the Federal Aviation Administration this 
morning.
    Thank you, Mr. Chairman.
    Senator Shelby. Mr. Hall.

                      STATEMENT OF JAMES EVAN HALL

    Mr. Hall. Good morning, Mr. Chairman, Senator Lautenberg, 
Senator Bennett, Senator Byrd. It is a pleasure to have the 
opportunity to appear before you today. Joining me in the 
audience are two individuals from the Safety Board, Dr. Vernon 
Ellingstadt, who is the head of our Office of Research and 
Engineering, and Mr. Tom Haueter, who is Deputy of our Office 
of Aviation Safety. I may ask them to join me at the table if I 
find that they can provide a more complete answer than I can to 
any of the questions that the committee may present.
    Senator, let me say how much I have appreciated working 
with the staff of this committee, particularly since TWA 800, 
on the very difficult situation regarding extraordinary costs 
associated with that accident. Your staff has been most 
cooperative, and most interested in this investigation, and I 
would like to extend to the members of this committee an 
invitation for any of you that would choose to do so to please 
come to Calverton and visit the reconstruction that is 
presently underway. We would be glad to make that arrangement 
at any time.
    It goes without saying, Mr. Chairman, that last year, as 
you referred, was dominated by catastrophic transportation 
accidents that have required extraordinary efforts by the 
Safety Board and have strained the agency's resources more than 
any time in history. I just might add that in addition to the 
high-profile aviation accidents that the committee is probably 
well familiar with, we had a number of major transportation 
accidents in rail, marine, and pipeline last year, as well.
    The TWA Flight 800 investigation has been the Safety 
Board's most costly and complex in terms of dollars spent for 
wreckage search and recovery and the level of investigative 
staff work. Mr. Chairman, the TWA investigation, I believe, 
provides dramatic testimony to the wisdom of Congress 30 years 
ago when it established a multidisciplined, independent 
accident investigation agency which was initially affiliated 
with the Department of Transportation with the mission to 
promote transportation safety by conducting independent 
accident investigations and by formulating safety improvement 
recommendations. And of course, as you are aware, Mr. Chairman, 
we were made totally independent from the Department of 
Transportation under the Independent Safety Board Act of 1974.
    The independence of the Safety Board and its clear mandate 
to conduct indepth objective investigations, draw conclusions 
from its findings, and make recommendations to improve safety 
without bias or undue influence from industry or other 
Government agencies is essential to maintaining the safety of 
the American traveling public. It is not unusual for the Safety 
Board to address safety issues that are controversial or that 
may be critical of Government or industry standards or 
operations. Since the Safety Board started investigating 
accidents it has made more than 10,000 safety recommendations 
to prevent accidents, save lives, and reduce injuries. While 
every recommendation from the Board is developed to help 
improve safety and prevent accidents, some have a greater 
potential to save lives than others.
    As you know, Mr. Chairman, it is the responsibility of the 
NTSB to formulate recommendations to those parties that can 
effect improvements in transportation safety. But it is a 
responsibility of the FAA and other agencies to determine how 
best to implement those changes. In the last 5 years the FAA 
has adopted 84 percent of our recommendations. We harbor no 
illusions that the FAA should adopt all of our recommendations, 
nor do we seek to have our recommendations mandatory. Frankly, 
Mr. Chairman, if the FAA adopted all of our recommendations, 
then we would not be asking for enough.
    There are bound to be some areas where the regulatory 
agency honestly believes that a recommended change is not cost 
effective. Remember, the FAA must conduct cost-benefit analysis 
of any proposed changes, or that a better alternative can be 
found. That is not to say that we do not strongly disagree with 
some of their actions or inaction, and that, of course, is what 
the most wanted list is designed to at least partially address. 
I would like to point out, by the way, that the Gore Commission 
on which I was proud to serve recommended that cost benefit 
analysis, while useful, should not be the driving force in 
determining the value of proposed safety improvements.

                              Most Wanted

    In order to identify those recommendations with the 
greatest potential to improve transportation safety that have 
not yet been acted on, the Board adopted its most wanted 
program. Recommendations added to that list will receive more 
intensive followup activity in order to encourage Government 
agencies and industry to act on the recommendations as quickly 
as possible.
    Currently on the Safety Board's most wanted list are five 
aviation-related issues that include: First, requiring the 
installation of expanded flight data recorders with an 
increased number of parameters; second, installing airport 
runway incursion avoidance systems; third, reviewing safe 
separation distances between larger and smaller following 
aircraft; fourth, installing Mode C instrument alert systems 
for airport terminals; and fifth, sharing pilot background 
information between airlines. All of these recommendations are 
the fruits of years of research by investigators of the NTSB, 
an Agency that makes its mark felt to a far greater degree than 
its size. I never hesitate to point out that we are just 360 
employees. At a cost of just 15 cents a citizen I think the 
Safety Board is one of the best buys in Government.

                             TWA Flight 800

    As I mentioned to you, the investigation of TWA Flight 800 
is the most extensive and costly in the Safety Board's history, 
and I might ask if Paul could show a couple of charts for the 
committee while I continue my testimony.
    On July 17, 1996, TWA Flight 800 tragically crashed into 
the Atlantic off the coast of Long Island. Wreckage was located 
at a depth of over 120 feet, and the thousands of pieces were 
spread over 5 square miles. Based on the condition of the 
wreckage from the center forward section of the plane, 
including the center wing tank, our investigators have 
determined that a fuel air explosion took place. The origin of 
that explosion is not known. However, with over 90 percent of 
the plane recovered, there is no physical evidence of a bomb or 
a missile.
    Based on the examination of the wreckage and other 
evidence, on December 13, 1996, the Safety Board issued four 
safety recommendations to the FAA aimed at reducing the 
flammability of the ullage in the airliner's center wing tanks, 
with specific emphasis on the Boeing 747 center wing tank.

                          Supplemental Request

    Mr. Chairman, let me briefly address some financial issues 
that are important to the Safety Board. As you know, the 1997 
enacted appropriation level for the Safety Board is $42.4 
million and 370 FTE's. Not included in this amount is the $6 
million supplemental earmarked primarily for reimbursement to 
the U.S. Navy for TWA Flight 800 recovery costs. In the spring 
of 1997, we requested an additional TWA 800-related 
supplemental of $23.2 million. This would have covered 
investigative expenditures through the end of the fiscal year, 
as well as allowing us to start our family assistance efforts. 
OMB approved $20.2 million.
    I realize, Mr. Chairman, this is not a budget hearing, but 
I do want a chance to make our case. Our $1 million emergency 
fund is used to pay for extraordinary recovery and 
investigative tasks. OMB has approved expanding the fund next 
year to $2 million. The simple truth is this fund does not 
begin to cover the extraordinary costs of our investigations.
    Aircraft tragedy investigative costs are usually borne by 
both the Federal Government and the carrier through its 
insurance underwriters. If the aircraft crashes on the land, 
the carrier is generally responsible for wreckage recovery and 
removal. If we deem that the wreckage is vital to our 
investigation we see that the critical parts or all of the 
wreckage are removed to a secure sight for examination. In 
general, payment for this is made by the insurance 
underwriters.
    In accidents occurring over water or where the probable 
cause may be criminal in nature, the responsibilities are not 
so clear. For example, in the TWA Flight 800 investigation I 
asked for the early financial participation of the carrier, 
manufacturers, and engine suppliers. All of them declined. The 
Federal Government has, in fact, borne all of the extraordinary 
costs in this investigation outside of the party's 
participation.
    I would also be remiss if I did not finally mention the 
outstanding work of the State and of local authorities and 
agencies at the accident scenes. In New York, Florida, and in 
Michigan, costs have been incurred because of the accidents 
that are currently being borne by the States and localities. 
They are not insignificant, and I believe that a system or 
process needs to be put in place to address the legitimate 
local costs associated with aircraft disasters.
    Mr. Chairman, that concludes my testimony, and I will be 
glad to answer any questions at the appropriate time.

                           Prepared Statement

    Senator Shelby. Thank you, Mr. Hall. We have your complete 
statement, and it will be made part of the record.
    [The statement follows:]
                 Prepared Statement of James Evan Hall
    Good morning, Mr. Chairman and Members of the Committee. It is a 
pleasure to be here today to represent the National Transportation 
Safety Board.
    It goes without saying that the past year was dominated by 
catastrophic transportation accidents that have required extraordinary 
efforts by the Safety Board and have strained the agency's resources 
more than any time in its history. It is well established that the TWA 
flight 800 Boeing 747 investigation has been the most costly and 
complex in the Safety Board's history, in terms of dollars spent for 
wreckage search and recovery, and the level of investigative staff 
work.
    Moreover, as a multi-modal agency, the Safety Board has an 
important responsibility for the investigation of surface 
transportation accidents. Our workload in that area has also been 
unprecedented in the past year. Many of our laboratory specialists 
support our multi-modal mission. For example, the metallurgists working 
on TWA flight 800 are also working on surface accidents. Also, one of 
our key engineers responsible for surface transportation vehicle 
performance has been assigned full time for several weeks to supervise 
the 3-dimensional mockup of the TWA flight 800 wreckage.
    Mr. Chairman, the TWA investigation provides dramatic testimony to 
the wisdom of Congress 30 years ago when it established a multi-
discipline, independent accident investigation agency, initially 
affiliated with the Department of Transportation, ``to promote 
transportation safety by conducting independent accident investigations 
and by formulating safety improvement recommendations.'` However, 
because the Congress recognized the need to make it totally independent 
from the Department of Transportation, the ``Independent Safety Board 
Act of 1974'' was passed.
    The independence of the Safety Board and its clear mandate to 
conduct in depth objective investigation, draw conclusions from its 
findings, and to make recommendations to improve safety, without bias 
or undue influence from industry or other government agencies is 
essential to maintaining the safety of the American traveling public. 
It is not unusual for the Safety Board to address safety issues that 
are controversial or that may be critical of government or industry 
standards or operations.
    The Safety Board is charged by Congress with investigating or 
causing to be investigated all civil aviation accidents in the U.S. In 
1994, the Safety Board's authority was expanded to investigate 
government-operated aircraft as well, except those operating in 
military or intelligence missions. In addition, the Safety Board 
provides the U.S. Accredited Representatives to overseas investigations 
involving U.S.-registered, -certified, or -operated aircraft, and 
aircraft whose airframes, engines, and major components were 
manufactured in the U.S.
    Since the Safety Board began investigating accidents, it has made 
more than 10,000 safety recommendations to prevent accidents, save 
lives, and reduce injuries. While every recommendation from the Board 
is developed to help improve safety and prevent accidents, some have a 
greater potential to save lives than others.
    As you know, Mr. Chairman, it is the responsibility of the NTSB to 
formulate recommendations to those parties that can effect improvements 
in transportation safety, but it is the responsibility of agencies like 
the FAA to determine how best to implement those changes. In the last 5 
years, the FAA has adopted 84 percent of our recommendations.
    We harbor no illusions that the FAA should adopt ALL of our 
recommendations, nor do we seek to have our recommendations mandatory. 
Frankly, Mr. Chairman, if the FAA adopted all of our recommendations, 
then we would not be asking for enough. There are bound to be some 
areas where the regulatory agency honestly believes that a recommended 
change is not cost-effective--remember, the FAA must conduct cost-
benefit analyses of any proposed changes--or that a better alternative 
can be found. This is not to say that we don't strongly disagree with 
some of their actions, or inaction, and that is what the ``Most 
Wanted'' list is designed to at least partially address.
    In order to identify those recommendations with the greatest 
potential to improve transportation safety that have not yet been acted 
on, the Safety Board in 1990 adopted a ``Most Wanted'' program. 
Recommendations placed on the program list will receive more intensive 
follow-up activity in order to encourage government agencies and 
industry to act on the recommendations as quickly as possible.
    To be considered for the ``Most Wanted'' list, a recommendation 
must affect transportation safety on a national level, concern a safety 
issue of high visibility, or be of great interest to the public. Also 
considered is the previous loss of life or property as well as the 
potential for future losses, and the extent of the exposure of the 
public to risk by the safety problem. Previous action taken by the 
recipient is also taken into consideration.
    Currently on the Safety Board's ``Most Wanted'' list are five 
aviation-related issues that include:
    1. The requiring of the installation of expanded flight data 
recorders with an increased number of parameters.
    2. The installation of airport runway incursion avoidance systems.
    3. The review of safe separation distances between larger and 
smaller following aircraft.
    4. The installation of mode C instrument alert systems for airport 
terminal areas.
    5. The sharing of pilot background information between airlines.
    Last year the Congress acted on the issue of pilot record sharing 
and the Safety Board will consider removing this issue from the ``Most 
Wanted'' list. Unfortunately the remaining four issues will remain. I 
would like to address two of these issues in more detail.
    Flight Data Recorders.--Although not a new issue on the ``Most 
Wanted'' list, I would like to discuss the importance of enhanced 
flight data recorders (FDR). Almost two years have passed since the 
Safety Board issued its recommendations for enhanced FDR's, and the FAA 
has failed to enact any rulemaking on this important safety issue.
    On July 16, 1996, the FAA issued the NPRM on enhanced FDR's, with a 
30-day comment period. NTSB comments on the rule were generally 
favorable. However, the NPRM would not require FDR retrofits to begin 
for at least another two years. Further, no action was taken on the 
Board's urgent recommendation to expedite the retrofit of Boeing 737 
airplanes.
    We are aware that a rulemaking package was forwarded to the Office 
of the Secretary of Transportation on February 7, 1997. However, the 
DOT and Office of Management and Budget review process has been 
lengthy. How much longer must we wait before action is taken?
    We believe that expanded flight data recorders are critical to 
accident and incident investigations. United Flight 585, which crashed 
in 1991 in Colorado Springs, Colorado, had a 5-parameter recorder and 
USAir 427, which crashed in 1994, had only 11 parameters. Vital 
information for investigators was simply unavailable and that is 
unacceptable.
    Runway Incursions.--On March 25, 1997, a Gulfstream G-2 corporate 
airplane was cleared to land on runway 31 at LaGuardia Airport. About 
the time the G-2 was touching down on the runway, the tower controller 
advised its pilot to go-around. The G-2 was unable to execute a missed 
approach and it collided with an airport maintenance truck. The same 
tower controller had cleared the vehicle operator onto runway 31 about 
40 minutes before the G-2 was cleared to land. The truck driver, his 
assistant, and the two G-2 pilots were not injured although the 
airplane and vehicle were substantially damaged.
    Mr. Chairman, the circumstances of this accident could very easily 
have involved a commercial air carrier resulting in multiple 
fatalities. Although our investigation continues, we have learned that 
the controller, who cleared the maintenance truck and the incoming 
airplane, simply ``forgot'' about the truck he had approved out onto 
the runway.
    Forgetting is a human factor routinely found in operational errors 
by air traffic controllers that cause incidents virtually every day in 
our nation's air traffic system. This type of human error has also been 
identified in past accidents. For example, on February 1, 1991, a USAir 
Boeing 737 collided with a Skywest Metroliner at the Los Angeles 
International Airport, killing 34 passengers and crew. This accident 
occurred, in part, because the air traffic controller cleared the USAir 
airplane to land about 3 minutes after she had cleared the Skywest 
airplane onto the same runway to hold for departure. She ``forgot'' the 
Skywest flight.
    And I regret to say that operational errors and runway incursions 
have been increasing. Operational errors in the terminal environment 
have increased 14 percent from 1995 to 1996. Similarly, runway 
incursions have increased 19 percent from 1995 to 1996. These trends 
raise concerns about the progress being made by the FAA in addressing 
the risks associated with the potential for ground collisions.
    Following several accidents and Safety Board recommendations, in 
1991, the Federal Aviation Administration (FAA) established a Runway 
Incursion Action Plan to reduce surface errors at the nation's more 
than 570 airports. This plan was revised in 1995. The action plan 
focuses on reducing human error, improving ground communications, and 
developing and implementing technologies to increase airport surface 
guidance and surveillance, as well as improved ground traffic 
management procedures and equipment. One of the more important 
components of the FAA's efforts is the Airport Movement Area Safety 
System (AMASS).
    AMASS, which is a system integrated into the new ASDE-3 ground 
radar system, automatically tracks all operations, compares each 
vehicle and aircraft movement, and provides visual and audio alerts of 
potential conflicts. This is a ``real time'' system for preventing 
runway accidents in a dynamic airport environment. AMASS would have 
provided the means to prevent accidents similar to the ground 
collisions that occurred February 1, 1991, at Los Angeles, November 22, 
1994, at Bridgeton, Missouri, and March 25, 1997, at LaGuardia. 
Unfortunately, except for a prototype at San Francisco International 
Airport that is operating with a limited capability, AMASS 
installations are not yet in place.
    In a February 28, 1995, safety recommendation letter to the FAA, 
the Safety Board expressed its concerns about delays in AMASS 
installations. In that letter we cited FAA testimony before Congress on 
March 6, 1990, in which the FAA stated that it had entered a contract 
for design and manufacture of AMASS that would be ``fast tracked'' with 
the project operational in 1992. In the February 28, 1995, letter, the 
Safety Board expressed its concerns that ``. . . this important project 
[AMASS] has been effectively paralyzed as a result of a succession of 
changes. . . .''
    The latest information published by the FAA on the status of AMASS 
is not encouraging. The prototype testing in San Francisco has been 
ongoing since May 1996. Under a contract awarded in June 1996, three 
full-scale AMASS systems are due to be installed in Detroit (September 
1997), St. Louis (November 1997), and Atlanta (February 1998). Another 
20 systems that are currently in initial production are scheduled to be 
delivered for installation between July 1998 and July 1999. There are 
options for 16 more AMASS systems; however, the funding is not 
available at present. We believe these are two important safety issues 
that must be addressed by the FAA.
                      twa flight 800 investigation
    On July 17, 1996, TWA flight 800 tragically crashed into the 
Atlantic Ocean near East Moriches, New York, killing all 230 people on 
board. The aircraft wreckage in this accident was ten miles off the 
coast at a depth of 120 feet, making this investigation anything but 
typical.
    To ensure the safety of the divers and to identify the location of 
the wreckage, the area had to be thoroughly mapped before the full-
scale underwater recovery effort could begin. Heavy wreckage was not 
lifted from the ocean floor until early August. By the end of October, 
the divers had cleared the debris fields of all large pieces of 
wreckage. On November 3, scallop trawlers were brought in to drag the 
ocean floor. To date, an area of over 28 square miles has been trawled, 
with some areas having been gone over in excess of 20 times. A second 
pass is being made over the entire area: trawling will continue until 
substantial amounts of wreckage are no longer being recovered.
    Based on the condition of the wreckage from the center forward 
section of the airplane and that surrounding the center wing tank, the 
investigators were particularly interested in this area and have 
created 3-dimensional mockups of this section. Three sets of 
scaffolding were erected on which this section of airplane was 
reassembled in order to give the investigators a better picture of what 
occurred. The fuselage surrounding the center wing tank was on one, the 
top and sides of the center wing tank on another, and the floor center 
wing tank was on the third. Following these initial efforts, it was 
decided to construct a full scale 3-dimensional mockup of a major 
portion of the airplane, including the fuselage skin. The mockup being 
constructed with the assistance of contractors to the Safety Board will 
be about 92 feet long, the largest in the world ever constructed. That 
work has been essentially completed.
    It is apparent that an explosion occurred in the center wing tank, 
but the origin of the explosion is not yet known. To date, with over 90 
percent of the airplane recovered, there is no physical evidence of a 
bomb or missile strike.
    Based on the examination of the wreckage and other evidence, on 
December 13, 1996, the Safety Board issued four safety recommendations 
to the FAA aimed at reducing the flammability of the ullage in airliner 
center wing tanks, with specific emphasis on the Boeing 747 center wing 
tank. The recommendations urged the FAA to:
    Require the development of and implementation of design or 
operational changes that will preclude the operation of transport-
category airplanes with explosive fuel-air mixtures in the fuel tanks:
    (a) Significant consideration should be given to the development of 
airplane design modifications, such as nitrogen-inerting systems and 
the addition of insulation between heat-generating equipment and fuel 
tanks. Appropriate modifications should apply to newly certificated 
airplanes and, where feasible, to existing airplanes. (A-96-174)
    (b) Pending implementation of design modifications, require 
modifications in operational procedures to reduce the potential for 
explosive fuel-air moisture in the fuel tanks of transport-category 
aircraft. In the B-747, consideration should be given to refueling the 
center wing fuel tank (COOT) before flight whenever possible from 
cooler ground fuel tanks, proper monitoring and management of the CWT 
fuel temperature, and maintaining an appropriate minimum fuel quantity 
in the CWT. (A-96-175)
    Require that the B-747 Flight Handbooks of TWA and other operators 
of B-747's and other aircraft in which fuel tank temperature cannot be 
determined by flightcrews be immediately revised to reflect the 
increases in CWT fuel temperatures found by flight tests, including 
operational procedures to reduce the potential for exceeding CWT 
temperature limitations. (A-96-176)
    Require modification of the CWT of B-747 airplanes and the fuel 
tanks of other airplanes that are located near heat sources to 
incorporate temperature probes and cockpit fuel tank temperature 
displays to permit determination of fuel tank temperatures. (A-96-177)
    The FAA responded to these recommendations on February 18, 1997. In 
general, the FAA's response stated that the recommendations propose 
major changes in the requirements for fuel tank design and fuel 
management of transport-category airplanes. The FAA stated, ``the 
airworthiness standards of 14 CFR Part 25 assume that fuel vapor is 
flammable, and the design requirements dictate the elimination of 
ignition sources within the fuel tanks.''
    Because the FAA considered the control of flammability 
characteristics of fuel vapor in airplane fuel tanks as a ``major 
change in design concept'', it elected to evaluate the safety 
recommendations by means of soliciting information about the 
effectiveness and practicality of implementing the recommendations. The 
FAA stated that it would publish a public notice in the Federal 
Register within 30 days.
    The September 8, 1994 accident involving USAir flight 427 near 
Pittsburgh, Pennsylvania, which killed all 132 people on board, 
continues to be one of our most complex investigations. It has been one 
of the most far-reaching investigations in the history of the Safety 
Board, with NTSB investigators and party participants working 
continually over 2\1/2\ years to try to understand the very complex 
circumstances of this tragic event. The investigation has involved tens 
of thousands of staff hours and numerous flight tests, resulting in 20 
safety recommendations.
    The Safety Board is aware that Boeing is actively engaged in a 
redesign of the main rudder power control unit for the existing Boeing 
737 series at an estimated cost to Boeing of $120 million to $140 
million. In January 1997, Boeing and the FAA announced that the primary 
and secondary slides of the PCU servo control valve would be redesigned 
to preclude the potential for reverse rudder operation. The FAA plans 
to issue an airworthiness directive (AD) that would require the Boeing 
737 fleet to be retrofitted with the new valve within two years.
    We are encouraged by Boeing's commitment to move forward. We are 
concerned, however, that there may be a delay by the Federal Aviation 
Administration in issuing a final rule, or that the final rule might 
allow more than 2 years for operators to complete the installation of 
the new servo control valve. On February 20, 1997, the Safety Board 
issued three additional safety recommendations to the Federal Aviation 
Administration regarding the Boeing 737 aircraft. Those recommendations 
state:
    Require the expeditions installation of a redesigned main rudder 
power control unit on Boeing 737 airplanes to preclude reverse 
operation of the rudder and to ensure that the airplanes comply with 
the intent of the certification requirements. (A-97-16)
    Advise Boeing 737 pilots of the potential hazard for a jammed 
secondary servo control valve slide in the main rudder power control 
unit to cause a reverse rudder response when a full or high-rate input 
is applied to the rudder pedals. (A-97-17)
    Require the Boeing Commercial Airplane Group to develop operational 
procedures for Boeing 737 flightcrews that effectively deal with a 
sudden uncommanded movement of the rudder to the limit of its travel 
for any given flight condition in the airplane's operational envelope, 
including specific initial and periodic training in the recognition of 
and recovery from unusual attitudes and upsets caused by reverse rudder 
response. Once the procedures are developed, require Boeing 737 
operators to provide this training to their pilots. (A-97-18)
    This investigation continues, and I am proud of the dedication of 
the investigative team. I believe these recommendations reflect, in 
part, the progress we are making. Safety Board staff hopes to have a 
final report regarding this accident before the Board for consideration 
this year. We will, of course, keep the Committee advised of 
developments.
    I want to turn now to what has become a new responsibility for the 
Safety Board, assistance to family members of victims of air disasters.
    Since the dawn of commercial aviation, the unpleasant duty of 
notifying next of kin after airline accidents has fallen upon the 
airline involved in the accident and that carrier often made 
arrangements for the transportation of family members to a location 
near the accident site and for the return of victims remains.
    Whether or not this modus operandi was ever adequate to address the 
needs of victims' family members, it is clear that the way things used 
to be done is not adequate today. The world has changed and all of us 
involved in the events following major airline accidents have to change 
with it. The combination of a litigious society, expanded and 
aggressive 24-hour news coverage, and perhaps a mistrust of authority 
all have contributed to this new environment.
    In September 1996, President Clinton issued a directive naming the 
Safety Board as the coordinator of federal services to families of 
victims of transportation accidents, and in October he signed 
legislation that gives us that responsibility for aviation disasters. 
The Safety Board did not seek this responsibility; in fact, I had hoped 
that it could be handled without federal intervention. But the 
families, the President and the Congress have entrusted us with these 
responsibilities and we will do the job.
    Under this new authority:
  --The Safety Board will coordinate the provisions of federal services 
        to the families of victims
  --These could include, but are not limited to, providing speedy and 
        accurate information about the accident and recovery efforts, 
        ensuring the families who wish to travel to the accident site 
        receive all necessary assistance, and arranging opportunities 
        for counseling and other support.
  --The Safety Board will work with State and local authorities and 
        with private relief organizations to ensure appropriate 
        coordination of the services they provide with those of the 
        Federal Government.
  --The following federal agencies will cooperate fully with the Safety 
        Board in these efforts; the Department of State, Defense, 
        Justice, Health and Human Services, Transportation and FEMA.
    Another provision of the Act calls on the Secretary of 
Transportation to appoint a task force composed of family members and 
representatives of government and private relief agencies. This task 
force will have quite a full plate before it. It is charged with 
developing a model plan to assist airlines in responding to aircraft 
accidents. The first meeting of the task force is scheduled for the end 
of this month.
    Let me describe two recent experiences since passage of the Family 
Assistance Act. On November 19, 1996, a United Express Beech 1900C 
collided with a King Air at intersecting runways in Quincy, Illinois. 
All 14 persons on both aircraft died in the accident.
    Although this was a relatively low-fatality accident as major 
airline disasters go, it still had a significant impact on local 
resources and facilities. The coroner had no medical expertise, and no 
facilities or staff at his disposal. Under an agreement with the 
Department of Health and Human Services, we arranged for a mobile 
morgue that was fully equipped, supplied, and staffed. This service was 
set up inside the airport's vacant firehouse, and served as the 
mortuary.
    Despite the fact that all 14 victims were badly burned, they all 
were identified and returned to their families within four days. This 
would not have been possible had local resources not been augmented.
    Although most families did not come to the scene, those who did 
were taken to the accident site on the second full day. The city 
provided us with police escorted transportation for the family members. 
The families who were on scene were briefed by Safety Board and our 
Investigator In-Charge. Those family members who did not travel to 
Quincy were briefed by staff members by phone.
    On January 9, 1997, a Comair EMB-120, a Brasilia, crashed on 
approach to Detroit, killing all 29 persons aboard. In this instance, 
nearly all families came to the scene. The Michigan State Police took 
care of security at the accident site, at the morgue, and at the hotel 
where the family members were staying.
    The identification of victims began on the second full day 
following the accident--Saturday--and continued through Wednesday. All 
29 victims were identified. This was an extremely difficult task 
because of the severe fragmentation of the remains and the extreme cold 
temperatures in the days following the accident (wind chills for many 
days after the accident were well below zero). A team of 125 people 
worked in the ad hoc morgue set up in a hangar for 20 hours a day. The 
mobile morgue was flown in the morning after the accident. Personal 
effects were recovered by teams of volunteers. The local Mental Health 
office provided counseling for family members and for rescue personnel.
    What we have seen in these two accidents has been evident in many 
accidents in the past. Local jurisdictions are not prepared for the 
consequences of a once-in-a-lifetime event like a major airliner crash. 
This is no criticism of them. You cannot build an infrastructure to be 
prepared for such a rare event; it would deprive communities of 
resources needed elsewhere for more pressing community needs.
    The Monroe County crash of the Comair commuter in January brought 
that county its highest death toll in a single event in more than 150 
years. Any individual airline might go decades between fatal accidents; 
it is difficult for them, too, to be completely prepared for such an 
event.
    The Safety Board deals with many major accidents every year. And 
we've been doing this for 30 years. That is why we were placed in 
charge of coordinating government services to the families, and that is 
why we are optimistic that once we have agreements in place with the 
many government and private agencies that can provide needed services, 
and once we have this program funded, we can fulfill the obligations 
given us by the American people though legislative directive.
    I can say that both of the recent accidents taught us lessons, but 
they also demonstrated the benefits of our involvement; many who have 
participated in previous incidents commented on how far things had come 
and how much better off families were under this more-organized on-
scene effort.
    I would like to point out that we have structured our family 
assistance program to ensure that our new responsibilities and 
authorities do not interfere with or adversely affect the well-
established process of managing major investigations.
    Mr. Chairman, let me now address some financial issues that are 
important to the Safety Board. As you know, the 1997 enacted 
appropriation level for the Safety Board is $42.4 million and 370 
FTE's. Not included in this amount is the $6 million 1996 supplemental 
earmarked primarily for reimbursement to the U.S. Navy for TWA Flight 
800 recovery costs. In 1997 we requested approval for an additional TWA 
800 related supplemental of $23.2 million. This would have covered 
investigative expenditures through the end of the fiscal year, as well 
as allowing us to start our family assistance efforts. OMB approved 
$20.2 million for inclusion in the President's Budget. I realize, Mr. 
Chairman, this is not a budget hearing but I did not want to miss a 
chance to make our case.
    Our emergency fund, which has been funded at a $1 million level, is 
used to pay for extraordinary recovery and investigative tasks. OMB has 
approved expanding the fund next year to $2 million. The simple truth 
is that this fund does not begin to cover the extraordinary costs of 
our investigations. Aircraft tragedy investigative costs are usually 
born by both the Federal Government and by the carrier through its 
insurance underwriters. If the aircraft crashes on land, the carrier is 
generally responsible for wreckage recovery and removal. If we deem 
that the wreckage is vital to our investigation, we see that the 
critical parts, or all of the wreckage, are removed to a secure 
location for examination. In general, payments for this is made by the 
insurance underwriters.
    In accidents occurring over water, or where the probable cause may 
be criminal in nature, the responsibilities are not so clear. For 
example, in the TWA Flight 800 investigation, I asked for the early 
financial participation of the carrier, manufacturers, and engine 
supplier and all declined. The Federal Government has in fact borne all 
of the extraordinary costs in this investigation outside of the party's 
participation.
    I would also be remiss if I did not mention the outstanding support 
of the state, and local authorities and agencies at the accident 
scenes. In New York, Florida, and in Michigan, costs have been incurred 
on behalf of the accident that are currently being borne by the states 
and localities. They are not insignificant and I believe that a system 
or process needs to be in place to address the legitimate local costs 
associated with aircraft disasters.
    Mr. Chairman, this concludes my testimony and I will be happy to 
answer any questions.

                        Investigation Financing

    Senator Shelby. Mr. Hall, the National Transportation 
Safety Board is responsible for investigating significant 
transportation accidents of all kinds. NTSB immediately 
dispatches what they call a go team to an accident site, 
analyzes the evidence, and tries to determine the probable 
cause of the accident. NTSB often issues safety recommendations 
to help avoid future accidents.
    Some investigations are very lengthy, such as the 1991 
Colorado Springs crash of a United Airlines 737, cause 
undetermined; the 1994 Pittsburgh crash of a USAir 737, and the 
ongoing probe regarding TWA Flight 800, that you just 
mentioned. How, Mr. Hall, does NTSB finance safety 
investigations? Does your budget require enough flexibility?
    Mr. Hall. Through appropriated funds. Mr. Chairman, 
obviously funding our agency is sometimes like funding the fire 
department--you are not exactly sure how many emergencies you 
are going to face in a particular year.
    Senator Shelby. Well, just like the TWA investigation has 
taken a long time, it has had to be very expensive.
    Mr. Hall. Yes; but it is all appropriated dollars.
    Senator Shelby. It has taken a toll on your budget as well, 
has it not?
    Mr. Hall. Yes, sir; definitely. And not just the budget, 
Mr. Chairman, but obviously I would be remiss if I did not say 
the toll it has taken on all the individual investigators.

                   Insurance Company Responsibilities

    Senator Shelby. Do insurance companies have a significant 
role in determining the course of an investigation, and if so, 
what role do they play?
    Mr. Hall. The only role they have played traditionally in 
the past is the assistance in the wreckage and recovery costs. 
They do not really have any party status or other role in the 
investigation.
    Senator Shelby. Should DOT review the level of insurance 
coverage it requires of transportation providers, especially 
common carriers of passengers?
    Mr. Hall. Yes, Mr. Chairman, I believe they should. And we 
have actively recommended to both OMB and to the Secretary that 
we ought to look at some type of emergency funding that would 
be available to cover situations similar to TWA 800, and also 
the responsibility that a carrier may carry to some of the 
victims. At the present time my understanding is that most of 
the policies do not provide any funds for victim recovery.
    Senator Shelby. Mr. Vogt, did you have any opening 
statement? I was told you did not, but I wanted to clarify 
that.
    Mr. Vogt. Mr. Chairman, I do not have a written opening 
statement.
    Senator Shelby. OK. Do you have any comments?
    Mr. Vogt. I will share some comments with you.
    Senator Shelby. Please go ahead.
STATEMENT OF CARL VOGT, FULBRIGHT & JAWORSKI, AND 
            MEMBER, WHITE HOUSE COMMISSION ON AVIATION 
            SAFETY AND SECURITY
    Mr. Vogt. Thank you for inviting me. I am pleased to be 
here. I am the only witness, I think, today who is not 
anticipating an appropriation from you, unless there is a rule 
I have missed.
    Senator Shelby. You have not missed it.
    Mr. Vogt. Thank you, Senator Lautenberg also, Senator Byrd, 
Senator Bennett.
    Just a few brief remarks.
    I think it is very important to keep the perspective of 
historical context on where we are today in aviation safety. We 
recently, last week, celebrated the 50th anniversary of the 
Flight Safety Foundation, of which I am privileged to be a 
governor, and we honored the founder of the Flight Safety 
Foundation, a man named Jerry Lederer. Jerry was 6 months old 
when Orville Wright made his first flight. So all that we are 
talking about today and all that involves commercial aviation 
today has happened in the long lifetime of one individual.
    We sometimes think that change which is occurring at any 
given time is unique, and this industry, in fact, has been 
characterized by change from the very beginning. Most often 
that change has been brought about by technological advances. 
Modern aviation, for example, in my judgment began with the 
introduction of turbine power in the late fifties and early 
sixties to commercial aviation. The microprocessor has had 
enormous impact, and today we are right on the threshold of a 
whole new era which is brought about by digital communications, 
global position satellite navigation, and so technologically 
today we find ourselves at the beginning of a very, very 
important era in aviation.
    At the same time we are seeing an enormous expansion of the 
market for aviation services, an expansion of capacity, growth 
throughout the world in commercial flights. The Boeing Co. has 
predicted from a safety perspective that if we do not improve 
the accident rate we are going to have an accident a week 
worldwide within the next 20 years.
    We also are at a point in time where I do not need to tell 
you that we are faced with reductions in government spending 
across the board. This is not only true in the United States, 
it is happening in Europe, as well. And so faced with an 
expansion of capacity in demand for aviation transportation 
services, on the threshold of a major technological innovation 
in change, we are in a position where we do not have the 
Federal resources available that we have had historically to 
deal with the change that is coming about. And it is the 
juxtaposition of these things that creates some unique 
challenges at this point in time.
    And to state the obvious, one of the challenges is that the 
Federal agencies involved are going to have to do more with 
less, and they are in the process of addressing that. The 
Challenge 2000 report that the FAA prepared is an innovative 
and thoughtful approach to this. There is a lot more to be 
done.
    But as you review the recommendations of the Gore 
Commission you will see that some of the most important ones 
open the issue of increased funding. There is more money needed 
to comply with or accede to the recommendation, for example, 
that the modernization of our air traffic control system be 
expedited and be in place by the year 2000 rather than the year 
2012--I am sorry, by 2005 rather than 2012.
    We call for increased security measures to be funded with 
Federal funds. We toss the ball to the Civil Aviation Review 
Commission, which the Congress has established in most of these 
cases to find new ways to come up with money for these programs 
and others. But I believe that new efficiencies within the 
administration and new sources of money are the real challenges 
that are facing us today.
    I would be happy to answer any of your questions.
    Senator Shelby. Senator Lautenberg.
    Senator Lautenberg. Thank you, Mr. Chairman.
    Mr. Vogt, you could not be more right in terms of the 
funding requirements. I am a senior on the Budget Committee and 
we spend every day talking about the problems that we have to 
solve that do require money in addition to attention. And this 
is one of them, and I think that we saw in TWA 800 what it is 
that people want to know, what we want to know about what took 
place.
    And, Mr. Chairman, the suggestion that Mr. Hall made about 
visiting that site, the reconstruction of TWA 800, is something 
if you do have a chance you ought to see. I was there and I 
also saw Pan Am 103 when it was reconstructed, and it is just 
amazing what can be done, what science is now available to us, 
and we ought to pursue it as diligently as we can.

                    Gore Commission Recommendations

    Mr. Hall, the Gore Commission made several recommendations 
on how to improve aviation safety and security. In some 
quarters, however, it is being criticized as being long on 
advice and fairly short on how to accomplish some of these 
objectives. Both of you having been involved with it, are we 
seeing a situation where some of the harder to solve safety 
problems are deferred because we cannot get industry agreement 
or because they have made a hard, cold calculation about how 
much they can do, how much they ought to do with the funds that 
they have available?
    Mr. Hall. Let me just briefly comment. Looking back, 
Senator Lautenberg, I want to commend former Administrator 
Hinson and Deputy Administrator Daschle. One of the things that 
Senator Byrd mentioned was a recommendation of the Board, one 
level of safety for regional aircraft is now a reality in this 
country. The previous administrator addressed the problem of 
the failed modernization of the air traffic control system and 
put that on track.
    I think, referring to your earlier remarks, what we now 
need is leadership and direction. We have the Challenge 2000 
program, we have the 90-day safety review, we have the Gore 
Commission recommendations which provide an overall direction. 
What we now have to talk about is the implementation of these 
recommendations. There are two things in that, having the 
direction and support of both the industry and the Government 
to make these things happen, and the second thing is who is 
going to pay.

                       NTSB Supplemental Request

    Senator Lautenberg. Well, that brings me to the next 
question, and that is the difference between that amount 
requested during the 1997 emergency supplemental, as well as 
the extraordinary costs associated with TWA 800, as well as the 
implementation of some of the Gore Commission recommendations. 
That is quite a package.
    Now, the amount of funding, therefore, that you request of 
us does differ from the level formally requested by OMB. Where 
do you see the difference coming? Are they just saying to you 
we cannot handle it, or are they saying that you do not need 
it?
    Mr. Hall. OMB did not provide us funds for the victims' 
assistance program that was directed by both the President and 
Congress for the NTSB to accomplish, and some additional 
positions that we felt were necessary.
    I have had, Mr. Chairman, a number of my investigators that 
have been living for 9 months up at Calverton. If we had 
another aviation disaster that occurred in the near future, we 
would be in a very difficult situation to be able to provide 
the type of investigation that our agency wants to provide to 
the American people.

                               Navy Costs

    Senator Lautenberg. Just questioning, the other costs that 
have been associated with this investigation are really 
significant. And I was out at Calverton twice, once a couple of 
days just after the airplane went down, and later on to see 
what the progress was, and it was an amazing task. I must tell 
you, your people and the FBI and the Navy and the divers and 
everybody that was involved gave it as good an effort as I 
think one could possibly see. But are you required to reimburse 
the Navy for any of the costs that they have incurred?
    Mr. Hall. Yes, sir; we have a memorandum of understanding 
with the Supervisor of Salvage of the U.S. Navy to assist us in 
the recovery on a reimbursable basis. They work under contract 
to us, and are up there under our direction. It is our 
responsibility to fund the recovery.
    Immediately after this event happened, I sent, as we have 
routinely done, and Peter, you might throw that other chart up, 
last year we had three----
    Senator Byrd. Those charts are not of much assistance.
    Senator Lautenberg. I would say.
    Mr. Hall. They are hard to see, I am sorry.
    Senator Byrd. I can see the chart, but I cannot read it. 
[Laughter.]
    Senator Shelby. That helps.
    Senator Lautenberg. That helps. It blots out the whole 
audience.
    Senator Shelby. Just the press.

                             TWA 800 Costs

    Mr. Hall. If you would like, we could basically review for 
you the costs on Flight 800 to date.
    Voice. Mr. Chairman, this chart intends to show a number of 
things, primarily the extraordinary investigative costs 
relative to TWA 800. As you will notice in the center column 
here, $26.8 million is the total cost we now see as required to 
complete the investigation.
    Senator Lautenberg. That is your share only?
    Voice. These are the total costs the NTSB expects to obtain 
through reimbursement of others.
    Senator Shelby. The whole thing.
    Voice. Out of 1996 we spent $766,000 out of our emergency 
fund. Congress provided $6 million at the beginning of fiscal 
1997 in a supplemental appropriation, and we have requested a 
total of $23 million additional this fiscal year, $20.1 million 
for TWA 800, the bulk of that going for reimbursement to the 
Navy of victim wreckage recovery, also for the wreckage 
storage, the facility at Calverton. The Navy has asked for $5.6 
million. And as you can see, there are other associated costs 
with the investigation. But the Navy portion is primarily 
victim wreckage search and recovery and wreckage storage. In 
addition, the trawling, which is ongoing, is $5.5 million all 
by itself.
    Senator Lautenberg. Mr. Chairman, my time is up, but I just 
want to say that I have seen the NTSB in many situations, rail 
accidents, aviation review. Mr. Hall has been to my office 
several times and we have discussed things. I have got to say 
this is a department under Mr. Hall's leadership that has done 
very, very well. They work hard, they are conscientious, they 
are professional in every sense of the word, and I think that 
we run a risk if we shortchange some of these reviews because 
of the longer term implications, obviously, what it is you 
learn in one of these investigations.
    Thanks very much.
    Senator Shelby. Senator Bennett.
    Senator Bennett. Thank you, Mr. Chairman.
    If I may impose a little personal history, my service in 
the executive branch was at the Department of Transportation. 
And it was my responsibility and ultimately my pleasure to 
shepherd through the Congress the Airport Airways Act of 1969, 
that created the airport airways trust fund, and we assumed as 
a result of that action that we had secured funding for the FAA 
and its safety responsibility for all time. We were not aware 
of the fact that subsequent administrations, both Republican 
and Democrat, would treat trust funds, whether it is the 
highway trust fund or the airport airways trust fund, as simple 
accounting devices that had little or nothing to do with the 
amount of money that would actually be spent. And as a 
consequence, fake balances were allowed to accumulate in the 
trust funds while serious needs were not met. And so I come to 
this committee with a little bit of that history behind me, and 
am concerned to hear you talk about the need for resources in 
this area relating to the safety of the FAA when I thought I 
had made a small contribution to making sure that those 
resources would always be there.
    There is a story going around which I would like you to 
comment on, either confirm or deny, lay down. It makes great 
conversation. Someone said, and if I knew who the someone was I 
would tell you, I am not trying to be coy here, I am trying to 
get some information, that a study was made of the Federal 
Government's computer technology and capability, primarily from 
the point of view of trying to find out whether or not a hacker 
could get into the Government's computers and compromise them. 
The result was, according to the version I have heard of the 
study that every portion of the Government's computer system is 
indeed vulnerable to a hacker getting in and one way or the 
other compromising or taking information out of the system, 
with the exception of the FAA. The reason we need not worry 
about a hacker getting into the FAA is that the software and 
the hardware are so obsolete that no hacker currently existing 
has any technical capability to deal with it. Now, is that a 
true statement or an old wives' tale?
    Mr. Hall. Senator, I do not know. Last year, because of 
concerns that came out of our Chicago regional office, we 
looked at the problems of the breakdowns of the air traffic 
control system at some of our major airports. Some of the 
equipment is so dated that there is a real concern about 
maintaining individuals on the FAA payroll to maintain that 
equipment till it can be replaced.
    However, I think that there has been progress made in the 
modernization of the system. But I do not have the background 
and expertise to answer that question, but it is an old system.
    Senator Bennett. I trust the Acting Administrator might 
have an answer for that. I apologize that I am going to have to 
leave, and many of these questions are perhaps more 
appropriately addressed to the FAA Administrator.
    The one other concern that I do have as we talk about 
resources and your obvious need for resources, is, of course, 
the controversy of Bay Area Rapid Transit System where BART 
wants to use money that might otherwise be available to the FAA 
or the NTSB to help defray the cost of their subway system. 
Senator McCain has been particularly outspoken on that, and I 
did not want to let the hearing pass without the opportunity of 
expressing myself in that regard.
    Now, Mr. Chairman, I apologize, and apologize to the 
witnesses. My beeper is very insistent.
    Senator Shelby. We will leave the record open for any 
further questions you might have.
    Senator Bennett. I would appreciate that opportunity. Thank 
you, Mr. Chairman.
    Senator Shelby. Senator Byrd.

                        Commuter Airline Safety

    Senator Byrd. Mr. Hall, are you currently satisfied that 
the FAA's procedures for regulating and inspecting commuter 
aircraft are sufficient to detect the problems that may pose a 
safety risk?
    Mr. Hall. As you pointed out, we now have one level of 
safety for both commuter airlines along with the major service. 
And last year was a good year in the commuter industry. 
However, 1 year is obviously not enough to see whether an 
effective job of oversight is being done.
    Through ongoing accident investigations, we will look very 
closely at what the FAA is doing, as we do in all of our 
investigations, and how they are doing their job of safety 
oversight. Clearly the addition last year of a number of new 
safety investigators for the FAA should have a positive impact 
on their work in this area. Mr. Valentine would have to address 
how many of those individuals are now in place with the 
additional FTE's that have been allocated for those positions.
    But this is an area of obvious ongoing concern, and is part 
of two investigations that we have presently underway.
    Senator Byrd. What concerns do you have specifically 
regarding the commuter aviation industry?
    Mr. Hall. Chairman Vogt was correct. We are seeing a great 
explosion in aviation and projected growth throughout the 
world. A lot of middle-sized and small communities in our 
country that are being left by the wayside, such as the 
interstate systems did years ago. In an era of deregulation, I 
think Congress is going to have to look at ways to ensure some 
service.
    I know the essential air service program is there, but 
there are a number of communities now that are suffering. With 
transportation being 12 percent of our gross national product, 
we will be basically out of the equation for growth in the 
future unless that problem is addressed.
    Senator Byrd. Do you have concerns with respect to the 
maintenance of commuter aircraft and with the experience of 
pilots who make these commuter runs? Do you along those lines?
    Mr. Hall. Yes, sir; and I would like to ask Mr. Haueter, if 
he would, to come up here, because we have an investigation 
specifically in regard to pilot record-sharing that I would 
like him to briefly touch on, and what is being done in that 
area.
    Senator Byrd. What is this gentleman's name?
    Mr. Hall. This is Tom Haueter, and he is the head of our 
chief investigation unit for the NTSB.
    Mr. Haueter. Following the investigation of the Raleigh-
Durham commuter accident the Safety Board issued a 
recommendation regarding pilot background checks. We found that 
the pilot had come from one airline to the accident airline. 
The previous airline had some negative findings, and those were 
not passed on to his new employer. We issued a recommendation 
to the FAA to require background checks that could be passed on 
from one employer to another. The FAA has been acting on that 
slower than we would like, but we will continue working in that 
area.
    Senator Byrd. What are you doing to get the FAA to work 
faster?
    Mr. Haueter. Through our recommendation process we have a 
dialog back and forth, trying to help them push the system.
    Senator Byrd. That sounds like in itself it is a pretty 
slow process.
    Mr. Hall. I have, in addition, Senator, discussed this 
personally with Secretary Slater, our most wanted list. He is 
aware of those concerns and has met with Mr. Valentine and with 
other appropriate officials of the FAA to let them know of our 
interest in this area. And again, they are moving in this area. 
I think it is merely the speed at which they are moving that is 
of concern to us.
    Senator Byrd. Mr. Chairman, is there anything the 
subcommittee can do to help to encourage an acceleration of the 
speed?
    Senator Shelby. I believe we could work together to get 
something done.
    Senator Byrd. I hope we can.
    Senator Shelby. And your suggestions and your overall 
leadership and experience would certainly help the 
subcommittee. I will be willing to work with you, and I think 
the other members would. This is vitally important.

                        Commuter Airline Safety

    Senator Byrd. Do you have any suggestions as to how we 
might help? Could we request a monthly report on the progress?
    Mr. Hall. Well, that would certainly be helpful, Senator.
    Senator Byrd. Well, let us take that under advisement, Mr. 
Chairman.
    Now, do you have concerns with reference to the maintenance 
of the commuter aircraft?
    Mr. Haueter. We saw a commuter accident in Eagle Lake, TX, 
where the mechanics had forgotten to put some screws back into 
the tail of the airplane. Subsequently, the tail came off or a 
portion of the leading edge came off on approach. We have 
looked into that. Obviously, commuters are quickly growing. 
Also, we are seeing the major airlines starting to need more 
pilots and more mechanics, and they are drawing these people 
out of the commuters. So in some cases the commuters are losing 
some of their better people to the major airlines.
    I think that the FAA is going to be pressed with getting as 
many inspectors as they can to ensure that the training and 
standards are kept up. The one level of safety will definitely 
help in this area.
    Senator Byrd. Do you have any indications of problems with 
drugs or alcohol on the part of any of these people who do the 
maintenance of the aircraft, or any of those who do the 
piloting?
    Mr. Haueter. Not that I have seen. We did have one case 
about 8 years ago or so, but I have not seen anything recently 
that would lead me to such a conclusion.
    Senator Byrd. What have been your observations, Mr. Hall, 
regarding the FAA's efforts to apply the same standards of 
safety to the small commuter aircraft?
    Mr. Hall. I think, Senator, that once the debate ended and 
the decision was made to move ahead with one level of safety, 
the Regional Airline Association and the people at the FAA have 
moved forward in a positive way to meet that mandate. So at 
this point in time I would give everybody good marks on that.
    Like everything else in the safety area, you have to stay 
after it.
    Senator Byrd. What other safety initiatives, if any, do you 
think would be appropriate for this segment of the aviation 
industry? My time is up.
    Senator Shelby. Go ahead and respond.
    Senator Byrd. Perhaps you could respond briefly.
    Mr. Hall. Obviously, that segment of the industry is 
impacted as well by the issues on our most wanted list; flight 
data recorders, ground separation, all the things that impact 
121 also impact commuter aviation.
    Senator Byrd. Thank you, Mr. Chairman.
    Senator Shelby. Senator Gorton.
    Senator Gorton. I would like to paraphrase a couple of the 
points, at least, that I made in that opening statement. This 
is a vitally important subject, and it is a subject both for 
this subcommittee and for the Commerce Subcommittee on Aviation 
that I chair. We had many of these same people, all of these 
same institutions, in front of us to discuss the Gore 
Commission report some time ago, and the chairman of the full 
committee, John McCain, held a hearing last week on airplane 
accidents, the investigations, and the way in which the results 
of those investigations had come out. Each of these was a 
learning process, just as it is here today. Obviously we have 
got to encourage the greatest move toward safety that we 
possibly can. We are probably going to do that better 
cooperatively, in many cases at least, than with a lot of 
mandates.
    One of the subjects I delved into during the Commerce 
Committee hearings was the sometimes rivalry between the FAA 
and the NTSB. Now, while there was a lot of criticism of that 
there, my own view was that there is some wisdom and some real 
value in having two organizations with a bit of overlapping 
jurisdiction. Certainly, what they talk about gets more 
publicity that way, and to have one checking on what the other 
does is probably pretty valuable. So these are really important 
issues because you control the money that we are dealing with, 
and the way in which we guide the deliberations and the actions 
of the Safety Board and of the Federal Aviation Administration 
are going to be very, very important for the future.

                    Gore Commission Recommendations

    With that, couple of questions. I guess, Mr. Vogt, I have 
really got two for you, and let me tell you an impression that 
I had in my own hearing on the Gore Commission report, not so 
much on the subjects that have been discussed, at least since I 
came to this hearing, on safety, but on the subject of 
security. Tell me whether this impression was wrong.
    I got the impression that many of those recommendations, 
without an awful lot of examination of the cost, stemmed from 
the belief during the course of the summer and the fall that 
TWA Flight 800 was done in either by an outside attack or more 
likely by a bomb on board the aircraft. Now it seems much more 
likely than not that neither of those were the causes of that 
crash. But I and a number of other members of the committee 
just got the view that many of those recommendations were 
almost academic or outmoded by reason of that initial 
apprehension. Were we wrong?
    Mr. Vogt. I am not sure whether you were totally wrong, but 
if you will recall, the initial mandate to the Commission was 
to investigate security matters, and a report was delivered 
within 45 days, I believe, and the members of the Commission at 
that point were predominantly public members, Mr. Pena, Mr. 
Deutsch, Mr. Freeh, and others. And it was only later that the 
rest of the commissioners were appointed, and that the mandate 
for the Commission was expanded to include air traffic control 
and safety.
    So a number of recommendations, if you look at a copy of 
the report, were submitted before the full Commission actually 
convened, and then we reviewed those and they were included in 
our final report with, I think, four or five additional 
security recommendations. And there is a status report as of 
the time of our last meeting on each of the prior 
recommendations that was made.
    I think that the issue of security is much broader, though, 
than the expectation initially that TWA 800 was a terrorist 
act, and I believe I speak for the Commission, the consensus of 
the commissioners is that this is a much broader issue. We were 
aware at that time that the focus was being directed elsewhere, 
so that it did not seem to be an accident-specific issue that 
was before us.
    So these recommendations, while we have a vulnerability to 
terrorism in the United States, we have not as yet had a 
recognized threat except for one terrorist plan to blow up 12 
U.S. airplanes over the Pacific Ocean. And we had not really 
anticipated a threat to Federal courthouses in the sense that 
we saw in Oklahoma City. So I think that there is much to be 
done here. We recognize the vulnerabilities. I think we have 
made some recommendations that address those vulnerabilities, 
and hopefully there will be implementation of many of these. 
Already, $160 million was appropriate, new equipment is being 
purchased, there is cooperation between the Customs and the FAA 
now--Customs Service.
    There are a number of things that are ongoing. I think all 
of these are very positive, and most of them are not costly in 
a relative sense.
    Senator Gorton. Thank you for that.
    Another question for you but on a different subject: You 
have had a lot of wonderful experience with the Safety Board, 
as an attorney who has specialized in civil litigation, so you 
have had a lot of time to investigate and observe the 
investigation of aircraft accidents. Do you believe that the 
huge financial stakes involved in determining liability for 
accidents has hampered in any way the ability of investigators 
to gather and assess the information necessary to find cause 
and to reach objective conclusions?
    Mr. Vogt. Well, I do not think the stakes are so much the 
issue as it bears on investigations. There are really two sets 
of investigations that go on. One is what the NTSB does, and I 
think the integrity of that process has proven itself over 
time, and it is very good and very impressive. And for the most 
part all of the parties to these investigations, in my 
judgment, offer good faith cooperation. Everyone wants to find 
the cause of the accident.
    Then you get my brethren at the bar who are seeking to 
recover damages for families or manufacturers or all of the 
interests involved. And as you know, the probable cause 
determinations of the NTSB are not admissible in evidence, 
although the factual record is available, and is used as a 
factual basis by attorneys in these liability cases. So I think 
the integrity of the governmental process is very sound.
    I think the stakes are so high that the entities involved, 
whether they are airlines manufacturers, unions, any of the 
interested parties, the stakes are so high that it is my 
opinion that no one is deterred from finding the cause by the 
potential liability cost of a single accident, because most of 
the time what we are really concerned about is the generic 
application of what we find and safety precautions that come 
out of a given accident which would prevent future accidents.
    Senator Gorton. In your view, should the NTSB conclusions 
be admissible?
    Mr. Vogt. No, sir; they should not.
    Senator Gorton. Why?
    Mr. Vogt. Well, I believe that that would impact the 
integrity of that process. It puts it into the area of money 
and liability, and the NTSB--part of the reason for its 
effectiveness is that it has a very clear cut mission, which is 
safety, and that should not in any way be combined with money 
issues or liability issues. I think the system works well.

                         Flight Data Recorders

    Senator Gorton. Mr. Hall, one for you, and, Mr. Chairman, 
if somebody has already asked this I apologize and you can 
correct me. When we were before the Commerce Committee you 
addressed the issue of expanded parameters for flight data 
recorders, and you really caused our ears to perk up when you 
said that a number of foreign flag airlines order far more 
significant data recorders than are often ordered in new 
aircraft manufactured by Boeing for domestic flag carriers. And 
there have been some real repercussions to that statement.
    Some since then have told me that one of the reasons for 
that was that domestic carriers preferred uniformity, for 
example, that all of their aircraft have the same kind of 
flight data recorders for their purposes. I guess I need to 
emphasize your own point that this was not something that the 
manufacturers decided on, it is something the purchaser, the 
airline purchaser, decides on.
    My basic question to you, is that an excuse? Is that a good 
reason for every new aircraft not being equipped by the 
purchaser with the most sophisticated flight data recorders?
    Mr. Hall. No, Senator; that is kind of a creative excuse.
    Senator Gorton. Thank you.
    Thank you, Mr. Chairman.
    Senator Shelby. Good phrase--creative excuse.
    Mr. Vogt, there seems to be a consensus among aviation 
experts that the FAA must fundamentally change the way it makes 
decisions, approaches personnel costs, and transitions from 
older technology to new technology. This subcommittee has tried 
to be responsive to the Department's request for increased 
flexibility in the personnel and procurement areas.
    For example, in the fiscal 1996 transportation 
appropriations bill, FAA was given unprecedented personnel and 
procurement reform tools. But the Coopers & Lybrand independent 
study of FAA's management practice points out that they have 
yet to effectively use these new tools. If we are to believe 
the Coopers & Lybrand study, there is every indication that FAA 
is having some difficulty managing itself. What kind of 
changes, from your perspective, do you think need to be made in 
the organization, and perhaps in the culture at FAA, to 
effectively keep safety as the agency's focus?
    Mr. Vogt. Well, first of all, Senator, I think that the two 
innovations that you mentioned, procurement and personnel, are 
extremely important. I think it is still a little early for 
Coopers to reach a decision that they have not been effective. 
I know that some of the purchasing has been most effective, and 
the personnel regulations, my impression is that they are in 
the process of being implemented.
    My concern is, as I stated initially, that we are at a 
crucial juxtaposition here of many changes, and it is obvious 
that the agency is going to have to be more efficient and 
effective in the way it does business, as are most Federal 
agencies.
    Senator Shelby. But in this particular agency, safety has 
got to be the real focus.
    Mr. Vogt. Yes; that is correct. And if you look at the 
Challenge 2000, which was developed by the FAA, it is filled 
with terms like reinvention and cultural change. So I think 
there is an awareness there. What has been missing for the past 
few months is obviously new leadership in the agency, and I 
think that the changing of the way in which the agency makes 
decisions, and I believe there is within that agency an inbred 
reluctance to make decisions for some reasons which once you 
are there and see it are quite understandable within the 
culture, some of the most talented people in this Government 
are in that agency, and I think that if the talent is unleashed 
to find solutions to develop new and more effective ways to 
make decisions, that it will get done. And to incentivize 
through these new personnel regulations, reward people who do 
things in creative ways, there is tremendous potential there to 
effect these changes.
    Senator Shelby. You played a leading role in developing the 
safety recommendations contained in the Gore Commission report. 
Aviation safety has been a touchstone throughout your career, 
and I believe it should be. You are one of the experts on the 
subject. In your opinion, which of the 53 recommendations 
contained in the Gore Commission report are most important and 
need to be implemented in the shortest timeframe possible, and 
which of the most pressing, immediate needs currently in force 
are being implemented?
    I know it is hard to just pinpoint which is the most 
important, but you have to go by priorities.
    Mr. Vogt. Let me creatively try to duck your question a 
little bit.
    Senator Shelby. You do not want to duck the focus, though. 
The focus is safety.
    Mr. Vogt. I am not going to duck the focus, but I do not 
want to make a statement that would detract from some of the 
issues there. But I think clearly the most weighty decisions 
there, first of all, is 1.1, which is to cut the accident rate 
fivefold within 10 years. And I think that is very doable if 
you take into account the fact that most accidents are caused 
by controlled flight in terrain today worldwide and loss of 
control in flight. If we can see the implementation of advanced 
ground proximity warning systems, I think there is tremendous 
potential through new technology to reduce that accident rate.
    Second, I think one of the most weighty recommendations was 
to implement our air traffic control system national airspace 
modernization by the year 2005 instead of 2012. That is a 
major, major task, and relevant to this committee's 
understanding, the $60 million need--or $60 billion need that 
the agency projected was verified, to a certain extent, by the 
Coopers report. And if OMB is going to cap those moneys at $47 
million, you have got the gap that has been widely talked 
about. And yet, our recommendation is to do something that is 
extremely expensive from an infrastructure cost in far less 
time than the agency has projected. That is a very, very major 
undertaking, and I think a major recommendation.
    Senator Shelby. Would you save some money by implementing 
it sooner?
    Mr. Vogt. Well, I do not know the figures on that. I think 
you probably can come to that conclusion. Some money would be 
saved, but you have got enormous capital costs that are going 
to have to be funded up front.
    Senator Shelby. Either way, have you not?
    Mr. Vogt. Absolutely, and that is one of the reasons that 
we recommended that there be some new approaches to financing 
explored, and to try and leverage some of the money that flows 
into the FAA in the capital markets.
    Senator Shelby. What about spending some of the money that 
is already there and is currently used for other purposes?
    Mr. Vogt. Well, you know the trust fund used to have a 
surplus. Right now it is pretty empty. I think it is very 
frustrating to everyone, as Senator Bennett said earlier, that 
when that trust fund does have a surplus that money is not used 
for its intended purpose. And there have been points in time 
where the use of that money could have made tremendous strides 
for this capital infrastructure I am talking about.
    And finally, I would say that of our recommendations, the 
security recommendations, particularly on the recognition of 
security as a national problem, a terrorist problem, terrorist 
attacks are directed against the United States, not against an 
air carrier as such, just to give an example, and that new ways 
to fund increased expenditures for security should be explored, 
but that the responsibility is basically a Federal 
responsibility.
    Those would be the recommendations I would say are the most 
weighty of our report.
    Senator Shelby. I think they are very important, and I 
concur.
    Senator Lautenberg.
    Senator Lautenberg. I have nothing more, Mr. Chairman.
    Senator Shelby. Senator Byrd.
    Senator Byrd. No; nothing more, Mr. Chairman.

                          Submitted Questions

    Senator Shelby. Gentlemen, I thank both of you for your 
appearance here today and for your candid testimony. We will 
submit additional questions to be answered for the record. 
Thank you.
    [The following questions were not asked at the hearing, but 
were submitted to the agency for response subsequent to the 
hearing:]
                  Question Submitted by Senator Gorton
    Question. In testimony before the Commerce Committee, and in 
response to questions raised by Committee members, NTSB Chairman Hall 
addressed the issue of expanded parameters for flight data recorders. 
Chairman Hall mentioned that foreign carriers have ordered, and U.S. 
manufacturers have supplied, aircraft with more sophisticated flight 
data recorders than U.S. carriers are demanding. Chairman Hall 
intimated that cost was the only reason that domestic air carriers 
would continue to order aircraft with flight data recorders that meet 
only the minimum FAA standards. I understand, however, that carriers 
also have concerns about integrating aircraft with new systems into 
their fleets. For maintenance purposes, they want to maintain 
standardization within their fleets. Is this a valid concern on the 
part of U.S. carriers? Does the FAA believe that its proposal for the 
industry transition to flight data recorders with expanded parameters 
takes this concern into account?
    Answer. It is a concern; however, there already is a great amount 
of diversity in FDR systems, more as a result of the unavoidable 
evolution in aircraft technology than as a result of government 
regulation. The age of U.S. air carrier aircraft varies greatly. It has 
been our experience that the older the aircraft, the more limited the 
number of FDR parameters available. As airplane systems have gotten 
more complex, airplane manufacturers (and government and airlines, too) 
want and need more information to determine how various aircraft 
systems performed after an accident or incident. The FDR itself is a 
very standardized unit that can operate on almost any aircraft type. 
Further, the Aviation Rulemaking Advisory Committee (ARAC) that helped 
develop the FAA's Notice of Proposed Rulemaking (NPRM) made every 
attempt to standardize across different airplane types and the 
different aircraft operating rules (i.e. Part 121, 135, 129). The 
airlines were well represented on the ARAC committee.
    We would like to note that Southwest Airlines is retrofitting its 
fleet with state-of-the art flight data recorders. The carrier has not 
found it financially prohibitive to do so.
    With regard to the FAA proposal for the industry's transition, 
based on our knowledge of the NPRM and how it was developed, we believe 
that FAA did take the industry's concerns about FDR system 
standardization into account.
                                 ______
                                 
               Questions Submitted by Senator Lautenberg
            ntsb's views of gore commission recommendations
    Question. Mr. Hall, the Gore Commission report made numerous 
recommendations on how to improve aviation safety and security. It is 
criticized in some quarters as being long on advice and short on how to 
accomplish the objectives.
    Do you believe that the Gore Commission report avoids some of the 
harder-to-solve safety issues in favor of accommodation with the 
aviation industry?
    Answer. I believe that the Gore Commission report addressed all of 
the important aviation safety and security issues and it contained 
important recommendations for actions to improve the safety of our air 
transportation system. Some of the actions are well underway. For 
example, BNASA has organized a significant government/industry group 
(Aviation Safety Investment Strategy Team [ASIST]) to address the 
future research and development technological needs to reduce the 
accident rate five-fold over the next 10 years and ten-fold over the 
next 20 years. The Safety Board participated in much of the work of the 
ASIST project, which included a series of workshops to define an 
aviation safety investment strategy and delineate NASA programmatic 
investment options to improve aviation safety. Moreover, many 
initiatives in the aviation security area have already begun in 
response to the interim recommendations issued by the Gore Commission 
on September 9, 1996.
     I do not believe that the Gore Commission report avoided the 
``hard-to-solve safety issues'' to accommodate the aviation industry. 
However, I should point out that the industry did make certain 
announcements to voluntarily take certain actions within a specified 
time frame as a result of the issues debated during the Gore Commission 
meetings. For example, in December 1996, the Air Transport Association 
(ATA) announced that its member airlines would voluntarily install 
smoke detectors in Class D cargo compartments without FAA regulation.
    The findings of the May 17, 1996, ValuJet accident in the 
Everglades highlighted the need for fire/smoke detection and 
suppression systems in passenger-carrying aircraft cargo compartments. 
The Gore Commission report did contain recommendations to the FAA for 
action on such systems. Last week, the FAA and ATA's member carriers 
announced their intention to move forward on this issue. We expect to 
see FAA rulemaking this summer, and Secretary Slater has committed to a 
final rule by the end of this year.
    Question. Are there some recommendations with which the NTSB 
disagrees in whole or part? Are there additional recommendations that 
NTSB would like to see added?
    Answer. As a member of the Gore Commission, I supported the 
Commission's final report. The Board has not formally reviewed the Gore 
Commission report or its recommendations.
    Question. Mr. Hall, one of the Gore Commission recommendations was 
for the NTSB to develop a coordinated federal response plan to aviation 
disasters by April 1997.
    What is the status of this recommendation? Have you had the full 
cooperation of the other agencies that would be involved in responding 
to a disaster?
    Answer. The Safety Board has complied with the Gore Commission 
recommendation, and a Family Assistance Plan for Aviation Disasters is 
completed. Copies of the plan were forwarded to the Subcommittee on May 
13, 1997. The Safety Board's plan was prepared in close cooperation 
with representatives from individual family members and the aviation 
industry, as well as legal, medical and emergency response experts. We 
have received excellent cooperation from other government agencies, and 
our plan also reflects memoranda of understanding, either in final or 
draft form, with six Federal agencies, including the Departments of 
Justice, Defense, State, Transportation, Health and Human Services, and 
the Federal Emergency Management Agency. These agencies, as well as the 
American Red Cross, are prepared to respond to an aviation disaster if 
needed.
                     ntsb's emergency fund request
    Question. Mr. Hall, the NTSB has submitted an fiscal year 1997 
Emergency Supplemental funding request to the Committee to cover the 
extraordinary costs associated with the TWA 800 costs as well as the 
implementation of some of the Gore Commission recommendations.
    Why does the amount of funding you are requesting of us differ from 
the level formally requested by OMB?
    Answer. The amount requested by the Safety Board for the 
supplemental appropriation reflects the amount required to accomplish 
the TWA flight 800 investigation, the new mandate to provide assistance 
to the families of the victims of transportation accidents, and other 
accident investigation activities.
    Question. How much of the costs of the TWA 800 investigation have 
been borne by the Navy. Did you ask the Navy to absorb their costs out 
of their huge annual operating budget?
    Answer. The U.S. Navy has not been reimbursed for $5.3 million for 
victim and wreckage recovery costs they have incurred, and they have 
not been reimbursed for any costs of the Calverton facility where the 
wreckage is stored and much of the investigation was conducted. For 
fiscal year 1997, the amount owed will be $5 million, for a total of 
$10.3 million. Since we have a reimbursable memorandum of 
understanding, we have not asked the Navy to absorb these costs. Also, 
it is our understanding that they cannot legally do so. We did ask the 
FBI to share in the costs of the investigation, but the Department of 
Justice declined.
    Question. What specific activities will not get done if we approve 
the OMB request rather than your higher request?
    Answer. If the full supplemental is not approved, we will be unable 
to fulfill our Congressional mandate to assist the families of the 
victims of recent transportation accident tragedies--including TWA 
flight 800--nor will we be able to avoid forcing our investigative 
staff to continue to take on inordinate workloads where we have only a 
few specialists in a given field. The real impact may take the form of 
diminished public confidence in the Board's work.
                      DEPARTMENT OF TRANSPORTATION

                    Federal Aviation Administration

STATEMENT OF BARRY VALENTINE, ACTING ADMINISTRATOR
ACCOMPANIED BY:
        SUSAN KURLAND, ASSOCIATE ADMINISTRATOR, AIRPORTS
        CATHAL L. FLYNN, ASSOCIATE ADMINISTRATOR, CIVIL AVIATION 
            SECURITY
        MONTE BELGER, ACTING DEPUTY ADMINISTRATOR
        GEORGE DONOHUE, ASSOCIATE ADMINISTRATOR, RESEARCH AND 
            ACQUISITIONS
        GUY S. GARDNER, ASSOCIATE ADMINISTRATOR, REGULATION AND 
            CERTIFICATION

                       Introduction of Witnesses

    Senator Shelby. In the second panel we will explore how the 
Federal Aviation Administration is addressing safety and 
security concerns. We will have Mr. Barry Valentine, Acting 
Administrator; Ms. Susan Kurland, Associate Administrator, 
Airports; Adm. Cathal Flynn, Associate Administrator, Civil 
Aviation Security; Mr. Monty Belger, Acting Deputy 
Administrator; Dr. George Donohue, Associate Administrator, 
Research and Acquisitions; and Mr. Guy Gardner, Associate 
Administrator, Regulation and Certification. Gentlemen, your 
written statements will be made part of the record in their 
entirety, without objection.
    Well, that is good news. Senator Lautenberg and Wally were 
just telling me that we are only going to have Mr. Valentine to 
give testimony. Is that correct?
    Mr. Valentine. That is correct.
    Senator Shelby. Mr. Valentine, you may proceed.

                            Opening Remarks

    Mr. Valentine. Thank you, Mr. Chairman.
    Mr. Chairman and members of the subcommittee, I welcome the 
opportunity to appear before you today on the Federal Aviation 
Administration's activities relating to aviation safety and 
security. I want to thank you and the other members of the 
subcommittee for your continued interest in and support of the 
FAA's activities and programs. With me today are the 
individuals that you just named, so I will not repeat the names 
and the positions. I would like to take this opportunity to 
mention some of the FAA's recent achievements and ongoing 
activities that enhance aviation safety and further ensure the 
security of the flying public.

         White House Commission on Aviation Safety and Security

    In February, the White House Commission on Aviation Safety 
and Security, led by Vice President Gore, issued its final 
report, updating its initial report issued in September of last 
year. A key recommendation was to reduce the aviation fatal 
accident rate by a factor of five within 10 years. Another was 
to accelerate the modernization of the air traffic control 
system. We are ready to work with the White House, the 
Congress, and the aviation community to see that these 
recommendations are implemented as quickly as possible.

               Security Equipment Integrated Product Team

    The FAA formed an integrated product team of acquisition 
and security experts last October, to plan, purchase, and 
install explosive detection devices and other advanced security 
equipment at many of the busiest U.S. airports. As a result, we 
are purchasing and deploying additional FAA certified 
explosives detection systems, trace detection devices, and 
automated x-ray machines with installations already underway.

                              Canine Teams

    Also, with the help of the airport industry, we are 
increasing the number of canine teams at the Nation's busiest 
airports. In what I believe to be a model example of 
partnership, the FAA is entering into cooperative agreements 
with these airports to place more teams on the tarmac to 
perform highly qualified screening of suspect cargo and bags, 
and to clear airliners and terminals after bomb threats.

                          Passenger Profiling

    FAA has been using profiling of passengers for nearly 25 
years, and views it as a significant element in the aviation 
security regime. Given the huge number of passengers and their 
bags moving through the U.S. air transportation system, 
profiling enables us to better focus application of the more 
rigorous measures. Since the airlines are responsible for the 
application of the profile and its results, I want to reassure 
the members of the subcommittee that there is no FAA data base 
or Federal system of records that will be generated in the 
process. The data that will be analyzed by the profiling 
program consists of information voluntarily provided by 
passengers to airlines in the course of commercial 
transactions, and the result will be automatically deleted 
shortly after the completion of the flight.

                          90-Day Safety Review

    In June 1996, the then Deputy Administrator, Linda Daschle, 
led a task force to conduct a 90-day safety review examining 
immediate areas of concern to the agency, especially with 
respect to safety inspections. The centerpiece of the 90-day 
safety review was the formation of a team to assist local 
flight standards district offices in processing new air carrier 
certification. The new entrant airlines will now have a 
heightened level of inspection for at least the first 5 years 
of operation.
    The 90-day safety review recommended the increase of 
funding to upgrade and accelerate the deployment of online 
aviation safety inspection systems to the aviation safety 
inspector work force by fiscal year 1999. We wholeheartedly 
agree with and are moving toward implementing these 
recommendations.

                      Airport Improvement Program

    As you know, the Office of Airports administers the airport 
improvement program [AIP]. The highest priority of the AIP is 
safety and security projects at airports. Typical projects for 
safety and security include the acquisition of aircraft rescue 
and firefighting equipment, runway and taxiway signs, runway 
incursion caution bars, runway and taxiway lighting, access 
control systems, and perimeter fencing, as well as lighting, 
marking, and removal of airport hazards. Much of the AIP is 
used each year to rehabilitate airport infrastructure.
    Some current FAA airport standard projects that directly 
relate to safe aircraft operations involve improved airfield 
lighting to support low visibility operations and reduce runway 
incursions and runway pavement traction. For instance, we are 
working with the Port Authority of New York and New Jersey on a 
prototype aircraft arrestment system that can be placed in the 
safety areas at runway ends to bring aircraft that have overrun 
the pavement to a controlled stop.

                Modernizing the National Airspace System

    Today the United States has the safest and most efficient 
air traffic system in the world. However, as former FAA 
Administrator David Hinson warned, with projected increases in 
traffic, if today's accident rate remains constant, we can 
expect the equivalent of one major accident every 8 to 10 days 
worldwide by the year 2015. Therefore, the core issue is 
whether the FAA can continue to provide a high level of safety 
and service in light of the aviation industry's expected growth 
without modernizing the national airspace system. It is obvious 
that we cannot.
    Without such features as digital radio communications and 
the decision support tools needed to increase controller 
productivity, the capability and capacity of the system will 
reach saturation by the years 2001 to 2002. If this occurs, we 
will have no alternative but to artificially constrain air 
traffic at major airports, which the FAA did after the 1981 
controller strike. The consequences of such an action are 
obvious and severe.
    One barrier to modernization is a human factors issue, a 
lack of experience with computer and human integration. We have 
conducted simulation tests and laboratory demonstrations of 
systems containing today's advances in technologies separately, 
but are designing a project to operate these systems together 
under real operating conditions. We currently intend to make a 
complete operational and systematic evaluation under real 
operational conditions prior to any commitment to systemwide 
acquisitions, training, and deployment.
    In closing, Mr. Chairman, I would like to thank you and the 
members of this committee for the support you have provided to 
and for the FAA. I want to assure you of our willingness to 
work closely with you.
    This completes my opening statement, and we would be 
pleased to answer any questions you have.

                           Prepared Statement

    Senator Shelby. Thank you, Mr. Valentine. We have your 
complete statement, and it will be made part of the record.
    [The statement follows:]
                Prepared Statement of Barry L. Valentine
    Mr. Chairman and Members of the Subcommittee: I welcome the 
opportunity to appear before you today on the Federal Aviation 
Administration's budget request of $8.46 billion for fiscal year 1998. 
I want to thank you and the other members of the Subcommittee for your 
continued interest in and support for the FAA's activities and 
programs. With me today are Monte Belger, Acting Deputy Administrator; 
George Donohue, Associate Administrator for Research & Acquisitions; 
Irish Flynn, Associate Administrator for Civil Aviation Security; Susan 
Kurland, Associate Administrator for Airports; and Guy Gardner, 
Associate Administrator for Regulation & Certification. They are 
available to answer any questions you may have.
    I would like to take this opportunity to highlight some of the 
FAA's recent achievements and on-going activities which enhance 
aviation safety and further ensure the security of the flying public. 
In February, the White House Commission on Aviation Safety and 
Security, led by Vice-President Gore, issued its final report, updating 
its initial report issued in September of last year. As you know, the 
Federal Aviation Reauthorization Act incorporated many of the White 
House Commission's initial recommendations dealing with aviation 
security and safety. Understandably then, we are focusing on 
implementing the provisions of the Reauthorization Act as well as those 
of the Omnibus Consolidated Appropriations Act of 1997, which funds the 
initial recommendations. As examples, we have published notices of 
proposed rulemaking on certification of screening companies and on 
extending background check regulations to include screeners. We are 
expanding our contract with the National Academy of Sciences to broaden 
our work on advanced security technologies, and have intensified our 
close working relationship with the FBI to refine airport risk 
assessment, and to conduct threat and vulnerability analyses. We have 
also instituted a bag match pilot program.
    The FAA formed an Integrated Product Team of acquisition and 
security experts last October to plan, purchase and install explosives 
detection devices, and other advanced security equipment, at many of 
the busiest U.S. airports. In the spirit of partnership fostered by the 
Commission, representatives of airport and air carrier representatives 
are members of the team. As a result, we are purchasing and deploying 
additional FAA certified explosives detection systems, trace detection 
devices and automated X-ray machines with installations already 
underway.
    Also, with the help of the airport industry, we are increasing the 
number of canine teams at the nation's busiest airports. In what I 
believe to be a model example of partnership, the FAA is entering into 
cooperative agreements with these airports to place more teams on the 
tarmac to perform high quality screening of suspect cargo and bags, and 
to clear airliners and terminals after bomb threats. Our classes for 
training the dogs and their handlers are well underway.
    FAA has been using passenger profiling for nearly 25 years and 
views it as a significant element in the aviation security regime. 
Profiling permits leveraging of limited security resources. Some of the 
more time-consuming security measures cannot be applied universally 
with existing technology and space constraints while keeping the 
aviation system functioning near its current capacity. Profiling 
enables us to better focus application of the more rigorous measures, 
given the huge number of passengers and their bags moving through the 
U.S. air transportation system. Automation will make it possible to 
refine the process and make it less time-consuming for both passengers 
and airline agents.
    The airlines will apply the profile and any additional screening 
that may occur as a result, which may delay some passengers in some 
cases. Since the airlines are responsible for the application of the 
profile and its results, there is no FAA ``database'' or federal system 
of records that will be generated in the process. The data that will be 
analyzed by the profiling program consists of information voluntarily 
provided by passengers to airlines in the course of commercial 
transactions. The analyzed result will be automatically deleted shortly 
after the completion of the flight. In addition, the Department of 
Transportation is proceeding with a White House Commission 
recommendation to have the Department of Transportation and the 
Department of Justice review the design and implementation of the 
prototype automated profiling system.
    In June 1996, the then-Deputy Administrator, Linda Daschle, led a 
task force to conduct a 90-Day Safety Review examining immediate areas 
of concern to the agency, especially with respect to safety 
inspections. The centerpiece of the 90-Day Safety Review was the 
formation of a Certification, Standardization, and Evaluation Team 
(CSET). CSET is designed to assist local Flight Standards District 
Offices in processing new air carrier certification. Developing, 
testing, and prototyping of improved certification and surveillance 
procedures for new entrant carriers is scheduled to begin in the third 
quarter of fiscal year 1997, and will become fully functional by the 
end of the fiscal year. New entrant airlines will now have a heightened 
level of inspection for at least the first 5 years of operation.
    Performance Enhancement System (PENS), also known as the On-line 
Aviation Safety Inspection System (OASIS), is an electronic performance 
system for Aviation Safety Inspectors which facilitates field data 
collection, information management, and on-line references. The 90-Day 
Safety Review recommended the increase of funding to upgrade and 
accelerate the deployment of OASIS to the aviation safety inspector 
work force by fiscal year 1999.
    The 90-Day Safety Review identified a need for an increase in 
Flight Standards Aviation Safety Inspectors (ASI) and field support. 
The fiscal year 1998 budget requests an additional 326 positions 
including 288 Flight Safety field office personnel, 6 Aviation Safety 
Inspectors, 17 Aviation Safety Engineers, and 15 Technical Safety 
Positions, to carry out these duties.
    The aviation safety record that the United States enjoys results in 
large part from the FAA's preventive efforts and ability to identify 
and solve potential safety problems before accidents happen. Despite 
the FAA's best efforts, accidents do occur. When they do, the FAA and 
the National Transportation Safety Board (NTSB) work closely together 
during an accident investigation to identify where and how the system 
failed. The FAA's Civil Aeromedical Institute in Oklahoma City is 
available to provide the NTSB with medical services such as 
pathological and toxicological testing, and funding for autopsies and 
other post mortem examinations. The FAA Technical Center in Atlantic 
City also provides investigation support through component testing and 
research. Of 3,123 NTSB recommendations that have been closed, 84 
percent of the FAA's responses have been closed ``acceptable'' by the 
NTSB. The FAA's closed ``acceptable'' rate for the NTSB's urgent 
recommendations is 90 percent.
    In response to the Gore Commission recommendation, the FAA is 
working in partnership with NASA in an endeavor to reduce the aviation 
fatal accident rate by a factor of 5 within 10 years. Current FAA/NASA 
cooperative research initiatives include aging aircraft studies and 
Advanced General Aviation Transport Experiments (AGATE).
    As you know, the Office of Airports administers the Airport 
Improvement Program (AIP). The highest priority of the AIP is reserved 
for safety and security projects at airports. Airport sponsors are 
strongly encouraged to use their formula funds for projects to meet 
these requirements. Typical projects for safety include the acquisition 
of aircraft rescue and firefighting equipment, runway and taxiway signs 
and runway incursion caution bars, and runway and taxiway lighting, as 
well as lighting, marking or removal of airport hazards. Typical 
security projects include access control systems to prevent 
unauthorized entry onto the airport operations areas and perimeter 
fencing. Safety related work of equal priority, such as runway 
grooving, distance-to-go signs, and runway end identifier lights are 
generally incorporated as standard elements of many AIP funded airport 
development projects. Much of the AIP is used each year to rehabilitate 
airport infrastructure. In addition to keeping airports in serviceable 
condition, these projects foster safety by ensuring that deteriorated 
pavement or lighting, for example, not contribute to airfield accidents 
or incidents.
    The Office of Airports also manages several key technical programs 
that promote airport safety and act to reduce the number of aircraft 
accidents on and near airports. In addition to regulatory 
certification, the Office of Airports establishes minimum standards and 
recommended practices for all aspects of the design, construction, and 
operation of airports. These standards must continually be reviewed and 
updated to reflect new technology.
    Some current FAA airport standards projects that directly relate to 
safe aircraft operation involve improved airfield lighting to support 
low visibility operations and reduce runway incursions, runway pavement 
traction, and the minimum distance between a runway and bird 
attractants such as landfills. For instance, we are working with the 
Port Authority of New York and New Jersey on a prototype aircraft 
arrestment system that can be placed in the safety areas at runway ends 
to bring aircraft which have overrun the pavement to a controlled stop.
    A modernized communications, navigation, surveillance and air 
traffic management system is one of the best long-term means of 
maximizing public safety benefits. Let me give you examples of what I 
mean by a public safety benefit. When we talk about modernizing the 
system, this means, among other things, putting state-of-the-art 
equipment in the cockpit to give pilots a much better picture of 
traffic and weather outside their cockpit window, and giving them the 
data needed to make real-time, informed decisions. This means giving 
air traffic controllers faster and more accurate decision support tools 
to separate aircraft. Some of this equipment uses satellite signals and 
digital data link capability to provide pilots with the equivalent of 
radar coverage no matter where they are flying in the system, 
worldwide, without the need for additional and costly ground-based 
radar.
    Today, the U.S. has the safest and most efficient air traffic 
system in the world. However, as former FAA Administrator David Hinson 
has warned, if today's accident rate remains constant, statistics show 
that, with projected increases in traffic, we can expect the equivalent 
of one major accident every 8-10 days worldwide by the year 2015. 
Therefore, the core issue is whether the FAA can continue to provide a 
high level of safety and service in light of the aviation industry's 
expected growth without modernizing the National Airspace System. It is 
obvious we cannot.
    Without such features as digital radio communications and the 
decision support tools needed to increase controller productivity, the 
capacity of the system will reach saturation by the years 2001-2002. If 
this occurs, we will have no alternative but to artificially constrain 
air traffic at major airport hubs, which the FAA did after the 1981 
controller strike. The consequences of such an action are obvious and 
severe.
    One barrier to modernization is a human factors issue--the lack of 
experience with computer and human integration. We have conducted 
simulation tests and laboratory demonstrations of systems containing 
today's advances in technologies separately, but have not operated 
these systems together, under real operating conditions. We must make 
such a complete operational and systemic evaluation under real 
operational conditions prior to any commitment to system-wide 
acquisitions, training, and deployment. We are attempting to develop 
such a plan that will help us accomplish such a large-scale evaluation. 
Our Flight 2000 project envisions such a set of conditions for a real-
time demonstration and evaluation of new technologies, and their 
adaptability to system-wide adoption.
    In closing, Mr. Chairman, we would like to thank you and the 
Members of this Committee for the support you have provided to, and 
for, the FAA, and to assure you of our willingness to work closely with 
you. This completes my prepared opening statement. We will be pleased 
to answer any questions you may have.

            Implementing Safety and Security Recommendations

    Senator Shelby. Senator Lautenberg.
    Senator Lautenberg. Thank you, Mr. Chairman, for indulging 
my request to be able to ask my questions first.
    Mr. Valentine, good to see you, and as I said, Mr. 
Chairman, in the capacity as Acting Administrator I think it is 
fair to say that the leadership has been diligent and good, and 
when we ask for a permanent resolution to that it is not 
intended to criticize but rather to have someone in place who 
is going to be there to see the long-term plans put into place 
and make the decisions that are long and complicated. So, Mr. 
Valentine, to you and your people my commendations for the hard 
work that does go into it.
    Mr. Valentine. Thank you, Senator.
    Senator Lautenberg. President Clinton, perhaps you know, 
before accepted virtually all of the safety and security 
recommendations of the Gore Commission. However, I am concerned 
that there is not an established timetable for the 
implementation of each of these recommendations. Can you give 
us a date by which time you expect all of the recommendations 
to be fully implemented?
    Mr. Valentine. Senator, it would be difficult to give a 
date when all of them will be 100 percent implemented. We are 
still reviewing the cost implications of some of the 
recommendations, particularly in the security area, and because 
those recommendations may, in fact, require additional 
appropriations funding from Congress. But of the 50-plus 
recommendations, a little over 30 of them were related to 
security, and most of the balance were related to safety. Some 
also relate to efficiency and response to disasters.
    I would note that a number of the recommendations were 
gleaned from the Challenge 2000 report and from the 90-day 
safety review, and those recommendations represent activities 
that we already have underway. Some of them have been 
completed. We have assigned the rest of the tasks to all of the 
lines of business. As I mentioned in my opening remarks, we 
have a team established to provide agencywide oversight of all 
of the recommendations that we are undertaking.
    We have a tracking system in place. I get briefings every 
couple of weeks from our staff letting me know and letting our 
senior managers know exactly where we are on each of those 
recommendations. My answer is that we will be pursuing them as 
expeditiously as we possibly can.

     Cost Factors--Implementing Safety and Security Recommendations

    Senator Lautenberg. You mentioned the appropriation and 
some of the cost factors that might be associated, and I quote 
here from the Gore Commission final recommendations: Cost alone 
should not become dispositive in deciding aviation safety and 
security rulemaking issues, and I would ask that if there are 
programs that have yet to be implemented that you kind of 
highlight those for us and let us know which of those require 
additional funding or what else we can do to move them along. 
And I would like to ask you also to look at which of the 
recommendations may take the longest time to implement. I will 
not ask you for an answer now, but I would ask that your staff 
supply that to the committee.
    [The information follows:]

    It is FAA's intent, working with agencies throughout the Federal 
Government, to implement all the recommendations of the White House 
Commission. A number of the recommendations, including some of the 
initial recommendations made by the Commission last September, have 
already been implemented. Among the recommendations we currently expect 
to implement this year are:
  --Strengthen the emphasis that government and aviation safety 
        research places on human factors and training,
  --Require installation of enhanced ground proximity warning systems 
        in all commercial and military aircraft,
  --Strengthen the protections that airline crew members receive from 
        passenger misconduct,
  --Develop a revised NAS modernization plan that achieves 
        modernization by 2005,
  --Research innovative means to accelerate the installation of 
        advanced avionics in general aviation aircraft,
  --Identify FAA's frequency spectrum needs for the future,
  --Implement a comprehensive plan to address security threats to 
        cargo,
  --Submit a resolution to ICAO to begin a program to verify and 
        improve compliance with international security standards,
  --Establish consortia at all commercial airports to implement 
        enhancements to safety and security,
  --Deploy existing checked and carry-on bag screening technology,
  --Significantly expand the use of bomb-sniffing dogs, and
  --Improve passenger screening, including improved passenger 
        manifests, automated passenger profiling, and positive bag-
        passenger match.
    Many recommendations, of course, are costly, and many will take 
time. Although funding for the initial White House Commission 
recommendations was provided in Public Law 104-208, the Omnibus 
Consolidated Appropriations Act, 1997, the additional recommendations 
included in the final findings issued in February 1997 are not funded 
in fiscal year 1997. Except for an advance appropriation of $100 
million requested for fiscal year 1999, funding is not included in the 
fiscal year 1998 budget submission since the budget was completed prior 
to the final recommendations being issued. Funding requirements for 
fiscal year 1999 and thereafter will be requested through the normal 
budget process. The final findings of the White House Commission are 
being reviewed to determine the details of implementation as well as 
the additional costs.
    By far the most costly unfunded item is modernizing the National 
Airspace System (NAS) by 2005 instead of 2015, as the current 
architecture envisions. This will clearly add several billion dollars 
to FAA budget needs over the next several years. Other costly items 
include strengthening aviation human factors research, and accelerating 
GPS use in NAS modernization. The White House Commission expects the 
National Civil Aviation Review Commission to explore innovative federal 
financing approaches, such as user fees, to finance an accelerated 
modernization of the NAS and design a new financing system for the FAA 
that would ensure adequate availability of funding.
    Many recommendations will also take time to complete. Modernizing 
the NAS by 2005 is an acceleration from FAA's existing schedule. Fully 
using GPS as a part of that modernization is also a long-term project. 
Many recommendations, such as targeting regulatory resources for the 
most impact, simplifying regulations, and keeping cost alone from being 
dispositive, are ongoing and continuous. Some additional 
recommendations that we see as taking over two years to implement 
include developing and applying higher standards for certification of 
aviation businesses; establishing a high level of protection for all 
aviation information systems; and requiring criminal background checks 
and FBI fingerprint checks for all screeners and all airport and 
airline employees with access to secure areas. In each case 
implementing the recommendation will require a long regulatory process, 
possibly preceded by the need to enact legislation and/or conduct 
research.

                        Access to Secured Areas

    Senator Lautenberg. Admiral Flynn, they should not put that 
nameplate up there. Irish is Irish. Why would you call it 
anything else?
    Anyway, it is good to see all of you, and you, Admiral 
Flynn, I know how hard you have worked on the security issue. 
There have been a number of well-publicized incidents, 
including one at Newark, where the media have with ease broken 
through airport security measures and gained access to 
vulnerable areas such as the tarmac and the ramps. The FAA 
Authorization Act included a provision that I authorized 
directing it to conduct unannounced aggressive testing of 
airport and airline security programs. What has changed over 
the last 6 months to tighten security for airport personnel to 
seal these vulnerable areas? Have we done enough? Are we at a 
point where you are satisfied?
    Admiral Flynn. I am satisfied that we are moving in the 
right direction. The additional resources, the additional 
inspectors that we are hiring, will help us carry out a 
comprehensive and aggressive program of testing the security 
measures at all of our airports.
    We have made considerable progress in that area. We have 
changed our method of inspecting from formal announced 
inspections, that people know ahead of time will be occurring, 
to aggressive testing that is not announced, where the 
inspectors are seen to be members of the public or take on the 
role of people who are attempting to do aircraft damage. By 
doing that, we have discovered vulnerabilities and are in the 
process of repairing them.
    I would say with the case with Newark in particular that 
that airport has taken considerable efforts to remedy the 
problems that they had. They are ahead of the rest of the 
Nation, for example, in requiring an employment history check 
and criminal history check for their screeners. They are also 
ahead of the rule that the FAA will introduce.
    I think we are on the right track to get truly secure 
airports.
    Senator Lautenberg. How long do you think it might take to 
get it to the point where you are satisfied?
    Admiral Flynn. I think that it is a matter of months rather 
than years.

                 Certification of New Entrant Airlines

    Senator Lautenberg. I hope so. We will watch with interest.
    Mr. Gardner, good to see you. The Gore Commission 
recognized that FAA is sometimes too lenient when it comes to 
certifying airlines and contractors, especially when safety and 
inspection records have not been what they ought to be. The 
commission recommended that the FAA be more stringent in the 
certification of these airlines. Do you agree with this 
recommendation?
    Mr. Gardner. Yes, sir. Actually, the 90-day safety review 
which, as Mr. Valentine mentioned, a lot of recommendations are 
incorporated in the White House Commission report. These 
recommendations concern the way we do oversight and 
certification of new entrant airlines. We have tightened up the 
way we do our certification processes of the new airlines, and 
hold them to tougher standards than we have before, as well as 
increased the oversight of new entrant carriers. We define a 
new entrant as someone who has been in continuous business for 
less than 5 years.
    Senator Lautenberg. So they are subject to more scrutiny 
than the existing long-time operators?
    Mr. Gardner. Yes, sir; they are not only subject to more 
scrutiny, but we are also refocusing the talent in our 
inspector corps. We have formed a new certification team to 
consist of our very best inspectors so that they can focus on 
the new entrant carriers.

                 Vulnerability of Out of Date Equipment

    Senator Lautenberg. Mr. Chairman, I thank you. I just want 
to respond to something.
    Senator Shelby. You can go right ahead.
    Senator Lautenberg. Senator Bennett asked before about the 
simplicity of the equipment making it less vulnerable. I come 
out of the computer business, and I think you have all heard 
the story about when my company wanted to give away equipment 
that FAA was not using, we wanted to give it to charity, to 
institutions that could use them to teach students. They would 
not take it because of the high maintenance costs. They could 
not get value of it. Simple equipment is simple to intrude on. 
The more complicated often is the more difficult. So just to 
register my 2 cents.
    Thank you very much.
    Senator Shelby. Thank you.
    Senator Byrd.

                 Automated Surface Observation Systems

    Senator Byrd. Mr. Valentine, I spoke earlier concerning the 
difficult weather conditions that pilots often face in my 
State. Two months ago I sent a letter to Secretary Slater 
passing along numerous complaints I had received from airports 
in my State regarding the poor performance of the automated 
surface observing systems [ASOS]. These automated weather 
observation systems which are being installed in nine West 
Virginia airports have been consistently reporting inaccurate 
weather conditions, especially during inclement weather. Have 
you specifically investigated the performance of these systems 
at the West Virginia airports?
    Mr. Valentine. Senator Byrd, let me ask Mr. Belger if he 
would address that subject. He is quite familiar with that.
    Mr. Belger. Yes, sir; first, I have seen your letter and I 
can tell you that the final response back to you is in final 
coordination. The reason it was delayed will be I think 
somewhat clear in my answer.
    We have had problems with ASOS at airports like those in 
West Virginia which you described. About a year ago we 
established some performance standards for the use of ASOS in a 
stand-alone mode, and when we did that we agreed that after a 
year we would go back and reassess how that was working. We are 
in the process of doing that now. I can tell you now that over 
the next month or 6 weeks or so we will be specifically 
addressing those issues at the four airports in West Virginia 
that you have referred to.
    I decided several weeks ago that in the interim, while we 
are going through this period of reassessment, we will not 
alter the current weather collection or augmentation systems at 
any of the airports. In other words, we will not eliminate any 
of the contract weather observers while we are going through 
this review.

                West Virginia Contract Weather Observers

    Senator Byrd. Well, very well. You cut right through to my 
next question, and it was, and I will state it for the record 
even though you have already responded, can you assure me that 
you will not be removing any of the contract weather observers 
from these four West Virginia airports until you can certify 
that the ASOS systems are working at an optimum level without 
compromising safety.
    Mr. Belger. Yes, sir.
    Senator Byrd. So the answer is yes.
    Mr. Chairman, I ask unanimous consent that my letter of 
February 19, 1997, to Secretary Rodney Slater be included in 
the record.
    Senator Shelby. Without objection, it is so ordered.
    [The information follows:]
                        Letter From Senator Byrd
                                                 February 19, 1997.
Hon. Rodney Slater,
Secretary, U.S. Department of Transportation,
Washington, DC.
    Dear Secretary Slater: Congratulations on your recent confirmation 
as Secretary of Transportation. I enjoyed very much our meeting on 
January 30, and I appreciate your taking the time to stop by and 
discuss issues of concern to me and my constituents.
    I want to bring to your attention a matter of immediate concern 
regarding aviation safety in my State. Recently, I have been informed 
by several constituents that the Automated Surface Observing System 
(ASOS) installed at airports in West Virginia is not accurately 
performing its intended functions of weather reporting and forecasting. 
During inclement weather, the ASOS is consistently reporting inaccurate 
measurements, requiring constant backup by human observers. Moreover, 
readings on wind conditions and visibility are commonly inaccurate, and 
sky sensors often report erroneous values during inclement weather. 
Indeed, there have been several instances in which snowfall has been 
indicated by the system when no such condition existed.
    Of even greater concern is the fact that four of the airports in 
West Virginia (Bluefield, Elkins, Martinsburg, and Beckley) have been 
classified as ``Level D'' and are targeted to lose the contract weather 
observers that currently compensate for the inaccurate ASOS 
information. The Mercer County Airport in Bluefield, West Virginia, is 
of utmost concern, since the contract weather observers are scheduled 
for removal within the next few days. Therefore, I am writing to 
request that the transfer of human observers from these four ``Level 
D'' airports be suspended until the accuracy and reliability of the 
ASOS devices at each West Virginia airport can be certified. I would 
further appreciate your assurance that safety will not be compromised 
at these ``Level D'' airports once the human observers are removed.
    Thank you in advance for your immediate attention to this matter.
    With kind regards, I am
            Sincerely yours,
                                                    Robert C. Byrd.

                 Paying for Contract Weather Observers

    Senator Byrd. Now, with reference to the paying for weather 
observers, the FAA this past June published this policy for 
contract weather observers in the Federal Register, and in that 
policy statement you made reference to the opportunity for 
local airport operators to back up the ASOS systems with their 
own contract weather observers. However, the cost of these 
weather observers would have to be borne by the airport and not 
by the FAA. Do you think it is consistent with your initiative 
to provide a single level of safety for all passenger aviation 
operations to implement a policy where smaller airports are 
required to pay for the weather observers themselves while the 
FAA continues to compensate weather observers at other larger 
airports around the country?
    Mr. Belger. That is one of the things we are looking at in 
this annual review that I referred to. The standards that we 
established a year ago are broken out into four levels, and 
they were developed, quite frankly, with the industry, and the 
airports had representation in the development of those 
standards. At the large airports, we are going to continue to 
provide the human observer. The issues, as you described, are 
at the smaller airports, and the question becomes whether or 
not removing the human observer has an impact on safety and 
efficiency. That is what we are doing this review for right 
now.
    There are a lot of innovative ways we are looking at in 
which the weather observations can be made without having to go 
through the FAA contracting activities, perhaps doing it on a 
local level. It could be that we will turn out in the end to 
reimburse for those costs, much like we do with the contract 
tower program.

             Contract Weather Observers at Smaller Airports

    Senator Byrd. Well, I am glad to hear you say that in the 
end there may be some reimbursement.
    Why will only the smaller airports be required to pay for 
contract weather observers? Why isn't that burden being passed 
on equally to all airports across the country?
    Mr. Belger. First of all, we have not made that decision. 
As I said, we are going through that review process. But the 
logic behind that thought is that at the larger airports the 
human observer is absolutely required to meet the safety and 
the efficiency and the performance of the larger aircraft. In 
other words, they have to have that 24-hour capability and they 
have to have, quite frankly, some of the augmentation 
observations that ASOS does not provide.
    At many of the smaller airports it might not be necessary 
to have that augmentation. And again, I want to reemphasize 
that is what we are reassessing in this review.
    Senator Byrd. I hope that due regard will be given to the 
question in the review and the kind of terrain where I live. We 
have many problems with weather. I have flown in and out of 
West Virginia for a long time, and some of the roughest flights 
I have had, and I have been all over the world, Afghanistan, 
flown up the Kyber Pass, and these places, I think the roughest 
flights I have had have been over West Virginia. They do not 
seem to be as rough as they used to be, but this is mountainous 
terrain, the weather changes fast.
    Mr. Belger. Right. I can assure you that we are looking at 
that.

                              Deregulation

    Senator Byrd. And in addition to that, the small airports, 
these rural airports, are socked with the increased costs of 
flying, far more-so than the big ones. We pay for these long 
trips at low prices. We in West Virginia pay for those long 
trips. It costs $664 for me to make a round trip to Charleston, 
WV. Now, I think I can also recall when that round trip 
probably cost $70, maybe even less. And so with deregulation 
the small airports in the rural counties and the rural States 
of this country started paying, and paying big-time.
    The air carriers started pulling out almost as soon as 
deregulation went into effect. Big carriers moved out of West 
Virginia, and the prices went up. The airfares went up. And I 
voted for deregulation, and I have been kicking myself ever 
since. My former colleague, Senator Randolph voted against it, 
and he voted right. I voted wrong.
    But that is just an aside from what we are talking about 
here. That is just one of the problems that we have in a State 
that has only small airports and very inconvenient service, and 
extremely costly service. So when we add to that this next 
specter that stands at the table, smaller airports being 
required to pay for contract weather observers, I hope that we 
will be mindful of the problems that these small airports have 
and that the traveling public have in flying out of those 
airports and into them.
    I see that my red light is on, Mr. Chairman. I thank you.

                          Category X Airports

    Senator Shelby. Thank you.
    Admiral Flynn, the administration's budget asks for $746 
million for safety--I believe that is a 12-percent increase 
above current levels--and $97 million for security in 1998. The 
FAA categorizes airports by risk level. Category X airports, 
such as New York's Kennedy Airport, Chicago's O'Hare, San 
Francisco International Airport, I understand are at the 
greatest risk for safety and security matters. Do you believe, 
Admiral, more money needs to be spent at category X airports to 
improve safety and security?
    Admiral Flynn. Mr. Chairman, with regard to risk, what 
makes the category X of greater concern is the complexity of 
the operations and the number of passenger embarkations. I want 
to hasten to say that they are not inherently more threatened 
by terrorists than other airports.
    Senator Shelby. But the traffic makes it so, is that 
correct?
    Admiral Flynn. Indeed, that is right. It is the complexity.
    Senator Shelby. But that is due to the traffic.
    Admiral Flynn. That is right, Senator. Yes, Senator. And we 
have sufficient operations resources to be able to perform all 
the FAA functions at all of the airports that we regulate. 
Those that are in the budget request are sufficient to give us 
the resources to perform all of our regulatory functions.
    Then with regard to the security at those airports, the 
principal vulnerability is in the area of checked baggage. We 
are aware of that. We had recommended changes to that and had 
instituted changes to it prior to the White House Commission 
being formed. There is the funding above that $97 million that 
you have mentioned, that is the $100 million per year, being 
recommended to acquire screening equipment for check baggage 
and other security improvements.

                  Costs for Better Safety and Security

    Senator Shelby. How much more money, if you would make a 
judgment, needs to be spent for better safety and security at a 
large category X airport to improve training for airport 
security employees who monitor explosive detection equipment, 
train canines, and so forth?
    Admiral Flynn. The costs over 10 years at any one of those 
big airports of the additional people, the upgrading of their 
training, paying people, good people, in order to retain them, 
the 10-year cost exceeds $100 million for one of those 
airports.
    Senator Shelby. About $10 million a year, more or less?
    Admiral Flynn. I can provide for the record more precise 
costs.
    Senator Shelby. Could you do that?
    [The information follows:]

    Based on the recommendations in the White House 
Commission's Report, the total ten-year cost to the Government, 
airport authorities, and airlines for security programs at the 
Category X airports will be close to $3 billion. The total 
includes capital costs for new equipment as well as added 
personnel and their training. This averages out to $154 million 
per Category X airport, or slightly over $15 million annually 
for the next ten years.

                     Bay Area Rapid Transit [BART]

    Senator Shelby. Mr. Valentine, Admiral Flynn has just 
informed us that San Francisco International Airport, or other 
category X airports, needs approximately $100 million over a 
10-year period to meet its basic safety and security needs. The 
BART financing agreement, which FAA must approve, requires the 
airlines to pay, I understand, about $7.5 million per year to 
help build the transit project. Is this the best use of those 
airport revenues?
    Mr. Valentine. I think the first part of the answer is that 
I do not know that it requires them to spend it. That was an 
agreement that was struck by the parties among themselves.
    Senator Shelby. Well, if they have an agreement that is 
going to be obligatory, is it not?
    Mr. Valentine. What I am saying is they have an agreement. 
There are no AIP moneys or PFC moneys involved in this process. 
It is just moneys that the airport has earned, and our role in 
that has been principally to determine whether or not that is 
an appropriate use of airport revenues.
    Senator Shelby. Is this an unusual precedent?
    Mr. Valentine. I think it is one of the first of this type, 
but it fits within the parameters that we use to identify 
whether or not money is being appropriately used. I do have Ms. 
Kurland here with me who is much more familiar with the details 
on this.

                   Airport Funds for Transit Projects

    Senator Shelby. Ms. Kurland on that?
    Ms. Kurland. Yes, Mr. Chairman; I agree with what Barry 
Valentine has just said. I would also point out that in the AIP 
handbook, which has been published for quite some time, there 
is a recognition that transit facilities at airports can in 
fact be eligible, if they are on the airport and connecting to 
a rapid transit system and for the benefit and purpose of the 
airport. And as you know, the committee in the conference 
report directed the FAA to look at the proposal that up to $200 
million of airport funds could be used for this project. What 
we did was look at the proposal that was provided to us, 
determine what parts of the proposal met the statutory 
criteria, set out the eligibility principles, and make it very 
clear that only actual costs could, in fact, be eligible.
    Senator Shelby. Is this the best and highest priority for 
airport revenues, in view of safety and other concerns?
    Ms. Kurland. Mr. Chairman, let me try and answer your 
question this way: The proposal which has been provided to us 
does not propose the use of either AIP or PFC funds. This is 
for revenues generated on the airport. The airports do have 
control, in conjunction with airlines, depending on what type 
of agreements they have with their airlines on how revenues at 
the airport will be used. Once it meets the eligibility 
criteria, this is a determination for the local airport.
    Senator Shelby. Does FAA policy require airports to 
prioritize their needs, and is this the best and most efficient 
use of the money in view of the safety concerns that we are all 
concerned about?
    Ms. Kurland. Let me just amplify on your statement a 
little. For airport revenue to be used, it has to be for an 
airport purpose. And when we at the FAA spend discretionary 
funds from the AIP fund, we in fact do have a priority system 
in terms of how we rank projects. Safety and security are 
always at the top of the list in terms of how we spend 
discretionary AIP funds.

                       Best Use of Airport Funds

    Senator Shelby. Earlier, Senator Byrd was bringing up 
safety concerns in his own State, the same concerns we have all 
over America. Would not the airport money be better spent for 
airport safety, and would not people feel better about it in 
America? Airport safety is very important.
    Ms. Kurland. Airport safety is our key mission at the FAA. 
And as I just stated, when we do have the flexibility to spend 
the discretionary funds, that is our top priority. The 
statutory criteria do allow airports, as long as it meets 
eligibility criteria, to determine, in conjunction with their 
airlines or based on whatever their way of governing their 
airports and their funds are, to make those local 
determinations.
    Senator Shelby. I know that several members of this 
subcommittee and other members of the Appropriation Committee 
have contacted me as the subcommittee chairman regarding the 
BART money, that this is a diversion of moneys that should be 
spent for airport safety and everything else, and I thought 
this issue should be raised here today.
    Ms. Kurland. Thank you, and we would be happy to provide 
you with whatever additional information you would like, or 
additional briefings.
    Admiral Flynn. Mr. Chairman?

                       Airlines Cost for Security

    Senator Shelby. Yes; go ahead, Admiral.
    Admiral Flynn. The cost that I gave for security at a major 
airport includes the cost that the airlines would bear.
    Senator Shelby. We understand that. But still, that is the 
overall cost. That was your judgment, was it not?
    Admiral Flynn. That was my judgment, but I would need to 
refine it for the record.
    Senator Shelby. Of course.
    Senator Byrd.

              Safety Performance of Commuter Air Carriers

    Senator Byrd. Thank you, Mr. Chairman.
    Mr. Valentine, the implementation period for all commuter 
air carriers to come into compliance with your initiative to 
ensure one level of safety for larger and smaller aircraft 
ended roughly 3 weeks ago, on March 20. At this point, do we 
have any hard evidence that the safety performance by the 
commuter industry has improved as a result of this initiative?
    Mr. Valentine. When we looked at that initiative 
originally, Senator, the premise on which we undertook that 
effort was that if the commuter industry followed the same 
rules and procedures as the large carriers, that they would 
ultimately enjoy the same safety record as the large carriers. 
That was based on the fact that historically the fatal accident 
rate among commuters was higher than that of the large 
carriers. So in pursuing that course of action we used that 
assumption. We did not say that this particular piece of what 
was really a 100 and some-odd part improvement would 
necessarily result in a specific measurable increase in safety 
but, in the aggregate, doing all of these things would elevate 
those operators to the same level as the large carriers.
    I am pleased to report that 1996 was the safest year in the 
last 15 years in terms of operations of commuter airlines. And 
in fact, candidly, 1996 was better than the large operators. I 
hope that we will see that trend continue and I think we can 
expect to.
    Senator Byrd. Well, I feel a little better about flying to 
West Virginia and back.
    Mr. Valentine. I understand. I am originally from a State 
not unlike West Virginia. I am from northern New England, and 
the terrain and the weather and access by only commuters is a 
feature of that area, as well. So I appreciate what you are 
saying.

                    Inspection and Oversight Methods

    Senator Byrd. Thank you, Mr. Valentine.
    Now, following the ValuJet crash, your agency conducted a 
90-day safety review that revealed deficiencies in the way that 
your agency inspected and conducted oversight over new entrants 
into the aviation business. Given these findings, are you 
convinced that your current inspection and oversight methods 
are ideally structured to detect any deficiencies in the 
commuter airline industry?
    Mr. Valentine. Mr. Gardner, a little earlier, addressed 
that subject to some extent, and I would just reiterate what he 
said. I think that we are on the right course of action to 
making sure that we have the right people in the right place to 
provide the right oversight for new entrant airlines.
    Senator Byrd. So you are satisfied that you are detecting 
any and all safety lapses in this part of the industry?
    Mr. Valentine. We are satisfied that, given our resources 
and our opportunities, we are doing the best we can in that 
area.
    Senator Byrd. Mr. Chairman, I thank you. I thank Mr. 
Valentine and all those who have appeared as witnesses. I 
especially thank you for your indulgence of questions from 
other members of the committee.

                   Cost of Accelerated Modernization

    Senator Shelby. Thank you.
    Dr. Donohue, I have another question here. How much would 
the accelerated modernization program outlined in the Gore 
Commission recommendations increase the funding levels needed 
in the facilities and equipment account in the years 1999 to 
the year 2000? Do you want to furnish that for the record, or 
do you have it now?
    Dr. Donohue. Yes, sir; I think that is an excellent 
question. We are currently staffing that, and we are trying to 
make sure that we have at least the beginning of that 
represented in the 1999 budget. But that is actually a very 
difficult question to answer accurately, even probably in our 
timeframe for putting together the 1999 budget. But we will 
continue to supply you with all the information we get as we 
get it.
    It really is, I think, a cashflow issue because up-front 
capital investment will decrease operations costs--a question 
that was asked earlier--but we have to find the availability 
within our cashflow constraints, through some innovative means, 
to do the capital investments to decrease out-year operations 
costs and increase safety.

          Security Measures for Domestic and Foreign Carriers

    Senator Shelby. Mr. Valentine, or perhaps Admiral Flynn 
too, in view of the clear instructions in the Terrorism 
Prevention Act of 1996 that the FAA require foreign airlines 
serving the United States to have the, quote, ``identical 
security measures that United States airlines are required to 
have.'' Do you know why the FAA has been unwilling to implement 
this law?
    Mr. Valentine. I would ask Admiral Flynn if he would 
address that.
    Senator Shelby. Admiral?
    Admiral Flynn. Mr. Chairman, we have not been unwilling.
    Senator Shelby. Have you been unable?
    Admiral Flynn. No; it requires a regulation to do that.
    Senator Shelby. All right.
    Admiral Flynn. And we are introducing a regulation.
    Senator Shelby. You are going to pursue it, then?
    Admiral Flynn. Oh, indeed. Indeed, yes, sir.
    Senator Shelby. Good. It is my understanding, Mr. 
Valentine, that about one-half of the U.S. citizens traveling 
internationally do so on foreign airlines. Should not our 
citizens receive the same level of security as a passenger of 
any nationality who travels on a U.S. airline? In other words, 
they travel on our airlines, we have high security; should we 
not insist on security for our own people traveling abroad?
    Mr. Valentine. We do insist, and I will let Admiral Flynn 
address some of this, if he wishes. We do insist on certain 
levels of security regarding, for example, foreign carriers who 
travel to the United States and airlines operating out of 
airports that are the last point of departure for the United 
States. They have to undergo security procedures virtually 
identical to the ones that we have here in the United States.

                    Budget Request for Modernization

    Senator Shelby. Mr. Valentine, I have read warnings from 
many experts on the aviation system that we cannot get much 
more capacity out of the current system without major 
modernization. This means we will require increased capacity, 
both in air traffic control systems and our ground capacity. If 
these modernizations and enhancements are not made, many 
believe that there will have to be a cap imposed on the system 
capacity. That would not be a popular alternative for American 
travelers and businesses.
    However, the FAA budget for 1998 system modernization under 
facilities and equipment decreases by $58 million, and the 
fiscal 1998 request for airport improvement program plummets 
$460 million below the enacted level, from $1.46 billion to $1 
billion. Could you explain, for the record, the apparent 
decrease in this administration's commitment to system 
modernization and capacity enhancement? I think it is very 
important to a growing economy, among other things.
    Mr. Valentine. We recognize, and I think recently you have 
heard Secretary Slater say, that air transportation is 
absolutely integral to the soundness of the economic system of 
any country today throughout the world. And for us to 
experience economic growth, we are going to have to have 
comparable capacity growth in our air transportation system. 
And we think that the budget we propose reflects a recognition 
of that. In putting the budget together we had to make some 
very tough decisions about where best to allocate those 
resources.
    I think one of the most obvious areas that you notice when 
you look at the budget is the change in the AIP funding, 
because the emphasis was placed on the operational end. 
Particularly focusing on airspace capacity, we recognize that, 
with regard to airport capacity and particularly those 
capacity-constrained airports--which are our larger airports--
they have the ability to secure resources from other means and, 
in fact, historically have secured most of their resources from 
means other than AIP funding.
    So in making our decisions and setting our priorities, we 
placed our emphasis on airspace capacity issues, recognizing 
that there are alternatives for the land side of the capacity 
problem.

                                CTX-5000

    Senator Shelby. I suppose this next question would be 
directed to you, Admiral Flynn, or Dr. Donohue. The CTX-5000 is 
the only FAA-certified airport baggage screening system, and 
the agency is currently procuring 54 systems for U.S. airports. 
In the fiscal 1998 budget request there is no funding requested 
for the CTX-5000 procurement. Is 54 systems the right number of 
CTX-5000's for the United States? Are there other technologies 
that will be certified within the next fiscal year that may 
provide the FAA with an alternative to CTX-5000?
    Admiral Flynn. It is possible that some other machine will 
be certified within the timeframe you mentioned, but the 54 
CTX-5000's represent a small fraction of the total that will be 
required.
    Senator Shelby. For everything else?
    Admiral Flynn. No; of all the certified machines, be they 
CTX or some other certified systems, that will be required for 
screening checked baggage at the 76 biggest airports in the 
United States, where the use of such machines is clearly 
practical.
    So additional money was requested, and that money becomes 
available on October 1, 1998, if it is appropriated as 
requested, to continue the acquisition of CTX-5000 or some 
other certified equipment, if that should happen in time to use 
that money.
    Senator Shelby. Dr. Donohue, do you concur with that?
    Dr. Donohue. Yes, I do. I think there are some issues of 
production rates and how fast we can reasonably expect these 
new equipments to be produced. So I think we are doing it in 
the most prudent way.

                     Wide Area Augmentation System

    Senator Shelby. Dr. Donohue, last year the Appropriations 
Committee expressed increasing concern about schedule and cost 
risk in the wide area augmentation system program. The General 
Accounting Office says that recent events have confirmed that 
the FAA schedule for augmenting global positioning system is at 
risk, and that the internal FAA documents point to the 
potential of substantial cost increases.
    Industry and even former FAA officials are saying that 
eventual costs for the program, even with scaled back 
requirements, will vastly exceed the $475 million original 
contract cost. Do you know what is the current cost baseline 
for the WAAS program?
    Dr. Donohue. Yes, Senator.
    Senator Shelby. And do you disagree with the General 
Accounting Office.
    Dr. Donohue. To some extent yes, I disagree with the 
General Accounting Office. This is a very complex program, and 
you have to look very carefully into what part of the program 
one is talking about. Our program does not only develop the 
software and the hardware and does the deployment of the 
system, it also buys communication services from satellites, 
INMARSAT, and it is looking at total life cycle costs including 
out-year maintenance.
    There are a number of different ways to provide the out-
year maintenance costs. They cost different amounts, depending 
upon what we ultimately execute. Our communications satellite 
costs, over a 10- or 15-year period, can vary in out-years 
based upon ways in which we are looking to decrease those 
costs.
    The current Hughes contract is on schedule. It is, in fact, 
in some places ahead of schedule. We feel very confident that 
the primary contract is, in fact, proceeding as we have said 
before. There are some technical issues that we are looking at 
as we collect data from our national satellite test bed. We are 
evaluating that data to try to see whether or not we need to 
modify our requirement. We have not decided that yet. We are 
holding to the original requirements. But they are under review 
right now. I am doing a full review to try to understand 
exactly what those costs might be and that we are doing 
everything we can to hold the line.
    Senator Shelby. Will you let us on the committee and the 
staff know the outcome of that review?
    Dr. Donohue. Yes, Senator; as soon as I complete the 
review, and I hope to do that over the next month or 6 weeks. 
We will provide you with all the information that we get.

                          Submitted Questions

    Senator Shelby. I appreciate all of you, Mr. Valentine and 
all of you, appearing here before us and having a good and 
frank exchange of views. We will submit additional questions to 
be answered for the record.
    [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 Domenici
                  airline safety improvement measures
    Question. Acting Administrator Valentine, the Gore Commission 
recommends that the FAA should actively include the aviation industry 
in improving safety by forming partnerships to work together in such 
areas as self-monitoring and certification. In fact, recent testimony 
by the General Accounting Office (GAO) highlighted several safety 
concerns which were identified by non-FAA sources which would not have 
been detected by relying solely on FAA surveillance. I believe an 
inclusive safety program involving various parties could present 
significant positive benefits in improving our nation's fleets. 
However, I believe such partnerships should be formed very carefully 
and only after the FAA has insured such as partnership would not 
compromise the agencies principle role as the industries' regulator. 
Has the FAA begun to consider any safety program(s) which would form 
partnerships with various aviation industries? And if so, would you 
provide me with examples?
    Answer. In recent years, the Federal Aviation Administration (FAA) 
and the air transportation industry have identified safety areas that 
were in need of improvement. In response to these safety needs, the 
FAA, in cooperation with industry, established several demonstration 
Partnership for Safety Programs in an effort to increase the flow of 
safety information to both the air carrier and FAA. Among these 
programs were the US Airways Altitude Awareness Program, the American 
Airlines Safety Action Program, and the Alaska Airlines Altitude 
Awareness Program.
    At the Safety Conference held on January 9-10, 1995, the Secretary 
of Transportation and the FAA Administrator announced the standardized 
policy and procedures that would be provided for the use of these 
programs along with the expansion of these programs to include 
participation from aviation industry employee groups, such as flight 
attendants, dispatchers, and mechanics.
    On January 8, 1997, the FAA published Advisory Circular (AC) 120-
66, which provides guidance for establishing air transportation 
Aviation Safety Action Programs (ASAP), formerly known as Partnership 
Programs. These programs, which are entered into by the FAA and 
entities of the air transportation industry, are intended to generate 
safety information that may not otherwise be obtainable.
    Under certain circumstances, ASAP provides a vehicle whereby 
employees of part 121 air carriers and major domestic repair station 
certificate holders (part 145) can identify and report safety issues to 
management and the FAA for resolution without fear of punitive legal 
enforcement action being taken against them. The elements of ASAP are 
set forth in a memorandum of understanding between the FAA, certificate 
holders, management, and employee groups or their representatives.
    Apparent violations of the regulations by employees of a 
certificate holder disclosed through safety-related reports will 
ordinarily be addressed with administrative action, provided that the 
apparent violations do not involve deliberate misconduct, a substantial 
disregard for safety or security, criminal conduct, or conduct that 
demonstrates or raises a question of a lack of qualification. Such 
violations are specifically excluded from the program. With the 
issuance and completion of the ASAP AC, inspector bulletin, and the 
informational seminar, airlines are now eligible to apply for program 
approval.
    Another area of significance within our agency is the Global 
Analysis and Information Network (GAIN), a proposed analysis and 
information sharing framework that is intended to identify emerging 
safety concerns and disseminate significant safety information to the 
aviation community world-wide. The GAIN concept would link various data 
sources, such as voluntary disclosure reporting, incident reporting, 
digital flight data, and air traffic control (ATC) radar data with 
analytical methods such as qualitative risk assessment, data mining, 
data visualization, and statistical methods. Further discussions on 
potential features of the proposed GAIN system can be found in the GAIN 
concept document that was issued by the FAA's Office of System Safety 
on May 9, 1996 (a copy of which may be found on the System Safety 
website at http://nasdac.faa.gov).
    The GAIN concept is not intended to replace the aviation safety 
programs currently active in segments of the global aviation community 
but will complement and build upon those activities, perhaps using 
information from some of these programs as inputs while helping to 
bring a wider, ``global'' participation to many of the programs. In 
addition, while many existing safety data systems rely on the more 
serious events that must be reported by regulation, GAIN will emphasize 
proactive identification of safety concerns through collection of data 
about the less serious but more numerous occurrences that are currently 
under-reported in the aviation system.
    GAIN would also go beyond many of the current safety data programs 
by incorporating analysis of empirical data, such as digital flight 
data and ACT system data. The two potential uses of this empirical are 
to validate the concerns raised in voluntary reports and to create 
measures that describe system operations. Monitoring National Airspace 
System day-to-day operations for deviations from these statistical 
norms should quickly heighten aviation operators' awareness of 
conditions or circumstances that may signal the onset of increasing 
safety risk.
    Other distinguishing features of GAIN include its scope, data 
management, and ownership. The scope of GAIN is envisioned as 
incorporating all aviation systems--flight operations, surface 
operations, and air traffic control--and all of the world-wide aviation 
community. By accessing the experience of the entire aviation 
community, GAIN will vastly increase the capability for all to benefit.
    The data management concept for GAIN is very flexible. For a number 
of reasons, including the large quantity of raw data available, little 
or no sharing of raw data is expected. Instead, the information 
resulting from analysis of raw data will be shared. In addition, it is 
unlikely that data or resulting information would be stored in a 
centralized location. Raw data could reside with its owners while the 
information byproducts could be made available to users through 
networking, a dissemination concept commonly known as a ``virtual 
database.''
    While the FAA is helping facilitate the creation of GAIN by 
informing potential participants about the concept and bringing 
potential participants together, FAA will not own or operate GAIN. It 
is hoped that the potential safety and economic benefits to be derived 
from GAIN would motivate the aviation community to step forward and 
fund its development and then to own and operate GAIN for the mutual 
benefit of many users. FAA would be one of those users, providing some 
of GAIN's data/information inputs and then using GAIN's analytical 
results and supporting data.
    Question. Do you as Acting Administrator, believe the FAA could 
effectively increase the safety of our nation's air fleet through a 
self-monitoring and self-certification process?
    Answer. The Federal Aviation Administration (FAA) has developed and 
implemented a voluntary disclosure policy for specific types of 
airlines and repair stations. This is a policy under which 14 Code of 
Federal Regulations Parts 121, 135, and 145 certificate and production 
approval holders may voluntarily report apparent violations of the 
regulations and develop corrective action satisfactory to the FAA to 
preclude their recurrence. Certificate holders who satisfy the elements 
of the voluntary disclosure policy, receive a letter of correction in 
lieu of civil penalty action. Voluntary disclosure reporting procedures 
are outlined in Advisory Circular (AC) 120-56, Air Carrier Voluntary 
Disclosure Report Procedures. Although not presently required by the 
regulations, manufacturers have been encouraged to perform self-audits 
as a basis for future changes since the new Federal Aviation 
Regulations (FAR) Part 21 will require self-audits by manufacturers.
    Voluntary disclosures for air carriers, which result in 
administrative actions, account for an increasing percentage of total 
air carrier enforcement investigative reports, growing from 7 percent 
in calendar year 1990 (the first year of the program) to 25 percent in 
calendar year 1996. This program is only one of several tools that the 
FAA has to seek compliance with the safety regulations. When 
appropriate the FAA will continue to use suspension or revocation and 
civil penalty actions for more serious cases.
    The FAA also believes that the certificate holder is in the best 
position to identify deficiencies and promptly correct them, and it 
should have in place a procedure whereby internal compliance audits are 
performed and top management is informed of its company's operations, 
compliance, and safety record. Such internal audits will improve the 
certificate holder's ability to identify and correct any safety 
problems before, rather than after, FAA inspections. Public safety is 
enhanced significantly if deficiencies are identified and corrected 
when they are discovered by the certificate holder, instead of when the 
FAA discovers the deficiencies, sometimes much later, in the course of 
an inspection or in the wake of an accident or incident.
    In 1990, the FAA announced a policy (Compliance & Enforcement 
Bulletin No. 90-6) that was intended to serve as an incentive to 
institute and maintain a system of internal evaluation. The FAA 
believes that aviation safety is best served by incentives to 
certificate holders to identify and correct their own instances of 
noncompliance and invest more resources in efforts to preclude their 
recurrence, rather than paying penalties. Prompt and meaningful 
remedial action to prevent the same or similar sort of violation from 
happening again, more directly and substantially improves the safety of 
our national transportation system than the recovery of thousands of 
dollars in civil penalties.
    In 1992, the FAA published AC 120-59, Air Carrier Internal 
Evaluation Programs. This AC provides information and guidance material 
that may be used by air carrier certificate holders, operating under 
FAR Parts 121 and 135, to design or develop an Internal Evaluation 
Program. The procedures and practices outlined in this document can be 
applied to maintenance, flight operations, and security aspects of an 
air carrier's organization.
    The Internal Evaluation Program is a voluntary program. 
Participation is left solely to the discretion of each certificate 
holder. As a matter of policy, the FAA encourages certificate holders 
to identify, correct, and disclose instances of noncompliance. 
Therefore, the development and implementation of an Internal Evaluation 
Program will benefit both the certificate holder and the flying public.
    In a joint venture between the FAA and industry, self-certification 
has been used to some extent for a number of years. These initiatives 
are Designated Alteration Stations (DAS) and Delegation Option 
Authorizations (DOA). In both of these initiatives, the function of 
self-certification is performed with limited oversight being performed 
by the FAA. However, in both the DOA and DAS, the company must have 
exhibited extraordinary abilities to perform these functions.
    Our experience to date with the various programs have produced 
positive results and the FAA is confident that airline safety will 
continue to benefit from this corrective action process.
                         aging aircraft center
    Question. Acting Administrator Valentine, the overall safety of our 
commercial air fleet has been of interest to me for several years now. 
In fact, in my state of New Mexico, an exciting new technology is being 
developed to improve the safety of our aging air fleet at the Aging 
Aircraft Non-destructive Evaluation Center (AANC) in Albuquerque. This 
center has been supported by the FAA for the past six years and we are 
seeing substantial progress in developing new techniques to assess the 
structural integrity of our commercial air fleets.
    In fact, in your own budget request, the Administration highlights 
this new technology by stating it will save our 700 man-hours per 
aircraft inspection over current methods. However, the Administration's 
budget proposes to reduce the level of funding for aging aircraft 
research from $13.9 million in fiscal year 1997 to $13 million in 
fiscal year 1998. I am puzzled by this Administration's policies 
regarding aviation safety. On one hand the President identifies 
commercial air safety as one of his top priorities, but on the other 
hand he produces a budget proposal that once again decreases funding 
for one of our most important aviation safety issues. Knowing that by 
the year 2000 more than 2500 commercial aircraft in the United States 
may be flying beyond their original design lives, I believe this is 
dangerous policy. Do you believe the Administration's current budget 
proposal is sufficient to continue our efforts in ensuring aircraft 
safety?
    Answer. The fiscal year 1998 budget request does not represent a 
decrease in the aging aircraft program. Rather, it reflects an increase 
of $2.4 million in contract funds. The total dollar amount appropriated 
in fiscal year 1997 was $13.9 million, which included in-house costs. 
The fiscal year 1998 budget request of $13 million reflects contract 
funds only, as in-house costs are now part of a separate budget line 
item. The budget proposal is sufficient to continue our highest 
priority work in ensuring the safety of aging aircraft.
    Question. What current activities will be sustained with these 
resources?
    Answer. Our highest priority aging aircraft activities in 
structural integrity, and maintenance and inspection in testing, 
evaluation, demonstration, and validation will be conducted.
    Question. What activities will be reduced or eliminated due to 
budget reductions?
    Answer. No major activities will be reduced or eliminated at the 
proposed $200 million budget level.
    Question. What is the Administration's proposed budget for the 
Aging Aircraft Non-destructive Evaluation Center in Albuquerque?
    Answer. The budget requests approximately $3 million for inspection 
technology development and validation.
    Question. Acting Administrator Valentine, the Gore Commission also 
identifies aging aircraft as a major concern for aviation safety. In 
fact, they recommend that we expand the current aging aircraft 
inspection program to include the effects of age on non-structural 
components of commercial aircraft. Does the FAA support this 
recommendation?
    Answer. FAA currently is evaluating the Gore Commission 
recommendations regarding the effects of age on non-structural 
components of commercial aircraft. Where the results of the evaluation 
indicate a need, the FAA will expand the current aging aircraft safety 
program to include non-structural components.
    Question. Understanding the limited amount of funding available 
under this program, how does the FAA propose to fund this extra work 
load?
    Answer. The Gore Commission recommendations were received after the 
fiscal year 1998 budget was formulated. If a review of the Commission's 
recommendations indicates a need for increasing the scope of the 
current aging aircraft program to include non-structural system 
components, the FAA will identify the scope of the changes necessary 
along with funding requirements.
                        aircraft safety research
    Question. One of the ``Gore Commission'' recommendations is to work 
in cooperation with the airlines and manufacturers to expand the FAA's 
Aging Aircraft program to cover non-structural systems. I believe this 
recommendation is on the mark based upon the innovative work being done 
at the FAA's Aging Aircraft Non-destructive Evaluation Center (AANC) in 
Albuquerque.
    This Center has made significant and effective contributions to 
improvements in aircraft inspection and repair by transferring new 
technology from the laboratory to routine use by industry. AANC goes 
through a methodical process of testing, demonstrating and validating 
new techniques and provides support to industry to implement them. 
Their success is shown by contracts with other federal agencies, 
including the Coast Guard and Air Force, on aircraft inspection and 
repair issues.
    It seems to me that the close collaboration with the FAA, AANC, and 
the industry ensures that the best inspection techniques are 
transferred to routine usage in the most expeditious fashion. AANC is 
also working closely with airlines and manufacturers to develop 
industry standards for composite structure inspection. NASA has stated 
its intention to devote a sizable share of its resources to improve 
aviation safety and security. What is the status of discussions between 
the FAA and NASA on how to proceed with policy?
    Answer. Two years ago, in anticipation of the need for a closer 
working relationship, NASA and the FAA exchanged executive personnel 
for the sole purpose of enhancing aviation safety by developing 
cooperative programs of mutual interest to both agencies. During the 
early development stage of the NASA new initiative for aviation safety, 
FAA played a key role in its formulation and focus. The FAA and NASA 
maintain a continuing dialogue through quarterly meetings at the 
Associate Administrator level to ensure that policy matters are 
resolved at this highest level. These discussions will lead to a method 
of transition, coordinated programs, and integrated planning. Included 
in the discussion is the establishment of an appropriate management 
oversight team to ensure timely execution of newly formulated programs.
    Question. What areas of expertise are most appropriate for the FAA 
to remain the lead agency in aviation safety and security?
    Answer. FAA's primary mission is to provide a safe, secure, and 
efficient global aviation system that contributes to national security. 
Public confidence in the safety of both the aircraft used and the 
airspace system is paramount to the ultimate competitiveness of the 
U.S. aviation industry. The inherent safety of an aircraft is a 
function of its design integrity and its manufacturing quality 
administrated through a certification program to ensure compliance with 
prescribed standards. A key aspect, therefore, of the FAA's primary 
mission is to ensure the highest level of public safety while 
incorporating new technology. The FAA has areas of preeminent 
expertise, such as, fire safety, aeromedical research, and air traffic 
systems technology. The FAA is required to address research that 
examines limits, performance, and margins of safety provided by current 
and evolving equipment, products, and procedures. This category of 
research supports the FAA in identifying and evaluating deterioration 
of the safety systems. This research can also identify needed 
innovative product development. Through early participation in the 
research and product development cycle, the FAA can accelerate 
technology through the certification process.
    The FAA established the National Resource Specialist (NRS) Program 
to maintain a cadre of highly specialized experts to provide technical 
leadership in the design development and application of regulatory 
policies and practices for certification of rapidly advancing 
technology. The NRS program influences the research agenda of U.S. and 
foreign aviation industries, military, academia, and other research 
institutions; and interacts with and assists other U.S. Government 
agencies and foreign civil aviation authorities in technology related 
issues.
    NASA has a role to play in the orderly development and validation 
of this technology including one of providing information that may 
assist the FAA in determining certification criteria.
    Question. Could you comment upon areas where NASA could make a 
unique contribution to aviation safety and security work?
    Answer. NASA's primary mission lies in the early, higher technical 
risk phase of the technology research and development chain where 
aeronautical concepts are created, basic research conducted, and risk 
is reduced through concept verification and validation. These efforts 
are aimed at improving the usefulness, performance, speed, safety, and 
efficiency of aeronautical vehicles and at helping to ensure a safe and 
efficient airspace system. NASA also acts as a catalyst with industry 
and academia to preserve the role of the United States as a world 
leader in aeronautical science and technology. NASA, in cooperation 
with FAA, has recently embarked upon a new technology investment 
strategy over the next five years with aggressive goals to provide the 
technology to reduce accident rates by a factor of five within the next 
ten years. These new systems will include but are not limited to: 
improving situational awareness, improving flight crews interactions, 
detecting and displaying hazardous weather, preventing collisions, 
extending useful life of existing aircraft, and identifying problems 
before they become accidents. As the technology matures, NASA assumes a 
supporting role as user needs--including those of the industry, DOD, 
and FAA--dictate the nature and pace of technology development, 
certification, and inspection.
    Question. Do you believe there can be an effective ``marriage'' 
between the FAA and NASA research programs to advance aviation safety 
and security?
    Answer. NASA and the FAA have worked together continually to 
leverage the limited research and development resources available to 
the aviation community for improving aviation safety. The two agencies 
closely coordinate their respective research programs through periodic 
reviews at both the working and the associate administrator levels. 
Each agency maintains its own research efforts focusing on the specific 
roles and responsibilities of each agency. Specific examples include 
the General Aviation Propulsion (GAP) Program to develop a coordinated 
series of activities to develop a certification basis for future low-
cost general aviation light aircraft propulsion systems. Another 
example is the jointly supported Advanced General Aviation Transport 
Experiments (AGATE) program designed to develop new technologies in the 
years 1995-2000 for a new generation of safe, economically and 
environmentally compatible general aviation aircraft. The FAA and NASA 
have demonstrated that they can effectively enhance aviation safety 
through a coordinated effort between the two agencies.
    Question. With constrained budgets, I am concerned about 
duplication of effort. Congress will want any research program to be 
well coordinated and avoid inefficiencies and duplication of FAA's 
research program. Are you confident that duplication of effort can be 
avoided within the Administration?
    Answer. The FAA and NASA are redoubling their efforts to ensure 
that the current and planned research programs are complimentary and 
leverage each others expertise and unique facilities. Through 
continuous communications throughout the two agencies' work force, the 
FAA is confident that its research program is coordinated with NASA's 
research efforts and supports the needs of the aviation community 
within the resources available. The FAA and NASA will strive to improve 
the integrated planning and coordination of each others research 
programs, so that potential duplication and inefficiencies will not 
occur. The establishment of an oversight management team will ensure 
continuous review and accountability of the research dollars in a 
constrained budget environment.
              modernization of air traffic control system
    Question. The Gore Commission also evaluated the FAA's progress on 
the modernization of the out dated Air Traffic Control System (ATC). I 
am very concerned with the FAA's inability to remain on schedule and 
produce a product which will significantly benefit the American air 
traveler. The Gore Commission recommends the FAA should develop a 
revised modernization plan and to have that system fully operational by 
the year 2005. Has the FAA began to develop a new strategic plan for 
the development and implementation for the modernization of the Air 
Traffic Control System? And if so, where specifically are you in that 
process.
    Answer. The FAA has begun to develop a new strategic plan for 
modernization of the Air Traffic Control System. A first draft of this 
strategic plan for modernization is embodied in the proposed National 
Airspace System Architecture (Version 2.0), which was released for 
aviation community comments October 1996. The FAA and the aviation 
community, taking into account the comments received on Version 2.0 and 
the new Air Traffic Control System concept of operations, will 
collaboratively develop a baseline architecture (Version 3.0) by the 
end of 1997.
    Question. Does the FAA believe it is possible to have the Air 
Traffic Control system completely modernized by the year 2005? And if 
so, how much additional funding would be necessary to complete the 
system on such a fast track?
    Answer. The FAA has taken a preliminary look at modernizing the Air 
Traffic Control system by 2005, and is in the process of developing a 
comprehensive plan to include detailed cost and schedule milestones. 
Completion of the modernization plan is scheduled for August of this 
year.
                               user fees
    Question. Mr. Valentine, the President's budget proposes that 
beginning in 1999, the current aviation excise tax will be replaced by 
a cost-based user fee system.
    The proposal shows $27.2 billion being collected under this user 
fee proposal between 1999 and 2002.
    What assumptions did the FAA use in determining the revenues that 
can be generated by a user fee proposal? Specifically, who would pay 
the user fee and how would it be collected? How would user fees be 
assessed on the traveling public?
    Answer. Projected revenues were based on the recovery of costs for 
all FAA programs. Using 1998 as a baseline, future years reflect 3-
percent annual growth except for the Airport Improvement Program, which 
remains constant at $1 billion. Specific fees to be charged have not 
been determined and will be influenced by the recommendations of the 
National Civil Aviation Review Commission. How the user fees are 
assessed and collected will be based on several considerations, 
including whether the fees are paid before, after, or concurrent with 
the provision of services, the volume of payments to be made, and the 
size of individual payments.
    Question. If the FAA has not finalized how these fees would be 
collected or imposed, how were these revenue figures generated?
    Answer. Using 1998 as a baseline, a 3-percent inflation factor per 
year was applied to operations, facilities and equipment, and research. 
AIP was straight-lined at $1 billion. As the President formulates his 
budget each year, decisions will be made on a year-to-year basis to 
update these assumptions.
    Question. Would it have been more advantageous for the FAA to wait 
until the final report of the National Civil Aviation Review Commission 
before making revenue projections for a cost-based user fee?
    Answer. The Administration is assuming that the work of the 
Commission will be completed before the end of this fiscal year and 
recommendations provided to Congress and DOT. This will allow time to 
make any necessary changes in the proposal to establish and implement 
user fees.
    Question. Mr. Valentine, the President's budget proposes that 
beginning in 1999, the aviation excise tax will be replaced with a 
cost-based user fee system.
    However the President's budget does not show where these user fees 
will be spent within the FAA.
    In what areas and in what amount will these new user fees be spent 
between 1999 and 2002?
    Answer. User fees will provide funding for all FAA programs. As the 
budget is formulated each year by the President, assumptions will be 
updated and the estimates revised.
    Question. If this information is not known, how did the FAA arrive 
at its budget request of $35.9 billion between 1999 and 2002?
    Answer. Fiscal year 1998 was used as a baseline and a 3-percent 
inflation factor per year was applied to operations, facilities and 
equipment and research. AIP was straight-lined at $1 billion.
    Question. What level of funding will the FAA recommend to the 
National Civil Aviation Review Commission for (a) FAA Operations, (b) 
FAA Facilities and Equipment, (c) FAA Research and Development, and (d) 
the Airport Improvement Program between 1999 and 2002?
    Answer. As part of their independent assessment of the FAA's 
financial requirements, Coopers & Lybrand concluded that the FAA's 
projected needs of $59.8 billion for fiscal years 1997-2002 were 
reasonable in total assuming a ``status quo operating environment.'' 
Coopers goes on to state that the ``National Civil Aviation Review 
Commission and its Aviation Funding Task Force should use that basic 
premise as their starting point.'' An update of the $59.8 billion was 
provided to Coopers. This update of FAA's requirements to $61.9 billion 
reflects the fiscal year 1997 enacted level, the fiscal year 1998 
request level, revised pay raise and inflation assumptions, a refined 
pricing model for Operations, and $500 million in needed staffing 
changes.
    For the shorter period, fiscal year 1999 through 2002, the levels 
of funding provided to Coopers and Lybrand were as follows (in budget 
authority): Operations--$25.6 billion, Facilities and Equipment--$10.4 
billion, Research, Engineering and Development--$1.7 billion, and 
Airport Improvement Program--$7.1 billion.
    At this time the requirements level to be recommended to the 
National Civil Aviation Review Commission have not been determined. The 
requirements level may need to be updated to reflect the fiscal year 
1999 budget submission to the Office of the Secretary of Transportation 
and the cost associated with the recommendations of the White House 
Commission on Aviation Safety and Security.
                                 ______
                                 
                 Questions Submitted by Senator Gorton
                         flight data recorders
    Question. In testimony before the Commerce Committee, and in 
response to questions raised by committee members, NTSB Chairman Hall 
addressed the issue of expanded parameters for flight data recorders. 
Chairman Hall mentioned that foreign carriers have ordered, and U.S. 
manufacturers have supplied, aircraft with more sophisticated flight 
data recorders than U.S. carriers are demanding. Chairman Hall 
intimated that cost was the only reason that domestic air carriers 
would continue to order aircraft with flight data recorders that meet 
only minimum FAA standards. I understand, however, that carriers also 
have concerns about integrating aircraft with new systems into their 
fleets. For maintenance purposes, they want to maintain standardization 
within their fleets. Is this a valid concern on the part of the U.S. 
carriers? Does the FAA believe that its proposal for the industry 
transition to flight data recorders with expanded parameters takes this 
concern into account?
    Answer. Yes, the proposed rule takes standardization of the fleet 
into account. The carriers would like to maintain a standardized 
equipage to minimize maintenance procedures, inventory, and to provide 
interchangeability of equipment between different types of aircraft. 
However, because all airplanes are not alike and later built airplanes 
have more functional capabilities with advanced technology, e.g. 
computers and data bases, the National Transportation Safety Board 
determined that the newer and more sophisticated airplanes can and 
should provide that information from those systems that automatically 
control more of the airplane operating functions.
               explosives detection equipment deployment
    Question. I understand that the Gore Commission and members of 
Congress have criticized the FAA for its heavy reliance on the CTX 5000 
security equipment, to the exclusion of other advanced technologies. 
Since the bombing of Pan Am 103, Congress has consistently urged the 
interim deployment of commercially available explosive detection 
equipment, and has recognized the benefits of a mix of technologies. 
The FAA appears, however, to continue to spend the bulk of its 
appropriations on CTX technology. When does the FAA plan to make a 
significant purchase of advanced x-ray equipment to complement the 
deployment of CTX equipment? Do you think we can learn lessons from 
countries throughout the world that are spending millions of dollars on 
this type of equipment?
    Answer. The Aviation Security Improvement Act of 1990 (Public Law 
101-604) says that prior to a requirement for deployment of explosives 
detection systems (EDS), the FAA must certify that EDS performance 
meets standards based upon the amount and types of explosives that are 
likely to be used to cause catastrophic damage to commercial aircraft, 
derived from test results using independently developed test protocols. 
The Act further states that certified equipment must be able to detect 
such amounts under realistic air carrier operating conditions.
    The FAA established a threat list of explosives and associated 
amounts that would cause catastrophic damage to an aircraft, in 
coordination with U.S. Government organizations, distinguished 
scientific bodies, and European Civil Aviation Conference member states 
and other key foreign governments. In November 1992, FAA issued the 
draft EDS standard in the Federal Register, and final certification 
test protocols were completed in May 1993 by the National Academy of 
Sciences. The FAA carefully developed and coordinated these standards 
with the scientific and intelligence communities, the aviation 
industry, and properly cleared manufacturers and vendors, then 
published the final unclassified portions in the Federal Register on 
September 10, 1993.
    The InVision CTX 5000 was certified in December 1994. No other 
manufacturer has yet applied for certification testing. The FAA agrees 
with the results that the rigorous process mandated by law has 
produced, namely, the performance criteria and certification standards 
that both InVision Technologies models, the CTX 5000 and the CTX 
5000SP, have met. The FAA and the Office of the Secretary of 
Transportation have encouraged other manufacturers to meet this 
standard, which has also been adopted as a goal by the European Civil 
Aviation Conference.
    Other commercially available ``less-than-certified'' automated 
explosives detection equipment is being deployed in foreign airports. 
The FAA has assessed these devices and will continue to monitor the 
progress of these other deployments. The White House Commission on 
Aviation Safety and Security recommended that such equipment be 
deployed at U.S. airports and this will be done.
    The FAA plans to award contracts for about 20 automated dual energy 
X-ray machines manufactured by Vivid Technologies of Woburn, 
Massachusetts; EG&G Astrophysics of Long Beach, California; and Heimann 
Systems of Wiesbaden, Germany, plus a quadrupole resonance device 
manufactured by Quantum Magnetics of San Diego, California.
    Question. I believe that the FAA has requested $100 million in 
fiscal year 1999 and nothing in fiscal year 1998 for use in the 
enhancement of airport security at our nation's airports. How does the 
FAA plan to use these funds, as well as the remainder of the fiscal 
year 1997 funds available? How many explosive detection machines will 
be purchased with this money and how many airports will receive the 
equipment? At the current time, how many airports have received 
explosives detection equipment and have it in use?
    Answer. Using a portion of the $144 million for the purchase of 
equipment provided by the Omnibus Consolidated Appropriations Act of 
1997, a contract was awarded to InVision Technologies in December 1996 
for an initial delivery of 54 units that began in January 1997 for 
deployment at 25 airports. Newly purchased units are now in Chicago and 
New York airports and installations are underway in two other cities. 
InVision CTX 5000 airport demonstrations, arranged through grants to 
three air carriers that began in November 1995 in San Francisco, in 
Atlanta during the Olympics, and in Manila in September 1996, continue 
in parallel with these new acquisitions. The demonstrations were 
designed to validate cost models and gain real world operational data 
and experience on the deployment of EDS as envisioned by the Aviation 
Security Improvement Act of 1990. As these demonstrations are 
completed, the equipment will remain at those three airports.
    An initial deployment of other types of advanced equipment began 
with the installation of trace explosives detection devices in Atlanta 
last year and continues today at Chicago, New York, and Washington area 
airports. The FAA plans to award contracts to purchase over 480 trace 
explosives detection devices, and about 20 automated dual energy X-ray 
machines manufactured by Vivid Technologies of Woburn, Massachusetts; 
EG&G Astrophysics of Long Beach, California; and Heimann Systems of 
Wiesbaden, Germany, plus a quadrupole resonance device manufactured by 
Quantum Magnetics of San Diego, California.
                  wide area augmentation system (waas)
    Question. A recent Flight Safety Foundation study concluded that 
the accident risk while flying a nonprecision approach was five times 
greater than that associated with flying a precision approach. I am 
told that nearly 70 regional carriers serve more than 150 airports with 
nonprecision approaches in the United States, including five airports 
in my home State of Washington (Friday Harbor, Lopez, Anacortes, 
Wenatchee and Pullman-Moscow). Both the Flight Safety Foundation and 
the Vice President's Commission on Aviation Safety and Security have 
identified augmented GPS navigation technology as key to improving 
aviation safety because it will make precision approaches possible at 
nearly every airport in the country. How committed is the FAA to 
implementation of augmented GPS navigation in the form of your Wide 
Area Augmentation Systems (WAAS)?
    Answer. The FAA is fully committed to implementation of the WAAS. 
The FAA awarded a contract for $483.5 million to Hughes Aircraft 
Company, and is over one year into execution of that contract. The 
initial operational capability is due to be commissioned in 1999; full 
operational capability is due to be commissioned in 2001.
    Question. This subcommittee has been told that one justification 
for the WAAS program is that it will allow the FAA to begin 
decommissioning ground-based navigation aids. What would be the effect 
on the FAA budget and user benefits if the WAAS program is not fully 
funded or the system implementation is delayed?
    Answer. FAA policy, based upon a full WAAS capability in 2001, is 
to begin decommissioning ILS's and VOR/DME's in 2005 and to be complete 
by 2010. The cost avoidance from decommissioning ground-based 
navigation aids is approximately $150 million annually (1997 dollars) 
and is due to the elimination of operation and maintenance expenses. If 
WAAS full system implementation is delayed more than five years, more 
than $1 billion would be needed to upgrade or replace many of today's 
navigation aids.
    User benefits from WAAS include the potential to remove other 
navigation avionics (e.g., VOR's, DME's, and NDB's) and the avoidance 
of the associated maintenance and training costs. The WAAS will also 
provide a precision approach capability at thousands of airports that 
today have no instrument approach or only a nonprecision approach. The 
accident risk while flying a nonprecision approach is estimated to be 
five times greater than that associated with flying a precision 
approach. WAAS implementation delays would delay these benefits and 
expose the users to the greater risks associated with nonprecision 
approaches for a longer time.
    Question. Tony Broderick, former FAA Associate Administrator for 
Regulation and Certification, recently testified before the Aviation 
Subcommittee. He indicated that the original cost projections for the 
WAAS program were underestimated to the tune of approximately $300 
million. Does the FAA plan to live up to its original commitment to 
deliver on the WAAS program with the capability that was envisioned at 
the time that its initial funding was requested? Specifically, will the 
system have adequate redundancy built in to be able to provide for 
``sole means'' of navigation en route, in the terminal area, and for 
``near-Category 1'' precision approaches and landings at any facility, 
without reliance on current ground-based navigation aids? Will the 
system also provide for the use of Local Area Augmentation Systems 
(LAAS), which the airlines can use to land in extremely poor visibility 
conditions?
    Answer. (a) Yes. FAA does plan to provide a WAAS with a full 
operational capability by 2001.
    (b) Yes. The current performance requirements will support sole 
means of navigation for en route, terminal, non-precision approaches, 
and Category 1 precision approaches at qualified locations.
    (c) The original WAAS cost estimate did not envision all costs 
related to safety certification and end-state technical complexities. 
The FAA is currently reviewing the total WAAS implementation strategy. 
Following that review, the agency will forward any proposed changes to 
the original baseline to Congress.
    (d) The FAA WAAS is being developed independent of the LAAS. 
However, user equipment specifications are being developed to provide 
both WAAS and LAAS services from a single receiver. The FAA is also 
investigating future joint use of reference stations equipment at sites 
requiring both WAAS and LAAS data collection.
                                 ______
                                 
                Questions Submitted by Senator Faircloth
                   air traffic control modernization
    Question. The Gore Commission recommended acceleration of the ATC 
modernization program. Why should we believe that FAA could manage an 
accelerated effort since it has struggled so mightily with achieving 
cost and schedule goals for its existing program?
    Answer. With the accomplishment of acquisition reform, and the 
establishment of Integrated Product Teams, the FAA has significantly 
improved its capability to acquire and deploy systems. For example, for 
the following major system acquisitions, we have ``delivered'' 119/124 
Airport Surface Radar-9's, 32/40 Airport Surface Detection Equipment-3, 
42/47 Terminal Doppler Weather Radar, 38/41 Area Route Surveillance 
Radar-4, 142/149 Mode S, all Voice Switch Communication Systems, 143/
183 Mark 20 Integrated Landing Systems, and other systems.
    The Display Channel Complex Rehost (DCCR) program was initiated in 
1995 to resolve unacceptable failure rates of Display Channel Complex 
(DCC) at 5 centers. The DCCR program began delivering equipment seven 
months ahead of schedule. Another major modernization effort, the 
Display System Replacement (DSR), which will replace air traffic 
controller displays in all of the Air Route Traffic Control Centers, is 
on schedule for initial deliveries in October 1998.
    Question. One long-standing criticism of FAA's management of its 
ATC acquisitions is that the agency tried to develop overly complex, 
large projects. The Advanced Automation System is one often-cited 
example. In recognizing the validity of this criticism, FAA announced 
that it would begin to emphasize commercial off-the-shelf (COTS) 
acquisitions. One of FAA's largest and most visible acquisitions is the 
Standard Terminal Automation Replacement System (STARS). STARS was 
billed as mostly COTS technology, yet the agency's timetable for 
developing STARS stretches into the next century before FAA will be 
able to install a fully operational system. Please provide me with your 
definition of COTS.
    Answer. The STARS concept is to enhance a commercially-available 
Air Traffic Control system to meet the FAA's operational requirements. 
The winning vendor proposed to supplement their existing design of 840 
thousand lines of code with an additional 140 thousand lines to address 
the full complement of STARS requirements. The contract calls for 
delivery of an Initial System Capability for test in December 1997, and 
a Full System Capability in December 1998. Each of these releases will 
undergo approximately one year of testing before they become 
operational. The STARS hardware is configured using commercial products 
for all major system components.
    Question. Our records indicate that the Congress appropriated over 
$3 billion for the Advanced Automation System acquisition before FAA 
restructured it in 1994. In light of the cancellation of the terminal 
and tower components of the acquisition and the scaling back of the en 
route component called the Display System Replacement, how many 
contract deliverables can be credited against the $3 billion? In other 
words, the balance was a loss to the taxpayers, isn't that correct?
    Answer. The FAA spent $2.6 billion on the Advanced Automation 
System (AAS) program prior to its restructuring in 1994. While the FAA 
agrees that large amount of funding was invested in the AAS program, 
there were also many benefits derived from the program.
    The Peripheral Adapter Module Replacement Item (PAMRI) was 
successfully completed with the installation of PAMRI in all 20 
ARTCC's, the FAA Technical Center, and the FAA Aeronautical Center. All 
efforts related to ARTCC Modernization, including expanding the control 
rooms, rehabilitating the ARTCC automation wing, and providing other 
upgrades to the facilities that were required to install ISSS remain a 
program requirement for DSR.
    The Initial Sector Suite System (ISSS) was descoped and renamed the 
Display System Replacement (DSR) program. Over 40 percent of the ISSS 
developed software was transported and used for the DSR program. The 
common console design; the 20''x20'' main display monitor (MDM) 
console, which was developed for AAS, has become a standard for Air 
Traffic Control displays; the monitor and control design; test support 
platforms at the FAA Technical Center and FAA Aeronautical Center; the 
Development and Demonstration Facility used for early user evaluations; 
the new centralized software support maintenance strategy; and the 
expansion of the FAA Technical Center test laboratory were all 
successes of the ISSS program and are being used today for the DSR 
program. The Oceanic program has reused a substantial amount of 
equipment that was procured for ISSS but not needed for DSR.
    When the AAS program was restructured, the AERA segment of the 
program was nearing completion of development of the algorithms 
necessary to predict flight path conflicts in the future, which is the 
basis for the URET prototype systems that are presently being tested at 
two ARTCC's. The URET prototypes will transition to the Initial 
Conflict Probe program, which will implement operational systems at all 
ARTCC's. FAA has committed to full scale development of the Initial 
Conflict Probe.
    The Tower Control Computer Complex (TCCC) segment of AAS was 
restructured to provide a modular approach to a full TCCC 
implementation. That program underwent subsequent restructuring based 
on the availability of F&E resources and FAA priorities. The contractor 
has completed all development required on that program and has a design 
that would provide a platform for Surface Movement Advisor (SMA). 
However, because of limited resources and other higher priority NAS 
Modernization programs, the TCCC program has been canceled.
    Two segments of the AAS program, Area Control Computer Complex 
(ACCC) and Terminal Advanced Automation System (TAAS), were canceled at 
the time of the restructuring. A substantial amount of the hardware 
that was procured during the development phase of the ACCC and TAAS 
programs, including common consoles, MDM's, processors, and displays, 
has been reused by the Oceanic and other FAA automation programs. 
Additionally, some FAA test laboratories are making use of residual 
material.
    In summary, the FAA has attempted to leverage hardware, software, 
and the sharing of lessons learned where appropriate to maximize the 
return on our investment and to minimize other program costs.
    Question. Please prepare a detailed account of federal government 
efforts to recover the costs to the taxpayers of waste and 
mismanagement in the Advanced Automation System acquisition program 
from IBM and other parties.
    Answer. When the AAS Program was terminated, there were multiple 
measures taken to ensure that the government's investment was 
protected. Full and independent audits were conducted of the prime 
contractor and every major subcontractor; all delivered equipment is 
being used in other FAA programs where appropriate or has been sent to 
the FAA Depot for reutilization and work-in-process inventory was 
identified and reintroduced back into the contractors inventory for use 
on continued FAA efforts. Approximately 95 percent of the equipment was 
reused and over 40 percent of the software was provided for use by 
other programs. These cost recovery measures resulted in cost avoidance 
or reductions in other program costs. Every effort was made to ensure 
that the governments investment was protected and that sunk cost were 
held to a minimum.
                   air traffic control modernization
    Question. Please prepare your best estimate of the costs to the 
taxpayers of waste and mismanagement in the Advanced Automation System 
acquisition program.
    Answer. Approximately $514 million invested in AAS through fiscal 
year 1994 resulted in non-recoverable costs.

Non-Recoverable funding spent on AAS....................    $437,000,000
Sunk Cost on TCCC through fiscal year 1994..............      77,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................     514,000,000

    Question. GAO reported in its 1996 report on FAA's culture that 
agency officials deliberately underestimated program costs and 
established unrealistic schedules to gain approval of funding for its 
projects. We have seen reports that the estimated costs of the Wide 
Area Augmentation System (WAAS) acquisition were underestimated for 
``convenience.'' Last month, GAO testified that it had evidence from 
several sources that program cost estimates could climb significantly. 
What is the agency's position on the reliability of the original WAAS 
cost estimate. We also understand that the schedule is facing another 
slippage. Could you address any schedule baseline changes being 
considered or already decided on by FAA?
    Answer. (a) The original WAAS cost estimate did not envision all 
costs related to safety certification and end-state technical 
complexities. The FAA is currently reviewing the total WAAS 
implementation strategy. Following that review, the agency will forward 
any proposed changes to the original baseline to Congress.
    (b) The initial operational capability is planned to be 
commissioned in 1999, and the final operational capability is planned 
for November 2001. There will be some intermediate milestone changes 
that evolve because of the technical complexities, however, no end-
state delivery changes are planned to the 2001 delivery date.
    Question. GAO and others have pointed to weaknesses in contract 
oversight as an underlying cause for FAA's acquisition problems. Does 
FAA have the necessary talent to provide sufficient oversight of its 
major contracts? To what extent should FAA rely less on contractors to 
oversee contractors and more on its own staff?
    Answer. We believe that FAA has a talented work force that over the 
years has been required to perform diverse functions including contract 
oversight. It has been recognized that this area of performance needs 
to be strengthened. Therefore, the FAA is conducting a pilot program to 
implement a competency-based learning system whose purpose is to 
develop a corps of acquisition professionals with the appropriate 
education, training, experience, skills, and attitudes to work 
successfully in a system with far fewer regulations that puts a premium 
on technical competence, judgment, creativity, and initiative. The plan 
is to hire, train, and retain individuals who can work as part of 
teams, who can operate with general guidelines where reason and common 
sense are more important than the ability to follow the rule book, and 
who have the specialized education and training to deal with some of 
the most sophisticated communications, navigation, and surveillance 
systems in the world. As a result, the FAA should be able to rely more 
on its work force and less on contractor support to perform oversight 
duties.
    Question. GAO reported in March that the STARS acquisition was able 
to avoid a major increase in its F&E cost estimate only because FAA now 
projects its costs for STARS computer hardware to be 40 percent less 
than initially expected. Why would the estimate be so far off?
    Answer. The commercial off-the-shelf (COTS) acquisition approach, 
seeking competition between various commercial applications, makes it 
far more difficult to accurately predict what hardware will be offered 
with the system, and how that hardware will be priced.
    All three of the STARS offerors proposed some hardware evolution of 
the existing Air Traffic Control systems. Two of the vendors proposed a 
PC-based solution, while the third (the eventual winner) proposed a 
system based on more powerful workstations. The workstation solution 
uses more expensive hardware, but the FAA was offered a competitive 
price due to an agreement negotiated by the Prime Contractor with the 
workstation manufacturer.
    The FAA estimate was based on a ``nominal'' system using a target 
number of processors and their catalog prices--the logic of the 
estimate is still valid. However, it is difficult to accurately predict 
vendors competitive strategies in system design and pricing, and 
incorporate that prediction into the estimate.
                   asheville, north carolina airport
    Question. I wrote to Secretary Pena November 13, 1996 to urge the 
FAA to approve the application of Asheville (NC) Airport for a $1.5 
million AIP grant for an extended runway safety area. The current 450 
foot safety area falls short of the 1000 foot area required for Group 
C-IV aircraft under FAA Advisory Circular 150/5300-13. As I noted, the 
Airport committed its entitlement monies to this project, and I am 
curious about the status of their application for discretionary funds. 
Please prepare a comprehensive answer to inform me of the status of 
this application and explain the basis for any decisions already made. 
I will also appreciate your efforts to keep my office updated of all 
developments in this matter.
    Answer. The FAA has formulated a project, which includes Airport 
Improvement Program discretionary funds, to extend the runway safety 
area at Asheville (NC) Airport. You will be notified through the 
congressional notification process once coordination within the 
Department of Transportation has been completed.
                       sanford-lee county airport
    Question. The conference report that accompanied the 1997 
transportation appropriations bill urged ``expeditious consideration to 
accelerated construction of the new Sanford-Lee County Airport in North 
Carolina in the hope that the project can be completed as quickly as 
possible.'' I sent a letter to Administrator Daschle on November 15, 
1996, and I encouraged the FAA to act to accommodate this 
recommendation. The Administrator replied that this request is ``being 
evaluated,'' and, as this was the last correspondence that I received 
about this project, I am quite eager to learn the result of this 
evaluation process. Please prepare a detailed answer to explain the 
status of this project and the basis for any decisions already made. I 
will also appreciate your efforts to keep my office updated of all 
developments in this matter.
    Answer. The FAA has formulated a project under the AIP's State 
Block Grant Program (SBGP) for North Carolina, which will provide 
fiscal year 1997 discretionary funding for the new Sanford-Lee County 
Airport. You will be notified through the congressional notification 
process once coordination within the Department of Transportation has 
been completed. This project will supplement any AIP State 
apportionment funds which the State of North Carolina approves under 
the SBGP. The discretionary funding is in accordance with the funding 
schedule for fiscal year 1997 to meet the airport's target date for 
completion by mid-1999, based on future funds availability beyond 
fiscal year 1997.
                                 ______
                                 
               Questions Submitted by Senator Lautenberg
        faa and certification of airlines and related businesses
    Question. The Gore Commission recognized that the FAA is sometimes 
too lenient when it comes to certifying airlines and contractors, 
especially when their safety and inspection records have been less than 
perfect. The Commission recommended that the FAA be more stringent in 
the certification of these aviation businesses. Do you agree with this 
recommendation? If so, what are you doing to change the way the FAA 
certifies these businesses?
    Answer. The FAA is in the process of establishing a new 
organization to address concerns regarding the manner in which the FAA 
certificates air carriers. This Certification Standardization and 
Evaluation Team (CSET) will be dedicated to the standardization of 
original certification and follow up evaluation activities for all 
Federal Aviation Regulations Part 121 air carriers.
    The CSET will change the way the FAA currently performs 
certification by providing a dedicated team of certification and 
inspection experts who have the specialized expertise and experience 
necessary to accomplish the objective of standardization. This team of 
experts will work in virtual offices facilitating a more flexible work 
environment capable of rapid response to certification and inspection 
issues. The CSET will establish evaluation guidelines and assist in the 
development and implementation of a comprehensive air carrier 
surveillance plan using statistical and scientific tools.
    Question. Is the FAA contemplating adopting more strenuous 
inspection measures and increasing enforcement actions when you find 
sub-standard practices?
    Answer. The ultimate goal of Flight Standards Service is to ensure 
the compliance of each air carrier with the Federal Aviation 
Regulations (FAR). If a certificated air carrier falls out of 
compliance in a particular area, the immediate concern is to correct 
the problem area and take measures to ensure that non-compliance does 
not happen again. As a result, it is felt that addressing the issues of 
certification requirements and targeted surveillance plans is a more 
responsive approach to continued compliance than simply applying more 
``strenuous'' inspection measures and increased enforcement actions.
    The FAA has several efforts underway that will change the way 
inspections of the FAR part 121 air carriers are conducted. In response 
to the FAA 90-Day Safety Review, the newly created Certification, 
Standardization, and Evaluation Team (CSET) will not only address 
standardizing the certification procedures for FAR part 121 air 
carriers, but also will follow up with a comprehensive surveillance 
plan tailored to each air carrier's specific operation. In addition, 
newly certificated air carriers will have a surveillance plan tailored 
to the specific needs of the air carrier based upon the circumstances 
encountered during the certification process. Surveillance plans will 
be based on analysis of historical safety data and targeted to the 
needs of the new air carrier. Air carriers that have been certificated 
within the last five years will have increased levels of surveillance 
based on the requirements in the National Work Program Guidelines.
    Other changes include the Surveillance Improvement Project (SIP) 
work group that examines the methodology, the organization, and the 
conduct of existing surveillance procedures. The final report from the 
SIP should be available in June and recommendations from the group may 
be incorporated into CSET. The FAA also has a new initiative to change 
the organizational structure of geographic surveillance to be more 
effective. The environmental inspections of each air carrier may be 
accomplished by inspectors who are trained experts in the procedures 
for that operator.
de-emphasizing cost-benefit analysis in promulgating safety regulations
    Question. The Gore Commission recognized that critical safety 
reforms are not being implemented because they cannot pass the strict 
``cost-benefit'' test which is required of all proposed regulations. 
The Commission recommended that, ``Cost alone should not become 
dispositive in deciding aviation safety and security rulemaking 
issues.'' What is the FAA doing to carry out this recommendation?
    Answer. The FAA agrees that cost alone should not be dispositive in 
deciding aviation safety and security rulemaking issues, and is 
preparing to issue a policy statement clarifying this principle. After 
coordinating with OST and OMB, the FAA plans to publish the statement 
this summer and will insure regulatory decisions fully comply with that 
policy.
    Question. What specific pending rulemaking actions do you expect to 
be influenced by this change in policy?
    Answer. The FAA expects that all current pending safety and 
security rulemaking actions will be evaluated in accordance with the 
Gore Commission recommendation. Several specific prominent rules that 
are publicly known to be forthcoming include the following:
  --Revised Standards for Cargo or Baggage Compartments in Transport 
        Category Airplanes (requirement for fire detection and 
        suppression systems)
  --Aging Aircraft Safety
  --Identical Security Measures (U.S. and non-U.S. air carriers serving 
        the U.S.)
  --Certification of Security Screening Companies
  --Criminal History Background Checks of Airport Security Passenger 
        and Baggage Screening Personnel.
       timetable for implementing gore commission recommendations
    Question. President Clinton officially accepted ALL of the safety 
and security recommendations of the Gore Commission. However, I am 
concerned that there is not an established timetable for implementation 
of each of the recommendations. By what date do you expect to have all 
of the recommendations fully implemented? Which of the recommendations 
will take the longest time to implement and why?
    Answer. FAA and the Department of Transportation, working with a 
number of Federal agencies that lead on specific recommendations, have 
developed plans and a timetable for implementing the White House 
Commission recommendations. One of the 57 recommendations has already 
been fully implemented, and we expect up to 12 to be completed this 
year. Our current timetable assumes timely and adequate funding of 
those recommendations.
    The recommendation that will take the longest to achieve is also 
the most costly, to modernize the air traffic management system by the 
year 2005. The current NAS Architecture calls for modernization by the 
year 2015. Modernization can be done more quickly, but it will require 
compression of both the schedule and the costs, and therefore 
substantially increased budgets from fiscal years 1998 through 2005.
   funding requirements to implement gore commission recommendations
    Question. At the end of last year, we added more than $225 million 
to the Continuing Resolution specifically to implement many of the 
measures recommended by the Gore Commission. This included funding for 
explosive detection systems, K-9 teams, threat assessments and other 
measures. Which specific Gore Commission recommendations do you believe 
still require additional appropriations above the current level?
    Answer. Many recommendations, of course, are costly and will take 
time to complete. The final findings of the White House Commission are 
being reviewed to determine the details of implementation as well as 
the additional costs. By far the most costly unfunded item is 
modernizing the National Airspace System (NAS) by 2005, an acceleration 
from FAA's existing schedule of 2015. Other costly items include 
strengthening aviation human factors research, accelerating GPS use in 
NAS modernization, deploying explosives detection equipment, and 
completing other security related initiatives.
    The White House Commission expects the National Civil Aviation 
Review Commission to explore innovative federal financing approaches, 
such as user fees, to finance an accelerated modernization of the NAS 
and design a new financing system for the FAA that would ensure 
adequate availability of funding.
    Question. Are the costs of implementing all of these 
recommendations contained in your 1998 budget request? If not, why not?
    Answer. No; funding is not included in the fiscal year 1998 budget 
submission for all of the recommendations since the budget was 
completed prior to issuance of the final recommendations. Funding 
requirements for fiscal year 1999 and thereafter will be requested 
through the normal budget process.
            passenger security measures and civil liberties
    Question. There have been concerns raised that the FAA's passenger 
``profiling'' methods will be overly intrusive and discriminatory. The 
Gore Commission recommended that an independent body monitor these 
security measures and make recommendations to ensure that no groups are 
inappropriately subjected to heightened security measures. When do you 
expect this independent body to be established?
    Answer. The Department of Transportation is proceeding with the 
White House Commission recommendation by arranging for the Department 
of Justice to review the design and implementation of the prototype 
automated profiling system known as Computer Assisted Passenger 
Screening or CAPS, which FAA developed with Northwest Airlines. An 
organizational meeting with senior representatives of the Department of 
Justice has been held and others are planned.
    FAA's profiling requirements do not differentiate among U.S. 
citizens on the basis of factors such as race, religion, ethnicity or 
national origin. While confident that FAA procedures do not infringe 
upon civil liberties, the review of profiling that is underway by the 
Department of Justice will ensure no illegal discrimination occurs.
    Question. What course of action will be available to passengers who 
feel they have been subjected to discriminatory or overly intrusive 
security measures?
    Answer. Passengers who have questions or complaints about overly 
intrusive actions should first speak with airline representatives. 
Those representatives may not, however, discuss with passengers the 
specifics of any security measure, since to do so could damage the 
measure's effectiveness. If this conversation does not resolve 
passenger's concerns, then the passenger may call the FAA at 1-800-322-
7873 if the issue deals with safety or security. Complaints concerning 
possible discrimination should be registered by writing the Department 
of Transportation Aviation Consumer Protection Division (C-75) or 
calling that office at 202-366-2220.
    Question. Will individual passengers be able to find out why he or 
she is being subjected to additional security measures?
    Answer. No. Neither the FAA nor the air carriers should discuss 
with passengers the specifics of any security measure, since to do so 
could damage the measure's effectiveness. In addition, a certain amount 
of randomness is included in applying security measures, particularly 
those noticeable to the traveling public. Persons should not be able to 
determine if they were subjected to additional security measures 
through profiling, at random, or for some other reason.
               consolidation of atlantic city tech center
    Question. The Hughes Technical Center in Pomona, New Jersey, is the 
nation's premier aviation testing facility for security technology and 
human factors research. The Coopers & Lybrand study included a 
recommendation that the FAA look into consolidating the Hughes 
Technical Center at Atlantic City, New Jersey into the Monroney 
facility in Oklahoma City. Does the facility in Oklahoma have the 
capability to conduct the same research and development as the Tech 
Center in New Jersey?
    Answer. The facility in Oklahoma does not have the capability to 
conduct the same research and development as the Technical Center. The 
missions of the Technical Center and the Aeronautical Center are 
focused in different areas. They require specific and unique facilities 
to accomplish each of the divergent missions.
    The Aeronautical Center is devoted to centralized training and 
central warehousing and supply, and provides certain automated data 
processing services for national and local programs.
    The Technical Center is the national scientific research and 
development facility for FAA. Center activities involve research, 
system development and integration in the areas of air traffic control, 
communications, navigation, airports, aircraft safety, and security. In 
addition, tenant organizations located at the Technical Center are 
involved in NAS operations support; flight inspection; independent 
operation test and evaluation; and the prevention of international 
terrorism.
    Many of the facilities required to accomplish the Technical 
Center's mission are unique and not available at the Aeronautical 
Center or, in some cases, anywhere else in the world. Also, the 
Technical Center's technological capabilities go beyond technical 
facilities. The Technical Center employs highly technical and 
scientific personnel who possess specialized training and background in 
critical disciplines directly related to NAS development and support. 
The comprehensive integration of all NAS components can be accomplished 
only at the Technical Center because of the collocation of its skilled 
professionals and specialized infrastructure.
    Question. How much would it cost to abandon the existing Tech 
Center and rebuild the same infrastructure in Oklahoma?
    Answer. The cost to abandon the existing Technical Center is 
estimated at $24 million; the rebuilding of the same infrastructure in 
Oklahoma is estimated at $900 million.
    The William J. Hughes Technical Center is comprised of 180 
individual, specialized buildings and structures on its 5,059-acre 
site. These technical laboratories and facilities include Test and 
Evaluation, Research and Development, administrative and storage 
facilities as well as numerous project test sites. The capitalization 
value of the buildings and infrastructure (roads, exterior utilities, 
etc.) is estimated to be $200 million.
    The cost to rebuild the required structures and infrastructure in 
Oklahoma is estimated to be over $750 million. This estimate includes 
space requirements of approximately 1.35 million square feet; 
infrastructure costs; and architectural and engineering design and 
construction management costs.
    Moving the Technical Center's mainframe computers and special 
systems to Oklahoma involves planning and design, disassembling, 
crating, and shipping costs, and reassembling the equipment at its 
destination. The cost for accomplishing the equipment move is estimated 
to be $125 million.
    The abandonment cost relates to the Technical Center's Superfund 
responsibility, which includes cleanup of hazardous sites on the Center 
as well as the replacement of aged underground storage tanks. The 
ramifications of this designation are that the site cannot be 
transferred to another owner until the completion of the cleanup 
operation, regardless of whether the Technical Center relocates.
    In addition to the rebuilding costs, the relocation of the 
Technical Center's existing talent would be an added financial burden 
to the relocation proposal. Also, a relocation would result in a 
significant adverse impact to the delivery schedule of every National 
Airspace System modernization program. In addition, aviation safety and 
security initiatives would be seriously jeopardized.
    Question. Coopers & Lybrand justified its recommendation on the 
value of the land that could be sold if the FAA left the Atlantic City 
facility. I am mystified by this recommendation because it is a known 
fact that the facility is a Superfund site. Moreover, there is a 
reversionary clause in the FAA's lease that requires you to sell the 
entire facility to the Southern New Jersey Transportation Authority for 
only $55,000 if you ever leave the facility. To your knowledge, was 
Coopers & Lybrand aware of these facts when they issued their 
recommendation?
    Answer. During Coopers & Lybrand's 2-day visit to the Technical 
Center, they did not ask questions that would provide any rationale for 
reaching their conclusion. Therefore, our assumption is that Coopers & 
Lybrand was unaware of these facts and based their recommendation on 
incomplete information and flawed analyses.
    An early draft version of Coopers & Lybrand's assessment stated 
that the Technical Center is located on land that is probably worth 
significantly more than the book value used by the FAA. The Technical 
Center proved the assessment incorrect for the following reasons:
  --The South Jersey Transportation Authority (SJTA) owns a right of 
        reverter on over 4,000 acres of the total Technical Center 
        acreage. If the U.S. Government no longer requires use of the 
        Center's land, ownership (title) of these acres, including all 
        improvements, will revert to SJTA for a total sum of $55,000.
  --The Center is listed as a Superfund site. As such, the site cannot 
        be transferred to another owner until the completion of an 
        extensive and expensive cleanup operation.
    This information was conveyed to Coopers & Lybrand and resulted in 
their removal of their core assumption for the consolidation 
recommendation. Coopers & Lybrand in their final revision recognized 
that the assets (land) of the Technical Center are not a means of 
financial benefit to the FAA to offset other agency funding needs.
    Question. Based on these facts, do you see any scenario by which 
the FAA would choose to pull out of the Atlantic City Technical Center 
and consolidate operations in Oklahoma?
    Answer. Based on the information gathered to date, there is no 
scenario that would justify the relocation and consolidation of the 
Atlantic City Technical Center with operations in Oklahoma.
 personnel reform and new york-new jersey controller staffing shortages
    Question. Two years ago, this Committee gave your agency 
unprecedented personnel reform authority. This was done so that you 
would have the necessary tools to get the appropriately trained people 
in the right place IMMEDIATELY. For years now, the FAA has made 
commitments to me to get the number of air traffic controllers at 
Newark Tower and at the New York Center and TRACON up to the authorized 
level. But you have missed deadline after deadline. Today, staffing at 
all three facilities is still below authorized levels. Given the far-
reaching personnel reforms you were granted in 1995, what explains 
these continued delays in getting the right number of controllers in 
the right place?
    Answer. Personnel reform was implemented in the FAA on April 1, 
1996. Because of financial constraints most controller hiring was 
deferred to the second half of fiscal year 1997. Newark Tower is 
scheduled to receive seven controllers in fiscal year 1997, four of 
which are already onboard. Similarly, New York Air Route Traffic 
Control Center is scheduled to receive 42 of which at least 12 are 
onboard. New York TRACON will receive a total of 22 in fiscal year 
1997, of which at least 4 are onboard.
    Question. We continue to hear reports that controller trainees at 
these facilities cannot get fully qualified in their jobs because the 
senior controllers that are responsible for training them are too busy 
handling aircraft to conduct any training. Do you agree that this is a 
problem? What are you doing to address it?
    Answer. In the past, this situation has occurred. We are currently 
implementing plans to increase staffing at New York area facilities. In 
addition, we have recently increased overtime funding for New York 
Center by $735,000 to optimize on-the-job training for the new hires.
    We have also initiated additional management controls at New York 
Center including: (1) the establishment of a stand-alone training 
department; (2) establishment of a staff manager for training; (3) 
assignment of two training specialists and two data analysts to the 
training department; and (4) designation of six operations supervisors 
(one from each area) to assume collateral training duties.
    Question. What is your new target date to get all of the facilities 
in my region staffed to the level called for by the FAA's own staffing 
plan.
    Answer. The FAA has worked closely with the National Air Traffic 
Controllers Association to negotiate staffing levels for key Eastern 
Region facilities. The agreed upon target date for meeting these 
staffing levels is September 30, 1998.
                  converging runway display aid (crda)
    Question. The Converging Runway Display Aid (CRDA) is an important 
feature in the FAA's Automated Radar Tracking System that is being 
adapted at the New York TRACON. It allows the use of two runways during 
instrument weather conditions and would increase safety and capacity as 
well as reduce weather delays. I understand that the CRDA system on 
this one runway at Newark airport is scheduled to be implemented next 
month, May 1997, but this will only be on the southwest flow runway. Is 
the CRDA still scheduled for implementation on the Southwest flow 
runway in May 1997? When will CRDA be implemented on the other major 
runway which handles about 40 percent of total traffic?
    Answer. All air traffic facets of the CRDA implementation have been 
completed and are in place. However, during shakedown testing an 
anomaly in the software surfaced. In the interest of safety, 
implementation of CRDA was delayed. Implementation of CRDA is pending 
further shakedown testing.
    There is currently not a firm timeline for implementation of CRDA 
on Runway 4 and 11 at EWR. Development of procedures on this runway 
configuration are more complicated than the southwest flow. Airspace 
changes including rerouting aircraft and adjustments of major arrival 
flows for Newark and LaGuardia Airports will be necessary to 
accommodate a Runway 4 final vector position. This will require an 
environmental review/assessment which will be a lengthy process.
    The geometry of this runway configuration is such that a 6-7 mile 
in trail spacing on the final approach course to Runway 4 would be 
required to accommodate CRDA which may or may not enhance the capacity 
of current operations. Also, Runway 11 arrival interact with the Runway 
4L departures in instrument Flight Rules (IFR) weather which will delay 
departures as a result.
    We will continue to evaluate the procedures, airspace changes, and 
environmental issues necessary for development and will keep the Users 
informed via our Capacity Enhancement Task Force process.
             airport access and aggressive security testing
    Question. There have been a number of well-publicized incidents 
including one at Newark, where the media have broken through airport 
security measures and gained access to vulnerable areas, such as the 
tarmac and the ramp. The FAA Authorization Act included a provision I 
authored directing the FAA to conduct unannounced, aggressive testing 
of airport and airline security programs. What has changed over the 
past six months to tighten security for airport personnel and seal 
these vulnerable areas?
    Answer. FAA initiated a focused, three-phased investigative effort 
emphasizing auditing the background and access investigations conducted 
primarily by airport tenant organizations prior to granting access 
privileges to employees of such entities. The first phase involved an 
audit of representative tenant organizations at 41 major airports 
nationwide. This effort was designed to determine the nature and scope 
of the problem. The results indicated problems at 10 airports, and 
strong immediate corrective actions were initiated, to include 
appropriate enforcement actions. Voluntary actions by the involved 
airports included locking out entire batches of employees until 
questions concerning their background verifications had been completely 
resolved. This audit also resulted in an emergency rule allowing FAA to 
take action against individuals and/or employers for falsification or 
fraud in background documents.
    A second-phase audit of 19 major airports was conducted by FAA 
during February, 1997. The results of that audit reflect improvement; 
however, some problem areas remain. Enforcement actions have been 
initiated against individuals found to have made false representations, 
as well as any airports and tenant organizations failing to properly 
discharge their responsibilities.
    FAA is now preparing a third-phase effort designed to ensure and 
confirm that all Category X airports and their tenant organizations are 
complying with the access investigation rules. Beyond this focused 
effort, FAA field elements will continue to conduct scheduled and 
unscheduled assessments of compliance at all airports subject to the 
requirements of FAR 107.
    Question. Have there been major enforcement actions against the 
airports with lax security as a result of these aggressive testing 
measures?
    Answer. During February, a second-phase audit of 19 major airports 
was conducted. The first phase of this effort was initiated in November 
1996, and continues to focus on the background and access 
investigations conducted by airport tenant organizations prior to 
seeking access privileges for employees. Although there were no major 
enforcement actions against airports during the second-phase audit, 27 
investigations for falsification of records were initiated against 
airports, air carriers, tenants and individuals.
    FAA continues to aggressively test air carriers and airports to 
determine compliance with current security directives and emergency 
amendments. Enforcement action has been initiated whenever our testing 
revealed instances of non-compliance. Actions taken have included 
maximum civil penalty, public notification when the amount of civil 
penalty recommended is $50,000 or more, and when appropriate, letters 
from the Administrator level to airline CEO's.
    In addition to our on-going testing to evaluate compliance with 
security requirements, FAA continues to define and develop testing 
procedures for all aspects of the aviation security program. As these 
new procedures are completed, special agents will use them as part of 
their daily compliance monitoring. Additionally, with these procedures, 
FAA will conduct nationally directed special emphasis assessments 
designed to target specific aviation security areas over an established 
period of time.
               implementing domestic passenger bag match
    Question. The FAA Authorization Bill and the Gore Commission both 
recommend implementing passenger bag-match on domestic flights to 
increase security. I also endorsed this program in my aviation security 
bill. The FAA and the major airlines conducted a study last year which 
estimated that it would cost $2.5 billion annually to apply bag-match 
domestically in the first year and $2.25 billion every year thereafter. 
A system of partial bag match of all passengers would cost $2 billion 
annually. Now that Phase I of your pilot project is complete, do those 
cost estimates still hold up?
    Answer. The White House Commission recommended implementation of a 
full passenger-baggage match by December 31, 1997. It entails matching 
bags to passengers to ensure no unaccompanied bag enters the system, 
and passengers to bags to ensure that a bag is removed if the passenger 
does not board. The latter part of the procedure would initially be 
based upon profiling. FAA, the Air Transport Association, and the 
Commission staff developed a protocol to ensure that the on-going bag 
match pilot test is unbiased and, with the application of existing 
system models, representative of the effects of systemwide 
implementation.
    As you noted, the pilot test is proceeding in two phases. In the 
first phase, existing operational models were verified and continue to 
be refined by an independent third party. The air carriers then 
collected data for analysis and computer modeling. This collection 
process was monitored by an FAA observation team. The second phase 
consists of analyses of historical and other data, and includes live 
testing on actual flights in May. A report, which will address the cost 
estimates of bag match in the domestic system, will be finished in 
August 1997.
    Question. Are there ways to further decrease the cost of 
implementing this critical security measure?
    Answer. The White House Commission recommended implementation of a 
full passenger-baggage match by December 31, 1997. It entails matching 
bags to passengers to ensure no unaccompanied bag enters the system, 
and passengers to bags to ensure that a bag is removed if the passenger 
does not board. The latter part of the procedure would initially be 
based upon profiling. FAA, the Air Transport Association, and the 
Commission staff developed a protocol to ensure that the on-going bag 
match pilot test is unbiased and, with the application of existing 
system models, representative of the effects of systemwide 
implementation.
    As you noted, the pilot test is proceeding in two phases. In the 
first phase, existing operational models were verified and continue to 
be refined by an independent third party. The air carriers then 
collected data for analysis and computer modeling. This collection 
process was monitored by an FAA observation team. Phase II, which is 
underway, consists of analyses of historical and other data, and 
includes live testing on actual flights. This phase is being monitored 
by a joint team of FAA and third party observers. Live tests are 
scheduled for May. The analysis of operational impacts will be 
available in July, and a refined estimate of the cost will be available 
in August 1997. Careful analysis of results may suggest ways of 
reducing costs, but it is still too early to project implementation 
costs or suggest cost reduction strategies.
    Question. Will the Federal Aviation Administration (FAA) and the 
airlines be able to hold to the December 31, 1997, deadline to 
implement domestic bag-match nationwide?
    Answer. The Commission's recommendation is that bag match, 
initially based on profiling, should be implemented no later than 
December 31, 1997. That recommendation remains our goal. The FAA and 
the airlines are moving forward rapidly in developing an automated 
profiling system, which is the key to adopting the Commission 
recommendation. We will not know until the end of July whether or not 
unforeseen technical difficulties remain for some carriers in 
implementing automated profiling. Moreover, refinements to the cost 
estimates, based on live testing, will be available in August 1997.
                      hazardous material shipments
    Question. Although not a certainty, it appears that the Valujet 
crash was caused by the ignition of oxygen generators, a hazardous 
material, in the cargo bay of the aircraft. While a lot of attention 
was focused on the airline involved, it would seem that the shipper 
bears a distinct responsibility to correctly package and label 
hazardous materials. What has FAA done to address the shipment of 
hazardous materials upstream from the airline, beyond banning the 
shipment of these particular canisters?
    Answer. The FAA has already taken a number of actions to address 
shipments of hazardous materials, particularly that carried in company 
materials (COMAT), before those shipments reach the airport. The FAA 
has:
  --Launched an entirely new Dangerous Goods and Cargo Security Program 
        funded with $13.5 million. The new program will have 118 full-
        time, highly trained, dedicated dangerous goods/cargo security 
        FAA inspectors in addition to the 14 full-time inspectors it 
        had before the ValuJet accident, along with 12 new attorneys. 
        RSPA is adding 15 new inspectors and 2 new attorneys. Hiring 
        and training are on target, and the first intensive air carrier 
        inspections began on February 1. The inspections will include 
        verification of training procedures.
  --Developed a new inspection/incident data base to provide trend 
        analysis information for targeting inspection and outreach 
        efforts upstream to deter and interdict unauthorized shipments 
        of hazardous materials.
  --In cooperation with RSPA, distributed to nearly 5,000 aviation 
        repair stations a ``Safety Alert'' providing explanatory 
        information regarding the shipment of hazardous materials as 
        part of air carrier COMAT and information detailing the 
        prohibition on the transport of oxygen generators as cargo 
        aboard passenger aircraft
  --Announced to the shipper community a policy of publicizing proposed 
        civil penalty cases over $50,000.00 where particularly 
        dangerous hazardous materials are involved. Two such violations 
        have been publicized
  --Proposed in the ``Hazardous Materials Transportation Safety 
        Reauthorization Act of 1997,'' a clarification of its authority 
        to open suspect packages when there is a reasonable belief that 
        the package contains a hazardous material.
  --In cooperation with RSPA, produced a training video to provide 
        guidance for air carriers and shippers, emphasizing their legal 
        responsibilities for safe preparation and transportation of 
        hazardous materials.
  --Together with RSPA, designed and developed a passenger information 
        brochure on restricted hazardous materials entitled ``These 
        Fly, These May Not.'' Over 5 million copies have already been 
        distributed to passengers, travel agencies, shippers, U.S. and 
        foreign air carriers, and multinational chemical and 
        pharmaceutical manufacturers.
  --Helped develop, market and present the Air Transportation 
        Association (ATA) HAZMAT/COMAT workshop attended by 200 air 
        carriers, freight forwarders, and shippers.
    Question. What specific measures have you taken with shippers and 
packers to insure proper packaging, labeling and handling of hazardous 
materials?
    Answer. The FAA is taking a number of steps which will extend its 
enforcement of the hazardous materials regulations to shippers and 
freight forwarders:
  --The FAA has developed new hazardous materials inspection protocols 
        which direct the focus for compliance to parties located ``off 
        the airport.'' Outreach letters will be directed to shippers 
        whose hazardous materials shipments were examined during 
        inspections at air carrier facilities. Follow-up inspections at 
        these shippers premises will verify that only properly trained 
        personnel are engaged in the handling and shipment of all 
        hazardous materials.
  --New outreach material is being developed in cooperation with RSPA, 
        for example, a training video to provide guidance for air 
        carriers and shippers, emphasizing their legal responsibilities 
        for safe preparation and transportation of hazardous materials.
  --In cooperation with RSPA, distributed to nearly 5,000 aviation 
        repair stations a ``Safety Alert'' providing explanatory 
        information regarding the shipment of hazardous materials as 
        part of air carrier COMAT and information detailing the 
        prohibition on the transport of oxygen generators as cargo 
        aboard passenger aircraft
  --FAA will soon begin inspections of both aviation repair stations 
        and indirect air carriers (freight forwarders) to continue to 
        push its compliance focus off the airport and upstream towards 
        the shippers.
  --FAA is developing a new automated inspection database designed to 
        provide trend analysis information for targeting inspection and 
        outreach efforts upstream to deter and interdict unauthorized 
        shipments of hazardous materials. Initial modules of the 
        database are already on-line with full development expected by 
        December 1997.

                          Subcommittee Recess

    Senator Shelby. This hearing of the Subcommittee on 
Transportation is now recessed. The next subcommittee hearing 
will be held on Wednesday, May 7, at 10 a.m. in Dirksen 124. 
The topic of the hearing will be transportation infrastructure 
financing, including a discussion of innovative financing 
methods and the administration proposed transportation user 
fees.
    I thank you.
    [Whereupon, at 12:08 p.m., Wednesday, April 16, the 
subcommittee was recessed, to reconvene at 10:36 a.m., 
Wednesday, May 7.]



 DEPARTMENT OF TRANSPORTATION AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 1998

                              ----------                              


                         WEDNESDAY, MAY 7, 1997

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10:36 a.m., in room SD-124, Dirksen 
Senate Office Building, Hon. Richard C. Shelby (chairman) 
presiding.
    Present: Senators Shelby, Domenici, Gorton, Faircloth, 
Lautenberg, and Reid.

                                Panel 1

                      DEPARTMENT OF TRANSPORTATION

STATEMENT OF MORTIMER L. DOWNEY, DEPUTY SECRETARY, 
            INNOVATIVE TRANSPORTATION FINANCING

                       GENERAL ACCOUNTING OFFICE

STATEMENT OF JOHN H. ANDERSON, JR., DIRECTOR, 
            TRANSPORTATION ISSUES, RESOURCES, 
            COMMUNITY, AND ECONOMIC DEVELOPMENT

                            Opening Remarks

    Senator Shelby. Our first panel is Mr. Mortimer Downey, 
Deputy Secretary, U.S. Department of Transportation; John 
Anderson, Director of Resources, Community, and Economic 
Development Division, General Accounting Office. Welcome to the 
committee.
    This hearing will now come to order. Today the subcommittee 
will explore several broad issues related to financing Federal 
transportation programs. The three areas we will discuss are 
Federal Aviation Administration user fees, innovative financing 
proposals to leverage Federal investment in infrastructure, and 
Amtrak's current precarious financial condition.
    Except for day-to-day operations, the Federal Aviation 
Administration derives its funding from the airport and airways 
trust fund, which is financed by the airline ticket tax. That 
tax expires at the end of fiscal year 1997 and the 
administration has proposed replacing the ticket tax with a 
cost-based user fee structure. This represents a major change 
in how financing is approached for this agency and many in 
Congress, myself included, are a little skeptical.
    There are many questions that need to be answered before 
any funding decisions can be based on user fee assumptions. 
Whatever system of financing, however, that we adopt, it must 
meet at least three broad objectives: It must not increase the 
overall tax burden on the American people; it must not place a 
disproportionate burden on any one group; and it must be easy 
to administer. I know that the GAO has studied several of these 
issues and I look forward to hearing from them today.
    Another issue of interest to the subcommittee is the 
administration's innovative financing proposals, which include 
the State infrastructure banks and the new transportation 
infrastructure credit enhancement program in the President's 
1998 budget request. These programs are intended to support 
highway, transit, or rail projects that can be financed with 
loans or credit enhancements and which involve non-Federal 
investment partnerships.
    Currently, only two States have actually begun projects 
with State Infrastructure Banks [SIB's] financing, and it 
appears that this approach to leveraged financing simply needs 
more time before it can be fully evaluated. In addition, the 
budget request and the NEXTEA reauthorization proposal both 
incorporate a change in Federal law that will permit States to 
levy tolls on interstate highways. I do not have to tell you 
how unpopular tolls are in my part of the country, or any part 
of the country for that matter.
    In general, I hate to mention the terms ``innovative 
financing'' and ``user fees'' in the same breath. There is 
nothing particularly innovative about charging system users for 
something they have already paid for. I hope that Deputy 
Secretary Downey and Mr. Anderson from the General Accounting 
Office can explain these proposals and that the discussions 
during this first panel will further illuminate the issues 
before us.
    Perhaps the most politically volatile issue we will discuss 
today is how and whether the Federal Government should continue 
to subsidize Amtrak. The administration has proposed spending 
about $767 million out of the highway trust fund to provide 
operating and capital assistance to Amtrak in fiscal year 1998. 
Ms. Jolene Molitoris, the Federal Railroad Administrator, will 
represent the Department's position on Amtrak funding, since 
Deputy Secretary Downey will need to leave the hearing. In 
addition, Amtrak's President, Tom Downs, will present the 
railroad's position, and Ms. Phyllis Scheinberg of GAO will 
give us the benefit of her extensive studies of Amtrak and the 
financial condition of the railroad.
    I have several concerns regarding Amtrak. First, Amtrak has 
now been in existence for 26 years and they have never once 
during that period generated an annual profit. Moreover, 
Amtrak, with its huge Federal subsidy, accounts for only three-
tenths of 1 percent of all annual intercity passenger trips in 
the United States, while intercity bus service attracts a 
ridership four times as great. I am not sure it makes sense to 
continue to pour millions of taxpayer dollars into a system 
which is used so little, but costs so much, especially when 
there are more efficient alternatives available. Finding a new 
bottomless source of revenue does not address the fundamental 
problems facing Amtrak.
    I understand that Amtrak is operating under outdated labor 
policies which make the railroad's success very difficult. 
American businesses all over the country have had to downsize 
during the past 10 years or so in order to stay competitive. 
However, Amtrak faces disincentives to reducing their work 
force to a size supported by the market because rail labor laws 
require the corporation to continue to pay a full salary for 6 
years to any employee who loses his or her job as a result of 
service reductions.
    I am a firm believer in markets. If there is a demand for 
passenger rail service, it will survive. In many areas of the 
country there is no doubt that a private company could operate 
a profitable rail service. But given Amtrak's poor track 
record, heavy debt load, massive capital requirements, and 
continued reliance on Federal operating subsidies, I question 
the merits of putting more and more of the taxpayers' hard-
earned money into this system. I do not know of a single 
investor who would put his or her own money into an 
organization in such a bleak financial situation. I am not sure 
it is right to ask the taxpayers to pay for something with 
their tax dollars which they are so clearly not willing to pay 
for with their disposable income.
    Amtrak President Tom Downs says in his statement that: ``If 
the decision is simply to end Amtrak, we ought to face it head 
on and deal with the reality that comes with it.'' I believe 
that is certainly one option to explore.
    Mr. Downey, your--excuse me, Harry. I did not see you. I 
apologize to you. Senator Reid.

                       STATEMENT OF SENATOR REID

    Senator Reid. Thank you a lot, Mr. Chairman. Because of the 
vote, I am not going to be able to stay for all the testimony. 
I appreciate your arranging this hearing in spite of the fact 
that we have not had our mark for what we are going to do with 
this subcommittee. This is an important subcommittee. I am very 
happy that you are getting some of these things looked at prior 
to our getting our mark.
    Mr. Chairman, I would just say this before going to my 
prepared statement. I think we have to take a close look at 
Amtrak, I agree with you. But I also think we have to look at 
what is happening with our other forms of transportation in 
this country. Our airports are crowded and filled. Our highways 
are jammed to capacity. And we as a government help the 
airlines, we help people who drive on highways, in many 
different ways with Federal moneys.
    We have to take a look at rail service. It is a way that we 
can increase the ability of people to travel. We are now 
working on rail service between Los Angeles and Las Vegas, to 
see if we can move more people through that very busy corridor 
than we have.
    I think from distances of 200 to 500 miles we have to look 
at rail service as an alternative. I think if you look around 
the world, other countries, they have done a much better job 
with their rail service than have we. So I would hope that we 
would recognize that rail service is something that we need to 
work to try to make it better, and certainly not consider 
terminating it.
    There is little doubt the issues we address in today's 
hearing are issues of great concern to every Member of both 
bodies, both the House and the Senate. Transportation 
represents a national concern. All of us have a stake in 
ensuring that America's transportation policies are coherent 
and they are efficient. More importantly, all have a vested 
interest in ensuring that the goals of our transportation 
policies are capable of being achieved.
    This session of Congress will include extensive 
consideration of not only how we finance our national 
infrastructure, but also what our transportation policies 
should aim for as we head into the 21st century. Our 
transportation policies must recognize the importance of 
providing adequate dollars for improvement and maintenance of 
our infrastructure. The policy should not favor one region over 
another. Funding formulas should provide States with sufficient 
funding to meet the changing infrastructure needs they face.
    While some push for devolution, all of us agree that 
Federal regulations have to recognize the need for greater 
flexibility at the State level. Because we have a national 
transportation policy, we must recognize that there are often 
unique interstate needs that otherwise would not be addressed 
but for a Federal program. I believe the unique regional 
perspective all of us bring to this issue will ultimately allow 
us to forge a coherent national policy.
    I represent a State that happens to be the fastest growing 
State in the country. We have about 7,000 new people moving 
into the Las Vegas area each month. Because funding formulas 
are based on old census data, it is nearly impossible for 
Nevada to receive the proper financing necessary to accommodate 
this growth.
    Nevada is also unique in that 87 percent of the land is 
owned by the Federal Government. To appreciate how much land 
this is, consider the fact that in the areas between our 
interstates--this is not the whole State of Nevada, but just 
between our two interstates--you can fit the States of New 
Jersey, Connecticut, Massachusetts, Rhode Island, Vermont, New 
Hampshire, and Delaware. That is a lot of land.
    Because the Federal Government owns these lands, the State 
of Nevada receives little or no taxes from them, but still must 
provide the intercontinental activity across these areas. In 
order for all States to enjoy the benefit of our economy, we 
must be able to build and maintain these lines of commerce, and 
Federal lands programs are a source of much of the funding for 
these areas.
    Nevada is also a bridge State. Much of the traffic is 
interstate. We play an important role in interstate commerce. 
But the need for improving and maintaining these interstates 
arises out of the damage caused by non-Nevada traffic, 
especially the big trucks. And we like to have the traffic 
coming from outside the State of Nevada, of course. But it is 
difficult for me to explain to my constituents why we are 
underfunding basic maintenance projects when we see first hand 
the infrastructure degradation caused by this out-of-State 
traffic on our interstates.
    Finally, I am concerned that, while we have consistently 
articulated a coherent national transportation policy, we fail 
to provide the adequate funding necessary to support these 
policies. I am troubled by the current budgetary things that 
are being used with the highway trust fund. The trust fund 
programs, some of them are penny wise and pound foolish.
    I have introduced legislation to take the highway trust 
fund off budget. I believe this action is necessary if we are 
to be serious about meeting our infrastructure needs. Our 
Nation's infrastructure represents the lifeline that fuels our 
economy. When we neglect to adequately provide for the health 
of this lifeline, all of us suffer. Whether it is unsafe and 
degraded roads or pollution caused from overcongestion, all of 
us are affected.
    The price is not only the inconvenience of traversing a 
dilapidated infrastructure. Indeed, the real price is the 
increased cost all of us pay for goods and services because of 
the burdens placed on the steady flow of this stream of 
traffic. Similar to cholesterol buildup in arteries, eventually 
there is a steep price to pay.
    I look forward to being a participant in rewriting a bill 
that will allow us to continue into the next millennium as the 
world's foremost economic powerhouse. The ranking member of 
this committee and I serve not only on this Appropriations 
Committee, but also on the authorizing committee, the 
Environment and Public Works Committee. By providing coherent, 
efficient, and flexible transportation policies, we will surely 
rise to the challenges of the 21st century. We have a big 
burden to bear. Thank you, Mr. Chairman.
    Senator Shelby. Senator Faircloth.

                     STATEMENT OF SENATOR FAIRCLOTH

    Senator Faircloth. Thank you, Senator Shelby, and thank you 
for calling this hearing.
    I have been concerned about the trend and talk by the 
Federal Government toward user fees. And I have even heard it 
referred to as ``innovative financing.'' I do not know if there 
is anything innovative about adding a toll to a road. We have 
been doing that for 2,000 years. But it is nothing but a tax 
increase with a different name.
    The political climate right now is not friendly to new 
taxes, certainly if we call them outright taxes. The Federal 
Government is already overtaxing the American people. But in 
this climate we wind up with a euphemism for a tax increase and 
we call it a user fee.
    If we are going to put user fees on every service the 
Federal Government provides, which is the direction we are 
headed, then what are we going to use the regular income tax 
and the other sources of general revenue for? The White House 
has even proposed $300 million in user fees for the Federal 
Aviation Administration. And yet this same FAA cannot tell me, 
has not told me, and literally refuses to tell me or explain 
how $1 billion was squandered by IBM on the Advanced Automation 
Systems computers in the eighties and early nineties. A billion 
dollars was absolutely wasted, no recoverable value, and they 
simply refuse to talk about it. Yet they need $300 million in 
user fees.
    The administration's proposal for surface transportation 
reauthorization includes a plan to let States impose tolls on 
interstates. This is simply another tax, on roads that have 
long since been paid for by the traveling public.
    There are a lot of new user fees and new ways--and user 
fees are simply a new way to take money from the American 
public. Now, if you want to cut the cost of highways, of 
highway construction, I have a suggestion. I ran for 8 years 
the largest highway system in the Nation under one head. That 
is the North Carolina Highway Department, as all roads in that 
State are under one authority--counties, city streets, all 
78,000 miles under one system. So I have watched what runs up 
the cost of roads, and the Davis-Bacon requirements are one of 
the principal sources of cost escalation. They probably add 20 
percent to the cost of construction.
    It is a needless surcharge on construction projects. If we 
want to do something to expedite the building of highways, to 
improve the system, and to get more road for our money and 
better road, the first thing we could do is to eliminate the 
requirements of the Davis-Bacon Act.
    Mr. Chairman, just one brief statement. I, as I said, have 
spent a lot of time watching highway construction, doing some, 
and running a highway department, and I have long been a strong 
advocate of highways. But I think the time has come and the 
time has clearly reached us that we are going to have to look 
at light rail transportation in different forms. And it is not 
as complex a problem as we might think it would be.
    Most of the railroads were acquiring right-of-way in the 
19th century. They acquired rights-of-way of 100 to 200 feet in 
many cases, when it requires 14 feet for a track. So much of 
the rail rights-of-way in this country could accommodate 
additional track, and certainly a lot of them have been 
abandoned. Double tracks were at one time necessary. Now only 
singles are used.
    So this is the way we are going to have to begin to go in 
this country. We cannot simply keep adding lanes to 
interstates.
    We are running out of right-of-way there.
    So I strongly support a move to look at rail 
transportation.
    Senator Shelby. Senator Lautenberg.

                    STATEMENT OF SENATOR LAUTENBERG

    Senator Lautenberg. Thank you, Mr. Chairman.
    First, my apologies for my late arrival. As you know, Mr. 
Chairman, since we serve on a couple committees together, it is 
just that we have been trying to disprove the process--it is 
just impossible to put ourselves in the same place two or three 
times at the same moment. We are still trying to prove that the 
standard rules of physics do not apply.
    Senator Shelby. Senator, before you arrived, Senator Reid 
suggested you move New Jersey to Nevada.
    Senator Lautenberg. Well, I think we are doing it one drop 
at a time and that is enough.
    Thanks, Mr. Chairman. I was delighted to hear our colleague 
from North Carolina, if I heard correctly, speak on behalf of 
investments in rail. We need to consider that.
    I appreciate your holding this hearing on Amtrak. The 
service is critical to the country at large, the Northeast 
corridor, my State of New Jersey.
    This morning GAO has very sobering testimony regarding 
Amtrak's financial condition. They say in short, without a 
prompt and bold response, Amtrak could be bankrupt and shut 
down by summer 1998. That, frankly, is not an acceptable 
option. It is imperative that the subcommittee and the Senate 
arrive at a consensus about how to restructure Amtrak's 
financing to get the railroad on a sounder footing.
    Amtrak's annual operating deficit is rising again, despite 
an aggressive cost-cutting program and its willingness to 
absorb a certain amount of cuts in its subsidy. Amtrak's 
revenues have suffered as a result of deeply discounted 
selective air route fares. Moreover, this committee has over 
the last 2 years cut the railroad's operating subsidy far below 
the levels identified by Amtrak as acceptable.
    To its credit, Amtrak has attempted to address this 
shortfall by eliminating routes that lose the most money. 
However, this predictable and reasonable response by Amtrak, 
which any business would have undertaken, has often been 
challenged by Members of Congress and their constituents, who 
want their services to continue. And we understand that, but 
somebody has got to pay the freight, as they say.
    That, Mr. Chairman, is the dilemma we face. I believe that 
Congress must make a decision this year whether we want to 
continue a national passenger rail system or end it. If we want 
to continue intercity rail service, we need to ask if we want a 
national system and, if so, how much we are willing to 
subsidize it and how much are we willing to invest to make it 
successful and stabilize its finances?
    I would like to see a stable funding stream provided for 
Amtrak and have endorsed, along with Senator Roth, chairman of 
the Finance Committee, and others, earmarking one-half cent of 
the gas tax to do just that. Amtrak's Northeast corridor 
service is essential to the Northeast corridor and that entire 
region, and these routes are profitable in the short run. In 
fact, short-term profits from the corridor subsidize all of the 
unprofitable routes elsewhere in the country and make a 
national rail passenger system possible. All of the increased 
revenue to sustain national Amtrak service is expected to be 
generated by new high-speed rail service in the Northeast 
corridor.
    As we contemplate the future of Amtrak, I would like to 
emphasize three points: No national intercity railroad operates 
without a subsidy, no place. Amtrak covers a larger portion of 
its operating costs than any other system in the world. These 
systems are subsidized because they are in the national public 
interest. In fact, every other mode of transportation in this 
Nation enjoys heavy subsidies, although some are more hidden or 
more indirect, and we ought to be honest about that.
    If Amtrak fails, the Federal Government will be exposed to 
sizable shutdown costs and other liabilities that will exceed 
even the funding levels called for under the half-cent 
proposal. At least in the Northeast corridor, if Amtrak fails 
this subcommittee will have to make enormous new investments in 
highways and aviation facilities to provide an alternative to 
rail service. Without Amtrak service, we would have to add 
7,500 fully booked 757's, or 10,000 fully booked DC-9's, for 
the year to the already congested airspace in our region.
    Amtrak currently carries one-half of the combined air-rail 
market between New York and Washington. If we move those 
travelers off the rails, we are talking about multiple new 
lanes on I-95, more terminal space at area airports, perhaps 
even a new airport in Boston.
    In closing, Mr. Chairman, these are the realities we should 
keep in mind when considering the substantial capital 
investment needed by Amtrak. Clearly, I believe it is an 
investment worth making and one which is critical to the 
functioning of one of the most densely populated regions of our 
country and one that deals with our national economic well-
being as well.
    Thanks very much, Mr. Chairman.
    Senator Shelby. Senator Gorton.

                      STATEMENT OF SENATOR GORTON

    Senator Gorton. Mr. Chairman, it has got to be extremely 
frustrating to sit on the other side of the bench, not just in 
this hearing but in every hearing, for witnesses, and much more 
so for second panels, because by the time the second panel gets 
here there will probably be one Senator left, maybe if they are 
lucky two, simply because of the nature of our work here. I 
strongly suspect that I am going to add to that frustration and 
end up apologizing for it.
    But I do want in my opening comments to ask for the 
comments, which I will read and see, of these witnesses and of 
the next witnesses on some of the questions which I think are 
fundamental to the talk about rail transportation that Senator 
Faircloth engaged in and the eloquent defense of Amtrak in 
which Senator Lautenberg engaged, because for the life of me I 
do not see the rationale of the way in which we treat various 
forms of transportation in the country and the kind of 
investments that we make in it.
    So I would like you to tell me, Mr. Secretary, for example, 
how many passengers Amtrak carries during the course of a year, 
and maybe the passenger-miles that they are carried. My note 
here from my staff says it is about 55 million passengers. You 
can correct that. It does not have passenger-miles.
    And you want between three-quarters of a billion dollars 
and $1 billion to subsidize that form of transportation, one 
that is not carried on very efficiently or very effectively. 
And that money you want out of the pockets of general 
taxpayers, those who use the system and those who do not.
    I also want you to tell me how many passengers our 
privately owned commercial airlines carry in the course of the 
year and the number of passenger-miles involved. Again, my 
notes say 550 million passengers, that is to say 10 times the 
number of passengers on Amtrak and obviously far more miles on 
average. And yet you only want to give to the physical 
facilities of the airlines $1 billion.
    [The information follows:]

    In 1996, Amtrak carried about 20 million passengers 
resulting in about 5 billion passenger-miles. U.S. commercial 
airlines carried about 558 million domestic passengers in 1996 
resulting in about 434 billion domestic passenger-miles.

    Senator Gorton. But that money does not come from the 
general taxpayer. That comes from people who ride on the 
airlines and pay a ticket tax for it.
    Now, what is the rationale of that ratio? I must say 
emotionally, with respect to Amtrak, that I agree with Senator 
Lautenberg. I think the idea of passenger rail service, a 
balanced system, is one I think I favor, and I am going to have 
to make an admission against interest now. Last year about this 
time of year, I flew to Chicago one Friday and took the Empire 
Builder to Seattle, just to see what kind of service was being 
provided for me.
    I must tell you very bluntly, it was a lousy experience. 
The service was not as good as the service is on United or one 
of the other airlines. No one ever told us why we were late 
when we were late or how long we were going to stop in any 
given place. But my feeling more than that was there was no way 
that that long-distance service could compete with air service 
on the cost per mile that it would operate. The crew was at 
least as large or larger per passenger than I would have found 
on United Airlines. The fare was higher, but not sufficiently 
higher by any means to make the difference between 4 hours and 
48 hours, which was the length of the trip.
    I just did not see, with all respect to Senator Lautenberg, 
how anyone, however efficiently they operated, could ever 
compete for passengers on long distances like that, unlike the 
situation between here and New York and perhaps Boston when 
there are new tracks.
    But why is it that we will spend as much money in a direct 
subsidy to one-tenth of the passengers on Amtrak as we spend 
out of a trust fund on the facilities for airports? Why is it 
that the airport trust fund spending for facilities has dropped 
in half, according to this administration's requests, at a time 
at which the passenger use of the airlines has gone up by 
almost double? And why is it--and this second, I am not asking 
rhetorical questions; I am asking a very, very specific 
question. You tell us in your statement that user fees are the 
best way to promote efficiency in both the provision and 
consumption of FAA services. What is broken that we have to 
fix?
    We have a present system that is a fuel tax and a ticket 
tax, that have at the very least the ability of great 
efficiency. It costs us almost nothing to collect them. The 
number of FTE's that are involved is extremely small. Obviously 
the cost of collecting user fees is going to be far higher. And 
are we not going to run into exactly the situation that some 
other countries that use user fees do, that pilots, 
particularly private pilots, are going to attempt to avoid the 
user fees by not using the services when in fact they really 
ought to use those services, and a distinct decline in safety 
in and among our aircraft?
    Do we have a situation that is broken or are we trying to 
fix something that is not broken at all?
    I put these questions to you. Whether I can stay and get 
all the answers, I think it is very important that we have the 
answers to each one of those.
    Finally, going back to Amtrak again, at my behest and with 
the agreement of the former chairman, Senator Lautenberg, we 
asked you all for a study of the privatization of Amtrak last 
year in our committee report. We understand that that request 
does not meet with much enthusiasm and that we are probably 
going to just get regurgitated insider information that we had 
previously. But it does seem to me that for those who wish for 
the survival of passenger service in the United States that a 
very serious and thoughtful examination of whether or not the 
system can efficiently and effectively be privatized is in 
order, and that it is very much in the interest of the 
administration to come up with some answers to those questions. 
And Lord knows we do not know the answers yet.
    Senator Shelby. Senator Domenici, happy birthday.
    Senator Domenici. Thank you very much.
    Senator Shelby. 39 years old today.
    Senator Gorton. He just told me he is ready to retire.
    Senator Shelby. No, no; he is just getting warmed up.

                     STATEMENT OF SENATOR DOMENICI

    Senator Domenici. Frankly, Senator Lautenberg, Senator 
Graham met me on the floor and somebody said I was 65. He said: 
Oh, that is why you were so interested in putting in all those 
good things for the old folks in your budget. I told him it was 
both you and me, not just me, right.
    Senator Lautenberg. I do not deny it.
    Senator Domenici. Well, listen. If you all could answer the 
questions that Senator Gorton asked, I would leave the scene 
and just wait around and read the answers with great 
enthusiasm. I would add just one more question, however.
    Ever since I have been serving on the Appropriations 
Committee and slightly before that, when we used to take a 
little more serious look at Amtrak in the budget process, it 
was a mystery to me as to why we could not change the system of 
compensating working men and women who are injured on the job 
from an ancient system Amtrak follows to the modern system that 
everybody else follows, to wit workman's compensation.
    Now, I understand, if there are any labor union people in 
the audience, I have just been put on their whatever they call 
it list. But the truth of the matter is, in my opinion, there 
is no excuse to have one system of compensation which costs, 
according to what I know, so much more than workman's 
compensation, which is covering workers in all the other 
systems. I think that there ought to be some reforms that are 
serious forthcoming if there is an expectation that we are 
going to continue to subsidize this program.
    Mr. Chairman, I would like to report to you, while the 
budget is not out yet, we heard your request loud and clear.
    Senator Shelby. Plea.
    Senator Domenici. Your plea, yours at some times almost 
begging.
    Senator Shelby. Right.
    Senator Domenici. It was very nice.
    Senator Shelby. Especially to the Budget Committee.
    Senator Domenici. It is very nice to have that happen every 
now and then, when somebody does that to me.
    Senator Shelby. Well, were our prayers answered?
    Senator Domenici. Yes.
    Senator Shelby. OK.
    Senator Domenici. The bipartisan balanced budget agreement 
will accommodate a rather substantial increase. I cannot give 
you the number, but surely it is $8 to $10 billion over the 
President's numbers, which were way too low, and I think they 
knew that, so they are not objecting to this increase. In fact, 
as in some items, the Republicans will claim victory for things 
the administration wanted and the administration will claim 
victory for the transportation funding, I assume.
    Senator Shelby. Nothing has changed, has it?
    Senator Domenici. It seems like it is going to turn out all 
right.
    I will not be here for the entire morning, but I commend 
you for the hearings and for the great work you are doing as 
the new chairman of the subcommittee.
    Senator Shelby. Secretary Downey.

                    Statement of Mortimer L. Downey

    Mr. Downey. Thank you, Mr. Chairman, and thank you for the 
opportunity to testify on the President's proposal.
    Senator Shelby. Let me mention this. Your entire written 
statement will be made part of the record, and if you will 
briefly summarize.
    Mr. Downey. Yes; I will do that. And before I begin my 
testimony, let me thank the subcommittee and the full committee 
for your prompt action on the emergency supplemental. The 
efforts that we have made together on this and in other 
disasters have made a real difference for hundreds of thousands 
of Americans. But disasters like those floods really make it 
clear how much we do depend on our transportation system. That 
is why we have worked with the Congress to increase Federal 
investment to record levels in infrastructure even as we are 
moving toward a balanced budget.
    We recognize that Federal funding alone cannot meet all of 
our needs, and that is the reason for conceiving a set of 
strategies to make the most of Federal resources by cutting 
redtape and leveraging greater non-Federal investment. The 
first step we took in that was what we called the Partnership 
for Transportation Investment to attract new sources of funding 
and speed up project construction.
    The National Highway System Act 2 years ago made a reality 
of our proposals for State Infrastructure Banks, which will use 
Federal seed money to provide loans and credit enhancements to 
highway and transit infrastructure projects. As these loans are 
repaid or as the financial exposure implied by credit 
enhancements expires, the funds will be available for 
additional cycles of projects. Banks in the 10 pilot States, as 
the chairman pointed out, are only now beginning operation, so 
there is limited experience with them. But we believe that they 
can leverage non-Federal funds at rates up to 4 to 1. We are 
now considering applications from 29 additional States for 
their State Infrastructure Banks. We expect to make decisions 
on them shortly.
    The President's proposed 1998 budget and the 
reauthorization bill would carry us to the next generation of 
innovative finance. They would continue supporting State 
Infrastructure Banks by providing $150 million annually in seed 
money and $100 million annually for a new national 
transportation infrastructure credit enhancement program.
    Finally, NEXTEA, our reauthorization bill, would provide 
for the first time a stable source of funding for Amtrak as it 
moves toward operating self-sufficiency. We want to provide 
direct funding for Amtrak from the highway trust fund and we 
wish to give States the flexibility to use part of their 
Federal funding apportionments for Amtrak infrastructure.
    We are also committed to adequately financing our aviation 
system needs. We want to work with the Congress and with the 
new National Civil Aviation Review Commission, which was 
recently appointed, to establish reliable long-term funding for 
the FAA so it can continue to provide the services the aviation 
system needs. In the meantime, Congress has authorized us to 
charge for air traffic services provided to those flying 
through our airspace but not using a U.S. airport, and these 
fees would become effective on May 19.
    I recognize that this committee has added language in the 
emergency supplemental that would limit our authority to impose 
these fees, but we look forward to working with the Congress on 
this issue.
    We also propose to collect an additional $300 million in 
new fees next year under the President's 1998 budget as a means 
to providing the necessary funding for a growing demand for air 
traffic services.
    We are also exploring new ways to fund airport 
infrastructure. Last year Congress authorized airport 
development projects using new financial techniques, much in 
the way the Partnership for Transportation Investment set the 
stage for innovative finance in the surface modes. We will soon 
select five innovative financing projects from around the 
country for formal applications under the airports improvement 
program. These proposed projects include the construction of a 
safety-related building, new runways to provide additional 
capacity, and mitigation of airport noise. And each of the 
three innovative financing mechanisms the Congress authorized--
payment of interest, credit enhancement, and a flexible non-
Federal share--would be tested by at least one of the 
proposals.
    Let me conclude my statement by reiterating our belief that 
these initiatives for surface transportation and for aviation 
will help give us the infrastructure and the equitable and 
efficient funding of services we need for a world-class 
transportation system. The partnership that we have forged with 
the Congress to make possible these innovations has been a 
successful one and we look forward to continuing to work with 
you in the coming months to build on this progress.
    Thank you.

                           Prepared Statement

    Senator Shelby. Thank you, Mr. Downey. We have your 
complete statement and it will be made part of the record.
    [The statement follows:]
                Prepared Statement of Mortimer L. Downey
    Mr. Chairman, Members of the Subcommittee. Thank you for the 
opportunity to testify on the Department of Transportation's 
accomplishments and proposals with respect to innovative financing of 
transportation infrastructure.
                                overview
    President Clinton came to office dedicated to improving the 
Nation's transportation infrastructure because of its contribution to 
economic prosperity. He had declared during the 1992 campaign: ``The 
1980's saw the concrete foundations of the United States crumble as the 
investment gap widened between America and our global competitors.''
    In the 21st century, Americans will compete in a truly global 
marketplace. This marketplace will be fiercely competitive, and our 
success as a Nation will be determined on how safely, reliably and 
cost-effectively we can move people, goods and information. 
Transportation accounts for about 11 percent of the United States gross 
domestic product--roughly comparable to health (14 percent) and food 
(12 percent)--and will affect our country's global competitiveness in 
the future.
    Working with Congress, we have increased Federal transportation 
infrastructure investment to record levels. These investments have paid 
off in substantial improvements to the condition and performance of our 
highways and mass transit systems. But the Federal government alone can 
not close the investment gap, and President Clinton early on recognized 
that ``the only way to lay the foundation for renewed American 
prosperity is to spur both public and private investment.'' His 1994 
Executive Order setting out ``Principles for Federal Infrastructure 
Investments,'' provides that:

          Agencies shall seek private sector participation in 
        infrastructure investment and management. Innovative public-
        private initiatives can bring about greater private sector 
        participation in the ownership, financing, construction, and 
        operation of . . . infrastructure programs. . . . Consistent 
        with the public interest, agencies should work with State and 
        local entities to minimize legal and regulatory barriers to 
        private sector participation in the provision of infrastructure 
        facilities and services.

    In response to the President's direction, the Department initiated 
the Partnership for Transportation Investment. Through that 
Partnership, we have supplemented our traditional surface 
transportation grant programs with innovative financing, stretching our 
transportation investments further. Our efforts, which have focused on 
public-private partnerships, have accelerated more than 74 projects 
with a total value exceeding $4.5 billion.
    State Infrastructure Banks, proposed by the Administration and 
approved by Congress in the National Highway System Designation Act of 
1995 (NHS Act), are now being established in 10 pilot states. The banks 
are beginning to offer new financing tools for a variety of 
transportation improvements--such as toll roads and intermodal 
terminals. As you well know, the fiscal year 1997 Transportation 
Appropriations Act gave us authority to select additional states to 
participate in the SIB's. We have received 26 applications from 29 
states, including two multi-state applications, for additional SIB's 
and expect to make announcements on those applications shortly. While 
projects are just being initiated under the new SIB's so experience is 
limited, some have suggested a potential for as much as a 4-to-1 
leveraging factor from funds deposited in SIB's.
    With respect to other modes, financing all of our aviation system's 
needs--airports, airway facilities, security, and FAA operations--is a 
critical priority for us. With authority Congress provided in the 
Federal Aviation Reauthorization Act of 1996, we are soliciting and 
reviewing innovative financing proposals for airport development. We 
want to work with Congress to establish a reliable, long-term funding 
base so that the FAA can continue to provide the services our aviation 
system needs. As an interim measure until comprehensive financial 
reform is achieved, we are proposing $300 million in new user fees. 
Members have been appointed to the new National Civil Aviation Review 
Commission, and they are beginning their work to analyze aviation 
budget requirements and ways to fund them and to help us to reach a 
consensus on what course to take.
    And we have proposed changes in the financing for Amtrak--to 
provide more stability in its direct funding by requesting contract 
authority (beginning in fiscal year 1999) from the Highway Trust Fund 
and to permit states to help meet Amtrak's financial needs from state 
apportionments of National Highway System and Surface Transportation 
Program funds where state officials see Amtrak as a key part of their 
transportation systems.
                           federal investment
    As Secretary Rodney Slater discussed with you, working with this 
Subcommittee and the entire Congress, over the past four years (fiscal 
years 1994-97) we have increased Federal investment in highways, 
transit systems, and other infrastructure to an average of $25.5 
billion, more than 20 percent higher than the average during the 
previous four years. The Department is committed to a long-term 
infrastructure investment program and seeks the highest levels of 
investment within the context of a balanced budget and the President's 
priorities. But we recognize that Federal investment alone can never 
close the investment gap.
    As part of Secretary Slater's commitment to bring common sense 
government to the Department of Transportation in order to provide the 
people we serve with a Department that works better and costs less, we 
will continue to encourage more flexible, innovative funding to 
leverage Federal dollars for infrastructure investment--one subject of 
your hearing today.
                          innovative financing
    Innovative financing is one of the Department's most significant 
success stories over the last four years. The Department initiated the 
Partnership for Transportation Investment in 1994. Under that 
initiative, we have supplemented our traditional grant programs with 
innovative financing. Our efforts have resulted in more than $1.2 
billion in non-Federal investment in transportation infrastructure that 
would not have occurred without the financing concepts included under 
the Partnership.
    As a result, projects like State Highway 190 in Texas cost less and 
will bring benefits to the economy sooner. In that case, the Texas DOT 
loaned $135 million in Federal-aid funds to the Texas Turnpike 
Authority, which was combined with almost $500 million in bond proceeds 
from the private sector. Construction on this project will be initiated 
over a decade earlier than originally planned and is expected to 
relieve existing congestion on other highways in the north Dallas area.
    Also, the Massachusetts Bay Transportation Authority was granted 
advance construction authority to issue bonds to rebuild its heavy rail 
maintenance facility. This $236 million project was undertaken 30 
months earlier as a result, with immediate construction savings of over 
$50 million. Each repair and overhaul from 1997 onward will take up to 
one-third less time to complete.
    The Partnership initiative was based on the use of innovation 
within existing authority by the Federal Transit Administration and on 
the use of test and evaluation authority provided to the Federal 
Highway Administration under Section 307(a) of Title 23 of the United 
States Code. That section permits FHWA to engage in a wide range of 
research projects, including those related to infrastructure finance. 
As part of this research effort, FHWA provided states with flexibility 
on certain policies and procedures so that specific transportation 
projects could be advanced through the use of non-traditional financing 
concepts. The Partnership was designed and operated to give states the 
opportunity to propose and test those concepts that best met their 
needs. Projects that were advanced were those that were identified by 
state-level decision makers facing real world barriers to financing 
needed transportation improvements. No new Federal funds were made 
available; the focus of the Partnership has been to foster the 
identification and implementation of new, flexible strategies to 
overcome fiscal, institutional, and administrative obstacles faced in 
funding transportation projects.
    The 74 projects have been both highway and intermodal projects. 
Because ISTEA broadened the availability of Federal-aid highway funds 
for non-highway projects, many of the projects that have been advanced 
have also involved other modes. For example, they have included 
installation of Intelligent Transportation System technologies, ferry 
purchases, intermodal facilities for truck-to-rail transfers, 
construction of a commuter rail station, and bike/pedestrian projects.
    There have been eight major financing tools tested under the 
Partnership for Transportation Investment; those tools can be generally 
characterized as investment tools and cash flow tools. Investment tools 
are those that draw new sources of funds to transportation investment; 
cash flow tools aim to accelerate construction and completion of 
projects.
    The most popular tools have been flexible match and advance 
construction, both of which were made a basic part of the Federal-aid 
highway program by the NHS Act. Prior to that, private contributions 
toward a project were deducted from the total project cost, and states 
had to provide the matching share of the remaining cost. Under the 
Partnership initiative, we permitted such contributions to be counted 
toward the state matching share. This innovation encouraged states to 
seek private partners since the states got the total benefit of the 
contributions. We also allowed some states to use tapered match where 
the Federal share is allowed to vary during the life of the project.
    Under advance construction, states use state and local funds to 
construct projects while preserving those projects' eligibility for 
future Federal-aid reimbursement. However, conversion of such projects 
was to be made by the end of the ISTEA authorization period--that is, 
by the end of this fiscal year--and, when the project is converted, 
obligation of the full amount of Federal funds to be committed to the 
project was required. The requirement to convert by the end of this 
year made advance construction less and less available as a tool as we 
got closer to the end of the ISTEA period. The requirement to obligate 
the full amount of Federal funds at the time of conversion limited the 
states' flexibility in using this tool. We allowed (and the NHS Act 
made the authority permanent) states to rely, within certain limits, on 
likely future-year apportionments beyond the current authorization 
period and to make partial conversions of such projects.
    Tax advantaged leasing is another finance tool that has provided 
significant additional revenues to transit systems in several States. 
Since 1994, over $2.2 billion in equipment and facilities leasehold 
transactions (cross-border leases, domestic leases, and lease/
leaseback) have provided over $143 million in cash benefits for the 
transit systems involved. This non-Federal cash has been used for these 
transit providers' long term capital investment programs.
    A few states used other innovative financing tools such as lending 
some of their regularly apportioned Federal funds to revenue producing 
projects or using those funds to reimburse the cost of retiring bonds. 
Although these tools leveraged the greatest amount of non-Federal 
funds, they have been utilized less frequently because in many cases 
legal and institutional impediments must be overcome and because states 
chose not to divert grant funds previously programmed for other uses.
    In addition to leveraging more non-Federal investment, the 
Partnership initiative has accelerated construction of these projects--
by an average of 2.2 years. That means the benefits of these projects--
typically, travel time savings, safety improvements, reduced vehicle 
operating costs for transportation users, and environmental and other 
social benefits for communities--are realized sooner.
    The Partnership for Transportation Investment provided clear 
evidence of the potential for innovative financing tools to generate 
more total investment and accelerate construction of transportation 
projects that deliver benefits to transportation users and communities 
in general. It also demonstrated that there is strong interest at the 
state and local level in using these tools. That evidence contributed 
to inclusion of a number of new authorities to use innovative financing 
tools and of a State Infrastructure Bank pilot program in the NHS Act--
an important step in making these tools broadly available to better 
meet the Nation's transportation needs.
                       state infrastructure banks
    A SIB is a state or multi-state fund that can offer loans and 
credit enhancements to a wide variety of project sponsors. They are 
intended to support certain highway, transit, or rail projects that can 
be financed--in whole or in part--with loans or that can benefit from 
the provision of credit enhancement. As loans are repaid or the 
financial exposure implied by a credit enhancement expires, a SIB's 
initial capital is replenished, and it can support a new cycle of 
projects.
    With the authority provided in the NHS Act, DOT selected ten states 
from among 15 applicants. We have established cooperative agreements 
with nine of those states: Arizona, Florida, Missouri, Ohio, Oklahoma, 
Oregon, South Carolina, Texas, and Virginia. California is still 
considering the best structure for its SIB.
    With just five months having passed since most states signed 
cooperative agreements with us for chartering their SIB's, financial 
activity within the SIB's has gotten underway. Federal outlays to the 
SIB pilots (from regularly apportioned Federal-aid highway funds) 
totaled $65 million as of the end of February. Three loans have been 
made--two by Ohio totaling $20 million and one by Missouri for $1.2 
million. Three other states--Florida, Oklahoma, and Oregon--intend to 
make project loans this fiscal year. Texas and Virginia may be able to 
offer loans this year, too.
    This is a new way of advancing infrastructure improvements--for us 
and for the states, and, as we move forward, we are finding impediments 
as we thought we would and we are solving them. Arizona, Oklahoma, and 
Texas have found limitations in their enabling legislation for SIB's 
and are actively seeking remedies. South Carolina and Virginia are 
developing procedures for SIB operations and project selection and do 
not expect to request Federal capitalization funds until late in fiscal 
year 1997 or fiscal year 1998. California is exploring structural 
options for its SIB, including the possibility of solely providing 
third-party credit enhancements. This strategy would require California 
to obtain an investment grade rating for its SIB. The process to do so 
is underway but not yet completed.
    While we are still in the start-up phase, our expectations are for 
a healthy level of SIB activity within the first ten pilots. Based on 
the states' plans, we expect to see $260 million in SIB assistance 
offered this fiscal year to support $940 million worth of projects. By 
the end of fiscal year 1998, we expect $324 million in assistance to be 
committed in support of $1.6 billion worth of projects. If those 
expectations hold true, by the end of fiscal year 1998, each SIB dollar 
would be supporting nearly $4 of non-Federal infrastructure investment.
    As with the Partnership initiative, highway projects will likely 
form the bulk of SIB-assisted projects--about 75 percent of them based 
on current plans. But SIB's will also assist in construction of other 
projects such as intermodal facilities and improvement of rail transit 
infrastructure. For example, Missouri's SIB will use a Missouri DOT 
grant to capitalize its SIB transit account. The initial capitalization 
will support a loan for the Kiehl Center, a multi-modal terminal 
serving St. Louis, Missouri's transit system, the Bi-State Development 
Agency. The loan will be followed by a debt service line of credit, 
which will reduce the project's borrowing costs by over 200 basis 
points. This will be the first SIB transit account to be capitalized.
    We expect that SIB's will be an important contributor to meeting 
the Nation's transportation needs. They can support locally and 
regionally significant projects that have access to a dedicated revenue 
stream but need flexible financial assistance to clear hurdles that 
would otherwise obstruct or delay their implementation. SIB's can do 
this by offering: lower cost financing than might otherwise be 
available, flexible repayment terms that can be tailored to a project's 
revenue stream, or credit enhancements that improve access to, or lower 
the cost of, debt financing. And the fact that SIB resources are 
recycled means that the benefits of SIB assistance--leveraging of other 
investment, lower project costs, and accelerated construction--can be 
realized repeatedly.
    The fiscal year 1997 Transportation Appropriations Act authorized 
us to permit more States to establish SIB's and provided $150 million 
in seed money. Twenty-nine States have applied to establish additional 
SIB's. We expect to be announcing our decisions on those applications 
very shortly. At the same time, we will be announcing how the $150 
million will be distributed among the first 10 pilot states and the new 
SIB states we are selecting with the authority in the Appropriations 
Act.
               proposals for fiscal year 1998 and beyond
    The President's fiscal year 1998 budget and our proposal for ISTEA 
reauthorization--the National Economics Crossroads Transportation 
Efficiency Act of 1997, or NEXTEA--expand the innovative financing 
opportunities available to state and local governments by authorizing 
all states to establish SIB's, by providing $150 million in seed money 
for SIB's per year, and by creating a new Transportation Infrastructure 
Credit Enhancement Program funded at $100 million per year. This 
program is intended to assist in the funding of nationally significant 
transportation projects that otherwise might be delayed or not 
constructed at all because of their size or uncertainty over timing of 
revenues.
    The proposed new Credit Enhancement Program would provide grants 
(limited to 20 percent of project costs), which could be supplemented 
by contributions from states or other entities, to establish a Revenue 
Stabilization Fund for each project selected. That Fund would be used 
to secure external debt financing or would be drawn upon if needed to 
pay debt service costs in the event project revenues are insufficient. 
These debts will not be considered ``federally guaranteed'' under the 
Internal Revenue Code, thus allowing the Program to be used in 
connection with either taxable or tax-exempt bond issues. Our vision is 
that the Credit Enhancement Program will complement the SIB's by 
encouraging the development of large, capital-intensive infrastructure 
facilities through public-private partnerships consisting of a state or 
local government and one or more private sector firms involved in the 
design, construction, or operation of the facility. Candidate projects 
that meet threshold eligibility criteria--relating to project size, 
access to user charges or other dedicated revenue streams, inclusion in 
a State's Transportation Improvement Program, ability to provide 
benefits of national significance, and demonstrated need that it cannot 
otherwise obtain financing on reasonable terms--would then be evaluated 
and selected based on the extent to which they would leverage private 
capital, their overall credit worthiness, and other program goals.
                              other modes
    I have focused my remarks on surface transportation infrastructure, 
but I want to tell you briefly how we are applying innovative concepts 
for financing of our aviation programs and Amtrak.
    Based on the success of the Partnership initiative in surface 
transportation, we asked Congress for authority similar to FHWA's test 
and evaluation authority to test innovative financing techniques for 
airport development. The Federal Aviation Reauthorization Act of 1996 
permitted us to select ten airport development projects to demonstrate 
innovative financing techniques that were not otherwise permitted by 
statute. Although FAA's innovative financing options available in this 
demonstration program are more limited than FHWA's have been under its 
test and evaluation authority, we are optimistic that the results will 
be positive.
    In response to its invitation, FAA has received 12 written 
expressions of interest that contained sufficient detail on which to 
base a preliminary concept decision. A panel with expertise in airport 
financing has reviewed the proposals and recommended that five be 
advanced to the next step. I am pleased to announce today that these 
five applicants will be invited to provide additional detail to support 
formal applications for Airport Improvement Program funds.
    The proposed projects include construction of a safety-related 
building, new runways to provide additional airport capacity, and 
mitigation of airport noise impacts. In addition, each of the three 
innovative financing mechanisms authorized under the 1996 Act--payment 
of interest, credit enhancement, and flexible non-Federal share--would 
be tested by at least one of the proposals.
    We anticipate finding that these financing innovations will lead to 
greater leveraging power for limited Federal funds, acceleration of 
needed capital improvements, and overall cost savings in developing 
airport infrastructure. We look forward to sharing preliminary data on 
innovative financing benefits with the National Civil Aviation Review 
Commission later this summer.
    As you know, we have been proposing for some time to change the 
financing structure for FAA from aviation excise taxes to cost-based 
user fees. In the long run, we believe that is the best way to promote 
efficiency in both the provision and consumption of FAA services and 
ensure that FAA will receive the resources it needs to be able to 
continue to provide the services that aviation users demand. FAA is 
critical to the operation of the civil aviation system in this country 
and for much of the airspace beyond our borders. Our economy, in turn, 
is dependent on the efficient and unconstrained use of that airspace. 
Congress has given us the authority to charge for the air traffic 
services provided to those flying through our airspace but not taking 
off or leaving from a U.S. airport. We have issued an interim final 
rule to collect those fees, and the fees will be effective May 19, 
1997. In the President's fiscal year 1998 Budget, we propose to collect 
an additional $300 million in new fees next year. This proposal is an 
interim measure to provide the FAA with needed resources until 
comprehensive financial reforms can be implemented based on the work of 
the National Civil Aviation Review Commission. The FAA provides a 
variety of services the costs of which are not fully recovered under 
the current system of excise taxes (e.g., security, inspections, and 
air traffic services provided to general aviation jet aircraft and 
international air cargo carriers). These represent possible fees that 
could be authorized for fiscal year 1998.
    We look forward to the recommendations of the National Civil 
Aviation Review Commission regarding the long-term financing of the FAA 
and to working with Congress on FAA financing.
    We believe Amtrak is a key part of the Nation's intercity 
transportation system and that a combination of cost savings, revenue 
generation, and capital support is essential if Amtrak is to achieve 
eventual operating self-sufficiency. Our NEXTEA proposal requests 
contract authority (beginning in fiscal year 1999) for Amtrak from the 
Highway Trust Fund. The total level of capital support is directly tied 
to Amtrak's ability to reduce spending and increase revenues so as to 
reduce its reliance on Federal operating grants. The intent of this 
arrangement is to encourage Amtrak to operate in the most efficient and 
effective manner. Our NEXTEA proposal would also let states, for the 
first time, use their National Highway System and Surface 
Transportation Program funds for Amtrak infrastructure. We believe that 
is the right kind of expansion of the flexibility ISTEA provided six 
years ago. More and more, state officials see the individual 
transportation modes as part of a network to meet transportation needs, 
and permitting them to use Federal funds in the most effective way to 
meet those needs is the best use we can make of the funds.
                               conclusion
    As the President has said, when times change, so government must 
change. We recognize that there must be more investment in 
transportation infrastructure and the Federal government can and must 
find new ways to promote that investment. The success of the 
Partnership for Transportation Investment encouraged us to change our 
grant programs so that innovative financing tools are available to 
encourage more non-Federal investment. We appreciate Congress' support 
in helping make those tools available. They are the right way to ensure 
the Nation's transportation system is ready to meet the demands of the 
21st Century.

                           Aviation User Fees

    Senator Gorton. Mr. Downey, there has been a lot of 
discussion and criticism of the way in which the Federal 
Aviation Administration is currently financed. We have already 
been talking about it some. Basically, the ticket tax and 
general revenues. I expect this controversy will not subside as 
we move through the appropriation process. Last year Congress 
established the National Civil Aviation Commission to review 
this issue and to make recommendations to the Secretary of 
Transportation by August 1997.
    Sir, what criteria will the Department use as it considers 
various user fees that are recommended by the National Civil 
Aviation Commission?
    Mr. Downey. We will be working with the Commission, and I 
am not sure what their recommendations will be. They are really 
beginning with a clean slate, looking at the needs of the 
system, looking at various means of financing it. I think the 
key issues will be ability to provide the funding necessary for 
FAA to meet a growing demand; second, equity among the classes 
of users; and third, efficiency in terms of the way the FAA 
does its business. As Senator Gorton raised the point of 
safety, we do not want a system of financing that would in any 
way detract from the safety of the system.
    So we need to look at all of those. The Civil Aviation 
Commission has been appointed. They began their work about 2 
weeks ago and we expect them to be able to meet their schedule.
    Senator Shelby. Mr. Anderson, do you have some comments?

                   Statement of John H. Anderson, Jr.

    Mr. Anderson. Yes; I do. I will summarize my statement as 
well.
    Senator Shelby. Go ahead. It will be made part of the 
record.
    Mr. Anderson. All right, thank you.
    I appreciate the opportunity to testify today on three 
critical transportation financing issues facing the Congress 
and the administration: meeting the long-term financing needs 
of FAA, Amtrak's needs for Federal financial assistance, and 
innovative ways for financing highway construction. In my oral 
statement I will summarize the financing challenges presented 
by FAA and our Nation's highways, and my colleague Phyllis 
Scheinberg will discuss Amtrak's financial condition during 
today's second panel.
    Major financing issues need to be resolved to improve the 
safety and security of our aviation system. Over the years we 
have identified numerous shortcomings in FAA's aviation safety 
and security programs. Following the crashes of ValuJet Flight 
592 and TWA Flight 800, FAA and the Gore Commission also 
identified areas requiring action.
    How these improvements will be funded, however, has yet to 
be addressed. FAA estimates that its needs will exceed 
projected funding levels over the next 5 years by $13 billion, 
which includes $4 billion to accelerate air traffic control 
modernization.
    The administration has proposed that the current financing 
system, including the tax on domestic airline tickets, be 
replaced with user fees, and a national commission will examine 
this financing option. However, a user fee approach requires a 
good cost accounting system, which our work has shown FAA 
lacks. In a recent study, Coopers & Lybrand reported that, 
despite FAA's lacking a cost accounting system, it is possible 
on an interim basis for FAA to assign its costs to broad 
categories of users such as commercial airlines, general 
aviation, and the military. However, the study concluded that 
FAA did not currently have sufficiently detailed, reliable cost 
data to support a comprehensive user fee system.
    If FAA is required to adopt a comprehensive system of user 
fees, it should first implement a modern cost accounting system 
that can reliably assign costs to specific users. FAA plans to 
implement such a system by October 1997. However, according to 
FAA, it will take at least 6 to 12 months after that before the 
agency can develop enough data to accurately assign costs to 
specific users.
    Even with better cost data, a significant portion of FAA's 
costs may not be directly assignable to individual users, and 
policy decisions and judgments are going to have to be made 
about how to assign those costs. Different user groups are 
likely to have diverging opinions about what constitutes an 
equitable allocation of these costs.
    Because the excise taxes that finance about three-fourths 
of FAA's budget lapse at the end of this fiscal year, the 
Congress will have to select a financing mechanism without 
knowing whether specific users are assigned their fair share of 
costs. The Congress could decide to extend the present excise 
tax system, modify it, or adopt a different one from numerous 
options, such as a fuel tax or enplanement fees. Deciding among 
these alternatives involves tradeoffs between their ease of 
administration, impact on the efficiency of the system, the 
ability to produce an equitable system in which users pay their 
fair share, and their impact on other policy goals.
    In choosing how to finance FAA, these tradeoffs and the 
potential competitive impacts of new fees will need to be 
carefully studied by the National Commission and the Congress. 
When FAA develops more detailed and reliable cost data, the 
financing method that is initially chosen could be reexamined.
    Similarly daunting challenges are presented by the 
financing of repairs and construction of our Nation's highways. 
DOT estimates that $16 billion in additional spending is needed 
annually just to maintain, not improve, the condition of the 
Nation's highways to 1993 levels. In order to stretch limited 
funds, the Congress in 1995 authorized a number of innovative 
financing mechanisms, including a State infrastructure bank 
pilot program.
    SIB's serve as an umbrella under which a variety of 
innovative finance techniques can be implemented. Much like a 
bank, a SIB needs equity capital to get started and equity 
capital can be provided, at least in part, through Federal 
highway funds. Once capitalized, the SIB can offer a range of 
loans and credit options, such as loan guarantees and lines of 
credit, to public or private sponsors of transportation 
projects.
    SIB's are intended to complement, not replace, traditional 
grant programs and provide States with increased flexibility to 
attract private investment in highway projects. For some 
States, however, barriers to establishing and effectively using 
a SIB remain. Michigan officials, for instance, told us that 
the State does not have the constitutional authority to lend 
money to the private sector. As a result, the SIB program has 
been slow to start up. Only two States, Missouri and Ohio, have 
actually started projects under their SIB's.
    To provide for greater participation, DOT's Fiscal Year 
1997 Appropriations Act lifted the 10-State limit on 
establishing SIB's and provided $150 million in new seed money. 
Since the act's passage, DOT has received additional 
applications from 28 States and Puerto Rico.
    Clearly, the SIB program will need time to develop and 
mature before its impact on meeting highway funding needs can 
be assessed. In our 1996 report we suggested that once SIB's 
begin operating FHWA could disseminate information on States' 
successes and failures with various financing options, which 
could help other States use them more effectively.
    That concludes my oral statement and I would be glad to 
answer any questions.

                           Prepared Statement

    Senator Shelby. Thank you, Mr. Anderson. We have your 
complete statement and it will be made part of the record.
    [The statement follows:]
              Prepared Statement of John H. Anderson, Jr.
    Mr. Chairman and Members of the Subcommittee: We appreciate the 
opportunity to testify on three critical transportation financing 
issues facing the Congress and the administration: meeting the long-
term funding needs of the Federal Aviation Administration (FAA), 
Amtrak, and the nation's highways. Each area presents formidable 
challenges that will stretch our limited resources; at the same time, 
pressures remain to reduce the federal budget. Overall, the $38 billion 
proposed in the Department of Transportation's (DOT) fiscal year 1998 
budget to fund the Department represents about a 1-percent reduction 
from this year's enacted appropriation. In summary, we have found the 
following:
  --Major financing issues need to be resolved to improve the safety 
        and security of our nation's aviation system. FAA estimates 
        that its needs will exceed projected funding levels by about 
        $13 billion over the next 5 years. The Congress last year 
        established a national commission to make recommendations by 
        August 1997 on how best to finance FAA. Currently, FAA receives 
        most of its funding from excise taxes, including a tax on 
        domestic airline tickets, but those taxes lapse at the end of 
        fiscal year 1997. The administration has proposed replacing the 
        current system with user fees, and the national commission 
        clearly will be examining this option. Developing such fees 
        requires good data for assigning FAA's costs to specific users 
        and policy decisions on such issues as how to allocate costs 
        not directly related to any particular user. FAA currently 
        lacks sufficient cost data, however, and will not start 
        collecting better data until October 1997. As a result, better 
        cost data will not be available before the excise taxes lapse 
        or before initial decisions will have to be made about how to 
        finance FAA. Deciding among the various financing alternatives 
        involves tradeoffs between their (1) ease of administration, 
        (2) impact on how efficiently the airport and airway system is 
        used, (3) ability to produce an equitable system in which users 
        pay their fair share, (4) potential competitive impacts, and 
        (5) other policy goals.
  --Amtrak remains in a very precarious financial position and 
        continues to be heavily dependent on federal support to meet 
        its operating and capital needs. Amtrak's passenger rail 
        service has never been profitable and, through fiscal year 
        1997, the federal government has provided Amtrak with over $19 
        billion for operating and capital expenses. Amtrak projects 
        that its fiscal year 1997 operating loss could be $783 million. 
        While the corporation's goal is to eliminate the need for 
        federal operating support by 2002, it is likely that Amtrak 
        will continue to require substantial federal financial 
        support--both operating and capital--beyond that time.
  --DOT believes that current public spending on the capital needs of 
        highways is inadequate and estimates that $16 billion in 
        additional spending is needed annually just to maintain--not 
        improve--the condition of the nation's highways. State 
        Infrastructure Banks offer the promise of helping to close the 
        gap between transportation needs and available resources by 
        sustaining and potentially expanding a fixed sum of federal 
        capital. Benefits include expediting the completion of 
        projects, recycling loan repayments to future projects, and 
        obtaining financial support from the private sector and local 
        communities. However, some state officials and industry experts 
        are skeptical that such banks will produce these benefits and 
        believe that (1) the number of projects with a sufficient 
        revenue stream to repay the loans may be insufficient and (2) 
        state infrastructure banks face impediments under state law. 
        Only time will tell. This program is new, and only two states 
        have begun projects under their state infrastructure bank.
    issues associated with addressing faa's financial problems and 
                 determining the best funding mechanism
    One of the most difficult financing problems confronting the 
Congress and the administration is how to adequately fund FAA to meet 
its mission over the long term. Over the years, we have issued numerous 
reports and testimonies that identified shortcomings in FAA's aviation 
safety and security programs.\1\ These shortcomings include the 
insufficient training of FAA safety inspectors, inaccurate and 
incomplete aviation safety databases, and vulnerabilities in our 
aviation security systems. Similarly, in the wake of the May 1996 crash 
of Valujet Flight 592 and the July 1996 crash of TWA Flight 800, FAA 
and the White House Commission on Aviation Safety and Security (the 
Gore Commission) have concluded that a number of actions are needed to 
improve the safety and security of our aviation system.\2\ However, how 
to fund these improvements has not been resolved.
---------------------------------------------------------------------------
    \1\ See, for example, ``Aviation Safety: New Airlines Illustrate 
Long-Standing Problems in FAA's Inspection Program'' (GAO/RCED-97-2, 
Oct. 17, 1996) ``Aviation Safety: Data Problems Threaten FAA Strides on 
Safety Analysis System'' (GAO/AIMD-95-27, Feb. 8, 1995), ``Aviation 
Security: Additional Actions Needed to Meet Domestic and International 
Challenges'' (GAO/RCED-94-38, Jan. 27, 1994), and ``Aviation Security: 
Technology's Role in Addressing Vulnerabilities'' (GAO/T-RCED/NSIAD-96-
262, Sept. 19, 1996).
    \2\ ``Final Report to President Clinton, White House Commission on 
Aviation Safety and Security'' (Feb. 12, 1997) and ``FAA 90 Day Safety 
Review'' (Sept. 16, 1996).
---------------------------------------------------------------------------
    Deciding how to meet FAA's funding needs involves not only 
determining what FAA's financial requirements are but choosing the best 
financing mechanism to meet those needs. Recognizing the seriousness of 
these issues, the Congress directed that a number of studies be 
completed. Under the Federal Aviation Reauthorization Act, enacted in 
October 1996, the Congress required (1) an independent assessment of 
FAA's financial needs and costs, which was performed by Coopers & 
Lybrand; (2) an assessment by GAO of airports' capital needs; and (3) 
an assessment by GAO of how air traffic control costs are allocated 
between FAA and the Department of Defense (DOD). The act established 
the National Civil Aviation Review Commission to, among other things, 
consider these studies and recommend to the Secretary of 
Transportation, by August 1997, how best to finance FAA.\3\
---------------------------------------------------------------------------
    \3\ The Secretary of Transportation is required to consult with the 
Secretary of the Treasury and report to the Congress by October 1997 on 
the Secretary's recommendations for funding FAA through 2002.
---------------------------------------------------------------------------
    While its assessment of FAA's financial needs identified some areas 
for potential savings, Coopers & Lybrand concluded that FAA's estimates 
of its needs through 2002 were reasonable.\4\ Table 1 compares FAA's 
estimated requirements with the agency's budget estimates for fiscal 
years 1998-2002, which were contained in the President's fiscal year 
1998 budget.\5\ In addition, FAA officials estimate that the almost $9 
billion potential shortfall shown in table 1 could increase by an 
additional $4 billion as the agency tries to address the Gore 
Commission's recommendations to accelerate the modernization of the 
National Airspace System.
---------------------------------------------------------------------------
    \4\ ``Federal Aviation Administration: Independent Financial 
Assessment,'' Coopers & Lybrand (Feb. 28, 1997).
    \5\ One component of FAA's requirements is funding a portion of the 
cost of developing our nation's airports. Last month, we reported that 
estimates of airports' annual capital needs during 1997-2001 ranged 
from $1.4 billion to $10.1 billion, depending on how needs are defined. 
See ``Airport Development Needs: Estimating Future Costs'' (GAO/RCED-
97-99, Apr. 7, 1997).

                                              [Dollars in billions]                                             
----------------------------------------------------------------------------------------------------------------
                                                                       FAA's           FAA's                    
                           Fiscal year                               estimated       projected     FAA's budget 
                                                                   requirements       budget         shortfall  
----------------------------------------------------------------------------------------------------------------
1998............................................................           $8.46           $8.46  ..............
1999............................................................           10.82            8.68         ($2.14)
2000............................................................           11.22            8.91          (2.31)
2001............................................................           11.32            9.15          (2.17)
2002............................................................           11.50            9.39          (2.11)
                                                                 -----------------------------------------------
      Total.....................................................           53.32           44.59          (8.73)
----------------------------------------------------------------------------------------------------------------
Source: FAA and the President's 1998 budget.                                                                    

    To help meet these financial challenges, the administration has 
proposed that the current approach to financing FAA be changed. 
Generally, three-quarters of FAA's funding comes from the Airport and 
Airway Trust Fund, which in turn, receives most of its funding from a 
10-percent tax on the fares paid by passengers. The remainder of FAA's 
funding comes from the General Fund of the U.S. Treasury. In its fiscal 
year 1998 budget for FAA, the administration proposed replacing this 
system with usage-based fees starting in fiscal year 1999. The 
administration also proposed, as an interim step, $300 million in new 
user fees in addition to the $100 million in fees on foreign airlines' 
overflights of the United States that were authorized in fiscal year 
1997. FAA has subsequently indicated that the new fees could 
potentially be charged for business aviation, international air cargo, 
and security activities. Similarly, a coalition of the nation's largest 
airlines advocate replacing the airline ticket tax with usage-based 
fees. These airlines believe that they pay more than their fair share 
of the costs incurred by FAA in running the airport and airway system 
and that competing low-fare airlines underpay.\6\
---------------------------------------------------------------------------
    \6\ The coalition comprises the seven largest airlines--American 
Airlines, Continental Airlines, Delta Air Lines, Northwest Airlines, 
TWA, United Airlines, and US Airways.
---------------------------------------------------------------------------
    In our December 1996 report on the coalition's proposal to replace 
the ticket tax and in our February 1997 testimonies before the Senate 
Finance Committee and House Aviation Subcommittee, we stated our belief 
that, to the extent possible, commercial users of the nation's airspace 
should pay their share of the costs that they impose on the nation's 
airport and airway system.\7\ We noted that because the airline ticket 
tax is computed based on the fares paid and not on factors that 
directly relate to FAA's costs for providing service, the extent to 
which the tax fairly allocates costs among system users is open to 
question. While many factors drive FAA's costs, we found that the 
coalition's proposal only incorporated factors that would substantially 
increase the taxes paid by low-fare and small airlines and decrease the 
taxes paid by the seven coalition airlines. We concluded that 
determining how best to finance FAA is a complex problem that requires 
careful study and good cost data. Our prior work has shown that FAA 
does not have an adequate cost-accounting system and, as a result, has 
limited capability to accumulate accurate, reliable cost data.\8\
---------------------------------------------------------------------------
    \7\ See ``Airport and Airway Trust Fund: Issues Raised by Proposal 
to Replace the Airline Ticket Tax'' (GAO/RCED-97-23, Dec. 9, 1996), 
``Issues and Options in Deciding to Reinstate or Replace the Airline 
Ticket Tax'' (GAO/T-RCED-97-56, Feb. 4, 1997), and ``Issues Related to 
Determining How Best to Finance FAA'' (GAO/T-RCED-97-59, Feb. 5, 1997).
    \8\ See ``Air Traffic Control: Improved Cost Information Needed to 
Make Billion Dollar Modernization Investment Decisions'' (GAO/AIMD-97-
20, Jan. 22, 1997).
---------------------------------------------------------------------------
    On February 28, 1997, Coopers & Lybrand reported that despite FAA's 
lack of a cost-accounting system, it is possible, on an interim basis, 
to attribute FAA's costs to broad categories of users such as 
commercial airlines as a group or general aviation. However, Coopers & 
Lybrand concluded that FAA did not have sufficiently detailed or 
reliable cost data upon which to base a comprehensive system of new 
fees charged to specific users (e.g., particular airlines). It 
recommended that if FAA is required to adopt a comprehensive system of 
user fees, a modern cost-accounting system should be implemented to 
reliably assign costs to specific products and users. FAA is developing 
a cost-accounting system as required by the Federal Aviation 
Reauthorization Act of 1996 and plans to implement the system by 
October 1997. However, FAA's Manager, Cost Accounting System Division, 
told us that developing a sufficient amount of data to accurately 
assign costs to specific users will take at least 6 to 12 months after 
the system is implemented.
    Because the airline ticket tax and other taxes that finance the 
Trust Fund lapse on September 30, 1997, better cost data will not be 
available before the Congress is faced with the lapsing of those taxes. 
As a result, regardless of whether the Congress decides to extend the 
current excise taxes, modify them, or implement some other financing 
mechanism, it will not have assurance that specific users are assigned 
their fair share of costs. When more detailed cost data become 
available sometime in the future, a determination could be made to 
reexamine the financing method that is chosen.
    Notwithstanding the limitations of FAA's cost data, the data that 
are currently available indicate that a large portion--55 percent--of 
FAA's costs are ``common,'' or not directly related to any particular 
user. In our congressionally mandated April 1997 report on the 
allocation of air traffic control costs, we concluded that the method 
for allocating common costs could have a profound impact on the total 
cost shares assigned to system users.\9\ We reported that in allocating 
common costs, assumptions and judgments must be made and that different 
user groups are likely to have diverging opinions about what 
constitutes an equitable allocation of those costs. We also reported 
that FAA and DOD strongly disagree about how FAA's common costs should 
be allocated.\10\ In addition, we noted that whether and to what extent 
DOD's costs for providing air traffic services to civil users should be 
included in the development of user fees is another issue that would 
need to be resolved if the Congress instituted such fees. If DOD's 
costs are included, fees could be collected from civil users for the 
services provided by DOD, thereby providing an offset to what DOD may 
owe FAA.
---------------------------------------------------------------------------
    \9\ ``Air Traffic Control: Issues in Allocating Costs for Air 
Traffic Services to DOD and Other Users'' (GAO/RCED-97-106, Apr. 25, 
1997).
    \10\ DOD believes that it should not bear any of FAA's common costs 
because the Department is only a marginal user of FAA's air traffic 
services and has a minor impact on FAA's cost structure. Conversely, 
FAA believes that DOD should be assigned some portion of common costs 
because, like other users, DOD benefits from FAA's air traffic control 
infrastructure.
---------------------------------------------------------------------------
    In addition to retaining the ticket tax, there are numerous 
financing alternatives for the national commission, and ultimately the 
Congress, to consider. Possible options include taxing one or more of 
the general indicators of system use, such as departures, passenger 
enplanements, seats flown, fuel consumed, or a combination of these 
indicators. However, the potential competitive impact of using these 
indicators as a basis for allocating FAA's costs varies greatly 
depending on which indicator is used. For example, if a tax on 
passenger enplanements were adopted and designed to generate about the 
same amount of revenue as the ticket tax, the amount paid by the 
coalition of the nation's largest airlines would decline by about $251 
million while the amount paid by competing airlines would increase by 
$269 million and commuter carriers by $61 million. In contrast, a fuel 
tax would keep the amount paid by the largest airlines and by competing 
airlines about the same as each paid under the ticket tax, but the 
amount paid by individual airlines would vary.
    The various potential financing mechanisms for FAA, whether they be 
the $400 million in user fees contained in the administration's fiscal 
year 1998 budget or the longer-term options for replacing the ticket 
tax with usage-based fees, present policy tradeoffs between their ease 
of administration, impact on how efficiently the airport and airway 
system is used, ability to produce an equitable system in which users 
pay their fair share, and other policy goals. For example, a usage-
based formula that combines several of the common system-usage 
indicators might provide the most exact method to ensure that all users 
pay their fair share of system costs. However, such a formula may also 
be so complex that it would be difficult to administer. By contrast, a 
fuel tax, while generally correlating to system use, would be less 
exact than more complex formulas but would be easier to administer. 
Likewise, taxing airlines for their use of the most congested airports 
may result in a more efficient use of the nation's airspace. However, 
because the coalition airlines are the primary users of these airports, 
this approach may not produce the most equitable result from their 
point of view.
    Such tradeoffs and the potential competitive impacts of new fees 
will need to be carefully studied over the next several months by the 
national commission, the Secretary of Transportation, and the Congress. 
The financing mechanism that is finally selected should be relatively 
easy to administer and help ensure that, in the long term, FAA has a 
secure funding source, the nation's airports and airways are used as 
efficiently as possible, commercial users of the system pay their fair 
share, and a strong, competitive airline industry continues to exist. 
Ultimately, it is a policy call for the Congress to decide how to 
achieve these and other goals.
     amtrak's financial condition and its quest for operating self-
                              sufficiency
    Over the last several years, we have issued a number of reports and 
testified several times on Amtrak's financial condition.\11\ Amtrak's 
passenger rail service has never been profitable and, through fiscal 
year 1997, the federal government has provided Amtrak over $19 billion 
for operating and capital expenses. In response to continually growing 
losses and a widening gap between operating deficits and federal 
subsidies, Amtrak developed its Strategic Business Plan. This plan, 
which has been revised several times, was designed to increase revenues 
and control cost growth and, at the same time, eliminate Amtrak's need 
for federal operating subsidies by 2002.
---------------------------------------------------------------------------
    \11\ See ``Intercity Passenger Rail: The Financial Viability of 
Amtrak Continues to Be Threatened'' (GAO/T-RCED-97-94, Mar 13, 1997), 
``Amtrak's Strategic Business Plan: Progress to Date'' (GAO/RCED-96-
187, July 24, 1996), ``Northeast Rail Corridor: Information on Users, 
Funding Sources, and Expenditures (GAO/RCED-96-144, June 27, 1996), 
``Amtrak: Early Progress Made in Implementing Strategic Business Plan, 
but Obstacles Remain'' (GAO/T-RCED-95-227, June 16, 1995), and 
``Intercity Passenger Rail: Financial and Operating Conditions Threaten 
Amtrak's Long-Term Viability'' (GAO/RCED-95-71, Feb. 6, 1995).
---------------------------------------------------------------------------
    Our assessment of Amtrak's financial condition is that, despite 
some gains, the corporation is still in a very precarious position. It 
remains heavily dependent on federal support to meet its operating and 
capital needs. Although actions taken by Amtrak through its business 
plans have helped reduce Amtrak's net losses, Amtrak has struggled to 
reach net loss targets.\12\ For example, Amtrak's plans for fiscal 
years 1995 and 1996 included actions to reduce its net loss by $195 
million--from about $834 million in fiscal year 1994 (in current year 
dollars) to $639 million in fiscal year 1996.\13\ By the end of fiscal 
year 1996, Amtrak's loss had declined to about $764 million; however, 
it was substantially more than planned. In addition, the relative gap 
between total revenues and total expenses has not significantly closed, 
and passenger revenues (adjusted for inflation)--which Amtrak has been 
relying on to help close the gap--have generally declined over the past 
several years (see apps. I and II). Similarly, the gap between 
operating deficits and federal operating subsidies rose in fiscal year 
1996 to $82 million--the highest it had been in the last 9 years.\14\
---------------------------------------------------------------------------
    \12\ ``Net loss'' is defined as total revenues minus total 
expenses.
    \13\ Net loss for fiscal year 1994 excludes a one-time charge of 
$244 million for accounting changes, restructuring costs, and other 
items.
    \14\ Operating deficit is the same as net loss, except noncash 
items (such as depreciation) and the one-time charge taken in fiscal 
year 1994 are excluded from total expenses.
---------------------------------------------------------------------------
    Amtrak's continuing financial crisis can be seen in other measures 
as well. In February 1995, we reported that Amtrak's working capital--
the difference between current assets and current liabilities--declined 
between fiscal years 1987 and 1994. Although Amtrak's working capital 
position improved in fiscal year 1995, it declined again in fiscal year 
1996 to a $195 million deficit (see app. III). This decline reflects an 
increase in accounts payable, short-term debt, and capital lease 
obligations, among other items. A continued decline in working capital 
jeopardizes Amtrak's ability to pay immediate expenses. Amtrak's debt 
levels have also increased significantly (see app. IV). During fiscal 
years 1993 through 1996, Amtrak's debt and capital lease obligations 
nearly doubled--from about $527 million to about $987 million, in 1996 
dollars. These debt levels do not include an additional $1 billion 
expected to be incurred beginning in fiscal year 1999 to finance 18 
high-speed trainsets and related maintenance facilities for the 
Northeast Corridor and the acquisition of new locomotives.
    It is important to note that servicing Amtrak's increased debt 
takes away from the federal financial operating support needed to cover 
future operating deficits. In fact, over the last 4 years, interest 
expenses have about tripled--from about $20.6 million in fiscal year 
1993 to about $60.2 million in fiscal year 1996 (see app. V). Because 
Amtrak pays interest from federal operating assistance and principal 
from federal capital grants, this increase has absorbed more of the 
federal operating subsidy each year. During fiscal years 1993 through 
1996, the percentage of federal operating subsidies used to pay 
interest expenses increased from about 6 to about 21 percent. As Amtrak 
assumes more debt to acquire equipment, the interest payments are 
likely to continue to consume an increasing portion of federal 
operating subsidies. Amtrak's fiscal year 1997 operating losses may be 
even higher than those in fiscal year 1996. As a result of 
unanticipated expenses and revenue shortfalls, at the end of the second 
quarter Amtrak projected that its actual fiscal year 1997 year-end net 
loss could be about $783 million.
Amtrak Has Large Capital Needs
    Amtrak's goal of eliminating federal operating subsidies by 2002 is 
heavily dependent on capital investment. Such investment--the 
modernizing of property, plant, and equipment--will not only help 
Amtrak to retain revenue by improving the quality of existing service 
but will potentially increase revenues by attracting new riders.
    Amtrak's capital investment needs are great--both to replace and 
modernize current physical assets and to complete new projects such as 
high-speed rail service on the Northeast Corridor. For example, in May 
1996, the Federal Railroad Administration (FRA) and Amtrak estimated 
that about $2 billion would be needed over the next 3 to 5 years to 
recapitalize the south end of the Northeast Corridor and preserve its 
ability to operate in the near-term at existing service levels. FRA and 
Amtrak estimate that up to $6.7 billion may be needed over the next 20 
years to recapitalize the Northeast Corridor and make improvements 
targeted to respond to high priority growth opportunities. Amtrak also 
estimates that an additional $1.4 billion will be needed to finish the 
high-speed rail project.
    Our ongoing work indicates that Amtrak has made some progress in 
addressing its capital needs, but the going has been slow and, in some 
cases, Amtrak may be facing significant future costs. For example, in 
October 1996, about 53 percent of Amtrak's active fleet of 1,600 
passenger cars averaged 20 years old or more and were at or approaching 
the end of their useful life. It is safe to assume that as this 
equipment continues to age, it will have more frequent failures and 
require more expensive repairs.
    Finally, Amtrak will continue to find it difficult to take those 
actions necessary to further reduce its costs. During fiscal year 1995, 
Amtrak was successful in reducing and eliminating some routes and 
services. For example, Amtrak reduced the frequency of service on seven 
routes from daily to three or four times per week, and on nine other 
routes various segments were eliminated. Amtrak estimates that such 
actions saved about $54 million. However, Amtrak was less successful in 
making the route and service adjustments planned for fiscal year 1997. 
As a result, Amtrak estimates that its projected fiscal year 1997 net 
loss will increase by $13.5 million. Amtrak has also been unsuccessful 
in negotiating productivity improvements with labor unions.
    Amtrak has staked its financial future on the ability to eliminate 
federal operating support by 2002 by increasing revenues, controlling 
costs, and providing customers with high-quality service. Although its 
business plans have helped reduce net losses, Amtrak continues to face 
significant challenges in accomplishing this goal, and it is likely 
Amtrak will continue to require substantial federal financial support--
both operating and capital--well into the future.
    innovative highway financing through state infrastructure banks
    In October 1996, we reported that total public spending on the 
capital needs for highways and bridges was approximately $40 billion in 
1993--the most recent year for which data are available--and that DOT 
estimated that an additional $16 billion annually is needed just to 
maintain--not improve--the condition of the nation's highways at the 
1993 level.\15\ Moreover, postponing investment can increase costs; DOT 
estimated that deferring $1 in highway resurfacing for just 2 years can 
require spending $4 in highway reconstruction costs to repair the 
damage.
---------------------------------------------------------------------------
    \15\ ``State Infrastructure Banks: A Mechanism to Expand Federal 
Transportation Financing'' (GAO/RCED-97-9, Oct. 31, 1996).
---------------------------------------------------------------------------
    In order to stretch limited federal funds, the Congress in 1995 
authorized some innovative uses of federal transportation funds. The 
National Highway System Designation Act of 1995 established a number of 
innovative financing mechanisms, including the authorization of a State 
Infrastructure Bank (SIB) Pilot Program for up to 10 states or 
multistate applicants--8 states were selected in April 1996, and 2 were 
selected in June 1996. Under this program, states can use up to 10 
percent of most of their federal highway funds for fiscal years 1996-97 
to establish their SIB's. This program was expanded by DOT's fiscal 
year 1997 appropriations act, which removed the 10-state limit and 
provided $150 million in new funds.
    A SIB serves essentially as an umbrella under which a variety of 
innovative finance techniques can be implemented. Much like a bank, a 
SIB needs equity capital to get started, and equity capital can be 
provided at least in part through federal highway funds. Once 
capitalized, the SIB can offer a range of loans and credit options, 
such as loan guarantees and lines of credit. For example, through a 
revolving fund, states can lend money to public or private sponsors of 
transportation projects. Project-based revenues such as tolls or 
general revenues such as dedicated taxes can be used to repay loans 
with interest, and the repayments replenish the fund so that new loans 
can be supported. Thus, projects with sufficient potential revenue 
streams are needed to make a SIB viable.
    Expected assistance for projects in the 10 states selected for the 
pilot program include loans, credit enhancement to support bonds, and 
lines of credit. In some cases, large projects that are already under 
way may be helped through SIB financial assistance. Examples of 
projects that the initial 10 pilot states are considering for financial 
assistance include the following:
  --In Orange County, California, a $713 million project that includes 
        construction of a 24-mile tollway may receive SIB assistance in 
        the form of a $25 million line of credit that would replace an 
        existing contingency fund. If the line of credit is used, plans 
        are for it to be repaid through excess toll revenues.
  --In Orlando, Florida, a $240 million project that will construct a 
        6-mile segment to complete a 56-mile beltway may receive a SIB 
        loan in the amount of $20 million. Repayment of the loan would 
        come from a mix of project-related and systemwide toll receipts 
        and state transportation funds.
  --In Myrtle Beach, South Carolina, a SIB loan is being considered to 
        help construct a new $15 million bridge to Fantasy Harbor. The 
        source for repaying the loan would be proceeds from an 
        admission tax at the Fantasy Harbor entertainment complex.
    SIB assistance is intended to complement, not replace, traditional 
transportation grant programs and provide states with increased 
flexibility to offer many types of financial assistance. As a result, 
projects could be completed more quickly, some projects could be built 
that would otherwise be delayed or infeasible if conventional federal 
grants were used, and private investment in transportation could be 
increased. Furthermore, a longer-term anticipated benefit is that 
repaid SIB loans can be ``recycled'' as a source of funds for future 
transportation projects. If states choose to leverage SIB funds, DOT 
has estimated that $2 billion in federal capital provided through SIB's 
could be expected to attract an additional $4 billion for 
transportation investments.
    For some states, barriers to establishing and effectively using a 
SIB still remain. One example is the low number of projects that could 
generate sufficient revenue to repay loans made by SIB's. Officials 
from six of the states that we surveyed told us that an insufficient 
number of projects with a potential revenue stream would diminish the 
prospects that their state would participate in the SIB pilot program. 
Officials from 10 of 11 states that we talked to about this issue said 
they were considering tolls as a revenue source. However, state 
officials also told us that tolls would likely generate considerable 
negative reaction from political officials and the general public.
    Some states expressed uncertainty regarding their legal or 
constitutional authority to establish a SIB or use some financing 
options that would involve the private sector. Michigan, for instance, 
said that it does not currently have the constitutional authority to 
lend money to the private sector. Another impediment can arise if the 
SIB exposes the state to debt. Backing SIB assistance with the full 
faith and credit of the state is not legally permitted in some states. 
Without that guarantee, SIB's will have to rely on the strength of 
their project portfolio and initial capitalization as the basis for 
borrowing. As such, they are likely to experience higher borrowing 
costs than if their portfolio was backed by the full faith and credit 
of the state. Bond-rating agencies will have to assess each portfolio 
on a case-by-case basis.
    Finally, a principal federal barrier to attracting private capital 
is the fact that the Internal Revenue Code, with some exceptions, 
restricts private involvement in tax-exempt debt. In the case of state 
and local bonds, bondholders' interest earnings are exempt from federal 
taxes. However, the tax exemption does not apply to a bond issue if (1) 
the private sector uses more than 10 percent of the proceeds and 
finances more than 10 percent of the debt or (2) more than 5 percent of 
the proceeds or $5 million (whichever is less) is used to make loans to 
the private sector. A number of federal and state officials and 
academic experts told us that states that choose to leverage their 
banks will likely do so with tax-exempt debt because bondholders are 
willing to accept lower interest rates in exchange for the bonds' tax-
exempt status.
    The SIB program has been slow to start up. Only two states--Ohio 
and Missouri--have actually begun projects under their SIB. 
Nevertheless, since $150 million was provided and the 10-state 
restriction was lifted in DOT's fiscal year 1997 appropriations act, 
the agency has received applications from 28 states and Puerto Rico. 
The program will need time to develop and mature before a comprehensive 
assessment of SIB's impact on meeting transportation needs can be 
assessed. In our October 1996 report, we suggested that once SIB's 
begin operating, the Federal Highway Administration could disseminate 
information on states' successes and failures with various financing 
options and thus help states use SIB's more effectively and educate 
other states on the pros and cons of a SIB.
    Mr. Chairman, that concludes our prepared statement. We would be 
happy to respond to any questions that your or other members might 
have.

                               APPENDIX I

          AMTRAK'S REVENUES AND EXPENSES, FISCAL YEARS 1988-96
[GRAPHIC] [TIFF OMITTED] T12MY07.006

    Note: Amounts are in 1996 dollars.
    Source: Amtrak.

                              APPENDIX II

           AMTRAK'S PASSENGER REVENUES, FISCAL YEARS 1989-96
[GRAPHIC] [TIFF OMITTED] T12MY07.007

    Note: Amounts are in 1996 dollars.
    Source: GAO's analysis of Amtrak's data.

                              APPENDIX III

    AMTRAK'S WORKING CAPITAL SURPLUS/DEFICIT, FISCAL YEARS 1987-96
    [GRAPHIC] [TIFF OMITTED] T12MY07.008
    
    Notes: Working capital is the difference between current assets and 
current liabilities.
    Amounts are in current year dollars. In 1996 dollars, working 
capital declined from $149 million in fiscal year 1987 to a deficit of 
$195 million in fiscal year 1996.
    Source: GAO's analysis of Amtrak's data.

                              APPENDIX IV

AMTRAK'S OUTSTANDING DEBT/CAPITAL LEASE OBLIGATIONS, FISCAL YEARS 1987-
                                   96
[GRAPHIC] [TIFF OMITTED] T12MY07.009

    Note: Amounts are in current year dollars.
    Source: Amtrak.

                               APPENDIX V

            AMTRAK'S INTEREST EXPENSE, FISCAL YEARS 1987-96
[GRAPHIC] [TIFF OMITTED] T12MY07.010

    Note: Amounts are in current year dollars.
    Source: Amtrak.

                           Aviation User Fees

    Senator Shelby. Going back to you, Secretary Downey, do you 
anticipate, first, that the National Civil Aviation Review 
Commission will in fact report on user fees by August of this 
year?
    Mr. Downey. We are hopeful that they can do that. They 
understand the importance of the timetable and the fact that 
decisions have to be made. They are planning to meet on a quite 
regular basis between now and August.
    Senator Shelby. If they do, will that leave sufficient time 
for the administration to review the recommendations they make 
and for Congress to consider enactment of any new user fees 
before the end of the year? That is moving in August, 
September?
    Mr. Downey. We will be sharing what information we have, 
but the $300 million that is in the coming year's budget in our 
view is independent of what the Commission will recommend and 
should be considered on its own merits.
    Senator Shelby. Mr. Anderson, is it fair to say that any 
imaginable new user-specific fee, whether security fees, 
inspection fees, air traffic service fees, per-seat fees, or 
per-passenger fees, will create winners and losers in the 
airline industry and among the traveling public?
    Mr. Anderson. There is no question. We have done various 
analyses of different alternatives for assessing fees, and 
there are winners and losers and they vary for each proposal.
    Senator Shelby. Who are the winners and losers?
    Mr. Anderson. It varies depending upon which proposal you 
look at. For example, the coalition of the Nation's largest 
airlines about 1 year ago at this time put forth a proposal 
where the major airlines were going to be winners in terms of 
having their tax burdens reduced, but the low-fare other 
airlines were going to be big losers. We looked at that 
proposal and we had some critical comments about it.
    Senator Shelby. What does that do to the traveling public?
    Mr. Anderson. Well, our biggest concern was it could have 
competitive impacts, because one of the reasons that we believe 
that airline deregulation overall has been a success is because 
of the competition that low-fare airlines have injected into 
the system.
    Senator Shelby. And brought down a lot of fares, has it 
not?
    Mr. Anderson. Exactly. So one of the problems if you go to 
tampering with a system that is going to significantly shift 
that tax burden is you could upset the applecart, so to speak, 
in terms of the competition mechanisms that have been set up.
    Senator Shelby. So I guess the caveat is for us to be real 
careful in what we do if we do anything?
    Mr. Anderson. Yes.
    Senator Shelby. Mr. Anderson, would you expect that user 
fees will alter behavior among the airlines?
    Mr. Anderson. I think it could. This is one of the things 
Mr. Downey alluded to. You have to be real careful when you set 
up these fees that you do not have some unintended consequences 
coming out as a result. It could also affect the routes they 
serve.
    Senator Shelby. Have you considered some unintended 
consequences?
    Mr. Anderson. Well, one of the things that has been talked 
about is if you actually have to--if, let us say, an airline 
has to pay for the amount of inspector time that FAA inspectors 
spend inspecting them, they might be attempting to get the 
inspectors out of there sooner so that they could reduce their 
inspection bill. Obviously you have to build in things to 
mitigate against that.
    Senator Shelby. Have you given any thought to how the 
various fees that might be considered could alter airline 
services' hub and spoke operations or traffic patterns? I know 
we talked about money, but I think that is very important.
    Mr. Anderson. Sure. I think they could, and this is another 
reason why this is a complex problem that I do not think you 
want to jump to solutions too soon. If you change the fee 
structure, the profit on individual routes could change and the 
airlines could decide to serve different cities, that sort of 
thing. One of the things that we have been concerned about was, 
while airline deregulation overall has been a success, there 
clearly are pockets of pain out there that have not fully 
enjoyed the benefits of lower fares and increased service. If 
you are not careful, you could exacerbate that problem.

                Other Proposed Transportation User Fees

    Senator Shelby. Mr. Downey, besides the FAA user fees, what 
other user fees are proposed in the President's 1998 budget 
request?
    Mr. Downey. The other fees that are proposed include 
railroad safety user fees, a proposal to reinstate the 
industrywide levy that had been in place up until 1 or 2 years 
ago, and an advance proposal to consider icebreaking fees for 
the Coast Guard, not in the current budget but 1 year out from 
now.
    Senator Shelby. Mr. Downey, have any recognized user groups 
publicly supported this administration's interstate toll 
proposal that you know of?
    Mr. Downey. User groups I do not believe have, but we have 
heard from States and local governments that do have an 
interest in that proposal. They would be the ones to enact any 
tolls. This would not be a Federal toll. It is merely an 
opportunity for State and local government to finance 
transportation projects through this mechanism.
    Senator Shelby. Mr. Anderson, I understand the GAO has 
looked at some of these user fees. If any of these user fees 
are imposed on top of the current ticket and excise tax that we 
have, is it possible that some of the airlines or users might 
be paying twice for the same service?
    Mr. Anderson. That is possible. I think that is one of the 
problems with going with an incremental approach as opposed to 
looking at it comprehensively, like I think the National 
Commission is doing. I think you can sort of see--I have had 
discussions with my staff--the proposal for the overflight 
fees, it is going through 1,000 cuts here as it is being 
examined. As you look at this thing piece by piece, you are not 
sure what changes are going to come down the road that might be 
an additional tax on the user. So I think a comprehensive look-
see is the way to go with these things.
    Senator Shelby. The bottomline is we better be careful what 
we do for a lot of reasons?
    Mr. Anderson. Yes, sir.
    Senator Shelby. Senator Lautenberg.
    Senator Lautenberg. Thanks very much, Mr. Chairman.
    I am sorry that Senator Gorton had to leave, but the record 
should reflect some of my concerns. I will talk about those for 
just a minute. In terms of comparing one transportation mode to 
another, I think you run into all kinds of extraneous debate. 
The fact is that we have to have intermodal balanced 
transportation services throughout our country, and you cannot 
suggest that one is more favored than the other because there 
is not a 10-to-1 ratio. I think that is, frankly, not a 
particularly reliable statistic to depend upon when you make 
decisions like we have.
    If you look at aviation--and I like flying, I like flying 
in small airplanes, and I think that the aviation system has 
helped build our country perhaps more than any other because of 
the ability to get across the breadth of our huge Nation. But 
when I start thinking about what it takes to keep airlines 
going, the aviation system going, and I think of people paying 
parking fees of $15, $20, $50 to be at an airport so that they 
can take an airplane, I am forced to say, well, is that a 
direct subsidy of air travel? It certainly ought to be counted 
as part of it.
    When I look at all the shops, and the rents in some of 
these places are fantastic, collecting a lot of fees. That goes 
to subsidize in part the whole of the aviation business. We are 
not counting that, but people are paying user fees effectively 
when they pay $2 for a coffee that you can get for 55 cents 
elsewhere.
    The fact of the matter is that when we build special roads, 
special travel connections, to get to airports, that is a 
subsidy. For railroads we do not do that. I have not seen a 
railroad station that has a private road built to it. And if 
you want to see a glaring example, look at the Denver Airport, 
which I like. I think the Denver Airport is an excellent 
airport. But look at what we had to do to have access to that 
airport created. We spend hundreds of millions of dollars.
    So those questions have to be answered. Unfortunately, 
since Senator Gorton is not here, I do not want to take 
advantage of his absence to ask the penetrating questions. But 
we will go on from here.

          Cost of Implementing Gore Commission Recommendations

    Mr. Downey, the Gore Commission's recommendation to 
accelerate the deployment of modern air traffic control 
equipment I frankly think was a wise one. We have seen what 
happens with our air traffic controllers. There is enough 
tension, enough stress in those towers, that we ought not to 
make their job more difficult as a result of outages in our air 
traffic control centers and towers in recent months because of 
the age of this antiquated equipment.
    Is the administration, Mr. Anderson, committed to 
requesting the additional billions of dollars that are going to 
be necessary to fully follow the Gore Commission's 
recommendations? I ask you, Mr. Downey.
    Mr. Downey. You are correct, it will cost additional 
billions or at least a need to accelerate the billions of 
dollars already planned. And we are working that through the 
budget process, looking down to the next few years. Within the 
constraints, even with the good news from Senator Domenici, it 
will be hard, but we need to find it. The benefits of improving 
the air traffic control system, both in terms of safety and 
efficiency, are so great, we really need to make that 
investment.
    That is one of the reasons why we have proposed user fees, 
because that may be a way to accelerate income in order to get 
those benefits sooner for the users.
    Senator Lautenberg. The good news from Senator Domenici was 
offset by the bad news from Congressman Shuster, I think, in 
the paper this morning. And while I do not necessarily agree 
with Congressman or Chairman Shuster in a lot of things, the 
fact is I think it is fairly obvious that we need more money 
than is planned, even with the--I will not call it a bonus--
with the largess that was discovered along the way, because it 
still leaves us short of what an extended baseline would look 
like running out 5 years. The system needs and deserves more 
than that.

                            Financing Amtrak

    Mr. Downey, your statement points out your request for 
contract authority from the highway trust fund for Amtrak 
beginning in fiscal 1999. How does your Amtrak proposal in 
NEXTEA compare to the one-half-cent proposal in terms of the 
funding that would be available, generally available to Amtrak 
over the next several years that would be capital funds?
    Mr. Downey. Our proposal is somewhat below the one-half 
cent. It phases it. It would increase capital investment in the 
outyears as Amtrak makes progress toward self-sufficiency, and 
I think by the fifth year it is roughly equivalent to the one-
half cent.
    Senator Lautenberg. Is it your view that once this contract 
authority is established, if NEXTEA is the version we subscribe 
to, Amtrak will be able to sign contracts for the total amount 
of the full funding of the contract authority assumed in the 
bill?
    Mr. Downey. I think in the same way a State is able to 
anticipate those funds and make financial arrangements for 
making use of them, we would expect Amtrak to be able to do the 
same thing.
    Senator Lautenberg. A couple seconds more if I might, Mr. 
Chairman?
    Senator Shelby. Yes, sir; go right ahead.
    Senator Lautenberg. Does your proposal assume that the 
Appropriations Committee is going to place obligations limits 
on this contract authority, just as we do on highway and 
transit programs?
    Mr. Downey. Certainly that has been the history of the 
highway and transit programs. We did not request such a limit, 
but we certainly would work with this committee on it. And I 
know your interest in seeing that the funds are used wisely.
    Senator Lautenberg. As always.

                      User Fees Coverage of Costs

    I want to ask you this. Should we assume that, whatever new 
user fees are developed, that they will completely offset the 
savings gained from the continuation of the ticket tax?
    Mr. Downey. I really do not know the answer to that, 
because I am not sure about what the continuation of the user 
taxes would entail.
    Senator Lautenberg. Right, but you would be projecting. Let 
us say, if you projected your own views, should they?
    Mr. Downey. If you look at the FAA's financing today, the 
ticket taxes, if collected for a full year on a regular basis, 
do not cover the entire cost to the FAA. So it would be our 
expectation that the user fees would come closer, hopefully, to 
100 percent coverage of those costs. In that sense they would, 
if they replaced the ticket taxes, would more than add up to 
the ticket taxes, but they would create some relief on the 
general fund side.
    Senator Lautenberg. Right. What I wanted to do there was 
just have you indicate, because I felt that it was necessary. 
There are going to be any number of combination of things and 
we ought not to be lulled into believing that, OK, everything 
is going to be paid for in direct user fees, you put down a 
buck and you would get 1 dollar's worth. I think you put down 
$1 right now and you get 100 dollars' worth, and I do not mind 
some of that because the aviation system is a national asset 
and we have to keep it going.
    I do not think it ought to be just those who ride the 
planes, but rather society in general has to participate in 
some way. If you build a national highway system they do. If 
you build a national aviation system they do. And frankly, if 
you have a decent, functioning rail passenger service like all 
of us here would like to say, the public is going to have to 
chip in.
    Thanks very much, Mr. Chairman.
    Senator Shelby. Thank you two gentlemen. We are probably 
going to have some questions for the record and we will keep 
that open for other members, too.
    Mr. Downey. We will be happy to.
    Senator Shelby. Some have already said that.
    We thank you both.
    Mr. Downey. Thank you.
    Mr. Anderson. Thank you.
                                Panel 2

                      DEPARTMENT OF TRANSPORTATION

                    Federal Railroad Administration

STATEMENT OF JOLENE MOLITORIS, ADMINISTRATOR

            NATIONAL RAILROAD PASSENGER CORPORATION (AMTRAK)

STATEMENT OF THOMAS M. DOWNS, CHAIRMAN, PRESIDENT, AND 
            CHIEF EXECUTIVE OFFICER

                       GENERAL ACCOUNTING OFFICE

STATEMENT OF PHYLLIS SCHEINBERG, ASSOCIATE DIRECTOR, 
            RESOURCES, COMMUNITY, AND ECONOMIC 
            DEVELOPMENT DIVISION

                       Introduction of Witnesses

    Senator Shelby. Our next panel will be Jolene Molitoris, 
Administrator, Federal Railroad Administration, Department of 
Transportation; Tom Downs, President, National Railroad 
Passenger Corporation (Amtrak); Phyllis Scheinberg, Associate 
Director, General Accounting Office, Resources, Community, and 
Economic Development Division.
    Your entire written statements will be made part of the 
record and I would ask you to briefly summarize your remarks. 
Ms. Molitoris.

                     Statement of Jolene Molitoris

    Ms. Molitoris. Thank you, Mr. Chairman and members of the 
committee. I appreciate the opportunity to represent the 
Federal Railroad Administration before you today. I would like 
to testify concerning the financial commitment of the Clinton 
administration to Amtrak and especially about the fiscal year 
proposed 1998 budget.
    We all know about the challenges that Amtrak is facing, not 
only to survive, Mr. Chairman, but to thrive, because that is 
the kind of system we all want. Let me comment that when we 
arrived 4 years ago we analyzed Amtrak and realized that it 
faced very serious challenges and set about the business of 
taking the very many necessary steps to help Amtrak become a 
very healthy organization. One of those steps that was very 
important was really developing a new leadership team, and of 
course you will be hearing from the leader of that team, Mr. 
Downs.
    Although we have much, much more to do, as the GAO and our 
own records indicate, I think it is useful for the committee to 
at least hear a couple of highlights as to the kinds of 
movement in a positive direction that we have had for Amtrak, 
and I think they may begin to respond to some of the comments 
that you made early on.
    First of all with regard to Federal operating subsidies, I 
think the Congress and the administration have agreed to set as 
a goal zero Federal operating subsidies by the year 2002. That 
is a goal that has been begun to be achieved by cutting these 
Federal subsidies in half in the last 2 years. That I think is 
a significant achievement.
    Second, Amtrak has divided its business into three 
strategic units so it can act like a business, better 
concentrate on the customers, and provide the kind of customer 
service that your colleague Senator Gorton did not find on his 
trip. I think if he took that trip today he would have a 
different experience.
    Another very important issue----
    Senator Shelby. Do you recommend that I take it?
    Ms. Molitoris. Absolutely, Mr. Chairman.
    Senator Shelby. I might do it.
    Ms. Molitoris. I am sure Mr. Downs would recommend the same 
thing.
    Senator Shelby. I might do that.
    Ms. Molitoris. I think a very important step, Mr. Chairman, 
was unbundling the whole financial information base at Amtrak, 
because when we arrived and when Mr. Downs arrived it was very, 
very difficult to understand the cost of individual pieces of 
the business, and I think that that very important piece of 
work has shown a big light on a lot of the issues that were not 
as visible before. But I think that we can only achieve a 
healthy company by looking at the facts as they really are.
    I think the kind of business partnerships and 
entrepreneurial activities of Amtrak are very important for the 
committee to recognize. They have made some very important 
business partnerships, not only with States, which they have, 
but also with private entities, like Disney, Pepsi, United 
Airlines. For example, in just one small example, they had a 
partnership with Disney on the release of the video 
``Aristocats'' and they had a coupon in that video. By tracking 
the coupons, they were able to see that through that one 
initiative alone they earned $13 million. So these private 
partnerships are ways to grow Amtrak into a healthy business.
    Another important change is that States are taking a much 
more active, proactive partnership with Amtrak. In fact, the 
State investment in Amtrak operating assistance has almost 
doubled in the past year. And in State capital assistance, four 
States--California, Washington, North Carolina, and 
Pennsylvania--are actually partnering with Amtrak by buying 
equipment for them to use. This gives you the kind of indicator 
that States consider Amtrak vital for their transportation 
future.
    I would believe another instance that is very important, 
and my guess is that Senator Gorton faced some of this. When we 
arrived and when Mr. Downs and his new team arrived, there were 
a lot of so-called heritage cars, Mr. Chairman. This is not a 
heritage that any of us would want to inherit. They were 40- or 
50-year-old cars. We know that no airline would fly equipment 
that age. They had nonoperative bathrooms, they broke down a 
lot. We know that--we knew that we had to change that situation 
if Amtrak was going to succeed.
    So there has been substantial progress there, Mr. Chairman, 
ordering nearly 200 locomotives, 250 passenger cars, and these 
40- and 50-year-old cars are almost now gone from the fleet, 
and I think that helps customer service.
    As a result of aggressive pricing strategies in 1996, 
ticket yields were up by 10 percent. And since 1994, the last 2 
full years, Amtrak's total revenue is up by $141 million. That 
is up 10 percent.
    I think we should recognize the employees of Amtrak, 
because without recognizing the employees you do not recognize 
the people who are working day by day to make this railroad 
succeed. For example, this company was voted the most improved 
transportation company in the country in customer service. That 
happens because employees make it happen, and I think we should 
give them credit for that.
    In addition, improved productivity of the work force. If 
you look at the Bear and Wilmington Shops, you see self-
directed employee shops that are actually bringing new business 
to Amtrak because they are so good and so cost competitive.
    Certainly last but not least, the high-speed rail 
initiatives, the new trainsets which the Vice President 
unveiled last April, the electrification project which was 
begun in July of last year, this is forecast to bring about 
$150 million of profit to Amtrak when they are fully 
implemented.
    Finally, let me say, Mr. Chairman, the budget of the 
administration has no fat at all. As I said for the record to 
Mr. Wolf and I would like to say to you, the administration has 
made a very serious investment in Amtrak through the NEXTEA 
proposal and we want to say it is not padded. It is not like 
the old days, where we put in extra and Congress took out 
extra.
    Mr. Downs will tell you that one of the challenges he faces 
financially is because there was a disconnect between the 
President's budget and the final appropriation last year, $115 
million. And if we had been on the same wavelength, Mr. Downs' 
budget would have shown a surplus.
    So I would like to say to you that our NEXTEA proposal, Mr. 
Downey has already said, represents about 96 percent of 
operating and 92 percent of capital of what Amtrak is 
requesting and what the one-half cent would give. So we think 
that in a time of budget cutting it really is a significant 
statement by the administration. Although we have just seen the 
fruits of the cooperation on the budget agreement, we know, as 
was said, there will be extra money, we do not know what the 
negotiation will end up with, but perhaps there would be an 
opportunity for some more money for Amtrak.
    Finally, the administration is committed to a corporation 
that you all would be proud of, that we all would be proud of, 
a healthy company that is free of operating subsidy, and it is 
one of the safest railroad companies in the world, and we 
should underscore that because no operation in any 
transportation mode can be viable without reliable safety for 
the American people.
    I appreciate the time with you, Mr. Chairman, and I would 
be happy to answer questions.
    Senator Shelby. Mr. Downs.

                      STATEMENT OF THOMAS M. DOWNS

    Mr. Downs. Thank you, Mr. Chairman. It is a pleasure to be 
here. Senator Lautenberg.
    At the risk of starting off with what seems like a 
superfluous note, there was a piece in this morning's New York 
Times that says:

    I was in Penn Station purchasing Amtrak tickets to 
Wilmington, DE, when a woman approached the agent at the next 
window. ``Is it your job to sell me a ticket to anywhere I want 
to go?'' she asked. ``Yes, ma'am,'' he replied. ``Where would 
you like to go?'' ``To hell and back,'' she said. Without 
batting an eye, the agent, with the utmost courtesy, consulted 
his computer and said, ``I'm sorry, ma'am, but that train is 
completely sold out.'' [Laughter.]

    I could spend this time reiterating how important Amtrak 
is, that we are 55 million passengers, that if you count 
intermediate stops in the Northeast corridor we are 70 percent 
of the combined air-rail traffic between Washington and New 
York. I could say that we are the essential lifeblood of urban 
and rural America in places like Anniston, AL, and Haver, MT, 
and Devil's Lake, ND.
    Where, as Senator Gorton says, it is a long way from 
Seattle to Chicago, the difference is that our business is 
often 60-mile increments linking places like Minneapolis to 
places like Minot, ND, and that is lost in this debate.
    We are the Nation's passenger railroad. We, Amtrak, are 
often held accountable for the things that have been done to 
this railroad. I believe the national Government is accountable 
for what has happened to Amtrak, good, bad, and indifferent. It 
is impossible to sort out our current financial position 
without at least telling part of the story in a slightly 
different way than perhaps Senator Shelby had characterized it 
earlier.
    I have a chart I hope you all have. It is called ``The 
Gap.'' We had an agreement between the Budget Committees, Mr. 
Kasich, Senator Domenici who was here earlier, about the 5-year 
glidepath to self-sufficiency. It looks like this [indicating]. 
In 1996, the glidepath number was supposed to be a $135 million 
reduction in operating subsidy for Amtrak. The Congress said: 
That is really neat; to give you something to shoot for, why do 
we not go ahead and reduce it by $210 million.
    That had a cost and a consequence. It wrecked, in a sense, 
the business plan for the company.
    [The chart follows:]
    [GRAPHIC] [TIFF OMITTED] T12MY07.011
    
                                Chart 1

    We started over. We said: OK, that makes it $250 million in 
1997. Well, the answer is it is $200 million. We said: It is 
$225 million for 1998. The answer is probably going to be it is 
$200 million.
    Underfunding a business plan has financial consequences. 
The financial consequences are we are running out of cash. The 
reason that we are out of cash is that in the 1980's the 
Congress told us, this company: Go borrow your money. Senator 
Shelby said nobody has invested, the private sector is not 
investing in this corporation. That is not true. All of our 
locomotives, all of our new passenger cars, and our high-speed 
trainsets are funded, not by Federal capital, but by private 
banking interests. Ironically, they are foreign banks, in 
France and Germany and Japan and Canada.
    But borrowing those moneys is an expense for the company, 
particularly since we have to pay a premium for the money.
    Chart 2 shows what happened to us from a capital 
standpoint. In 1986 our capital budget was $3 million. It was 
enough to fix broken windows maybe. In 1987 it zoomed all the 
way to $27 million. Both years, our depreciation account was 
one-quarter of a billion dollars. Clearly, we were directed to 
borrow the money that we needed for capital investments in this 
company.
    [The chart follows:]
    [GRAPHIC] [TIFF OMITTED] T12MY07.012
    
                                Chart 2

    We did. We began to incur private sector investments. I do 
not consider it debt; I consider it investments in our future. 
That is chart 3.
    [The chart follows:]
    [GRAPHIC] [TIFF OMITTED] T12MY07.013
    
                                Chart 3

    And what has happened about our principal and our debt 
yields a chart that looks like ``Principal and Interest 
Payments,'' not unlike what is happening with the Federal 
budget. Our fastest growing expense, as GAO will point out, is 
principal and interest on that capital.
    [The chart follows:]
    [GRAPHIC] [TIFF OMITTED] T12MY07.014
    
                                Chart 4

    We have been told to make this a businesslike operation. We 
still believe it is part of a national transportation network 
and an asset, but we are told: Make it a business. I hope you 
have this last chart: ``1987 to 1998, Percent of Expenses 
Covered by Federal Operating Support for Amtrak.'' In 1987 it 
was 34.6 percent, in 1998 it is 14.4 percent of expenses.
    [The chart follows:]
    [GRAPHIC] [TIFF OMITTED] T12MY07.015
    
                                Chart 5

    I would like to say that this company has done what the 
Congress has asked it to do. What we have not had is a 
concomitant response about defining clearly what the national 
role for Amtrak is, what purpose it fills in environmental, in 
mobility, in small urban and rural areas.
    We have exhausted, I believe--and I would take exception 
only with one statement in Senator Shelby's opening remarks, 
that there is no doubt that a private company could operate a 
profitable rail service. Every private railroad in America 
proved that that was wrong in the 1960's and 1970's. They said, 
we cannot any longer operate rail passenger service as private 
businesses. I do not know of a single country in the world who 
can, private or public, operate an intercity rail passenger 
service at a break-even or profitable basis.
    We have said: Recapitalize this railroad after a horrible 
depreciation cycle, which gives us bad equipment, bad plant, 
inefficient operations. We have said: Give us the right 
structure in law to operate the way you want. We will build 
high-speed rail to the point where that investment will yield, 
after all principal and interest payments, a net profit for 
this company of $150 million a year. That is working capital, 
that is an improvement on the bottomline.
    We have said in our business plans that we are building in 
mail and express business, the business we put on the back of 
passenger trains, to help defray the expenses of long distance 
trains. In 1959, the last time that freight railroads in 
America on a fully allocated cost basis broke even on rail 
passenger service, 46 percent of the revenues of those 
passenger trains were mail and express. We would like to 
recreate that kind of environment, the old REA business, 
without getting in the freight railroads business, without 
trying to be in economic warfare with anyone, that we can build 
a profitable relationship with the Post Office and express 
business. That is part of a business plan that we think makes 
sense for you all.
    We have said clearly: The answer is recapitalize this 
railroad. Make a choice. If you cannot fund it, have the 
courage to face the consequences. Senator Shelby said that at 
the end of his remarks. It is one option to explore.
    What has happened is that we have been told time and again, 
make it work, do it with less, do it without capital, keep 
selling tickets, sell disappointment to the American public, 
ignore the consequences of the undercapitalization. We have run 
out of time, we have run out of room, because we are now out of 
cash. It is time to choose.
    Thank you, Mr. Chairman.

                           Prepared Statement

    Senator Shelby. Thank you, Mr. Downs. We have your complete 
statement and it will be made part of the record.
    [The statement follows:]
                 Prepared Statement of Thomas M. Downs
    Mr. Chair: Thank you for the opportunity to discuss Amtrak's fiscal 
year 1998 funding request, as well as the current financial condition 
of Amtrak and our vision for the future.
    The current state of Amtrak, if it were boiled down to a single 
phrase, it would be, to borrow a line, ``the best of times and worst of 
times.'' In the last two and one-half years, we have begun to put 
together the pieces for a viable national service which is 
operationally self-sufficient. We know that two years in the future, we 
will inaugurate the first high-speed rail service in America and usher 
in a new level of rail passenger service for our customers. And, in the 
next few months, I am hopeful that we will be sharing revenues with our 
freight partners by using Amtrak trains for the delivery of time-
sensitive materials. Each of these endeavors is expected to generate 
large net-revenue benefits, help steady our finances, and make Amtrak 
far less dependent on federal resources.
    The problem is that in the short term, I am not sure that we will 
remain solvent. Further, I do not believe that enough people realize or 
understand how close to extinction intercity rail service is in the 
United States.
    I make this statement in stark terms because I want the attention 
of the Congress. The demise of Amtrak need not happen. In fact, it 
would be a national tragedy if it did. Unless we all, and I mean 
Amtrak, Congress and the Administration, work together during the next 
six months, we will likely be out of cash and out of business by the 
summer of 1998.
    This Subcommittee has a major role to play in whether or not 
America has a national rail passenger system. The answer in the short 
term is adequate operating support, legislative reform, and dedicated 
capital. I have a fiduciary responsibility to make the right decisions 
and recommendations to make a national system work. But I need the help 
of this Committee and others in Congress.
    Two years ago, the Administration and the new Congress indicated 
that if Amtrak was to survive, it would have to eliminate its 
dependence on federal operating support. We were faced with a daunting 
task. For some reason Amtrak, the only major mode of transportation 
which does not have a dedicated source of funding, is held to a higher 
standard than any other mode, all of which are dependent on the federal 
government for support and none of whom are called upon to defend 
themselves in terms of ``profitability.'' We are also held to a higher 
standard than any other passenger rail system in the world, all of 
which rely on some level of federal support. Amtrak covers more of its 
operating costs--an estimated 84 percent--than any other passenger 
railroad in the world, and serves more than 93 percent of the 
continental states, while receiving less than 3 percent of all federal 
transportation spending.
    I am not aware of any transportation system that supports itself 
solely through user fees. According to the US DOT, in fiscal year 1994 
nearly $6 billion more was spent on highways than was collected in user 
fees. In fiscal year 1995 nearly $8 billion more was spent on highways 
than was collected in user fees. It's not just highways--transit is 
exempt from the gas tax and received approximately $3 billion in 
gasoline revenues last year. No mode is self-financed.
    Amtrak is an absolutely critical part of our national 
transportation system in both rural and urban areas. To provide some 
context, if we were an airline carrier, we would be the third largest 
in the United States. We carry almost half of the combined air-rail 
market between Washington, DC and New York, and when intermediate 
cities (such as Baltimore and Philadelphia) are included, Amtrak's 
share of the air-rail market rises to seventy percent. Loss of Amtrak 
service in this corridor would not only put a huge financial burden on 
the affected states, it would require another 7,500 fully-booked 757's 
to carry our passengers every year, or hundreds of thousands of cars 
added to already congested highways. If Amtrak disappeared tomorrow, 
there would be an additional 27,000 cars on the highway between Boston 
and New York every day. Between New York and Philadelphia, Amtrak 
service removes 18,000 cars from the highways every weekday.
    That number--18,000 cars a day--does not include the thousands of 
commuter rail passengers, and their parked cars, that are carried on 
Amtrak's Northeast Corridor by commuter agencies such as New Jersey 
Transit (NJT) and the Southeastern Pennsylvania Transit Authority 
(SEPTA) every day. These commuter agencies could not operate if Amtrak 
did not maintain the track, bridges, signals and electric traction 
system on the Corridor. Above and beyond Amtrak's enumerated ridership, 
another 220 million commuter passengers ride on Amtrak's Corridor 
between Boston and Washington, DC every year. You can measure Amtrak's 
impact not only in the number of cars removed from the road, but also 
in terms of avoided costs--as reported in the Journal of Commerce last 
May, Amtrak's presence eliminates the need for twenty additional 
highway lanes in New York City, and ten new tunnels under the Hudson.
    It's not just the urban corridors that depend on our service. Some 
22 million of our 55 million passengers depend on Amtrak for travel 
between urban centers and rural locations some of which have no 
alternative modes of transportation. Some of the most persuasive 
appeals for flexibility for Amtrak and some of the strongest advocates 
for a dedicated trust fund have been elected officials from those 
states who are facing the elimination of Essential Air Service (EAS) or 
the disappearance of local bus service, and truly face the elimination 
of all other modes.
    Finally, it also must be noted that Amtrak carries all these 
passengers even as the terms of relative investment by mode become more 
and more disparate. In real terms, spending for highways approached $20 
billion last year while capital investment for Amtrak was less than 
$450 million. In relative terms, between fiscal year 1980 and fiscal 
year 1994, transportation outlays for highways increased seventy-three 
percent, aviation increased 170 percent, and transportation outlays for 
rail went down by sixty-two percent. In terms of growth, between 1982 
and 1992 highway spending grew by five percent, aviation by ten 
percent, while rail decreased by nine percent. The overall funding 
amounts as well as the relative levels of investment should make one 
wonder how Amtrak has managed to maintain a fairly constant level of 
ridership, not why it hasn't increased its share. Amtrak has been 
accused of not serving enough of the travelling population, but that 
must be weighed against the price of not serving those travelers. It 
isn't just a matter of slightly more clogged roads or additional 
pollution. For some people it is the only way ``to get there from 
here.''
    I both hope and expect that Amtrak will play an even larger role in 
America's transportation system in the future, as Congress, the states, 
and local planners work toward developing a more balanced 
transportation system which addresses the increased congestion, land 
use and clean air challenges.
    At this point in time, however, playing a bigger role in our 
transportation system is a dream. I have had to call too many 
governors, mayors and Members of Congress over the past three years to 
tell them that I will be eliminating or reducing Amtrak service in 
their district, town or state. I relish making these calls even less 
than the recipients enjoy receiving them. I believe in a national 
passenger rail system, but years of disinvestment in the system are 
finally taking their toll. As GAO will confirm for you today, Amtrak is 
in difficult financial shape. We cannot preserve a national passenger 
rail system through yet another year of inadequate funding. I can also 
assure you that Amtrak will have to break its commitment to achieve 
independence from federal operating support if we are not given an 
adequate, reliable dedicated source of capital funding, and the 
requested level of declining operating support. As we have always said, 
operational self-sufficiency is absolutely dependent on adequate 
capital investment in the system.
    How did we get into the financial condition GAO has described for 
you? Nearly a decade of inadequate appropriations, especially for 
capital investment, has caused us to borrow heavily from private banks. 
Amtrak also owns, operates, and maintains the majority of the Northeast 
Corridor, a critical transportation asset that carries more than 1,000 
trains a day, including Amtrak, seven different commuter railroads, and 
freight. The Northeast Corridor is in the midst of a tremendous make 
over of transportation. Work is underway to introduce high-speed rail 
service to America. In preparation, investments have been made to 
upgrade and modernize the infrastructure--track, bridges, and 
structures--in the north end. This past spring, construction also 
started on the completion of a 75-year transportation plan--
electrification north of New Haven. The high-speed rail program has 
been met enthusiastically by rail riders as well as investors. 
Significant capital investments are needed on the south end and a 
continued source of capital will be needed for the entire program if we 
are to have the highest return on this investment.
    To provide some context, in the fall of 1994, we, as brand new 
managers of Amtrak, evaluated and came to grips with the corporation's 
financial fragility, and began taking the steps to avoid bankruptcy. 
Two years ago, I came up here and laid out for our authorizing 
committees a three-pronged approach which would reduce Amtrak's 
deficit, improve our operating ratio by making capital investments in 
our infrastructure, and reduce costs through legislative reform. We 
implemented a business plan at that time which internally generated 
nearly $400 million in savings on an annualized basis and re-engineered 
virtually every aspect of our operations.
    To help us, we asked Congress to enact legislative reforms which 
would allow Amtrak to operate more like a business, and provide us with 
a dedicated source of capital funding and the requested level of 
operating support. These three items--Amtrak-controlled cost savings, 
legislative reforms, and establishment of a dedicated capital funding 
source--were the key to surviving, and doing so without operating 
support. Two years later, we have successfully advanced only one of the 
three prongs. Ours.
    During the past two years, Amtrak has reduced costs, eliminated 
some of our poorest performing routes, retired old 1950's era 
equipment, eliminated a large number of positions, consolidated 
operations, rationalized our fare structure, and made countless 
productivity improvements. As important, we have restructured our 
service so that decisions are made closer to the passenger. We also 
improved our on-board services. The trains we are operating today are 
light years ahead of where they were in 1994. In addition, we have 
progressively managed to modernize our fleet of rolling stock, purchase 
new and more efficient locomotives, and have ordered the first 
generation of North American high-speed train sets, all with private 
capital. Our six-year strategic plan provides us with an innovative way 
out of our current financial predicament but has very little cash 
cushion. The plan, adopted by our Board of Directors last September, 
will require short-term borrowing simply to finance operations over the 
next three years of close to $180 million ($66 million this year). 
These borrowed funds will be paid back through profits generated from 
capital investments in high-speed rail implementation, locomotive 
replacement, reflecting and other critical capital projects which will 
generate new revenues, reduce expenses, and leverage new state and 
local support for trains. Without the capital investment, the revenue 
and savings will not be generated and the already difficult cash 
management task will be impossible to manage.
    Unfortunately, neither the legislative reform nor the dedicated 
funding source was enacted last session, and we've been provided $125 
million less than requested in operating grants over the past two 
years. The Senate Finance Committee came closest when it reported S. 
1395, which redirected \1/2\ cent of the federal fuel tax into a 
dedicated trust fund for Amtrak. Unfortunately, it was never taken up 
by the full Senate. However, companion legislation to accomplish the 
same thing has been introduced in both the House and the Senate this 
year. On this side, Senators Roth and Moynihan are the primary authors 
of S. 436, which takes \1/2\ cent of the permanent 4.3 excise fuel tax, 
currently going toward the General Fund, and redirects it to an 
Intercity Passenger Rail Account. I believe their positions of 
leadership on the Finance Committee bode well for the future of the 
bill. I also want to publicly thank Senator Lautenberg for being a 
cosponsor of that bill. More recently, Senators Baucus and Warner 
introduced S. 634, which is more far reaching legislation and which 
includes the \1/2\ cent provision.
    As GAO testified two weeks ago, in the current fiscal environment, 
the best course is to provide a significant capital funding increase. 
It is the single best solution for both Amtrak and for the American 
taxpayer. It does not constitute a new tax--it is an existing one. It 
would increase the spending on transportation overall without taking 
dollars from any other mode, and most importantly, it would allow 
Amtrak to preserve the national system and attain operating self-
sufficiency.
    Congress must soon make a decision on whether or not it wants this 
country to have a national rail passenger system. If we go on without 
the necessary capital investment, it will be a decision by default, 
resulting in bankruptcy--which is a painful and messy way to implement 
policy.
    If the decision is simply to end Amtrak, we ought to face it head 
on and deal with the reality that comes with it. There is no question 
that it has some significant costs. Dissolution of Amtrak by neglect 
would be irresponsible. Two years ago, the Budget Committee and others 
in Congress asked us what we thought the dissolution of Amtrak would 
cost the American taxpayer. At that time, we estimated that the costs 
would top out at, or above, $5 billion. This number, which included the 
mandatory labor protection costs, was later certified by the 
Congressional Budget Office.
    In addition, the elimination of Amtrak would mean the loss of over 
20,000 jobs, well over 1,500 pieces of equipment would have to be 
parked, mandatory labor protection be triggered, Railroad Retirement 
would be further burdened and the list goes on and on. Ironically, the 
dissolution of Amtrak would likely cost the American taxpayers nearly 
20 percent more money than the entire five years of funding for a trust 
fund proposal. The latter solution has the bonus of creating a viable 
and less costly national rail passenger service.
    At the same time, although there is a critical and immediate need, 
the picture is not all bleak. Between the 1st and 2nd quarter this 
year, Amtrak's year-end cash deficit projection, after five months of 
actual financial data, has improved from $96 million to $76 million. I 
also believe that the support exists in this Congress to finally put 
Amtrak on more equal footing with other modes. There are ten cosponsors 
of S. 436, three cosponsors of S. 634, and two other bills being 
introduced in the Senate which include the \1/2\ cent provision. In 
addition, last year a non-binding ``Sense of the Senate'' amendment to 
the fiscal year 1997 Budget Resolution, supporting the creation of an 
Intercity Passenger Rail Account using \1/2\ cent of the fuel tax, was 
adopted 57-43, and later included in the conference report. With the 
reauthorization of ISTEA approaching, I think the appropriate vehicle 
exists. The time is right.
    I can share with you the vision of what Amtrak can be in a few 
years if a trust fund is provided. High-speed service will be operating 
in the Northeast, strong state investment and partnerships in the West, 
and profitable mail and express-laden long-distance trains connecting 
both coasts. The path to that is the half-cent and legislative reform 
that will allow Amtrak to maintain a national system, complete our 
high-speed rail initiatives, and develop the business partnerships with 
the freight railroads. Adequate operating funds and a dedicated capital 
funding source will deliver an Amtrak that will be, for the first time, 
free of federal operating support.
    There are no simple solutions to Amtrak finances, but it is very 
clear that Amtrak cannot continue to go on as we have been, bleeding 
the corporation and trying to achieve prosperity by downsizing the 
system. I sat here two years ago and presented a workable plan to 
achieve operating self-sufficiency, and I sit here today with the same 
proposal, seeking your help. It is also very clear Congress cannot make 
Amtrak better simply by wishing it so.
    Unfortunately, we no longer have the luxury of time. Without 
adequate resources there is only a limited amount of time that Amtrak 
can be held together and a national system preserved. The GAO report 
should be viewed as a call to action. Over the next few months, I hope 
we at Amtrak can work with this Committee, and the United States 
Congress, to save and strengthen this railroad for future generations 
of Americans.
    I am enclosing a detailed summary of our fiscal year 1998 Grant 
Request, and I look forward to answering any questions the Committee 
may have.
                                 ______
                                 
            Explanation of Amtrak's Fiscal Year 1998 Request
    Amtrak requests: $245 million in federal operating assistance; $751 
million in federal capital (which includes funding for the Northeast 
Corridor); $142 million in excess RRTA for fiscal year 1998.
Operating Support
    Amtrak is requesting $245.0 million in operating support in fiscal 
year 1998. It represents an increase of $45 million or 22.5 percent 
increase over the original appropriation for fiscal year 1997 of $200 
million before the Omnibus Appropriations Act (OAA) of 1997. The $245 
million is $20 million over the original glidepath amount for fiscal 
year 1998 in order to help compensate for the cumulative fiscal years 
1995-1997 underfunding and help limit the impacts of the fiscal year 
1997 cash deficit on fiscal year 1998, keeping Amtrak on plan for 
fiscal years 1998-2002.
Excess RRTA Contribution for fiscal year 1998
    The sum of $142.0 million represents the current estimate for 
actual mandatory excess RRTA liabilities in fiscal year 1998. The 
methodology for calculating the liability has been shared with OMB and 
was submitted to Congress and this Subcommittee on February 15. It is 
Amtrak's position that the excess RRTA liability should be fully funded 
by the federal government and not considered a part of federal 
operating support to Amtrak. The RRTA account of $142 million is a 
mandatory spending provision that has nothing to do with Amtrak's cost 
of providing rail passenger service. These costs are based on a federal 
formula that requires Amtrak to pay the retirement costs of former 
freight railroad employees who have never worked for Amtrak. These 
costs will exist whether or not Amtrak continues its operations and 
these payments rightfully belong in a mandatory account. As stated in 
the fiscal years 1997-2002 Strategic Business Plan, Amtrak must 
continue to either receive full reimbursement from the federal 
government for these federally mandated excess RRTA costs or be 
relieved from paying them altogether.
Federal Capital Support
    The fiscal year 1998 grant request is $751 million or the 
equivalent of \1/2\ cent of the existing federal motor fuels excise 
tax.\1\ This is only 68 percent of Amtrak's fiscal year 1998 capital 
sources and 52 percent of our fiscal year 1998 needs. It is assumed 
that the difference between total needs and sources of funds can be 
commercially borrowed as long as a dedicated capital source is secured 
for the total amount over our planning period. Fiscal year 1998 is 
probably the most critical year for achieving the full implementation 
of high-speed rail in the Northeast Corridor in fiscal year 2000. Our 
February 15 grant request submission breaks this out in much greater 
detail.
---------------------------------------------------------------------------
    \1\ April 11 scoring by CBO equals $800 million.
---------------------------------------------------------------------------

                    STATEMENT OF PHYLLIS SCHEINBERG

    Senator Shelby. Ms. Scheinberg.
    Ms. Scheinberg. Thank you, Mr. Chairman and Senator 
Lautenberg. I appreciate the opportunity to be here today to 
discuss Amtrak's financial condition.
    As you know, Amtrak's passenger rail service has never been 
profitable and to date the Federal Government has provided 
Amtrak with over $19 billion for operating and capital 
expenses. In 1995, in response to continually growing losses, 
Amtrak developed a strategic plan to increase revenues and 
control cost growth, with the goal of eliminating its need for 
Federal operating subsidies by the year 2002.
    On the positive side, Amtrak's actions to reduce some 
routes and services, cut management positions, and raise fares 
have helped improve its financial performance. For example, 
Amtrak's net operating losses--total revenues less total 
expenses--declined from over $1 billion to about three-quarters 
of a billion dollars in 1996.
    Despite these efforts, Amtrak is projecting that its 1997 
net losses may be even greater than those of last year. These 
losses are one indication that Amtrak is still in a very 
precarious financial position. It remains heavily dependent on 
Federal support to meet its operating and capital needs. 
Amtrak's expenses have exceeded its revenues by at least $760 
million in every year since 1988. Amtrak had hoped that 
increases in passenger revenues would help close the gap, but 
for the most part passenger revenues have actually decreased 
when adjusted for inflation.
    Furthermore, Amtrak's operating deficits exceed the Federal 
operating subsidy. In 1996 this gap reached $82 million, the 
highest level of any of the last 9 years. To pay for the gap 
between operating deficits and Federal operating subsidies, 
Amtrak has had to draw upon its financial resources. To 
illustrate, Amtrak's working capital position indicates its 
ability to pay short-term bills out of current assets, such as 
cash and short-term receivables. Amtrak's working capital has 
decreased from a surplus position in the late 1980's to a 
deficit of $195 million in 1996. This affects Amtrak's ability 
to pay its bills over the short term.
    A related concern is with Amtrak's debt level, which has 
doubled since 1993 from about one-half of a billion dollars to 
almost $1 billion. Amtrak expects to borrow an additional $1 
billion in 1999 to finance high-speed trainsets and maintenance 
facilities.
    As Amtrak's debt levels have increased, interest expenses 
on this debt have also increased. In fact, over the last 4 
years annual interest expenses have tripled, from about $21 
million to about $60 million. Interest expenses now consume 
over 21 percent of the Federal operating subsidy and will 
consume an even higher portion of its Federal operating 
subsidies as Amtrak assumes more debt.
    Amtrak's goal of eliminating Federal operating subsidies by 
the year 2002 is heavily dependent on capital investment. For 
the Northeast corridor alone, Amtrak estimates that an 
additional $1.4 billion are needed to bring high-speed rail 
service between New York and Boston and about $2 billion are 
needed over the next few years for the south end of the 
corridor just to preserve the ability to operate at existing 
service levels.
    However, an increasing portion of Amtrak's Federal capital 
subsidy is being devoted to debt service, capital overhauls, 
and legally mandated uses, such as equipment modifications and 
environmental cleanup. As a result, the portion of the capital 
grant available to meet general capital investment needs 
continues to shrink. In fiscal year 1997 only about 5 percent 
of Amtrak's Federal capital grant of $223 million is expected 
to be available for general capital needs.
    Regarding the future, Amtrak anticipates significantly 
increased levels of Federal capital assistance, about $750 
million per year, compared to the $478 million in capital 
funding that Amtrak received this year. However, even with 
increased capital funding, Amtrak will continue to find it 
difficult to take the actions that are necessary to further 
reduce its costs. While Amtrak was somewhat successful in 
making route and service adjustments in fiscal year 1995, it 
was less successful in 1997. Amtrak has also been unsuccessful 
in negotiating productivity improvements with labor.
    To conclude, although Amtrak's business plans have helped 
reduce net losses, we see little hope for Amtrak to reach the 
goal of operating self-sufficiency by the year 2002. We believe 
that as currently constituted Amtrak will continue to require 
significant Federal financial support, both operating and 
capital, well into the future.
    Mr. Chairman, thank you. That concludes my statement.
    Senator Shelby. Thank you.

          Federal Government's Liability if Amtrak Liquidated

    Ms. Molitoris, the Federal Government I understand has 
appropriated over $19 billion for Amtrak since the 
corporation's formation in 1971. If continued Federal funding 
was not provided this year for Amtrak, either by a dedicated 
trust fund or appropriation, what would the Federal 
Government's liability be in the event of a liquidation of the 
corporation?
    Ms. Molitoris. Well, of course, Mr. Chairman----
    Senator Shelby. In that event?
    Ms. Molitoris. We agree that the corporation is crucial to 
the transportation network of the country. Under the scenario 
that you paint, of course, there is a real danger of the loss 
of a true important transportation resource. That is the 
Northeast corridor, which, as I am sure you are aware, is a 
lifeline for hundreds of thousands of commuter travelers.
    The agreement, the lease arrangement that Amtrak has with 
the Federal Government, is one of 1,000 years with a balloon 
payment at the end. So there is a question of technically the 
amount of value in 1997, considering that kind of a lease, is 
small and the concern, of course, would be when this was 
litigated, as it surely would be, what the decision of any 
court would be.
    The Congress does have the ability by congressional action 
to accelerate that value to protect that asset for the Federal 
Government.
    Mr. Downs. Mr. Chairman, if I might.
    Senator Shelby. Sure, Mr. Downs.
    Mr. Downs. Two years ago the House Budget Committee asked 
that CBO score that scenario. It was $5 billion.
    Senator Shelby. It was $5 billion.
    Mr. Downs. According to CBO.
    Senator Shelby. Scored at $5 billion.
    Mr. Downs. Yes; $5 billion.

                    Opportunities for Privatization

    Senator Shelby. I understand that the Northeast corridor is 
profitable, is that correct?
    Ms. Molitoris. The Metroliners, Mr. Chairman, on the 
Northeast corridor are for the first time in the history of the 
corporation making a profit, and I think that indicates the 
kind of progress the company is making.
    Senator Shelby. Is that an indication that the Northeast 
corridor could possibly be run by a private company if Amtrak 
were liquidated?
    Ms. Molitoris. Well, I would comment, certainly with the 
kind of management that Amtrak is receiving, the Metroliners 
are very popular and are making a profit for the company.
    I would like to comment for the record with regard to 
Senator Gorton's comments, that we are responsible for the 
privatization study that he requested and I want you to know 
that we are doing this in a very thoughtful way. We have 
already reached out with meetings with local and State 
governments and throughout the system, and we will be providing 
the Congress with that report in August. So I do not know where 
the Senator got his information, but, being the responsible 
party, I would like to make that statement.
    Senator Shelby. Well, that is good.
    You did not suggest that a private company could profitably 
run a national railroad, did you?
    Ms. Molitoris. What I would like to suggest is that I think 
the full report will do a better job of giving you all of the 
elements. I think it is interesting----
    Senator Shelby. When is that coming?
    Ms. Molitoris. That is due in August, Mr. Chairman.
    I could comment on efforts throughout the world in terms of 
privatization. I think it is very important for someone 
studying this issue to recognize that so-called privatization, 
which is defined in a variety of ways, in Britain, Germany, and 
elsewhere, Japan, almost exclusively involves the government 
owning and maintaining the right of way while the operational 
franchise for operating those systems then goes to a private 
company.
    So I am not sure that most people who use the term 
``privatization'' consider that kind of a split.
    Senator Shelby. It is some kind of a mix, anyway, is it 
not?
    Ms. Molitoris. Yes; it is, sir.

            Amtrak's Federal Subsidy on Per Passenger Basis

    Senator Shelby. Ms. Scheinberg, how does the Federal 
subsidy per passenger for Amtrak, noncommuter passengers, 
compare to the Federal cost per passenger for commercial 
airline passengers? Is there any data available on Federal 
costs per passenger for intercity business service? Have you 
gotten any into that?
    Ms. Scheinberg. I do not have information on the intercity 
bus service, but if you look at the general fund Federal 
subsidy to commercial airlines and if you look at that portion 
of the airline industry, it is about $1.50 per emplanement, and 
if you look at the Amtrak direct Federal subsidy it comes out 
to about $38 per passenger trip.
    Senator Shelby. It is $38?
    Mr. Downs. Mr. Chairman, if I might.
    Senator Shelby. Mr. Downs.
    Mr. Downs. The Congressional Research Service, at the 
request of Senator Pressler, was asked the same question. They 
did three comparisons. One was highways from general funds, 
including user fees. That is all local property, sales, and 
income tax. That was $79 per person in the United States on 
highway, according to CRS.
    The second was Amtrak's. This was done on 1990 data to make 
sure that it was completely clean. CRS said the number was $27.
    On aviation, they recognized that there was a $19 billion 
general fund subsidy to general domestic aviation before any 
user fees were imposed and the inability to quantify the 
subsidy that goes to aviation for the use of tax exempt bonding 
and property tax exemptions for airports as a business, but 
said it was probably in the billions of dollars as a subsidy.
    It is a report that I would be glad to share with the 
committee.

                    Amtrak's Long-Term Funding Needs

    Senator Shelby. Mr. Downs, let us just assume for a moment 
a best case scenario. Let us say that Congress enacts the one-
half-penny trust fund for capital expenses, that Amtrak is able 
to offset more of its operating losses with increased revenue 
from high-speed services in the Northeast corridor and other 
savings and efficiencies realized along the way. A dedicated 
funding resource based on Federal gas tax revenues is 
authorized for only 5 years if it happens. What would you do 
when it goes away?
    Mr. Downs. We have been told, and I have been asked this 
same question, will it be able to go away? And that was asked 
by Senator Warner, Senator Chafee, Senator Moynihan, Senator 
Roth in various hearings that I have been through in the last 3 
weeks.
    The answer is, We will probably have some need for some 
ongoing capital because no railroad, with the exception of the 
Illinois Central and the Norfolk Southern, in the United States 
makes its full cost of capital. Not even railroads as large as 
the Union Pacific-Southern Pacific, for instance, make their 
full cost of capital yet.
    We have said that part of the key to that will be what the 
Congress decides to let States do with Federal transportation 
dollars about funding flexibility. It depends on what we can do 
about developing business alliances where others can make 
investments in us on a capital basis, for instance ongoing 
power distribution investments in the corridor based on an 
ability to partner with power companies in the Northeast.
    We say we will need capital. We do not believe that it is 
necessary to extend the one-half-cent gas tax trust fund beyond 
its 5-year life. Senator Chafee has said that his expectation 
was that it would return to deficit reduction. Others have said 
that it is going to go into the highway trust fund account. Mr. 
Shuster has made it clear in his authorization bill that if it 
does include an authorization for a trust fund, it would be a 
5-year limited life. Senate Finance has said the exact same 
thing.
    Senator Shelby. Do you see in the foreseeable future, Mr. 
Downs, any scenario where you would not need some kind of 
subsidy?
    Mr. Downs. The only thing that we have said that we will 
continue to need is some way of funding excess railroad 
retirement long term. We have said that that is in effect a 
subsidy to the existing freight railroads.
    Senator Shelby. How much money are you talking about?
    Mr. Downs. $145 million a year that Amtrak pays into 
railroad retirement above whatever its normal charges would be. 
There are 800,000 retired railroad employees in the United 
States, almost all of them freight railroad employees. There 
are 175,000 existing employees in the railroad industry, so the 
charges are pretty hefty. Most of those, 95 percent of those 
employees, are freight railroad employees.
    We believe it is unfair to consider that a subsidy to 
Amtrak. If Amtrak went away tomorrow, those charges would be 
spread immediately to the freight railroads. We think that that 
needs to be addressed, not as a subsidy to Amtrak, but a 
subsidy to the railroad retirement system.
    Senator Shelby. Well, it certainly does not need to be 
hidden, does it?
    Mr. Downs. No; it does not.
    Senator Shelby. Mr. Downs, in your testimony you state that 
Amtrak provides a necessary service for rural communities as 
well as urban corridors. Do you still believe that?
    Mr. Downs. Absolutely, more than ever.
    Senator Shelby. Give us several examples?
    Mr. Downs. I was meeting with some folks in Haver, MT. The 
mayor said: ``You know, everybody, the rest of the world has 
kind of left us all behind. We do not have essential air 
service. We have a highway. Sometimes in the winter up here, it 
closes. If you cannot drive a car or a four-wheel vehicle, you 
do not have mobility up here. We do not have economic 
development resources like an airport. We do not have it in 
terms of the kind of rail system that the rest of the country, 
particularly the east and west coast, take for granted.''
    That railroad from Haver, MT, to Minot, ND, is an essential 
part of business development and local transportation for them, 
for seniors, for young people, and for the handicapped. He said 
it is just an essential part of the railroad business.
    Anniston, AL, will say the same thing about connections to 
places like New Orleans and Birmingham. We do provide that 
linkage, and we are proud of it.

                          Route profitability

    Senator Shelby. Mr. Downs, it is my understanding that, of 
the Amtrak routes, the Metroliners between Washington, DC, and 
New York are the only profitable routes. Is that right?
    Mr. Downs. On a fully allocated cost basis.
    Senator Shelby. OK.
    Mr. Downs. The next closest is, I believe, AutoTrain.
    Senator Shelby. Have you thought about trying to close or 
realign some of your most unprofitable routes? That is just the 
way you do business, is it not?
    Mr. Downs. We have. This committee stopped that process 
last year by saying that they thought we ought to defer those 
route closings for 6 months to give those States the 
opportunity to see if they wanted to partner. Those routes, 
particularly the Pioneer and the Desert Wind, Senator Reid's 
service, disappears on the 11th of this month. Service to 
eastern Oregon, Wyoming, Idaho, on the Pioneer disappears. The 
Texas legislature is still struggling with whether or not they 
are actually going to invest enough money to keep the Texas 
Eagle going until the 1st of October. If they do not, that 
service will go away.
    We have said we have to do that. Everybody said be a 
business. We are now about 20 percent smaller than we were 36 
months ago. We are several thousand employees smaller as a 
result of that. We think we are more efficient. But we have 
kept every one of those commitments about downsizing the 
railroad to make it more businesslike.
    Ms. Molitoris. Mr. Chairman, if I might.
    Senator Shelby. Sure, go ahead.
    Ms. Molitoris. I would like to comment on cutting your way 
to health. You mentioned, your comment was: That is the way you 
do business, is it not?
    Senator Shelby. Well, you do, but you do not cut your heart 
out.
    Ms. Molitoris. Right, or the arteries, either.
    And I want to make this comment. Certainly all the biggest 
and most profitable, most healthy passenger railroads in the 
world, especially in Japan, have an interesting mission 
statement, and that is--for example, Japan East, which makes 
more money than any other passenger railroad because they have 
almost unlimited passengers, that 50 percent of their revenues 
will come from nonpassenger sources.
    Mr. Downs mentioned that the last time the rail passenger 
service was close to break-even it was because they had mail 
and express. It was not until just a few months ago that Amtrak 
was looking at even enhancing the mail and express that they 
already had.
    So if you cut away vital routes, you cannot even have the 
opportunity for very valuable and important express service. So 
I want to just get for the record that that is not always as 
simple as it sounds. Some people think, well, you just cut, 
cut, cut until you somehow achieve health, and with this 
railroad that is not possible.

                          Labor-Related Costs

    Senator Shelby. Under current rail labor laws, I understand 
Amtrak is required to pay up to 6 years salary to anyone who 
loses their job as a result of Amtrak's reduction or 
terminating service. Would the administration support revising 
this provision to allow labor unions and Amtrak management to 
negotiate a more workable solution?
    Ms. Molitoris. Well, Mr. Chairman----
    Senator Shelby. Have you thought about it?
    Ms. Molitoris. In the discussions of last year the 
administration continued to support the opportunity for Amtrak 
management and labor to come to an agreement that was 
satisfactory to both. I think it is also--I would like to have 
for the record that C2, as it is called, is sometimes----
    Senator Shelby. The 6-year provision?
    Ms. Molitoris. Yes, sir; is sometimes held out to be much 
more significant expense than it really ends up being. If the 
railroad closed everything, then that $5 billion that Mr. Downs 
mentioned would occur. But in fact, even in the route closings 
that the railroad has accomplished, the estimates of the cost 
were much more than they actually ended up being, something in 
the neighborhood of approximately $10,000 per person. So I 
think----
    Senator Shelby. So it is an overstatement thus far?
    Ms. Molitoris. Well, I think that railroad labor wants this 
railroad to succeed and has a history of working to have good 
agreements with management. So I just want to point out that 
the facts do not always substantiate this, which is always 
pulled out as somehow the panacea for the health of the 
railroad.
    Senator Shelby. GAO, for example, stated that Amtrak has 
been unsuccessful in negotiating productivity improvements with 
the labor unions. Many of the same craft unions are represented 
at both freight rail and Amtrak labor negotiations and I know 
there is pressure from labor to secure equally favorable 
agreements with Amtrak--that would be logical--as have been 
secured with the freight railroads.
    As a result, in the last 6 months many freight labor union 
agreements have been negotiated, while I understand that Amtrak 
is stuck at the table, bargaining still. Is that correct?
    Ms. Molitoris. I think Mr. Downs is better able to respond 
to that.
    Senator Shelby. Mr. Downs, is that right?
    Mr. Downs. We have 13 labor unions, 25 collective 
bargaining agreements. All of them have expired. Some of them 
have been expired for as long as 2\1/2\ years. You are 
absolutely right that part of the motivation with rail labor 
was to conclude their freight railroad contracts. Freight 
railroads had a lot more in terms of profits and could afford a 
better settlement, and they are also 90 percent of the 
employment in the rail labor industry. So it was important for 
them to finish those agreements first.
    We have said that we were willing to do gain-sharing type 
contracts, that we are not asking for give-backs, not asking 
for fundamental changes in the way that the contracts are 
drawn. We have said, however, that if we can make changes in 
the way work rules are put together, around the way health care 
is provided, or in other areas, that we would count that in and 
that it would have zero impact on our business plan.
    It has been very difficult because of the disparity between 
the impact of a freight railroad agreement on Amtrak. We have 
done some calculations. Over 5 years, the freight railroad 
agreement would cost Amtrak about $220 million. We have not got 
$220 million.
    Ultimately, that issue may be resolved by Congress because, 
as you know, the Rail Labor Act says that if there is a release 
from mediation and there is a job action and the President 
deems it in the national interest, there is a Presidential 
emergency board appointed. They make a finding. If the parties 
still disagree at the end of that finding and they are released 
from further action, then the issue is brought here to Congress 
to resolve.
    So ultimately, if the question is what assurance could the 
Congress have about a reasonable outcome on labor negotiations, 
this Congress will perhaps have the ultimate say about what 
those outcomes are.
    Senator Shelby. Senator Lautenberg, thanks for your 
indulgence.

               Administration's Budget Request for Amtrak

    Senator Lautenberg. Thank you, Mr. Chairman. The questions 
were interesting ones and I think ought to be answered, and 
they were.
    Ms. Molitoris, the administration's request for Amtrak for 
1998 is substantially lower than the levels requested by Amtrak 
itself. If the administration's budget request was enacted, 
would that permit us to avoid the system shutdown that Mr. 
Downs has warned us about by the summer of 1998?
    Ms. Molitoris. Mr. Chairman, Senator Lautenberg, the 
administration's budget is barebones. I have said that clearly. 
There is no fat in it at all. We need every cent.
    Senator Lautenberg. Is there any marrow in it?
    Ms. Molitoris. There is marrow.
    Clearly, Senator Lautenberg, I think, given our challenges 
with deficit reduction, the administration has made a clear 
statement of support and has invested over the life of this 
administration more in the last 4 years for Amtrak than in the 
previous 10. However, we recognize this will not be easy. The 
cash problem that Mr. Downs has raised he is addressing.
    In all the years on the board since the Clinton 
administration has arrived, the projected deficits by Amtrak 
have always been in the neighborhood of $200 million or 
something in that area and the board has always asked for 
actions by management to address that deficit. The same 
continues to go on. We believe Amtrak is going to have to push 
hard with the administration's request, cut costs, increase the 
partnerships with States, increase the private sector 
partnerships. And there are many opportunities. We know that 
mail and express can produce some positive effects. We know 
some more partnerships with private industry can produce 
effects.
    But we also know that it is going to be very, very tight 
for 1998. As I mentioned, we do not know at this time if the 
numbers that Mr. Downey mentioned of somewhere around $10 
billion with $7 billion authority will net any more opportunity 
for Amtrak or not.
    Senator Lautenberg. I think that I heard you say that--no.
    Ms. Molitoris. I said yes, Mr. Chairman, and Senator 
Lautenberg.
    Senator Lautenberg. Well, by the time we get finished with 
these partnerships and the agreements, and considering that 
there are political ramifications to every one of these 
decisions, I could have a full head of white hair by that time. 
It is going to take a long time, I would believe. I think we 
need more.
    Mr. Downs, what do you--can you give us a little 
information about how you see the administration's budget 
request? Does it seem to be adequate to you?
    Mr. Downs. There is a leading question.
    Senator Lautenberg. Speak freely, young man. You are among 
friends.
    Mr. Downs. Speak freely?
    I had long and difficult arguments with the Office of 
Management and Budget over the President's budget request. We 
said we did not make the request for $245 million lightly. We 
did not make it because we thought that it was kind of a nice 
to do, pie in the sky kind of target. We explained that on a 
cash basis we would have a very difficult time making it at the 
administration's number.
    The answer was: We are sorry; that is all the room there 
was in their budget. It was not necessarily a longer story 
about what they thought it meant or how this whole process 
looked over a couple of years. It was simply that there was no 
room in the inn for anything more.
    It does make for a very difficult environment for labor 
contract negotiations. It creates no room. It makes it a 
shrinking sum pie. It makes for a kind of hostile, antagonistic 
environment with labor. Labor supported a larger number with 
the administration aggressively.
    The sum of $200 million is one of the reasons why we will 
probably face a liquidity crisis at the end of fiscal 1998. We 
will be clearly challenged, I think is the right term, by a 
$200 million operating subsidy number.
    Ms. Scheinberg. Senator Lautenberg, may I address the 
question?
    Senator Lautenberg. Please, yes.
    Ms. Scheinberg. I think the $43 million that the 
administration's budget or operating subsidy is lower than the 
Amtrak business plan assumes will require, if you follow the 
business plan assumptions, that that money--the lack of that 
$43 million will require Amtrak to further borrow for its 
short-term needs and lead to the crisis that Mr. Downs is 
discussing.
    On the capital side, the administration's budget is $328 
million lower than what Amtrak is assuming. That level of 
capital support will not allow Amtrak to make the capital 
improvements that it needs to improve the quality of service, 
to attract more riders and increase revenues.
    Senator Lautenberg. This chart tells you something about 
the prospect of additional borrowing. We could get a larger 
page, of course. That would enable us to run the bar higher.
    Mr. Downs. Senator, I think our bankers have told us that 
we are probably at the limits of our credit in terms of long-
term borrowing, unless there is something unique that happens 
in our future, that we have probably exhausted all of our 
capabilities with the last round of high-speed trainsets.
    Senator Lautenberg. I am glad that these charts are not my 
EKG, I can tell you that.

                           Northeast corridor

    Ms. Scheinberg, do you know of any investment that holds 
the kind of promise that the Northeast corridor high-speed 
project could offer in terms of generating substantial revenues 
to aid Amtrak's bottomline?
    Ms. Scheinberg. The high-speed rail improvement project on 
the north end of the Northeast corridor is the best investment 
that Amtrak can make. As we discussed, the Metroliner is the 
only route that covers all its fully allocated costs, and 
Amtrak's plans are to extend that type of service to the north 
end of the corridor. By doing that and in making that 
investment, the hope is to generate the revenues that would 
cover, more than cover, the cost of that route and apply that 
surplus to the rest of the system.
    Senator Lautenberg. So positive cash flow could result.
    I have got to tell you something. I use Amtrak, Mr. 
Chairman, between here and Newark, and the Metroliner is good 
service. But it is not a great ride, the equipment. It is the 
only place I can go to find anything older than me around here. 
It bumps and it grinds. People try to do their best, but it is 
just not up to the kind of service that we ought to be 
offering.
    With that, it is a pretty good investment in terms of 
railroad as we sit here. There is nothing else in the system 
that offers that kind of opportunity.
    Ms. Molitoris, you were with me and Vice President Gore 
when we celebrated the signing of the new high speed train sets 
for the Northeast corridor. At the time the administration 
fully endorsed the goal of achieving 3-hour high speed service 
with the modern trainsets by the end of 1999, to be sure.
    Do you believe that we can have that high-speed service--
and 3 hours is not as good as it could be, but it would be 
good--based on the funding level that you have requested in 
your fiscal year 1998 budget?
    Ms. Molitoris. Mr. Chairman, Senator Lautenberg, of course 
we need to look at the whole NEXTEA proposal to really look at 
how the administration plans to invest in those high-speed 
trains, because the NEXTEA proposal stretches out to the year 
2003. And if you look at our total investment package, on the 
capital side we are suggesting 92 percent of what Amtrak itself 
is asking and 96 percent of the operating.
    So I do not think it is insignificant. But I think we must 
say that the Federal funds cannot do it alone. There is no 
major transportation system that gets 100 percent of its 
funding from the Feds, and the board of Amtrak is working with 
management to continually focus on new ways to instigate 
additional revenue, cost cutting, and ways to achieve all the 
goals in the business plan.
    The goal of the business plan is high-speed service, and of 
course we all want that because, as Ms. Scheinberg identified, 
it is going to be profitable, it is going to help the 
bottomline of Amtrak.
    The difficulty that we are facing is the shorter term; 1998 
will be very difficult. I think that the NEXTEA proposal 
clearly shows the investment and the support of those trainsets 
and the high-speed service. And I might comment that they are 
bending the steel now and those bodies will be ready for 
testing by the end of the summer.
    Senator Lautenberg. So you said they got 90 percent of 
their request, Amtrak?
    Ms. Molitoris. It totals 90 percent of what Amtrak----
    Senator Lautenberg. So you are saying to this patient, you 
are going to get 90 percent of the oxygen you need, and if you 
are around here a couple years longer than we expect you to be 
you are going to get the full shot. Because you said they 
stretched out the service, so we cannot possibly execute all 
these refinements, develop all these plans, get them into 
place--the interest and debt payments here are overpowering--by 
the original date. So we are now going to, you said, maybe 2003 
if I heard you?
    Ms. Molitoris. No, sir; what I am saying to you is, if we 
are going to use your analogy of oxygen, that the Federal 
Government pharmacy will give 90 percent of the oxygen and they 
will have to get an extra tube of oxygen from other sources, 
another pharmacy.
    The fact is there is a partnership that has to occur. The 
States are stepping up to the plate. I have mentioned that they 
have doubled their support of Amtrak in the last year. They are 
buying equipment because Amtrak is so important to them.
    Senator Lautenberg. Because Amtrak is important, but it is 
also so deficient.
    What happens in your judgment if the railroad does go into 
some default kind of position? What happens to commuter 
service? Is it affected? We have got New Jersey Transit, SEPTA, 
MTA, MARC, MBTA. Is there any impact at all on their operating 
costs, their ability to perform service?
    Ms. Molitoris. Mr. Chairman, Senator Lautenberg, not only 
is there some, there is tremendous impact. In fact, I do not 
believe the $5 billion reflects that kind of cost, because of 
course not only would Amtrak's service on the Northeast 
corridor be in danger, but the commuter services on the NEC 
would be in danger as well.
    That is why we continually emphasize this is a partnership, 
and the importance of Amtrak cannot be evaluated by their 
passengers alone, because in fact on the Northeast corridor 
three-quarters of the passengers are commuter passengers.
    Senator Lautenberg. So the partnership proposal is the one 
that says, if you want to keep this system going, that you are 
going to be the pharmacy necessary to keep this alive. So you 
can make your choice whether you just turn people to the 
highways and the airways and all that, and we will have to do 
it right away.
    Ms. Molitoris. Mr. Chairman----
    Senator Lautenberg. I would not want to be operating that 
pharmacy and to give you that decision, I must tell you.
    What about the costs or the involvement of the freight 
railroads to this operating annual cost that we have? Do you 
get any assistance, Mr. Downs, from the freight railroad 
community in support of the one-half-cent proposal, for 
instance?
    Mr. Downs. I thought you were going to say there for a 
minute, do we get any respect from the freight railroad 
industry. And the answer to that would be----
    Senator Lautenberg. Rodney--and I am talking about, not 
Slater, Dangerfield. Do not expect respect also.
    Mr. Downs. The American Association of Railroads' 
unofficial position, which I am not sure they have delivered as 
testimony for the record, is that because they pay 5.3 cents of 
diesel fuel tax to the deficit reduction fund at Treasury, they 
will likely oppose the creation of a one-half-cent gas tax 
trust fund for Amtrak if it includes any of the revenues that 
they pay to deficit reduction. They do not want to be paying 
into an Amtrak trust fund for any purpose.
    I think that is a relatively convoluted argument. I have 
said that time and again. They cannot necessarily track where 
the revenue goes, into Treasury or into trust funds. But I have 
been unable to dissuade them from that.
    At the same time, though, I have to say that we are having 
a lot of luck in developing working partnerships about the 
development of this new business, mail and express, with them. 
These will be joint ventures with them that will be very 
helpful to both of us. I think that their position so far on 
the trust fund is a bit murky.
    Senator Lautenberg. If Amtrak does go under, the freights 
will have to pay some significant contribution to Amtrak's 
railroad retirement bill, will they not?
    Mr. Downs. We currently pay total, management and employees 
and Federal payment, we pay $300 million a year into railroad 
retirement. If this railroad goes away, all of those costs, all 
$300 million, get absorbed into the railroad retirement fund 
and they are then spread to the freight railroads. Do they have 
an interest in not having that happen? You bet.
    Senator Lautenberg. I would imagine.
    Mr. Chairman, I have got a couple of other questions, but I 
do not want to keep our panel or the subcommittee here any 
longer. I think it is fairly obvious that more has to be done, 
and it cannot just be new innovative partnership designs or the 
creation of new business opportunities, which are coming at a 
time which we would describe as under the gun.
    I would hope that the administration will find a way to 
boost its transportation funding request to a more satisfactory 
level. I talk as a member of the negotiating committee on 
budget as well. But we have to make this investment. The 
communities are crying for it, the States are demanding it, and 
we are going to have to find a way to do it, Mr. Chairman.
    Thank you very much.
    Senator Shelby. Thank you, Senator Lautenberg.

                          Submitted Questions

    There will be additional questions which will be submitted 
in writing, and we urge you to respond to them within a 
reasonable period of time.
    [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 Shelby
                      capital assets and expenses
                 northeast corridor improvement project
    Question. When does Amtrak anticipate the completion of Northeast 
Corridor (NEC) electrification and commencement of high-speed rail 
service throughout the Corridor? What is the end goal of this project?
    Answer. The program is on schedule. Before the end of 1999, 
infrastructure and electrification will have been completed and Boston 
to Washington high-speed service will have begun, using electric power 
and no longer requiring a time consuming engine change in New Haven. 
The end goal of the program is to provide reliable high-speed rail 
service between Boston and New York in approximately three hours and 
between New York and Washington, DC, in under three hours.
    Question. With the commencement of high-speed service throughout 
the Northeast Corridor, what increase in ridership and revenue does 
Amtrak expect to realize on an annual basis? Have any independent 
auditors or other interested parties corroborated these projections?
    Answer. The revenue forecasts for high-speed rail service in the 
Northeast Corridor are based on extensive market analysis and modeling 
which incorporate all critical factors that drive market demand--travel 
time, trip frequency, fares, transportation alternatives and location 
of true passenger origination and destination.
    The growth forecasted for high-speed rail is premised on 
significant travel time reductions that place the train trip in a 
competitive position with alternative transportation modes, service 
frequency increases, service reliability and quality improvements and a 
reasonable pricing structure that is competitive with, or complementary 
to, airfares.
    Completion of electrification and high-speed rail investments (high 
horsepower locomotives, tilt-technology trainsets and infrastructure 
improvements) will reduce travel time between Boston and New York from 
four hours forty-five minutes to three hours. Southend travel time 
between New York and Washington, DC, will be reduced from three hours 
to two hours forty-five minutes.
    The investment made to complete the electrification of the northend 
and the investment made to improve the track, signal, stations and 
other infrastructure will benefit both high-speed rail service as well 
as NortheastDirect service. Travel times for all trains will improve on 
the Corridor.
    Service frequency increases drive a significant portion of 
forecasted revenue growth. The daily frequency of high-speed service 
increases on the northend from zero to eight roundtrips, while the 
current Metroliner service of 15-daily roundtrips on the southend will 
increase to high-speed service with 17-daily roundtrips. While this 
represents a 67 percent increase in roundtrips available, revenue 
estimates are not predicated on filling this to capacity.
    Investments in equipment and infrastructure produce reliability 
improvements that strengthen Amtrak's products and increase revenues. 
Reduced infrastructure related delays and mechanical failures from 
employment of new, proven equipment will enhance on-time performance, 
the key factor to customer satisfaction. Less time will be devoted to 
maintenance and repair due to state-of-the-art diagnostic and 
communications systems and manufacturer-trained and -managed staff.
    The NEC's current market share is 12 percent, with a 16 percent 
share of business travel and a 9 percent share on non-business travel. 
Current business travel along the Corridor is driven by the southend 
frequencies provided by the Metroliner service. When the market share 
is analyzed geographically, it is clear that Amtrak has the potential 
to increase ridership, particularly on the northend. The current market 
share for the north and south ends of the corridor are 7 percent and 16 
percent respectively. Since there is no first class/high-speed service 
currently provided between Boston and New York, the advent of an 
incremental eight daily roundtrips high-speed trains will increase 
ridership and market share. To place the revenue forecasts in a market 
share perspective, the current market share of 12 percent needs only to 
grow to 14-15 percent for the forecasted revenues to be met.
    Passenger rail provides amenities other modes do not offer, such as 
a level of interior comfort and access directly to and from urban 
centers. This access provides time savings and financial savings for 
travelers who do not need to arrange for transportation outside the 
urban core. These benefits have been considered in the assessment of 
comparative costs, value of alternate modes of transportation and the 
pricing for high-speed rail service.
    From fiscal year 1996 to fiscal year 2000, ticket prices are 
assumed to be moderately inflated, with a premium then placed on first 
class service. Amtrak understands that high-speed rail will not compete 
pricewise with discount air carriers or short-lived promotional 
airfares. However, Amtrak's 2001 high-speed rail fares are very 
competitive with steady state airfares. Discount carriers that provide 
service in Northeast Corridor markets present an opportunity, not a 
risk, for Amtrak. Rather than compete with these airlines, Amtrak will 
be complementing the discount air service available in secondary 
markets. The NEC has already experienced revenue growth at stations 
that provide convenient access to these airports.
    The resulting incremental revenue forecast for the full 
implementation of electrified service on the northend, and high-speed 
rail service throughout the Corridor totals $280 million annually. In 
fiscal year 2001, for example, these gross revenues will be partially 
offset by incremental operating costs and debt service of approximately 
$100 million, yielding net incremental benefits of approximately $180 
million. Total ridership is expected to grow from the current volume of 
11.1 million riders in fiscal year 1997 to 14.7 million riders in 
fiscal year 2001.
    The assumptions used in the forecasting process are conservative 
and are supported by extensive market research, elasticity models, 
pricing analysis and sensitivity analysis. Three separate forecasting 
models have been used, with resulting revenue estimates within five 
percentage points of each other.
    The best testament to the validity of the forecasts is that 
private, profitable corporations have partnered with Amtrak to finance 
the high-speed trainsets and maintenance facilities. This external 
funding stream was made possible because of the strength and legitimacy 
of the ridership and revenue forecasts.
    Question. Amtrak estimates that $1,400,000.000 is needed to finish 
the Northeast Corridor high-speed rail project. How much total has been 
invested in the Northeast Corridor improvement project thus far? What 
is the year-to-year capital budget for improvements to the Northeast 
Corridor, beginning with fiscal year 1997 through fiscal year 2000?
    Answer. The budget for the electrification and high-speed rail 
service program is $2.3 billion. Of this total, $810 million, or 
approximately 35 percent is being externally financed for trainset and 
maintenance facility costs. The remaining $1.5 billion is supported by 
Federal funds--$.9 billion has been appropriated to-date and $.6 
billion is required to be funded.
    These funding levels represent only the investment required for 
electrification and high-speed service. When state-of-good-repair, 
equipment overhaul, life/safety and other infrastructure needs are 
added to the electrification/high-speed rail requirements, the total 
capital program for fiscal year 1997 through fiscal year 2000 is 
estimated to be $597 million, $924 million, $557 million and $550 
million respectively. This capital program is supported by federal 
funds, external financing and state/local funding. The Northeast 
Corridor's five-year capital program is premised on an average federal 
capital funding stream of $388 million per year.
    Question. How much of Amtrak's $751,000,000 capital request for 
fiscal year 1998 would be utilized for improvements to the Northeast 
Corridor? Why doesn't the fiscal year 1998 federal grant request 
display NECIP funds versus general capital funds?
    Answer. Based on the fiscal year 1997-2002 Strategic Capital Plan, 
the Northeast Corridor planned to invest $593 million in projects to be 
funded from federal capital sources and short-term borrowings. The 
breakdown between those two funding sources has not been determined. 
However, the process by which fiscal year 1998 capital projects will be 
chosen for funding (based on financial and non-financial factors), is 
currently underway, and with the completion of that process we will be 
able to determine exactly which Northeast Corridor projects would be 
funded, and from which sources.
    The fiscal year 1998 Grant request does not request general capital 
and NECIP funding separately because Amtrak requested a dedicated 
source of capital equal to the revenues from \1/2\ cent of the current 
gasoline tax (which at the time had been estimated to be $751 million). 
Those funds would be available to all organizational units within 
Amtrak and invested in the projects with the highest returns.
    Question. Will Amtrak obligate all previously appropriated funds 
for the North Philadelphia station by September 1, 1997, as directed in 
the fiscal year 1997 conference report?
    Answer. Amtrak has obligated all previously appropriated funds for 
the North Philadelphia station project.
    Question. Over half of all Amtrak passengers use NEC services. What 
has been the Customer Satisfaction Index for the NEC in fiscal year 
1994, fiscal year 1995 and fiscal year 1996?
    Answer. Amtrak began measuring customer satisfaction in May 1996 
through the use of monthly ridership surveys that measure customer 
satisfaction for fourteen characteristics of train service. The NEC 
Customer Satisfaction Index has risen from a score of 79 in May 1996 to 
the recent score of 85 in the second quarter of this fiscal year. These 
customer satisfaction statistics show a consistently improving trend 
line since the inception of the program for all NEC product lines. 
These increases are attributable in large measure to improved on-time 
performance and the NEC's priority focus on quality customer service.
    Question. How much in revenues to Northeast Corridor operations 
return to Amtrak annually (fiscal years 1994, 1995, 1996 and projected 
end of 1997)? Do these figures include depreciation?
    Answer. The Northeast Corridor Business Unit's first full year of 
operation was fiscal year 1995. In fiscal year 1995 and fiscal year 
1996 the NEC contributed $1.3 million and $56.4 million in budget 
surpluses, respectively, to Amtrak's corporate-wide budget results 
($12.4 million deficit in fiscal year 1995, $82.2 million deficit in 
fiscal year 1996). Amtrak's 1996 Annual report displays each Business 
Unit contribution to Amtrak's overall budget result for fiscal year 
1995 and fiscal year 1996 (attached). The ``budget result'' is equal to 
all revenues and operating grants minus all expenses excluding 
depreciation, as reported in Amtrak's monthly and quarterly reports. 
The current year-end estimate (as of the end of May 1997) for NEC's 
fiscal year 1997 budget surplus is $109 million. This estimate includes 
eight months of actual financial results and four months of forecast.

                                                          TABLE 1: FISCAL YEARS 1995 AND 1996 OPERATING RESULTS BY MAJOR BUSINESS UNIT                                                          
                                                                                      [Dollars in millions]                                                                                     
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                        Intercity                    NEC                      West                    Corporate                   Total         
                                                               ---------------------------------------------------------------------------------------------------------------------------------
                                                                      Fiscal year--             Fiscal year--             Fiscal year--             Fiscal year--             Fiscal year--     
                                                               ---------------------------------------------------------------------------------------------------------------------------------
                                                                    1995         1996         1995         1996         1995         1996         1995         1996         1995         1996   
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Revenue.......................................................       $465.0       $483.8       $828.3       $867.9       $156.5       $184.1        $47.1        $19.0     $1,496.9     $1,554.8
Expenses......................................................        673.0        738.5      1,044.4      1,018.9        253.0        272.0        334.7        289.0      2,305.1      2,318.4
                                                               ---------------------------------------------------------------------------------------------------------------------------------
      Operating loss..........................................       -208.0       -254.7       -216.1       -151.0        -96.5        -87.9       -287.6       -270.0       -808.2       -763.6
Federal operating grant.......................................  ...........          7.0  ...........  ...........  ...........  ...........  ...........  ...........        392.0        285.0
Other Federal contributions...................................         42.0         62.2         70.5         65.4         16.5         13.3         21.0         15.5        150.0        156.4
                                                               ---------------------------------------------------------------------------------------------------------------------------------
      Net operating loss......................................       -166.0       -185.5       -145.6        -85.6        -80.0        -74.6       -266.6       -254.5       -266.2       -322.2
Noncash.......................................................         87.4         80.1        146.9        142.0         18.2         14.7          1.4          3.2        253.9        240.0
                                                               ---------------------------------------------------------------------------------------------------------------------------------
      Budget result...........................................        -78.6       -105.4          1.3         56.4        -61.8        -59.9       -265.2       -251.3        -12.3        -82.2
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

    Question. Recently, the FRA issued a notice of proposed rulemaking 
that would require improved safety in train cars and seats. What 
efforts have been devoted to assuring that the NECIP high-speed rail 
trainsets meet the letter and spirit of the rail safety rulemaking? Are 
safety engineers involved in developing the specifications for the 
trainsets?
    Answer. Every aspect of existing and proposed rules for passenger 
equipment safety were included as performance requirements in the 
design and manufacture of the NECIP high-speed rail trainsets. The 
design of the trainsets is undergoing an intense safety analysis, 
forcing mitigation through design, and is complemented with a System 
Safety Plan (Amtrak's comprehensive management tool for implementing 
safe operations). Particular emphasis has been placed on passenger 
compartments, with an eye to maintaining the safest environments during 
all operating conditions. Examples include:
  --Trainset structure is designed to manage and dissipate energy 
        during a collision, creating ``crumple'' zones in non-passenger 
        areas to keep passenger compartments intact.
  --All windows on coaches will also be emergency exits.
  --Lighted strips will illuminate aisles in event of power loss.
  --Overhead luggage compartments will contain and secure carry-on 
        items inside compartments, instead of on open shelves.
  --Seats will conform to new standards for securement strength.
  --On-board systems to monitor and control speed will include the 
        latest requirements in proposed rulemaking relating to civil 
        speed enforcement.
    In addition, Amtrak is working with the FRA on a Notice of 
Particular Applicability to define the requirements of the new Advanced 
Civil Speed Enforcement System (ACSES), which will be incorporated into 
the new trainsets to enforce civil speed restrictions. This state-of-
the-art system will constitute a fundamental improvement in safety on 
the Northeast Corridor and is an essential component of Amtrak's 
program to operate at speeds up to 150 mph.
    The coordination between Amtrak and the FRA in the design of the 
high-speed trainsets has been extraordinary. During development of the 
trainset specifications between 1993 and 1996, Amtrak design and safety 
engineers met frequently with the FRA to review all safety issues and 
develop new safety standards for what will be the fastest trains 
operating in the United States. This iterative process resulted in 
changes to the specifications for the trainsets in 1994. The FRA has 
deemed the new trainsets to be the safest trains ever built.
    The joint work on trainset safety spurred by the high-speed 
trainset procurement has had benefits for safety in the rest of the 
industry--this joint work has served as the basis for many of the 
changes the FRA is now seeking in its rulemaking for all passenger 
trains.
    Question. Please detail how many new jobs will be created in 
American cities and communities through the manufacture, testing, and 
deployment of the new high-speed trainsets.
    Answer. High-speed rail generates many direct and indirect jobs:
  --100 suppliers from 23 states are benefiting from the contract for 
        high-speed trainsets.
  --Thousands of design and construction jobs have already been created 
        by the contracts awarded for infrastructure and electrification 
        work.
  --Amtrak ridership is expected to grow from the current level of 11.1 
        million passengers per year to 14.7 million passengers annually 
        due to the implementation of high-speed rail service. These 
        customers will be delivered to the stations, city centers, and 
        surrounding communities served by Amtrak and commuter rail, 
        providing an engine for economic development. This has already 
        happened on a smaller scale with Metroliner service. The advent 
        of this transportation alternative has helped spur development 
        in the New York to Washington D.C. corridor. Leaders in the 
        political and business community in cities such as 
        Philadelphia, Wilmington and Baltimore have also looked ahead 
        and understand the potential that high-speed rail service 
        brings. In Baltimore, the local business community, as well as 
        the City and State, have joined Amtrak in investing in station 
        improvements to handle an increasing number of passengers more 
        quickly, safely, and easily. In Wilmington and in Philadelphia, 
        local businesses and universities, the cities, states, and 
        Amtrak are joining in distinct programs to redevelop the 
        stations and their surrounding neighborhoods. High-speed rail 
        service opens up enormous opportunities for economic growth to 
        cities located on the north end of the Corridor that can take 
        advantage of proximity to major city markets such as New York 
        and Boston.
  --The Coalition of Northeastern Governors has estimated that nearly 
        5,000 new jobs and $440 million per year will be generated 
        indirectly in that region by Amtrak's high-speed rail once it 
        is up and running--businesses and communities enjoying an 
        improved transportation system will be more productive.
    Question. Please update the Committee on the recent offer by 
Guilford to purchase the Northeast Corridor.
    Answer. The purchase offer was submitted by Guilford to the United 
States Secretary of Transportation, Amtrak's majority shareholder. The 
Secretary of Transportation is expected to formally respond.
                          other capital issues
    Question. What is the statutory provision regarding cross-
utilization of general capital funds for the Northeast Corridor 
Improvement Program? How much general capital funding has been 
crosswalked to NECIP in fiscal years 1995, 1996, and anticipated for 
1997?
    Answer. There is no statutory prohibition on Amtrak using general 
capital grants for NECIP. But NECIP grant funds may be used only for 
NECIP as defined in Pub. L. No. 104-205, 110 Stat. 2961 and 2963 
(1996).
    For fiscal year 1994, the last year for which appropriations for 
Amtrak were authorized, capital was authorized for NECIP and non-NECIP 
projects separately in 49 U.S.C. 24104(a). This may be the ``provision 
regarding cross-utilization `` which is referenced in the question.
    General capital funds spent for track and structure programs on the 
Northeast Corridor total $17.2 million in fiscal year 1995; $0 in 
fiscal year 1996 and $0 in fiscal year 1997. During fiscal year 1995 
and fiscal year 1996, $18.8 million and $17.2 million, respectively, 
was used to fund certain debt service principal, facility upgrades and 
mandatory environmental projects in the Northeast Corridor. This 
brought the total general capital expenditure ``crosswalked'' to NEC-
related projects in fiscal year 1995 to $36 million, and in fiscal year 
1996 $17.2 million. In fiscal year 1997, no general capital funds will 
be crosswalked from general capital to Northeast Corridor projects.
    Question. Please display the total Corporation capital spending 
(including funding from all sources, not only federal) by strategic 
business unit, for fiscal years 1995, 1996, 1997, and anticipated for 
1998.
    Answer.

                AMTRAK CAPITAL SPENDING FROM ALL SOURCES                
                          [Dollars in millions]                         
------------------------------------------------------------------------
                                               Fiscal year--            
                                  --------------------------------------
                                       1995         1996         1997   
------------------------------------------------------------------------
NEC SBU..........................       $252.8       $372.2       $596.5
Intercity SBU....................         43.6         77.2        180.7
West SBU.........................          3.4         25.3         37.4
Corp/Svc.........................          5.4          5.3         15.2
Multiple SBU.....................         28.2          2.5          4.9
Debt Service.....................         50.0         33.3         85.2
                                  --------------------------------------
      Total......................        383.4        515.8        919.9
------------------------------------------------------------------------
Capital Projects to be funded in fiscal year 1998 have yet to be        
  determined.                                                           
Source: Capital Expenditure Reports                                     

    Question. Does Amtrak support the administration's request of 
$23,450,000 for Pennsylvania Station redevelopment (the Farley 
Building)? If the Corporation were to receive the administration's 
requested level of funding for capital expenses ($445,450,000) rather 
than the Corporation's requested level of $751,000,000, would Amtrak 
still want to earmark $23,450,000 for Pennsylvania Station 
redevelopment?
    Answer. Amtrak supports the Administration's request of $23,450,000 
for the Pennsylvania Station Redevelopment, including the redevelopment 
of the James A. Farley Post Office Building. If the funds are to be 
dedicated exclusively to the Farley portion of the Redevelopment 
project, the funds should be made available to the Pennsylvania Station 
Redevelopment Corporation, rather than to Amtrak. If the funds are to 
be used for the Pennsylvania Station portion of the Redevelopment 
project, they should be made available to Amtrak. It is Amtrak's 
preference to receive all capital funding without constraints on 
allowable uses, so that Amtrak can define priority allocations within 
its capital program. If Amtrak receives less capital funding in fiscal 
year 1998 than requested, we will have to amend and prioritize our 
capital plan accordingly.
    Question. Please prepare a summary of all non-track equipment and 
rolling stock assets, property, and other non-railroad assets owned by 
the Corporation, including market value, broken out by strategic 
business unit and grouped by type of asset. What is the debt secured by 
each of these assets?
    Answer. The attached table summarizes property accounts gross book 
value by type of asset for Amtrak as a whole. To break out this 
information by SBU would result in a loss of information, as only a 
portion of it is tracked by SBU. In terms of market value, such 
information can only be provided by appraisals. Amtrak conducts market 
appraisals of its assets on an as-needed basis.
    Also attached is a one page table indicating the assets which are 
financed, and the amount of debt outstanding as of May 1997.
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                          NATIONAL RAILROAD PASSENGER CORPORATION EQUIPMENT COLLATERAL                          
----------------------------------------------------------------------------------------------------------------
                                                                                      Outstanding     Number of 
                      Project description                         Equipment cost        balance         units   
----------------------------------------------------------------------------------------------------------------
                  Encumbered through Financing                                                                  
                                                                                                                
Viewliners.....................................................       $67,754,183       $67,754,183           50
Superliners....................................................       263,523,402       259,295,962          112
    Do.........................................................        19,643,148        19,643,148            7
    Do.........................................................        64,211,589        63,989,961           23
    Do.........................................................        37,634,372        37,634,371           13
    Do.........................................................        19,552,189        19,436,013            7
    Do.........................................................        31,851,793        31,851,792           11
    Do.........................................................        63,740,830        63,740,829           22
                                                                ------------------------------------------------
      Subtotal.................................................       500,157,323       495,592,076          195
                                                                ================================================
Material handling cars.........................................        22,197,000        20,483,220           70
Locomotives....................................................        28,600,000        27,935,012           11
    Do.........................................................        83,200,000        80,316,410           32
                                                                ------------------------------------------------
      Subtotal.................................................       111,800,000       108,251,422           43
                                                                ================================================
Horizon........................................................       108,150,462        92,669,314          103
GE Dash 8 locomotives..........................................        31,872,604        29,453,302           18
F40 locomotives................................................        16,200,000        14,494,622            9
AEM 7..........................................................        25,776,800        21,225,220            7
Base order GE locomotives......................................        83,200,000        83,200,000           32
    Do.........................................................        52,000,000        52,000,000           20
    Do.........................................................        33,800,000        33,800,000           13
    Do.........................................................        36,400,000        36,400,000           14
    Do.........................................................        49,400,000        49,400,000           19
                                                                ------------------------------------------------
      Subtotal.................................................       254 800,000       254,800,000           98
                                                                ================================================
Option order GE locomotives....................................        13,000,000        13,000,000            5
                                                                ------------------------------------------------
      Subtotal.................................................        13,000,000        13,000,000            5
                                                                ================================================
10 duel mode locomotives.......................................        34,159,605        33,864,264           10
                                                                ------------------------------------------------
      Subtotal.................................................     1,185,867,977     1,151,587,622          608
                                                                ================================================
                   Uncollaterized Financings                                                                    
                                                                                                                
WRSO...........................................................        11,700,000         4,095,000          N/A
Wreck repair...................................................        28,500,000         3,000,000          N/A
CUS garage.....................................................        20,000,000        20,000,000          N/A
30th Street--Term loan.........................................        33,100,486         7,505,775          N/A
30th Street--Bonds.............................................        30,000,000        30,000,000          N/A
                                                                ------------------------------------------------
      Total....................................................     1,309,168,463     1,216,188,397          608
----------------------------------------------------------------------------------------------------------------

    Question. Please describe ongoing or planned commercial development 
of Corporation assets that Amtrak believes will net a profit in fiscal 
year 1998.
    Answer. Amtrak is continuing to pursue numerous Commercial 
Development initiatives which create net profits for the corporation. 
These initiatives include commercial leasing of space within corporate 
owned stations and along the right-of-way, including leases for 
telecommunications purposes, parking leases and development, 
advertising sales and property sales and development. The net profit 
associated with Amtrak Commercial Development projects is estimated to 
be at least $33 million dollars in fiscal year 1998.
                         strategic capital plan
    Question. A total of approximately $1,100,000,000 in capital 
funding is assumed by Amtrak for fiscal year 1998, $751,000,000 of 
which is to be provided by federal appropriations (through a dedicated 
trust fund or reserve fund, or directly appropriated funds). Amtrak's 
capital plan projects spending $1,440,000,000 in fiscal year 1998, for 
a capital net loss of $341,500,000. Does it make sense to deliberately 
set out to spend more than the ``best case scenario'' plans to bring 
into the capital program?
    Answer. Amtrak has identified its investment needs based on the 
implementation of high-speed rail and other high return projects which 
will help move Amtrak toward operating self-sufficiency. The spending 
needs, as projected, approximately equal the revenue generated by the 
\1/2\ cent of the existing gasoline tax. However, there are spending 
peaks and valleys in those projections which, if ``smoothed,'' could 
create delays in completing critical programs. With a secure, dedicated 
source of capital funding such as a trust fund with revenues equal to 
those generated by \1/2\ cent of the current gasoline tax and with 
contract authority, Amtrak anticipates that it would be able to obtain 
short-term financing for the shortfall in capital needs in fiscal year 
1998. However, without the guarantee of such a stable source of capital 
funding, such short-term financing would likely not be possible.
    Question. Please describe the current status of efforts to secure a 
dedicated trust fund or reserve fund for Amtrak.
    Answer. The Amtrak Reserve Fund is included in Section 207 of 
H.Con.Res. 84, the concurrent congressional resolution on the budget, 
and codified in S. 949, the Senate-passed Revenue Reconciliation Act of 
1997. S. 949 also establishes a three and one-half year, $2.323 billion 
Intercity Passenger Rail Fund, which is a deficit neutral and fully 
offset dedicated source of capital for Amtrak. This fund is subject to 
the annual appropriations process and is the key to Amtrak's survival.
                  state contributions to capital needs
    Question. Amtrak plans that a portion of its capital needs are to 
be met through state and local financial contributions. For example, in 
1995, Amtrak assumed state contributions would double over the years. 
To what extent have states increased their contributions since then?
    Answer. Amtrak continues to expect a portion of its capital needs 
to be met through state and local financial contributions. Since 1995, 
the contributions are as follows (including future expectations):

1996....................................................     $89,100,000
1997....................................................     115,700,000
1998....................................................      49,300,000
1999....................................................      33,200,000
2000....................................................      50,000,000
2001....................................................      50,300,000
2002....................................................      50,300,000

    While it may appear that future support is diminished, Amtrak has 
only included obligations from states and localities which have entered 
into agreements with Amtrak. Most state and local support is approved 
on a year-by year basis during the fiscal budgeting cycle, and we would 
expect the later years to increase accordingly.
    Question. Does Amtrak still assume that state contributions will 
fully cover the cost of some state routes by fiscal year 1998? If so, 
what is the likelihood of this event occurring and what actions is 
Amtrak taking to bring this aspect of its plan to fruition?
    Answer. In 1995, Amtrak began negotiations to have the relevant 
states reimburse Amtrak for fully allocated costs. The original goal 
was to have states assume fully allocated costs by fiscal year 1999. 
This policy proved unworkable because:
  --it rapidly imposed costs for which the states have no dedicated 
        funds.
  --there are significant differences between the state services and 
        each state's ability to contribute. For example, the Texas rail 
        service differs greatly from the Pennsylvania service.
  --Amtrak historically has not had a ``one size fits all'' agreement 
        with our states.
    Therefore, in late 1996, Amtrak developed an individually 
negotiated approach with each (former 403B states, and now Texas as a 
new contract service state). This allows for each state to develop a 
contract with its Strategic Business Unit that includes pricing for 
train operations, shared overhead expenses, state specific services 
(i.e. The Vermonter) and equipment lease costs. Beyond these changes, 
there are other negotiable items such as long term capital 
contributions, contract term incentives and specific performance 
guarantees (such as the recent agreement with Illinois).
    Amtrak's business plan through 2002, forecasts growth in state 
revenues (403B) from $32.6 million in fiscal year 1994 up to $73.6 
million in 2002. Increased ``flexible funding'' in NEXTEA will be the 
mechanism which will enable states to cover a greater portion of the 
costs for rail services delivered by Amtrak.
                            revenue and debt
    Question. Please display the Corporation's total revenues by fiscal 
year for 1996, 1997, and requested for 1998, breaking out revenue in 
four subdivisions: (1) internally generated or prior existing funds; 
(2) federal appropriations further broken down by operating and 
capital; (3) state and local funds; and (4) external financing.
    Answer.

                REVENUES, APPROPRIATIONS, AND FINANCINGS                
                          [Millions of dollars]                         
------------------------------------------------------------------------
                                               Fiscal year--            
                                  --------------------------------------
                                                    1997      Requested 
                                       1996       forecast       1998   
------------------------------------------------------------------------
1. Prior existing funds \1\......          N/A          N/A          N/A
2. Revenues......................      1,490.6      1,540.8  ...........
3. Federal appropriations:                                              
    Operating + excess RRTA......        405.0        364.5  ...........
    Capital......................        345.0        398.0  ...........
    One-time grant...............  ...........         80.0  ...........
4. State and local funds.........         66.1         69.0  ...........
5. External financing............        188.5        213.3  ...........
------------------------------------------------------------------------
\1\ Amtrak does not have existing revenue that carries over from year to
  year.                                                                 
The fiscal year 1998 budget is a work in progress and there are no      
  statistics for 1998.                                                  

    Question. Please display the Corporation's total end-of-year debt 
load for the past ten fiscal years (1988-1997 projected), broken out by 
year.
    Answer.
        Debt obligation                                          Balance
1988 actual.............................................     $35,900,000
1989 actual.............................................     126,500,000
1990 actual.............................................     183,800,000
1991 actual.............................................     287,900,000
1992 actual.............................................     418,800,000
1993 actual.............................................     492,300,000
1994 actual.............................................     770,300,000
1995 actual.............................................     836,900,000
1996 actual.............................................     986,900,000
1997 projected \1\......................................   1,216,200,000

\1\ Fiscal year 1997 projection as of May 1997.

    Question. Amtrak's debt level has significantly increased, 
correspondingly increasing interest payments. For example, over the 
last four years interest payments have tripled from about $20.6 million 
in fiscal year 1993 to about $60.2 million in fiscal year 1996. As 
Amtrak assumes more debt to acquire more equipment, what portion of the 
federal operating subsidy will be used for interest payments over the 
next five years?
    Answer. Amtrak's current outyear projection as of July 3, 1997 for 
interest expense, based on all known financings, are as follows: Fiscal 
year 1998, $98,200,000; fiscal year 1999, $94,200,000; Fiscal year 
2000, $114,400,000; Fiscal year 2001, $137,200,000; fiscal year 2002, 
$133,000,000; and fiscal year 2003, $127,900,000. However, how much of 
that will be funded by federal operating subsidy has yet to be 
determined. It clearly will not be the entire amount.
    Question. How much current movement of freight railroads occurs 
over Amtrak-owned trackage? Please specifically detail where this 
occurs, which railroads utilize Amtrak's trackage, and what 
arrangements exist for recompense. How much revenue was generated by 
these arrangements in fiscal years 1995, 1996, and projected for 1997?
    Answer. The current movement of freight railroads that occurs over 
Amtrak-owned trackage is approximately 22 million car miles per annum.
    The locations where freight railroads utilize Amtrak's trackage is 
as follows:
  --Northeast Corridor: Conrail; St. Lawrence & Hudson Railway 
        (Delaware & Hudson Railway Company \1\); Springfield Terminal; 
        Providence & Worcester; and Connecticut Southern Railroad.\2\
---------------------------------------------------------------------------
    \1\ Service ended March 31, 1997.
    \2\ Service commenced September 23, 1996.
---------------------------------------------------------------------------
  --Chicago (South Joint Tracks): Burlington Northern Santa Fe Railway 
        Company; Illinois Central Railroad Company; and Consolidated 
        Rail Corporation.
  --Indiana and Michigan--Porter, Indiana, to Kalamazoo, Michigan: 
        Consolidated Rail Corporation.
    The arrangements that exist for recompensation are the various 
operating agreements between Amtrak and the freight railroads that 
specify rates per car mile. Those rates range from $0.33 cents per car 
mile in Michigan to $0.90 cents per car mile on the Northeast Corridor.
    Revenue generated by these arrangements in fiscal years 1995, 1996 
and projected for 1997 is as follows: Fiscal year 1995, $18,717,762; 
fiscal year 1996, $19,083,744; and fiscal year 1997 projected, 
$15,146,558.
    Over the past ten years, thanks in large part to Senator 
Lautenberg's leadership with respect to rail safety, including his 
sponsorship of amendments to the Rail Safety Act of 1988, we have 
implemented many critical railroad operating safety measures across the 
Amtrak system and on the Northeast Corridor. These include:
  --Speed control for Amtrak, commuter, and freight trains on the NEC.
  --Random drug and alcohol testing for hours of service employees.
  --Improvements to engineer certification and recertification 
        processes.
  --Improved audit and enforcement procedures.
    Thanks to these efforts, Amtrak is prepared to safely support 
limited, selective, and compatible competitive freight access to ports 
along the Northeast Corridor that might flow from merger decisions.
    The Northeast Corridor could play a role to help facilitate access 
to ports along the eastern seaboard, spur economic competitiveness and 
development in this region, and generate new commercial revenue in the 
context of declining federal operating support for Amtrak. However, 
Amtrak stresses that increased access would only be considered within 
the context of absolute and overriding protocols relating to operating 
safety. We are inflexible on this. This includes the measures listed 
above as well as assessment of the locations and time slots in the 
Northeast which may offer these opportunities--generally, those 
locations and periods of time that are lightly-used by passenger rail 
services.
    Other than the primary concern of safety, two other concerns would 
also weigh heavily in our consideration of incremental freight access. 
One, on time performance for Amtrak and commuter trains on the 
Northeast Corridor will not be jeopardized. Two, any additional burden 
placed on Amtrak's infrastructure (tracks, bridges, etc.) by increased 
traffic or increased axle loads will be carefully established to ensure 
full compensation for wear and tear as well as useful life impacts.
    Question. What commuter railroads currently operate over Amtrak-
owned trackage? Please specifically detail where this occurs, which 
commuter railroads utilize Amtrak's trackage, and what arrangements 
exist for recompense. How much revenue was generated by these 
arrangements in fiscal years 1995, 1996, and projected for 1997?
    Answer.

                                              [Dollars in millions]                                             
----------------------------------------------------------------------------------------------------------------
                                                                               Fiscal year--                    
                     Commuter agency                      ------------------------------------------------------
                                                              1992       1993       1994       1995       1996  
----------------------------------------------------------------------------------------------------------------
MBTA,\1\ MA..............................................       $7.0       $7.4       $7.2      $14.7       $7.3
NJ Transit, NJ...........................................       25.4       26.7       28.9       28.3       25.5
SEPTA, PA................................................       16.9       16.7       17.5       18.1       18.7
LIRR, NY.................................................        3.1        3.5        3.4        2.4        2.1
NIRC-CUS, IL.............................................        5.4        6.0        6.5        7.4        7.9
Other....................................................  .........        0.1  .........        0.1  .........
                                                          ------------------------------------------------------
      Total revenue......................................       57.8       60.4       63.5       71.0       61.5
----------------------------------------------------------------------------------------------------------------
\1\ Fiscal year 1995 includes a $7.5 million retro-active settlement covering fiscal year 1988 thru fiscal year 
  1995.                                                                                                         
The fiscal year 1997 revenues are still being developed.                                                        


                                               ELECTRIC PROPULSION                                              
                                              [Dollars in millions]                                             
----------------------------------------------------------------------------------------------------------------
                                                                               Fiscal year--                    
                     Commuter agency                      ------------------------------------------------------
                                                              1992       1993       1994       1995       1996  
----------------------------------------------------------------------------------------------------------------
NJ Transit...............................................      $13.2      $13.6      $13.0      $12.0      $11.2
SEPTA....................................................        7.8        7.8        7.7        6.9       10.6
Maryland DOT \1\.........................................  .........  .........  .........  .........  .........
                                                          ------------------------------------------------------
      Total revenue......................................       21.0       21.4       20.7       18.9       21.8
----------------------------------------------------------------------------------------------------------------
\1\ Maryland DOT Propulsion costs are in Contract Operations.                                                   

    The Northeast Corridor is a critical and valued part of the 
region's transportation infrastructure. Over 1,200 commuter, freight 
and Amtrak trains daily use the corridor. Commuter railroad recompense 
is governed by principles laid down in federal statute and regulatory 
decisions.
    More so than operating fees, investments in the extensive capital 
plant of the Northeast Corridor are critical to the survival of Amtrak 
and commuter railroads. Amtrak has aggressively pursued joint 
investment partnerships with commuter authorities to encourage 
increased investment in the capital asset of the Northeast Corridor.
    One example of the joint capital investment partnerships which 
Amtrak is using as a model is the Amtrak and NJ Transit agreement which 
commits both parties to invest $25 million each for the next five 
years. This will give NJ Transit a direct voice in the decision making 
process for capital investments, guarantees investments from Amtrak for 
the benefit of New Jersey, and permits both entities a better ability 
to engage in long-term planning for the infrastructure needs of New 
Jersey. Similar capital partnership agreements have been developed in 
Maryland, Virginia, the District of Columbia, Delaware, New York and 
Pennsylvania.
    Question. Amtrak has many ongoing strategies to decrease costs and/
or generate additional revenue. For each of the following strategies, 
please estimate the annual savings or additional revenue for fiscal 
years 1998, 1999 and 2000.
    Answer. The following table represents a preliminary estimate of 
the impact from revenue enhancements or cost reduction efforts based on 
the following Business Plan Actions for fiscal years 1998-2000. These 
estimates are from Amtrak's fiscal year 1998-2000 Business Plan which 
is currently being updated.

------------------------------------------------------------------------
                                                 Fiscal year--          
        Business plan action         -----------------------------------
                                         1998        1999        2000   
------------------------------------------------------------------------
High-speed rail.....................  ..........       (7.3)       93.1 
Self service ticketing (NEC, West)..        1.8         1.8         1.8 
Procurement.........................        7.7         8.3         8.9 
Route and service changes...........       21.6        19.7        19.7 
Real estate sales and leases........        2.8         2.8         2.8 
Insourcing and consulting (NEC).....        1.0         1.5         2.0 
Reduction in operating costs due to                                     
 capital investment.................     ( \1\ )  ..........  ..........
Power wheeling (NEC)................       15.6        34.5        36.5 
Food and beverage initiative (NEC)..       (3.0)        5.6         5.6 
Telecommunications (NEC)............        2.0         1.0         1.0 
Station development.................        N/A         N/A         N/A 
Training (NEC, intercity)...........       (4.0)       (2.0)       (4.0)
Commuter--Total revenue.............      249.5      249. 9       250.3 
State supported trains..............       77.6        78.7        79.3 
------------------------------------------------------------------------
\1\ Fiscal year 1998 projects under review.                             

                   operating expenses--funding issues
    Question. Please display the annual federal operating grant and 
mandatory passenger rail service payments for fiscal years 1988 through 
1997.
    Answer.

                          [Dollars in millions]                         
------------------------------------------------------------------------
                                                  Federal               
                  Fiscal year                    operating   Excess RRTA
                                                   grant                
------------------------------------------------------------------------
1988..........................................       $580.8      ( \1\ )
1989..........................................        584.0      ( \1\ )
1990..........................................        520.1      ( \1\ )
1991..........................................        342.1       $144.8
1992..........................................        330.0        150.2
1993..........................................        350.0        147.0
1994..........................................        351.7        150.0
1995..........................................        392.0        150.0
1996..........................................        285.0        120.0
1997..........................................        222.5        142.0
------------------------------------------------------------------------
\1\ Included in Block Grant.                                            

    Question. What is the historical per passenger subsidy for non-
commuter passengers per year by fiscal year since Amtrak's creation?
    Answer. The historical per passenger (trip) subsidy for non-
commuter passengers is shown below since 1971. Federal operating grants 
decreased from $587 in fiscal year 1986 to $285 in fiscal year 1996, a 
51.4 percent decline. The subsidy per passenger decreased from $28.92 
per passenger in fiscal year 1986 to $14.47 per passenger in fiscal 
year 1996, representing a 49.8 percent decline, or a nearly 50 percent 
improvement in efficiency.

                                                                        
------------------------------------------------------------------------
                                     Federal                            
                                    operating   Noncommuter  Subsidy per
                                      grant      ridership    passenger 
                                    (millions)   (millions)             
------------------------------------------------------------------------
Calendar years 1971/72...........          $40         27.2        $1.47
Fiscal year:                                                            
    1974.........................          147         18.4         7.97
    1975.........................          277         17.3        15.98
    1976.........................          462         17.8        25.96
    1977.........................          483         19.2        25.14
    1978.........................          536         18.9        28.36
    1979.........................          600         21.4        28.04
    1980.........................          650         21.2        30.68
    1981.........................          720         20.6        34.96
    1982.........................      \1\ 735         19.0        38.68
    1983.........................      \1\ 670         19.0        35.26
    1984.........................      \1\ 716         19.9        36.00
    1985.........................      \1\ 680         20.8        32.69
    1986.........................          587         20.3        28.92
    1987.........................          579         20.4        28.38
    1988.........................          532         21.5        24.74
    1989.........................          554         21.4        25.89
    1990.........................          520         22.2        23.42
    1991.........................          343         22.0        15.59
    1992.........................          331         21.3        15.54
    1993.........................          351         22.1        15.88
    1994.........................          352         21.2        16.60
    1995.........................          392         20.7        18.94
    1996.........................          285         19.7        14.47
------------------------------------------------------------------------
\1\ Received as Block Grant rather than Operating Grant.                

    Question. Please prepare a table showing Amtrak's cost to operate 
each strategic business unit, for fiscal years 1996, 1997, and 
requested for 1998.
    Answer.

                                                      1996                                                      
                                              [Dollars in millions]                                             
----------------------------------------------------------------------------------------------------------------
                    Operating expenses                     Intercity     NEC        West     Corp/Svc    Total  
----------------------------------------------------------------------------------------------------------------
Salaries.................................................      $16.4      $42.1      $12.4      $43.7     $114.6
Wages and overtime.......................................      224.1      375.1       86.6       56.9      742.7
Employee benefits........................................      102.5      176.4       41.7       33.4      354.0
Employee related.........................................        5.9        8.0        2.4        8.7       25.0
Facility and office related..............................       46.7       62.4       15.2       57.0      181.3
Train operations.........................................      126.5      131.8       62.4       -0.1      320.6
M of W Good and Svs......................................        4.2       51.4        3.7        0.1       59.4
Advertising and sales....................................       53.5       23.7       10.8       20.5      108.5
Financial................................................       78.1       36.1       18.3       16.5      149.0
Depreciation.............................................       80.1      142.0       14.7        1.2      238.0
Other....................................................        0.5      -30.1        3.9       51.1       25.4
                                                          ------------------------------------------------------
      Total expenses.....................................      738.5    1,018.9      272.1      289.0    2,318.5
----------------------------------------------------------------------------------------------------------------


                                                  1997 FORECAST                                                 
                                              [Dollars in millions]                                             
----------------------------------------------------------------------------------------------------------------
                    Operating expenses                     Intercity     NEC        West     Corp/Svc    Total  
----------------------------------------------------------------------------------------------------------------
Salaries.................................................      $18.2      $44.5      $12.7      $47.5     $122.9
Wages and overtime.......................................      229.7      378.4       88.3       59.6      756.1
Employee benefits........................................      104.4      178.0       42.2       50.1      374.6
Employee related.........................................        7.3        9.6        2.6        9.6       29.2
Facility and office related..............................       47.3       72.2       13.1       57.4      189.9
Train operations.........................................      153.1      143.6       66.3       -0.1      362.9
M of W Good and Svs......................................        3.6       41.9        2.4  .........       47.9
Advertising and sales....................................       47.1       30.0        6.6       15.2       98.8
Financial................................................       97.0       41.7       23.7        1.4      163.9
Depreciation.............................................       99.7      143.7       16.1        1.5      261.0
Other....................................................        0.4      -24.1        4.6       65.1       46.0
                                                          ------------------------------------------------------
      Total expenses.....................................      807.9    1,059.5      278.5      307.3    2,453.2
----------------------------------------------------------------------------------------------------------------
Note: 1997 based on the eight months of actuals and four months of forecast.                                    
Fiscal year 1998 business plan development is currently in progress.                                            

    Question. What is the current set cost which Amtrak must pay 
freight railroads to operate passenger rail over freight-owned 
trackage? How much of Amtrak's operating expenses went for this 
recompense in fiscal years 1994, 1995, and 1996? How much is estimated 
for fiscal year 1997?
    Answer. The current expense which Amtrak must pay freight railroads 
to operate passenger rail over freight-owned trackage is the costing 
methodology employed under U.S.C. Title 49, Section 24308(a), the Rail 
Passenger Service Act.
    The amount (and percentage) of Amtrak's operating expenses paid to 
the freight railroads to operate passenger rail over freight-owned 
trackage in fiscal years 1994, 1995 and 1996, and estimated for fiscal 
year 1997, is as follows: \3\
---------------------------------------------------------------------------
    \3\ Defined as total expenses as reported in Amtrak's applicable 
annual report.

------------------------------------------------------------------------
                 Fiscal year                       Amount       Percent 
------------------------------------------------------------------------
1994.........................................     $89,728,000        3.7
1995.........................................      86,373,000        3.7
1996.........................................      84,246,000        3.6
1997 projected...............................      88,946,000        3.6
------------------------------------------------------------------------

    Question. The Administration and the Congress have instructed 
Amtrak to be free from federal operating assistance by 2002. Although 
Amtrak has improved its bottom line by more than $300,000,000 over the 
last two years, significant improvements are necessary in the remaining 
years to meet the goal of operating self-sufficiency. Currently, Amtrak 
is significantly behind schedule in its plan to eliminate operating 
subsidies. In this regard, Amtrak's operating losses were $764,000,000 
for fiscal year 1996, $125,000,000 more than planned for its business 
plan. How does Amtrak plan to get back on track and achieve all of its 
planned savings by 2002? What actions require legislative changes?
    Answer. As noted in the question, Amtrak has improved its bottom 
line by over $300,000,000 on an annualized basis over the last two 
years. Yes, significant improvements are necessary in the remaining 
years if we are to meet the 2002 goal of operating independence. 
However, it should be noted that Amtrak has achieved this much of the 
plan without the three elements we have said were absolutely essential 
from the beginning: a secure and reliable source of dedicated capital; 
a declining level of operating support consistent with our business 
plan, and legislative relief from some of our statutory mandates. None 
of these things have occurred, yet we met and exceeded our target in 
the first year of our business plan. In the second year, despite having 
our operating needs underfunded by more than $125 million over the same 
two year period, we missed our plan target but more importantly, 
avoided losing any of the ground gained in fiscal year 1995. Should we 
in fact receive the dedicated source of capital we have sought, and an 
adequate amount of operating support as proposed in our Strategic 
Business Plan and included in the Congressional Budget Resolution, we 
do believe we can achieve independence from federal operating support 
by 2002.
    Question. For over 25 years Amtrak has operated passenger rail 
service. With the exception of Metroliner service in fiscal year 1996, 
none of Amtrak's routes has made a profit or broken even, when all cost 
are allocated. What is the likelihood, given Amtrak's history, that the 
railroad can operate without federal operating funds?
    Answer. As stated in the fiscal year 1997-2002 Strategic Business 
Plan as well as in the fiscal year 1998 Federal Grant Request, Amtrak's 
ability to operate without federal operating support is dependent on 
several key assumptions in order to meet that target by 2002. The 
implementation and operation of high-speed rail in 2000 will contribute 
$150-200 million, net of expense, to the corporation. Non-core business 
will contribute $50 million in fiscal year 1997, escalating to $80 
million in the year 2002. Other key assumptions are the continued 
funding of excess mandatory RRTA payments at $142 million per year and 
a gradual reduction in federal operating support consistent with our 
request. Not included in the plan are initiatives such as significantly 
expanded mail and express. These will be included in the revised fiscal 
years 1998-2003 Strategic Business Plan. As we have consistently said, 
if we are provided with a secure and reliable source of capital, and 
the necessary legislative relief and declining levels of operating 
support, we will achieve the goal of operating self-sufficiency. Our 
Strategic Business Plan shows exactly how that will be achieved.
    Question. Please provide the Committee a copy of the Working Group 
on Intercity Passenger Rail recommendations, released on June 23, 1997.
    Answer. ``A New Vision for America's Passenger Rail'' is attached.
               A New Vision for America's Passenger Rail
                              introduction
    For millions of Americans, passenger trains signify more than just 
a means of transportation; they serve as potent symbols of our nation's 
heritage, environmental consciousness and collective hopes for a humane 
future. Many passionately argue that the United States has the capacity 
and indeed, the obligation, to create a world-class national passenger 
rail system to endorse these values and to arrest the growing 
unintended side-effects of automobiles and airplanes in our cities and 
countryside.
    A more tangible and immediate argument for rail service can be 
weighed in straight financial terms. The United States is a diverse and 
increasingly mobile nation with a growing (as well as graying) 
population and an aging transportation infrastructure. It needs a well-
integrated national transportation policy that offers a range of modal 
choices in order to maximize mobility and to minimize transportation 
costs, infrastructure funding requirements and environmental damage in 
a variety of settings.
    Under the right conditions, passenger rail service can provide an 
attractive, financially sustainable transportation alternative that 
enhances efficiency of other modes (including cars, trucks, buses, 
airplanes and freight rail). Unfortunately, the conditions under which 
Amtrak currently operates do not allow for Amtrak to function as a true 
and equal alternative to other modes of transportation.
    Amtrak is now awash in red ink, buffeted by conflicting missions 
and ballooning debt, and virtually starved for capital in both 
political and financial terms. Not surprisingly, revenues, ridership 
and service have ebbed despite valiant efforts by both management and 
labor to reverse these trends. Neither the Congress nor the 
Administration seems eager to increase or even continue Amtrak's 
subsidy, though each institution still exerts sizable control over its 
organization, operations and route structure. This control is often at 
odds with Amtrak's ability to operate efficiently and to maximize the 
value of its assets. Meanwhile, competing modes of transportation fight 
ruthlessly for every uncommitted traveler in Amtrak's shrinking market 
share.
    Together these conditions create an untenable outlook for passenger 
rail in the United States. In the short range (the next 6 to 12 
months), Amtrak faces a major liquidity crisis and probable bankruptcy. 
Unless the Congress moves swiftly to reconfirm the value of passenger 
rail service and dramatically restructure the way in which it is 
organized and operated, the substantial asset base of the existing 
system will permanently disappear by default, along with many vital 
long-range prospects for service.
    A good measure of political and financial capital will be needed to 
avert this course; naturally, both elements are in short supply. 
Nevertheless, the U.S. government can claim a long and impressive 
tradition of large-scale problem solving, as in the creation of the 
interstate highway system and the notable improvement of the nation's 
air and water quality.
    Genuine renewal of national passenger rail service will not be 
resolved by political rhetoric nor by periodic last-minute infusions of 
cash; rather, it requires that the Congress take a long, hard step back 
from the status quo in order to plot a viable, market-driven course for 
the future. The immediate pain and risks to existing rail service and 
jobs that may accompany this overhaul must be gauged carefully against 
the larger and longer-range havoc that assuredly would follow the 
further decline and liquidation of Amtrak.
    More importantly, if passenger rail is to become a serious part of 
the nation's mobility strategy in the future--rather than a mere 
incantation of the past--it must operate in a profoundly more growth- 
and customer-oriented fashion. It must have the management tools, the 
flexibility, the incentives and the discipline posed by competition to 
vie with other modes of transportation on a level playing field.
                                context
Fiscal
    Amtrak has been in financial difficulty for most of its 26-year 
existence. In recent years, its financial condition has deteriorated to 
the point that Amtrak believes it may exhaust all sources of cash 
within the next 12 months. To reduce its continually growing losses and 
widening gap between operating deficits and federal subsidies, Amtrak 
developed its Strategic Business Plan. Although Amtrak has made some 
progress in implementing its business plan and cutting its losses, its 
financial condition is still very precarious. Amtrak's financial 
measures continue to deteriorate. Financial targets have been missed, 
and substantial capital investment is needed.
    Amtrak has lost over $700 million in each of the last 9 years. 
Amtrak has been relying on passenger revenues to help close the gap 
between revenues and expenses, but passenger revenues, when adjusted 
for inflation, have declined over the past several years. Half way 
through the current fiscal year, Amtrak began borrowing against its 
short-term line of credit to meet basic operating expenses, such as 
payroll. From 1993 to 1996, Amtrak's debt and capital lease obligations 
nearly doubled--from about $500 million to almost $1 billion dollars. 
Amtrak expects to incur another $1 billion in debt within the next 2 
years to finance 18 train sets and related maintenance facilities for 
the Northeast Corridor and the acquisition of new locomotives. To 
service this increased debt, Amtrak must use a substantial portion of 
its federal operating subsidies that would otherwise be used to cover 
future operating deficits. Over the past 4 years, Amtrak's interest 
expenses have tripled from about $20 million to about $60 million.
    The costs of an Amtrak bankruptcy cannot be underestimated. These 
include financial, social, and political. Every constituency would 
lose: state, local, and federal government, employees, customers, 
suppliers, taxpayers. The true cost of a bankruptcy would be billions 
of dollars. The resolution of such a bankruptcy is far from certain, as 
control of the process would be taken out of the hands of the 
government.
Support
    After investing over $19 billion in Amtrak since 1971, Congress is 
losing patience with Amtrak's continued dependence on federal 
subsidies. Congress has promised to provide legislative reforms (labor, 
liability) and continued capital support in return for Amtrak's pledge 
to eliminate its need for federal operating subsidies by 2002. Amtrak 
has asked for a dedicated funding source for its capital needs, and 
there have been several bills introduced to accomplish this, but the 
outcome is uncertain.
    While the Administration has stated its commitment to Amtrak's 
future, it has proposed a level of funding below Amtrak's stated needs 
to be provided from the Highway Trust Fund in its NEXTEA legislative 
proposal. The Administration's proposal would force Amtrak to compete 
with other surface transportation programs for the limited funding 
allowed by the budget from the Trust Fund. The Administration also 
supports the elimination of all federal operating subsidies for Amtrak 
by 2002. The current Congressional budget resolution makes additional 
resources for a possible inter-city rail trust fund contingent upon 
enactment of reform legislation.
    The public's support for Amtrak is segmented among the geographic 
areas of the country. Its greatest support is in the Northeast, where 
Amtrak serves a substantial portion of the business travel between New 
York and Washington. In contrast, Amtrak's routes in other parts of the 
country are sparsely traveled. Amtrak's support among select user 
groups (retirees, leisure travelers), is higher than its support from 
the general population. Yet Amtrak's load factor (the percentage of 
seats filled) for fiscal year 1996 was 43.3 per cent on a system-wide 
basis, and ranged from 37.4 per cent to 47.3 per cent among its 
strategic business units. By comparison, a load factor around 60 per 
cent is generally considered the break-even point for airlines.
Access to freight railroads' facilities
    Currently, Amtrak operates over the freight railroads' right-of-way 
for all routes except the Northeast Corridor, which Amtrak owns, and 
small route segments in New York State, Pennsylvania, and Michigan, 
also owned by Amtrak. Amtrak owned rights-of-way comprise less than 5 
per cent of the company's current route system. Amtrak's access rights, 
in combination with its own right-of-way, form the nation's current 
intercity rail system, and therefore, these rights must be viewed as 
one of the most valuable of all of Amtrak's assets.
    The freight railroads view the terms and conditions that govern 
Amtrak's access as entirely to their detriment, while Amtrak views its 
access rights as part of its compensation for having relieved the 
freight railroads of the obligation to provide passenger rail service. 
These viewpoints represent polar extremes and there needs to be 
satisfactory balance between the two positions.
    There are three elements to the freight railroad/Amtrak 
relationship:
  --Access--Amtrak has compulsory access to the freight railroads' 
        right-of-way by virtue of a federal statute. In addition, by 
        federal law, Amtrak must be given priority dispatching over 
        freight trains.
  --Compensation--Amtrak's payments to the freight railroads for its 
        use of their right-of-way is specified by formula in federal 
        statute according to incremental costs. The freight railroads 
        claim that this formula forces them to subsidize Amtrak 
        service.
  --Liability--Current law and judicial interpretation of access 
        agreements gives the freight railroads no protection against 
        unlimited tort liability that comes with the presence of 
        passenger trains on their tracks.
    An additional element that exacerbates the freight/Amtrak 
relationship is the recent increase in freight traffic, which makes 
each train movement more valuable as capacity becomes constrained. The 
freight railroads claim that the incremental cost formula, in addition 
to not adequately covering the costs that Amtrak itself imposes, does 
not even address the opportunity cost of reduced freight movements due 
to Amtrak's presence. The freight railroads are very sensitive to new 
lines of business that Amtrak has proposed to undertake, such as 
hauling increased mail and express freight commodities that may 
encroach on their own business.
    The Amtrak/freight relationship can be contrasted with the current 
system by which commuter authorities obtain access to freight railroad 
rights-of-way. Commuter railroads negotiate with the freight railroads 
at arms' length on a case-by-case basis with no federal statute 
compelling mandatory access. Compensation levels are established by 
mutual agreement. And in most cases, state law limits tort liability 
that can arise from a commuter rail accident.
    A major task in designing a new format for intercity passenger rail 
will be to determine at what point in between the two options, i.e., 
the current Amtrak/freight relationship, and the freight/commuter 
relationship, a balance can be achieved that is fair and adequately 
provides for continued access by Amtrak and other potential intercity 
passenger rail operators.
Services and values
    A renewed National Passenger Rail System (as one or more entities) 
should do two important things (in order of priority):
    (1) Provide safe, reliable, comfortable convenient and financially-
sound passenger rail service in all densely populated corridors of the 
United States that show declining air quality and presently or 
potentially intractable traffic congestion problems; and
    (2) Encourage public/private development of attractive overnight 
passenger rail service, on a periodic basis throughout regions of the 
nation with significant cultural, historical and scenic character 
(e.g., a kind of ``rolling national park'') or where such service is 
justified on an economic basis.
    The working group believes that a renewed passenger rail system 
should provide the maximum benefit to its customers and achieve 
operational excellence and efficiency. In addition, the system should 
be subjected to market discipline and financial accountability. 
Environmental protection and improvement, as well as national historic 
and cultural preservation should also be goals of a new passenger rail 
system.
                         restructuring proposal
    The working group believes that Intercity Passenger Rail is a major 
United States asset which is, for specific roles, superior to or 
complementary to competing modes. It should be supported and expanded. 
This, however, requires a commitment to broadened, secure investment in 
the basic infrastructure to permit competitive speeds and reliable 
operation in the major corridors of the country.
    This infrastructure investment for passenger rail should properly 
be the responsibility of the Federal Government, as it is for the 
highways, ports, airports, and traffic control systems of the other 
modes. However, Amtrak is an anomaly. Competing modes do not own their 
infrastructure. Bus lines and autos use public highways, airlines use 
public airports, cruise ships use public waterway improvements. Thus, 
competing modes infrastructure needs are funded through long-
established entities, e.g. FAA, FTA, the Corps of Engineers, etc. No 
such vehicle exists for the funding of passenger rail infrastructure. 
The working group recognizes that currently all major publicly owned 
rail infrastructure is in the Northeast Corridor, but it believes that 
there can be efficient use of Federal capital in rail for short and 
medium distance trips in several areas of the country.
    While the working group believes that the costs of infrastructure 
investment and maintenance are properly the province of the Federal 
Government, it also believes that the operating costs of intercity rail 
travel should be met by its beneficiaries, particularly users and state 
and local governments and authorities. Again, this generally parallels 
competitive modes who are generally responsible for their operating 
costs. The working group also notes that typically several operators 
compete by using common public ports, highways, and airports, and this 
principle should be applicable to rail. Thus, opportunities for 
possible access by competitive operators in intercity passenger rail 
should be enhanced.
    The working group believes that the separation of infrastructure 
ownership and management from passenger transportation responsibility 
is fundamental, and that it should be reflected in a basic division of 
governance. The separation of the infrastructure function from the 
passenger transportation function serves several purposes:
  --It provides a clear demarcation between the ultimate federal 
        infrastructure capital responsibility and the operating 
        responsibility funded by beneficiaries. Accountability will 
        therefore be made much clearer.
  --It provides a mechanism whereby the merits of funding new rail 
        corridor development can be assessed separately from criticism 
        of the performance of the operator.
  --It provides a mechanism to introduce new operators competitive to 
        or comparative to Amtrak.
  --It will enable Amtrak to focus its efforts on its principal day-to-
        day responsibility--providing and developing superior, 
        efficient service to its users, not seeking support for its 
        infrastructure capital program.
    Amtrak's current responsibility for infrastructure planning, 
construction, and maintenance should therefore be separated from the 
responsibility of operating passenger service. Thus, a new federally 
owned corporation with its own governance would take responsibility for 
managing the track, signals, and other fixed infrastructure of the 
Northeast Corridor, along with capital investment in those new 
corridors that are envisioned for the future, while Amtrak would 
continue its passenger services operating role.
    Initially Amtrak would be the only operator of intercity passenger 
transportation, but to encourage innovation and to match service to 
local interests, it would further decentralize by adding strategic 
business units in the Midwest and elsewhere. The working group also 
believes that the potential of intercity passenger rail will be 
improved if subject to competition from other modes and from other 
actual or potential providers of intercity passenger rail service and 
furthermore from a new focus on passenger service provision, as 
distinct from infrastructure management. Thus, eventually, provision 
would be made for other operators to compete with Amtrak on particular 
routes or in particular regions.
    Establishing this newly structured passenger rail service 
environment will not be an instantaneous process, and therefore 
attention will need to be paid during the transitional period to 
ensuring a reasonable balance of benefits among various stakeholders in 
rail passenger service and among various regions of the country. 
Legislation to implement this proposal would provide that the 
infrastructure currently owned by Amtrak would be transferred to the 
new infrastructure management entity.
    The new infrastructure management entity would:
  --Determine infrastructure capital needs
  --Request and expend Federal funding for passenger rail 
        infrastructure
  --Oversee rail operations on and manage its infrastructure
  --Establish standards for selection of passenger rail operators.
    In the long run, after standards for new passenger service 
operators are established, the infrastructure entity would establish 
competitive procedures for selecting passenger service operators and 
conduct competitions for the right to provide service. These procedures 
would provide for reasonable protection for employees adversely 
affected by the competition. We want to emphasize, however, that a 
properly structured reform of inter-city rail passenger service and the 
related infrastructure responsibilities offers real potential for 
stable, secure employment. The proposal is assumed to increase 
passenger rail jobs with the expansion of rail service in appropriate 
markets. Most of Amtrak's employees would continue to work under 
existing labor contracts. Some Amtrak employees, who currently work on 
infrastructure maintenance, would work for the new infrastructure 
entity, Amrail.
                                funding
    The working group assumes that there are essentially three 
alternatives: (1) no funding; (2) funding (with some minimal level of 
conditionality attached); and (3) bridge, or conditional funding. 
Clearly variations are possible, but all would include principal 
elements of one of these three alternatives.
    The group has also assumed that the national passenger rail service 
contemplated is one where infrastructure management and development and 
passenger transportation services are non-overlapping and divided into 
two different operating entities.
    The working group is also of the belief that fixed infrastructure 
capital funding and operating funding requirements must be viewed as 
distinct from one another. Additionally, both types of funding need to 
be more directed toward existing and potential routes with the greatest 
demand and market potential, which are primarily the higher density 
inter-city corridors.
    Fixed infrastructure capital funding amounts required would be 
determined by the new infrastructure manager and developer. The new 
entity would in turn request and expend federal funding for passenger 
rail infrastructure. Over the short term, the amount of such funding 
needs to be absolutely no less than called for in the Amtrak strategic 
plan. Longer term, these amounts must be increased significantly and 
placed in a more secure manner.
    Operating funding requirements arise at the transportation service 
provider level, and in the group's view should be minimized through 
strict oversight and market discipline. Start-up operating funding 
requirements should be factored into the initial years of the 
operation, possibly for 5 years.
    The group has identified two types of funding requirements: short 
term, or bridge funding, and longer term funding. These are discussed 
further below.
Alternative 1: No Funding (``Bankruptcy'')
    Based on statements made by both Amtrak senior management as well 
as several government transportation officials in the past six months, 
it appears irrefutable that (i) Amtrak is not financially self-
sustainable, and; (ii) Amtrak has borrowings and other financial 
payment obligations that place it in real danger of bankruptcy if these 
obligations are not met.
    The costs of an Amtrak bankruptcy cannot be underestimated. These 
include financial, social, and political. Every constituency would 
lose: state, local and federal government, employees, customers, 
suppliers, taxpayers. The true cost of a bankruptcy would cost billions 
of dollars. The resolution of such a bankruptcy is far from certain, as 
control of the process would be taken out of the hands of the 
government.
    Although frequently used as a tool to precipitate wholesale 
corporate reorganization, bankruptcy for Amtrak would most likely ensue 
in chaos. This outcome should be seen as most undesirable.
Alternative 2: Funding (assumes encouragement of existing management to 
        get on with their plan)
    Amtrak has cost U.S. taxpayers almost $1 billion per year since its 
inception twenty six years ago. Funding has been irregular, and its 
operating plan impaired, resulting in yearly underfunding by Congress, 
and declining levels of corporate performance including bigger 
operating losses, fewer passengers, fewer routes, and poorer service. 
Monies marked for capital improvements have been spent on covering debt 
service, resulting in a chronic underinvestment for the future.
    Many reforms were launched by the company in the 1993-94 period, 
aiming at reversing this decline. Broadly speaking, these have not paid 
off. Today, Amtrak finds itself once again cap in hand asking for money 
that it claims will support the achievement of a self-sufficiency plan 
that is generally acknowledged by many outside Amtrak as wholly 
unrealistic. Specifically, many if not most of the tenets of this plan 
(on which the funding request is predicated), include sources of 
revenue which are unproven on a broad scale (e.g. high speed trains, 
express delivery, freight carriage). Management is fighting with, or 
staving off, creditors, freight carriers, Congress, and labor, to name 
a few. Credibility is beyond repair without a real fresh start.
    The Clinton Administration, and many within Congress, have put 
proposals forward to fund a portion of Amtrak's needs, but none would 
come close to solving Amtrak's problems. By Amtrak's own admission, 
this approach will merely postpone a true crisis. A true crisis would 
be akin to bankruptcy, with many of the attendant costs. In fact, 
Amtrak management has gone on the record stating that even if all of 
its request for funds was met, Amtrak would still be in an extremely 
precarious position.
    It would seem logical to conclude from this that simply funding 
Amtrak when it is running with a poorly articulated plan and little 
hope of success would seem to be irrational, a true waste of taxpayers' 
money and in fact only serve to defer and potentially exacerbate the 
problems.
Alternative 3: Conditional Funding
    The notion of conditional funding incorporates two concepts. 
Firstly, that bankruptcy must be avoided (i.e., funding must be made 
available) and secondly that such funding as is granted must be done 
within the context of the implementation of one or a set of mechanisms/
reforms designed to improve the performance of Amtrak for its owner, 
users, and employees.
    Such funding naturally breaks down in two parts: (i) short term 
funding to avert the immediate crisis and allow the reforms to be 
implemented; and (ii) longer term funding that allows for the 
flourishing of the model that is implemented. It is our belief that 
alternative sources of funding will become accessible as a direct 
result of a credible reform process being implemented. Some of these 
are discussed further below.
How much money, for how long and from where?
    Under (i) above, short term funding should be provided in an amount 
that lies between the current funding request of Amtrak and the 
Administration's proposal. This funding should be made to be as short 
term as possible to encourage urgency in implementing reform. A term of 
12 to 18 months is seen as realistic. In other words, fund Amtrak 
exactly as much as it needs to avoid bankruptcy during the 
implementation of reforms over a specific and defined time period. This 
funding must be sourced from the readiest sources of cash, i.e., the 
normal Amtrak appropriation.
    Regarding (ii) above, the amount required on a regular basis will 
depend on the plan adopted. Sources will vary depending on the use of 
funds, but the implementation of various reforms will certainly impact 
the funding sources available, as discussed further below. This funding 
should be regular and predictable, for greatest ease for both the 
recipient as well as the donor. It should be subject to periodic 
review, or certain performance or other events should trigger such a 
review.
    In light of current budgetary constraints, and yet the clear need 
to provide a regular, predictable, and stable infusion of capital 
investment in inter-city passenger rail infrastructure, Congress should 
consider creative and innovative procedures for infrastructure 
assistance. Merely renewing calls for ``dedicated'' funding sources 
without exploring new and more adaptable funding mechanisms is unlikely 
to produce constructive results. In the past, many such proposals for 
``dedicated'' funding have foundered on the philosophical objection of 
states with little or no inter-city passenger rail service to making 
forced tax contributions to states with substantial amounts of such 
service.
    We have not attempted to select a single funding mechanism to 
recommend to the Congress. We are agreed that stability is an essential 
element of such funding, and that greater creativity needs to be 
exercised in selecting potential funding mechanisms. As part of our 
deliberations, we did discuss two examples of innovative funding 
mechanisms. Although we are not recommending these specific approaches, 
they are offered here as purely illustrative examples of the general 
type of non-traditional mechanisms we recommend the Congress examine.
    First, one potential technique for addressing the perennial issue 
of fairness among ``rail'' and ``non-rail'' states might be to 
authorize at the federal level a state-option portion of the federal 
gasoline tax. This would permit states who wished-either alone or in 
concert with other participants in multi-state compacts-to participate 
directly in passenger rail capital funding to opt for some additional 
increment of gasoline tax to be used for this purpose.
    Another example would be to expand and modernize the guaranteed 
loan programs of the 1976 Railroad Revitalization and Regulatory Reform 
(``4R'') Act. These programs are already targeted toward rail 
infrastructure needs. Under current law, the ``subsidy component'' or 
``risk premium'' supporting such guaranteed loans may be funded only 
through on-budget federal appropriations. If these functional 
equivalents of security deposits could be provided by outside entities 
(such as state governments or private parties), substantial amounts of 
infrastructure capital might be made available with minimal budgetary 
impact.
                               conclusion
    A majority of the working group is of the view that a division 
between infrastructure management and operations affords the best 
chance for the preservation and renewal of passenger rail service in 
this country. Amtrak has operated for too long under conditions that no 
business could endure. The problems do not lie with Amtrak management 
or Amtrak labor, but rather with the basic structure that was 
established when Amtrak was created in 1971. Amtrak's mission is 
vaguely defined, its funding has never been adequate for a true 
national system and it has been burdened with expensive legal mandates.
    The majority believes that intercity rail should be placed on the 
same structural footing as other modes of transportation. This would 
include a stable and permanent commitment by the Federal Government to 
fund the infrastructure costs of intercity passenger rail. It would 
also mean the elimination of operating subsidies for operators of 
passenger rail, and the introduction of competition among these 
operators.
                           Minority Comments
                   james j. florio and carl van horn
    The majority of the Working Group on Intercity Rail sets the right 
note at the outset of their report by emphasizing the important role 
that intercity passenger rail plays in reducing airport and highway 
congestion and improving air quality, and urges the preservation and 
enhancement of intercity passenger rail service in order to achieve 
these objectives. The report also advances the admirable goal of 
increasing the Nation's investment in intercity passenger rail 
infrastructure, especially in densely travelled corridors where high-
speed rail service is a realistic alternative. The report proposes to 
achieve these goals by separating ownership of passenger rail 
infrastructure from responsibility for passenger rail operations. We 
have examined this proposal carefully, however, and have concluded that 
it is unlikely to solve the existing problems of intercity passenger 
rail service in the United States. In fact, we believe that, if 
adopted, it would create difficult new problems.
    The majority report establishes two goals for reforming and 
restructuring Amtrak:
    (1) Provide safe, reliable, comfortable, convenient, and 
financially sound passenger rail service in all densely populated 
corridors of the United States that show declining air quality and 
presently or potentially traffic congestion problems; and
    (2) Encourage public/private development of attractive overnight 
passenger rail service, on a periodic basis, throughout regions of the 
nation with significant cultural, historical, and scenic character 
(e.g., a kind of ``rolling national park'').
    We believe the proposals advanced by the majority report fail to 
achieve either goal. We believe that, if implemented, they are likely 
to reduce investment in passenger rail infrastructure and reduce 
service on most interstate routes, whether those routes are on high-
density corridors or in regions of the country with significant 
cultural, historical, and scenic character.
    We believe that our colleagues come at their proposal largely due 
to an unwarranted pessimism about Amtrak's prospects. They are unduly 
critical of Amtrak's management, unduly critical of Amtrak's Strategic 
Business Plan, and unduly critical of the market potential for Amtrak's 
services. The majority report is also unnecessarily pessimistic about 
Congressional support for Amtrak. Senator Roth has recently introduced 
legislation to create a $2 billion reserve fund for Amtrak that has 
attracted broad support in the Senate. While the majority report claims 
that there is ``very little support for the long-distance routes,'' 
that is contradicted by the fact that the Senate added a special 
provision in last year's Omnibus Appropriations Act adding $22.5 
million to Amtrak's appropriation to save four long-distance routes. 
Senator Lott has become a leading supporter of Amtrak, primarily 
because of his support for a long-distance route passing through the 
State of Mississippi.
There is No Compelling Rationale for Restructuring
    The proponents of restructuring Amtrak have not put forth any 
compelling rationale for changing the current structure. The majority 
report cites four purposes that are served by their restructuring 
proposal; on closer examination, none of the four purposes is actually 
achieved.
    First, the majority report suggests that the proposal would enhance 
accountability by providing ``a clear demarcation between the ultimate 
infrastructure capital responsibility and the operating responsibility 
funded by beneficiaries.'' Yet the way in which the infrastructure 
entity is established would muddy this responsibility, because the 
infrastructure entity would be responsible not only for managing the 
infrastructure, but also for establishing standards for selecting 
operating companies. The ``infrastructure'' entity would thus be 
setting service standards for operations and be involved both as a 
supplier to the operating companies (by selling them access to the 
infrastructure) and as a regulator of those companies (by selecting who 
can use the infrastructure and what service standards they must meet). 
In any case, separating the infrastructure and operations roles is 
unlikely to enhance accountability. When problems develop, the 
operating companies are likely to blame the infrastructure company for 
failing to maintain the infrastructure properly, while the 
infrastructure company is likely to blame the operating companies. When 
both infrastructure and operations are the responsibility of the same 
company, accountability is clear and undivided. There is no one else to 
blame.
    Second, our colleagues suggest that separating ownership of the 
rails from operations will create greater infrastructure investment 
from the public and private sector. They argue that having an entity 
whose sole responsibility is infrastructure will encourage Congress to 
invest more in high-speed rail infrastructure in appropriate high-
density corridors around the country without being distracted by 
arguments about the performance of the rail service operator (Amtrak).
    In our view, the impediment to high-speed rail has been constraints 
on the federal budget resulting in budget caps on all infrastructure 
investment, not structural problems with Amtrak. In 1994, the Congress 
declined to approve the Clinton Administration's request to finance 
high-speed rail development, despite the fact that these funds would 
have been spent independently of Amtrak. Since 1991, the Congress has 
declined to appropriate any of the $725 million authorized for maglev 
development by the Intermodal Surface Transportation Efficiency Act, 
none of which would have been managed by Amtrak. This year, Congress is 
considering a request for $300 million for development of the high-
speed rail project in Florida, which would be managed independently of 
Amtrak; however, thus far the Florida congressional delegation has not 
strongly supported the request.
    Third, our colleagues suggest that separating infrastructure 
management from operations will facilitate the introduction of new 
competitors to Amtrak. For virtually all of the Amtrak system, 
ownership of the infrastructure is already separate, in the hands of 
the freight railroads, so there are already opportunities for 
competition over the rails that Amtrak does not own. In any case, it is 
not clear why new competitors are needed, since there is plenty of 
competition already from other modes of transportation. As the majority 
report itself states in its Introduction, ``. . . competing modes of 
transportation fight ruthlessly for every uncommitted traveler'' who 
rides on Amtrak.
    Fourth, the majority report also argues that separating 
infrastructure from operations will benefit Amtrak by eliminating the 
need for Amtrak to seek support for its infrastructure capital program. 
We believe this argument is exceedingly naive. Amtrak's success will 
still depend critically on the amount appropriated for the 
infrastructure program, so Amtrak will still need to expend resources 
lobbying for appropriations for it, just as trucking companies lobby 
for highway expenditures and airlines lobby for airport investments.
    There are, perhaps, other reasons for advancing this restructuring 
proposal. Several members of the working group have cited, with 
approval, the recent British approach that separated infrastructure 
maintenance from operations. But the British model is not one to be 
emulated. Thus far, the British model has cost nearly $1 billion a year 
more in public funding than it did under its predecessor, BritRail. If 
the British model were applied to the U.S. it would in all likelihood 
lead either to substantially increased subsidy levels or to the 
elimination of all long distance trains as well as the elimination of 
many short-haul trains that require regional or multi-state support. 
The best one can say at this point is that the jury is still out on the 
British experiment.
    Another rationale for the proposal is that other modes of 
transportation operate privately-owned and operated vehicles on 
publicly-owned infrastructure. This is not uniformly true--mass transit 
receives federal subsidies both for its rolling stock and for its 
operating costs. But the proposal to separate ownership of 
infrastructure from operation of trains might be more appealing in an 
environment where the entire national rail infrastructure is owned by a 
single entity, and where several passenger rail operators compete on 
that infrastructure. Neither of those conditions obtains in the United 
States. Most rail infrastructure is owned by freight railroads, and the 
existence of competing passenger rail operators is only a distant 
potential. Our colleagues acknowledge those facts, but think that 
separation of infrastructure from operation will help to move us toward 
an environment where more infrastructure is publicly-owned and more 
operators compete on that infrastructure. For reasons which we shall 
discuss in more detail below, however, we think the proposal is 
unlikely to increase the extent of publicly owned infrastructure. We 
also think that the elimination of federal operating subsidy is likely 
to discourage most new private passenger rail operators from entering 
the market.
There are Serious Negative Effects of Restructuring
    We believe that our colleagues's restructuring proposal not only 
lacks a clear rationale; it also is likely to have serious adverse 
effects on infrastructure investment and passenger rail service. We 
think it is likely both to reduce the level of infrastructure 
investment for passenger rail and, by reducing operating subsidies, 
dramatically curtail the level of interstate passenger rail service.
    While the restructuring proposal is advanced with the intent of 
increasing infrastructure investment, the likelihood of Congress 
approving additional infrastructure funding under this proposal is 
undermined by the unequal distribution of infrastructure spending among 
the states. Virtually all of Amtrak's infrastructure spending is now 
done within the eight states of the Northeast Corridor. Other states 
are willing to support these expenditures because they receive a 
disproportionate share of the operating subsidies to keep trains 
running in their states. If federal operating subsidies were 
eliminated, as the proposal envisions, the other states would have 
little reason to support infrastructure investment in the Northeast 
Corridor, and might cease such expenditures altogether. This could lead 
to the collapse of the high-speed rail project in the Northeast 
Corridor and the gradual erosion of conventional Northeast Corridor 
service as the infrastructure deteriorates.
    Even if a handful of high-speed rail infrastructure projects were 
supported outside of the Northeast Corridor, this would still not 
produce enough support to keep the program going. While the proposal is 
advanced on the assumption of an increase in passenger rail 
infrastructure funding, it may thus result in a decrease in 
infrastructure funding.
    The restructuring proposal's assumptions about operating subsidies 
would also have a seriously negative effect on the support for 
interstate passenger rail service, and would probably lead to most of 
that service being canceled. The proposal suggests that the new 
operating entity would receive no federal operating subsidy, would be 
required to pay for its own rolling stock, and would have to depend on 
voluntary payments from the states for any public operating subsidy it 
received. We think this proposal would make most long-distance trains 
and many short-haul trains that require regional or multi-state support 
unsupportable.
    Amtrak believes that it can cover its operating costs, but only if 
the costs of acquiring rolling stock are treated as a capital cost to 
be paid for by public subsidy. No one who has studied Amtrak's cost 
structure believes that it can break even if it has to cover the costs 
of its rolling stock. If Amtrak cannot cover its costs, it must either 
cut routes or go to the states for operating subsidy. (If Amtrak cuts 
routes, this further undermines national support for federal 
infrastructure funding.)
    We think Amtrak is unlikely to be able to generate substantial 
operating subsidies from the states. Amtrak's inability to obtain 
sufficient state support thus far is instructive. While state support 
for Amtrak has increased, it is still only $70 million in 1997 and the 
states continue to struggle over providing modest amounts of money. 
More than half of the state support comes from a single state--
California. Two-thirds comes from two states (California and Illinois). 
All of it comes from 14 states. The States of Louisiana, Mississippi, 
and Alabama could not agree on how to divide up the $2 million cost of 
the Gulf Coast Limited, so none of them contributed anything, and the 
route was terminated, even though this is the sort of short haul 
service (from Mobile, AL, to New Orleans, LA) that states should find 
attractive. The State of Massachusetts would not contribute even 
$100,000 to support the Vermonter even though it serves the western 
part of the state. Vermont had to pay the full share (but in the 
absence of federal subsidies, the route would have been canceled, 
because Vermont only had to pay for the extension of service north from 
Springfield, MA). The proposal will likely lead to the elimination of 
most interstate routes outside of the Northeast Corridor; the few 
remaining routes are likely to be the relatively small number that fall 
entirely within one state, such as those in California.
    Our colleagues assert that separation of infrastructure ownership 
from operations would enhance the efficient use of the infrastructure, 
but the experience of Amtrak and the freight railroads points to the 
opposite conclusion. Freight railroads defend their right to operate on 
their own privately owned rights-of-way because they believe strongly 
that the ownership of the right-of-way allows them to offer a more 
efficient and customer-oriented service than would be the case if they 
were tenants on a right-of-way owned by someone else. Clearly, one of 
Amtrak's problems over the years has been that it does not own most of 
its rights-of-way. Delays in Amtrak service are often due to operations 
of freight railroads. It is no accident that Amtrak has succeeded on 
the one right-of-way that it owns--the Northeast Corridor. We see no 
reason to endanger this success by separating ownership of the right-
of-way from operation of the trains.
    The restructuring proposal also suggests weakening what the report 
itself describes as ``one of the most valuable of all of Amtrak's 
assets.'' Amtrak has guaranteed access to the Nation's freight railway 
system, and it is these rights of access that the ``Context'' section 
of the report describes as one of the ``most valuable'' assets cited 
above. Yet in the ``Question-and-Answer'' section of the report, these 
rights are put up for negotiation. ``The panel believes that Congress 
should explore new alternatives that would fall between the current 
Amtrak arrangements [i.e., guaranteed access] and the present framework 
for commuter rail access [i.e., no guaranteed access] to freight rail 
infrastructure.'' We cannot see how giving away these critical access 
rights advances the cause of passenger rail transportation in the 
United States.
The Restructuring Proposal is Based on Erroneous Factual Statements
    The analysis in the majority report is based in part on a number of 
unsupported factual assertions, some of which are contradicted by its 
own findings. The majority report alleges, without foundation, that 
``Amtrak's Strategic Business Plan is generally acknowledged by many 
outside of Amtrak as wholly unrealistic.'' In fact, the outside parties 
that count, namely the bankers that are lending Amtrak money, do 
believe the plan is realistic, and that is why they are lending the $1 
billion that Amtrak is borrowing for its Northeast Corridor high-speed 
rail service.
    The majority report takes note of the reforms that Amtrak has 
instituted in the past three years and asserts, again without offering 
any evidence, ``Broadly speaking, these [reforms] have not paid off.'' 
This does not appear to be the view of the states who work with Amtrak. 
The State of Wisconsin, for example, has written to the Working Group 
saying that ``In recent years, Amtrak has taken more aggressive actions 
to improve the service, increase advertising, and increase eldership. 
These changes are reflective of the new attitude that is manifesting 
itself in Amtrak. Everyone at the company recognizes that they must 
please their customers if they are to continue as a company. They are 
working hard to do so.'' The letter also notes that ridership has 
doubled since the State contracted with Amtrak for passenger service. 
While ridership has declined nationally because Amtrak has been forced 
to eliminate routes due to federal budget cuts, traffic is generally 
growing on those routes that have been retained. Similarly, the State 
of Illinois has written to the Working Group stating that ``Amtrak has 
shown the flexibility and will to make significant and tangible strides 
toward self-sufficiency and good business practices. We thus have 
reason to be hopeful for the future.''
The Majority Report Proposes Confusing Information about Rail Labor 
        Issues
    The majority report for the most part ignores the controversial 
issue of labor protection and accident liability, because there was 
little consensus on these issues among the Working Group, and 
information had been presented to the Group indicating that these 
issues had inconsequential effects on Amtrak's financial status. 
Indeed, the majority report states in its conclusions that ``The 
problems do not lie with Amtrak management or Amtrak labor. . . .'' 
Yet, the report does not address what will happen to employees under 
the restructured system. Freight railroads operate under essentially 
the same labor protection provisions as Amtrak, and they find it 
possible to succeed in a competitive business. The fact is that 
Amtrak's recent experience in eliminating routes has shown that labor 
protection in practice has inconsequential costs. Amtrak does not use 
the flexibility it has now to contract out work and has never been able 
to show that it would actually save money if it had more flexibility. 
We believe that these labor provisions have little if any effect on 
Amtrak's financial status and should not be part of any Amtrak reform 
proposals. But more importantly, we believe that any proposal to 
restructure Amtrak should specifically address the future status of 
Amtrak's employees.
There Are Better Ways to Preserve and Enhance Intercity Passenger Rail 
        Service in the United States
    Congress has repeatedly urged Amtrak to make better use of its 
infrastructure and to reduce costs and lessen its dependence on 
operating support. Instead of embarking on an the uncertain path of 
restructuring, we believe that Amtrak should be given the next two to 
three years to implement several promising revenue-enhancing activities 
that could significantly improve its financial situation. These 
initiatives include high-speed rail in the Northeast Corridor, 
increased mail and express, and development of electric power 
initiatives, among others.
    We believe that Amtrak's management has done a credible job of 
making Amtrak more efficient and more customer-focused. We believe that 
Amtrak has correctly seen that it must invest in new rolling stock to 
replace obsolete equipment that is unreliable and expensive to 
maintain. We believe that the Congress should support Amtrak's effort 
to reduce its costs and expand its market by providing it with the 
capital and operating support it needs and by eliminating statutory 
restrictions on Amtrak's operations.
    First, Amtrak needs more capital support so that it does not have 
to borrow money on the private market at high interest rates. Clearly 
it makes more sense for Amtrak's capital costs to be financed at low 
government interest rates than at high private interest rates. In 
particular, Amtrak needs capital support to pay for and promptly begin 
service with its new high-speed rail service on the Northeast Corridor. 
While it is possible to dispute the exact estimates of the surplus that 
will be generated by this service, there is no doubt that this is a 
worthwhile investment for Amtrak and for the Nation.
    Second, Amtrak needs sufficient operating subsidy so that it does 
not have to borrow short-term to meet its operating costs. Amtrak has 
reduced its operating costs by over $200 million since 1994. It is 
making good progress toward minimizing its need for operating subsidy. 
Reducing Amtrak's operating subsidy in the short run simply forces 
Amtrak to borrow more, thus increasing its need for operating subsidy 
in the long run. A predictable, realistic glidepath to lower operating 
subsidy is the most sensible policy.
    Third, Amtrak needs some basic revisions in its statutory 
authorization to clarify its authority and allow it to reduce its costs 
and increase its revenues. Amtrak currently is authorized to carry 
``mail and express'' in addition to passengers, but ``express'' is 
never defined in the statute. Instead, ``express'' is defined by a long 
series of Interstate Commerce Commission decisions. The definition is 
obscure and subject to prolonged litigation. The freight railroads have 
opposed Amtrak's recent attempts to expand its express business and 
have threatened litigation to prevent Amtrak from increasing its 
revenues in this way. The freight railroads say they only want Amtrak 
to carry what is traditionally considered express--things like United 
Parcel Service (UPS) packages. But the freight railroads already carry 
a considerable amount of UPS packages by carrying UPS trailers on their 
flatcars. It would not make sense for the freight railroads for Amtrak 
to expand its business in an area that is already being served by the 
freight railroads.
    Amtrak has proposed carrying cargoes like refrigerated perishables 
and other intermodal traffic requiring very tight delivery times. The 
railroads have opposed letting Amtrak carry this cargo because it is 
``freight,'' not ``express.'' But the important point is whether the 
railroads have any realistic likelihood of carrying the cargo in 
question. If the freight railroads cannot meet the delivery schedules 
demanded by shippers, then they are not harmed by having Amtrak carry 
the cargo, regardless of whether it is ``freight'' or ``express.'' We 
therefore recommend that the definition of ``express'' that Amtrak is 
authorized to carry be defined in statute as any cargo that existing 
freight railroads do not carry because they cannot routinely meet the 
delivery schedules or other criteria demanded by shippers.
    Amtrak uses prodigious amounts of electrical power on the Northeast 
Corridor. The commuter railroads who use Amtrak's right-of-way use even 
more. Electrical power costs in the northeast are among the highest in 
the country. If Amtrak could buy power from distant suppliers who can 
generate power at lower costs, it could dramatically reduce its costs 
of service. Amtrak should further be permitted to make more efficient 
use of the natural distribution system created by its Northeast 
Corridor electrical grid to sell power to other users along its right-
of-way. If Amtrak is to make more efficient use of its infrastructure, 
it needs to have the authority to use its infrastructure to reduce its 
costs and generate revenues.
Summary
    In summary, despite the unanimous belief of the Working Group that 
intercity passenger rail is a valuable part of the Nation's 
transportation system, our colleagues' proposal could create a crisis 
in rail transportation in the one corridor where it is most vital, and 
lead to the erosion or collapse of rail service in other regions of the 
country. We believe that further analysis of the costs and benefits is 
needed before reaching the conclusion that intercity rail operating and 
infrastructure units should be separated. In our judgment, such a 
strategy would result in greater costs to the taxpayer, more 
bureaucracy, and fewer trains.
    While our worst fears may not be realized, we strongly urge the 
Congress to undertake a more thorough analysis of the tools necessary 
for lowering costs and raising revenues before adopting their 
recommendations.
                                 ______
                                 
                               appendix c
   Questions and Answers Concerning the Proposal of the Committee on 
   Transportation and Infrastructure Working Group on Intercity Rail
  --Will the proposal lead to a reduction in Amtrak routes?
    The proposal does not envision or call for a reduction in routes. 
In fact, it is hoped that with a more streamlined organizational 
structure, the lifting of Amtrak's current legal constraints, and 
increased infrastructure investment by Amrail, an expansion of 
intercity passenger rail service in appropriate markets will be 
possible.
  --What level of federal funding does the proposal assume?
    The working group believes that capital and operating funding 
requirements must be treated separately. Federal operating subsidies 
should be eliminated at least by 2002. In the short-term, operating 
bridge funding at a level between the Administration's request ($342M) 
and Amtrak's request ($387M) should be provided in order to avoid a 
bankruptcy.
    Continued capital funding should be provided on a regular, 
predictable and permanent basis. The level should be on the order of 
that proposed in Amtrak's strategic business plan (approximately $750M 
per year), although the working group believes non-federal sources, 
such as private and state/local funding would be available for at least 
a portion of this funding.
  --What will happen to Amtrak's employees?
    Employment levels will not decrease as a result of this proposal. 
In fact, the proposal is assumed to increase passenger rail jobs with 
the expansion of passenger rail service in appropriate markets.
    Both Amtrak's employees and its management have been severely 
handicapped by the organizational structure of Amtrak as currently 
constituted. The working group views the proposed restructuring as an 
opportunity for both labor and management to be freed from these 
constraints and to explore new options for stable and growing 
employment.
    Most of Amtrak's employees will continue to work for Amtrak under 
existing labor contracts. Some Amtrak employees, who currently work on 
infrastructure maintenance, would work for the new infrastructure 
entity, Amrail.
  --How will the working group's proposal improve passenger rail 
        service?
    In the short-term, the proposal is aimed at averting an Amtrak 
bankruptcy, which is a real possibility if no legislative action is 
taken.
    Over the longer-term, splitting operations from infrastructure 
management will enable Amtrak to focus its efforts on its principal 
day-to-day responsibility--providing and developing superior, efficient 
service to its users--not seeking support for its infrastructure 
capital program.
    In addition, the working group believes that the introduction of 
competition from other providers of intercity passenger rail service 
will inject an element of market discipline in the provision of 
passenger rail service that is currently lacking.
    Furthermore, Amrail, the new infrastructure management 
organization, would be responsible for developing new rail corridors 
outside the Northeast Corridor to provide high quality, higher-speed 
rail service in appropriate markets.
  --Would providers of inter-city passenger rail service have access to 
        freight railroads' rights-of-way outside the Northeast 
        Corridor?
    Amtrak currently has compulsory access by federal law and pays for 
that access under a statutory ``incremental cost'' formula that does 
not take into account the operational impact of passenger traffic on 
freight operations. In addition, the presence of Amtrak trains exposes 
the host railroad to unlimited tort liability from possible passenger 
train accidents. In sharp contrast to the present Amtrak access 
arrangements, publicly funded commuter railroads using freight 
railroads' tracks negotiate their access on a case-by-case basis, 
bargain the specific compensation to be paid, and typically bring with 
them the liability limitations of state laws governing publicly funded 
transit and commuter rail operations.
    The panel believes that Congress should explore new alternatives 
that would fall between the current Amtrak arrangements and the present 
framework for commuter rail access to freight rail infrastructure. 
Liability protection should be a critical element of a new access 
regime. In addition, the panel has recommended long-term, stable 
federal assistance for infrastructure upgrades on and off the Northeast 
Corridor. This already occurs in the commuter rail field, where the 
Federal Transit Administration assists in capacity and signal 
improvements on freight railroad lines that also carry commuter rail 
traffic. We envision similar infrastructure projects focused on the 
passenger corridors around the country with the greatest market 
potential.
  --Has anything like this ever been tried before?
    Yes, other countries have restructured their rail systems by 
separating infrastructure management from transportation services, 
including Great Britain, Denmark, Sweden, the Netherlands, and 
Australia. Materials on the experiences of other countries are included 
in the appendices to the working group's report.
                            mail and express
    Question. What is the size and make-up of Amtrak's current fleet of 
mail and express cars? Are there plans to acquire new cars for mail and 
express service? What funds are being utilized to purchase these cars?
    Answer. Amtrak has a fleet of 138 active and 9 stored baggage cars 
that are used for passenger baggage, mail and express. Mail and express 
are also carried in Material Handling Cars (MHC's) for which the fleet 
includes 141 active and 2 stored cars. Last year 13 Roadrailer trailers 
(vehicles that operate on the rail and highway) were acquired, which 
are used primarily to transport mail. Amtrak is acquiring an additional 
250 plain MHC's, 367 refrigerated MHC's and 283 Roadrailer trailers for 
the mail and express business this year. This equipment is being leased 
through private market financing
    Question. For fiscal years 1995, 1996 and projected for 1997, 
please display the amount of revenue generated by Amtrak's mail service 
and by express service.
    Answer.

------------------------------------------------------------------------
                Year                    Mail revenue     Express revenue
------------------------------------------------------------------------
1995................................       $57,300,000        $3,100,000
1996................................        63,000,000         3,100,000
1997 (proj.)........................        64,500,000         5,200,000
------------------------------------------------------------------------

    Question. How much does Amtrak expect to generate in mail and 
express business in the next five years (fiscal years 1998-2002), by 
year?
    Answer. The 1998-2002 business plan will not be approved by 
Amtrak's board of directors until September, so specific numbers are 
not yet available. Because of the board's approval of the equipment 
acquisition (250 plain MHC's, 367 refrigerated MHC's and 283 Roadrailer 
trailers for mail and express business), 1998 pilot program express 
revenue will exceed $200 million. Plans are being developed which, if 
approved by Amtrak's Board, will result in potential annual mail 
revenue exceeding $200 million and an equivalent amount or higher in 
express revenue.
    Question. Do you have agreements with any freight railroads to 
initiate this service? Which railroads? Which railroads are opposed to 
Amtrak performing this service?
    Answer. Joint venture agreements are in various stages of 
discussion with Class I railroads and several smaller railroads to give 
them profitable opportunities to participate in aggressive growth of 
carload and trailerload express. Amtrak intends to increase its 
handling of premium shipments that are currently being transported by 
motor carriers and via air for which prices higher than railroad 
freight rates will be charged. Shippers have expressed strong interest 
in Amtrak's express service capabilities because it is tightly 
scheduled, relatively damage free, offered by a transcontinental 
carrier meaning no railroad to railroad interchange, and is highway 
transit time competitive while at the same time being more economical 
than highway or air. Mail and express business is currently carried 
over virtually all freight railroads over which Amtrak operates. It has 
been this way since Amtrak's inception. One railroad has publicly 
stated concerns about the possibility of Amtrak capturing business it 
now carries.
    Question. What additional expenses are associated with the mail and 
freight program? What are the estimated first year profits?
    Answer. Since the business is handled on passenger trains that are 
currently operating, as a way to help make them financially viable, 
incremental expenses are relatively limited. They include equipment 
leases, terminal costs and administrative costs. As train lengths 
increase there is an additional cost associated with additional 
locomotive power and fuel. First year contribution (incremental revenue 
less incremental expense) for the pilot express initiative is projected 
at $53 million.
    Question. Why is it necessary to enter into agreements with freight 
railroads at all to provide mail and express service? Doesn't Amtrak 
have the authority and absolute right to operate over any track?
    Answer. Amtrak wishes to enter into agreements with freight 
railroads in connection with the expansion of its express business 
because some of the accessory services required, such as terminal 
services, can be best provided by the freight railroads. In addition, 
Amtrak believes that railroad participation in its express business, 
through joint ventures or other contractual arrangements, will give 
railroads a financial incentive to achieve significantly improved on-
time performance which also benefits passengers. Amtrak also believes 
that entering into agreements with railroads will enable it to avoid 
disputes over whether particular shipments it is handling constitute 
``express.'' Although Interstate Commerce Commission decisions support 
Amtrak's position that all of the business it plans to handle is in 
fact ``express'', litigation over this issue with freight railroads, 
which own the tracks over which Amtrak's trains operate, could delay 
Amtrak's efforts to expand the business. This would hamper Amtrak's 
ability to free itself from Federal operating subsidy, as it has been 
directed to do by the Administration and Congress, and would be 
inconsistent with Amtrak's objective of being viewed by those railroads 
as a valued partner whose operations provide a way for them to earn 
additional profits. Amtrak has the right to operate over any railroad's 
track and to carry mail and express business on its trains.
                              labor issues
    Question. How do the labor provisions affecting rail employees 
differ from those affecting airlines and intercity buses?
    Answer. Amtrak is governed by the following legislative labor 
provisions which do not apply to airlines and/or intercity buses:
    1. Federal Employer's Liability Act.--A fault-based workers 
compensation system, governing compensation for employee on-duty 
injuries.
    2. Railway Labor Act (also applies to airlines).--Governing labor 
relations issues of employee representation, dispute resolution and 
negotiation of contracts.
    3. Railroad Retirement Act.--Governing railroad employee 
retirement.
    4. Rail Passenger Service Act provisions.--Governing employee 
protective conditions (Appendix C-2) and no furlough (except food and 
beverage) contracting out restrictions.
    While airlines and intercity bus operations are affected by other 
laws covering workman's compensation, collective bargaining and 
retirement, Amtrak is uniquely covered by the legislative requirements 
outlined in item 4 above.
    Question. GAO's testimony stated that Amtrak has been unsuccessful 
in negotiating productivity improvements with labor unions. Many of the 
same craft unions are represented at both freight rail and Amtrak labor 
negotiations, and there is pressure from labor to secure equally 
favorable agreements with Amtrak as have been secured with the freight 
railroads. As a result, in the last six months, many freight/labor 
union agreements have been negotiated, while Amtrak is stuck at the 
table. Do you believe that the labor unions fully appreciate how dire 
Amtrak's financial circumstances actually are? Are the union 
negotiating the railroad out of business?
    Answer. With freight settlements in the background, it seems 
unlikely ``concessionary'' agreement can be reached voluntarily with 
some unions for political or union institutional reasons without 
Congressional action but it is difficult to characterize union beliefs 
in general or in total. We believe that all of our unions understand 
Amtrak is in financial difficulty. However, few, if any, unions accept 
the Congressional and Administration mandate that Amtrak be independent 
of federal operating support. Consequently, they do not accept Amtrak's 
Strategic Business Plan to achieve that independence. This non-
acceptance exists despite the fact that our level of federal operating 
support has been cut in half--nearly 50 percent--over the past two 
fiscal years. Consequently, Amtrak has been unable to reach agreements 
providing for work rule and benefit reform necessary to help Amtrak 
live within an environment of declining federal operating support.
                      operating commuter railroads
    Question. What commuter railroads does Amtrak operate? What was the 
total revenue stream from these operations (broken out by commuter 
transit authority) for fiscal years 1994, 1995, 1996, and projected for 
fiscal year 1997?
    Answer. Amtrak operates seven commuter operations. Those commuter 
services and revenues are noted below. (fiscal year 1997 figures still 
being developed.)

                                  AMTRAK CONTRACT OPERATIONS OF COMMUTER TRAINS                                 
                                              [Dollars in millions]                                             
----------------------------------------------------------------------------------------------------------------
                                                                               Fiscal year--                    
                     Commuter agency                      ------------------------------------------------------
                                                              1992       1993       1994       1995       1996  
----------------------------------------------------------------------------------------------------------------
MBTA (Boston)............................................      $88.4      $96.4     $105.4     $124.0     $132.2
Maryland DOT.............................................       10.7       12.2       14.0       14.2       22.2
Northern Virginia........................................        2.8        7.7        7.3        9.0        8.6
Connecticut DOT..........................................        5.3        5.8        6.0        6.1        6.5
Southern California......................................        1.6       13.8       24.2       25.1       25.1
Peninsula Commuter.......................................        7.4       27.2       30.0       30.8       34.9
San Diego Commuter.......................................  .........  .........        0.2        6.2        5.8
Orange County, CA........................................        1.8        1.5        0.5  .........  .........
                                                          ------------------------------------------------------
      Total revenue......................................      118.0      164.6      187.6      215.4      235.4
----------------------------------------------------------------------------------------------------------------

                             rural service
    Question. In Amtrak's testimony before the Committee on May 7th, 
President Downs stated that Amtrak provides a necessary service for 
rural communities as well as urban corridors. But considering the 
ridership figures and operating losses on many of these long-distance 
routes that serve rural communities, it seems clear that the railroad's 
rural constituency is not sold on Amtrak's necessity. Low income, 
young, and elderly passengers who generally have to watch their budgets 
more often travel by intercity buses, which have four times the 
ridership Amtrak does, rather than pay more per ticket for less 
frequent, more often delayed, train service. Can you make any 
compelling arguments for Amtrak's importance as a rural transportation 
alternative?
    Answer. Passenger rail service is essential to many rural areas. 
Sixty-two million Americans live in small towns and rural areas. Amtrak 
serves over 530 communities nationwide many of which are in rural areas 
with few transportation options. While commercial air and bus carriers 
have found it economically infeasible to provide service to many 
smaller cities, intercity passenger trains can stop at areas with 
populations as low as 10,000-20,000 without significant cost or time 
loss. Amtrak serves thirty-three communities which have no air service, 
eighteen communities which have no bus service, and nine communities 
with neither air nor bus service.
                           cost to liquidate
    Question. How solid is the estimate of $5,000,000,000 in costs 
associated with liquidation of the railroad? Couldn't some employee 
dismissal cost be reduced?
    Answer. The estimated cost associated with the liquidation of the 
railroad is approximately $6.2 billion. This is based on an analysis 
done by Amtrak in February 1995 and subsequently scored by the 
Congressional Budget Office on April 11, 1995. The original analysis 
estimates a ``shut down'' cost of $5.4 billion. The current estimate of 
$6.2 billion is higher primarily due to an escalation in the amount of 
financing obligations that Amtrak now has. In a shutdown situation, 
employee dismissal cost would be reduced primarily via ``protected'' 
employees getting jobs and giving up their protection payments.
                          unprofitable routes
    Question. Please update the Committee on the status of the five 
routes on which Amtrak planned to discontinue service last year, that 
then received 6-month extension funds in the fiscal year 1997 omnibus 
consolidated appropriations bill.
    Answer. The five routes are the Texas Eagle, Pioneer, Desert Wind, 
Boston-Albany section of the Lake Shore Limited, and the Gulf Coast 
Limited.
    The Gulf Coast Limited was discontinued on March 31, 1997 and the 
Pioneer and Desert Wind were discontinued on May 10, 1997. The Texas 
Eagle and Boston-Albany section of the Lakeshore Limited were extended 
through the end of the fiscal year based on arrangements with the 
states (loan from the state of Texas and a capital investment from the 
state of Massachusetts).
    Question. Does Amtrak have plans to close or reduce service on 
additional routes? If yes, what routes would be affected and why? Does 
Amtrak expect that it will be successful in making these route 
adjustments?
    Answer. Amtrak does not plan on closing additional routes. Our 
business plan calls for maintaining the national system.
                   states using highway fund flexing
    Question. If the successor surface transportation authorization 
bill includes provisions giving states the flexibility to use highway 
funds for Amtrak operations within the state, what is the likelihood of 
this increased flexibility being utilized by the states? What states 
have done this so far?
    Answer. It seems clear that states would utilize the increased 
flexibility to spend a portion of their federal transportation 
allocation on Amtrak if they were allowed to do so. Many, many states 
have expressed their strong support for this, coast to coast, north to 
south, urban to rural. Governors who have made clear public statements 
on this issue range from Oregon to Delaware, West Virginia to 
Wisconsin, Michigan to Virginia. Right now public policy concerning the 
various transportation modes is incredibly skewed and distorts state 
and local decision making. The federal government offers generous 
matches for state investments in highway or transit service, but little 
or no funds to match state investment in rail passenger service. The 
result is states and localities are discouraged in investing in rail 
even when it is the best transportation solution for the area.
    The only program exception is the ISTEA Enhancements program, which 
states can use for Amtrak stations, but not intercity rail operations. 
States have so far used more than $70 million for Amtrak station 
projects, and spent another $100 million of ISTEA funds on intermodal 
stations where Amtrak stops. Because states are currently not allowed 
to use their federal transportation funds for intercity passenger rail, 
only the State of Oregon, which was granted permission under specific 
conditions, is using Congestion Mitigation and Air Quality (CMAQ) funds 
to help support an Amtrak train.
                   strategic business unit operations
    Question. Please prepare a table displaying, for each strategic 
business unit, the routes operated by name; by terminus city pairs (and 
system miles); by frequency of service; by total annual revenue in 
fiscal year 1996; by total annual expanses in fiscal year 1996; the 
profit/(loss) in dollars for each route; and the operating ration 
(expenses to revenue comparison).

                                                                    NATIONAL RAILROAD PASSENGER SYSTEM FINANCIAL PERFORMANCE                                                                    
                                                                                          [In millions]                                                                                         
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                              Fiscal year 1996--                
                                                                                                                                             ---------------------------------------------------
          Route No./description                          Terminus city pairs                 Route miles               Frequency                              Total                   Operating 
                                                                                                                                                Revenue      expense    Profit/loss     ratio   
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
              Intercity SBU                                                                                                                                                                     
                                                                                                                                                                                                
16 Silver Star...........................  New York-Tampa/Miami..........................     1,263/1,433  Daily............................         31.1         70.4       (39.3)         2.26
17 Three Rivers..........................  New York-Chicago..............................             924  Daily............................         11.5         18.8        (7.3)         1.63
18 Cardinal..............................  Chicago-Washington............................             929  Triweekly........................          4.2         14.0        (9.8)         3.33
19 Silver Meteor.........................  New York-Miami................................           1,391  Daily............................         30.1         62.9       (32.8)         2.09
20 Chicago-St. Louis.....................  Chicago-St. Louis.............................             282  Daily............................         10.4         26.6       (16.2)         2.56
21 Hiawathas.............................  Chicago-Milwaukee.............................              86  Daily............................          9.8         25.3       (15.5)         2.58
22 Chicago-Detroit-Pontiac...............  Chicago-Pontiac...............................             302  Daily............................          9.7         33.9       (24.2)         3.49
23 Illini................................  Chicago-Carbondale............................             309  Daily............................          4.7          8.0        (3.3)         1.70
24 Illinois Zephyr.......................  Chicago-Quincy................................             258  Daily............................          3.6          7.2        (3.6)         2.00
25 Empire Builder........................  Chicago-Portland/Seattle......................     2,209/2,261  Quadweekly.......................         32.5         73.6       (41.1)         2.26
26 Capitol Limited.......................  Chicago-Washington............................             780  Daily............................         20.6         48.2       (27.6)         2.34
27 California Zephyr.....................  Chicago-Oakland...............................           2,425  Quadweekly.......................         25.9         60.1       (34.2)         2.32
28 Southwest Chief.......................  Chicago-Los Angeles...........................           2,259  Daily............................         45.6         83.4       (37.8)         1.83
30 City of New Orleans...................  Chicago-New Orleans...........................             934  Six days.........................         10.8         31.0       (20.2)         2.87
32 Texas Eagle...........................  Chicago-Los Angeles...........................           2,726  Triweekly........................         10.4         32.7       (22.3)         3.14
33 Sunset Limited........................  Los Angeles-Miami.............................           3,066  Triweekly........................         16.1         55.9       (39.8)         3.47
41 International.........................  Chicago-Toronto...............................             501  Daily............................          4.5         12.6        (8.1)         2.80
45 Lake Shore Limited....................  Chicago-Boston/New York.......................       950/1,017  Daily............................         29.7         60.3       (30.6)         2.03
49 Pioneer...............................  Denver-Seattle................................           1,625  Triweekly........................         10.3         29.2       (18.9)         2.83
52 Crescent..............................  New York-New Orleans..........................           1,380  Daily............................         22.0         52.8       (30.8)         2.40
56 Kansas City-St. Louis.................  Kansas City-St. Louis.........................             282  Daily............................          6.9         12.9        (6.0)         1.87
57 Pennsylvanian.........................  New York-Pittsburgh...........................             788  Daily............................          5.9         12.5        (6.6)         2.12
60 Desert Wind...........................  Chicago-Los Angeles...........................           2,397  Triweekly........................         14.9         38.0       (23.1)         2.55
63 Auto Train............................  Lorton-Sanford................................             861  Daily............................         45.4         58.4       (13.0)         1.29
65 Pere Marquette........................  Chicago-Grand Rapids..........................             177  Daily............................          1.9          4.8        (2.9)         2.53
66 Carolinian............................  New York-Charlotte............................             702  Daily............................         12.0         17.3        (5.3)         1.44
67 Piedmont..............................  Raleigh-Charlotte.............................             172  Daily............................          1.7          3.5        (1.8)         2.06
                                                                                                                                             ---------------------------------------------------
      Intercity SBU total................  ..............................................  ..............  .................................        432.2        954.3      (522.1)         2.21
                                                                                                                                             ===================================================
          Northeast Corridor SBU                                                                                                                                                                
                                                                                                                                                                                                
01 Metroliners...........................  New York-Washington...........................             226  Daily............................        157.9        143.8        14.1          0.91
04 Vermonter.............................  St. Albans-Washington.........................             606  Daily............................          4.2         11.4        (7.2)         2.71
05 Northeast Direct......................  Newport News-Boston...........................             644  Daily............................        239.9        381.9      (142.0)         1.59
13 Clockers..............................  New York-Philadelphia.........................              90  M-F..............................         12.6         24.8       (12.2)         1.97
14 Philadelphia-Harrisburg...............  Philadelphia-Harrisburg.......................             104  Daily............................          5.0          8.8        (3.8)         1.76
15 Empire Service........................  New York-Toronto..............................             544  Daily............................         35.7         83.4       (47.7)         2.34
40 Adirondack............................  Montreal-New York.............................             381  Daily............................          4.6         10.4        (5.8)         2.26
42 New York-Harrisburg...................  New York-Harrisburg...........................             195  Daily............................          7.4         16.7        (9.3)         2.26
                                                                                                                                             ---------------------------------------------------
      NEC SBU totals.....................  ..............................................  ..............  .................................        467.3        681.2      (213.9)         1.46
                                                                                                                                             ===================================================
                 West SBU                                                                                                                                                                       
                                                                                                                                                                                                
34 Coast Starlight.......................  Seattle-Los Angeles...........................           1,389  Daily............................         25.1         69.7       (44.6)         2.78
35 San Diegans...........................  San Luis Obispo-San Diego.....................             347  Daily............................         36.4         73.2       (36.8)         2.01
36 Pacific Northwest.....................  Vancouver, BC-Eugene..........................             310  Daily............................          9.9         23.4       (13.5)         2.36
37 Capitols..............................  Roseville-San Jose............................             152  Daily............................         11.7         25.3       (13.6)         2.16
39 San Joaquins..........................  Oakland-Bakersfield...........................             315  Daily............................         28.1         38.0        (9.9)         1.35
                                                                                                                                             ---------------------------------------------------
      West SBU totals....................  ..............................................  ..............  .................................        111.2        229.6      (118.4)         2.06
                                                                                                                                             ===================================================
      Total Amtrak.......................  ..............................................  ..............  .................................      1,010.7      1,865.1      (854.4)         1.85
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

                         reimbursable services
    Question. In what reimbursable service agreements is Amtrak 
currently engaged? What revenues are associated with these agreements?
    Answer. The major portion of Amtrak's reimbursable service 
agreements are in the NEC. The largest service agreement is with NJ 
Transit, a ``new initiatives'' agreement involving maintenance-of-way 
(M.O.W.) services which Amtrak undertakes for NJ Transit. Amtrak also 
has an agreement with the Long Island Rail Road (LIRR) for various 
M.O.W. tasks and a joint venture with the LIRR for Penn Station train 
control improvements.
    Revenues associated with reimbursable arrangements are: Fiscal year 
1995, $107,300,000; fiscal year 1996, $107,500,000; and fiscal year 
1997, $90,878,000 (forecast).

                          Subcommittee Recess

    Senator Shelby. The hearing of the Subcommittee on 
Transportation is now recessed, to reconvene subject to the 
call of the Chair. Thank you.
    [Whereupon, at 12:37 p.m., Wednesday, May 7, the 
subcommittee was recessed, to reconvene at 10:10 a.m., 
Thursday, June 12.]



 DEPARTMENT OF TRANSPORTATION AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 1998

                              ----------                              


                        THURSDAY, JUNE 12, 1997

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10:10 a.m., in room SD-138, Dirksen 
Senate Office Building, Hon. Richard C. Shelby (chairman) 
presiding.
    Present: Senators Shelby, Domenici, Bennett, Faircloth, and 
Lautenberg.
    Also present: Senator D'Amato.

                                Panel 1

                        CONGRESSIONAL WITNESSES

STATEMENTS OF:
        HON. ALFONSE M. D'AMATO, U.S. SENATOR FROM NEW YORK
        HON. SUSAN MOLINARI, U.S. REPRESENTATIVE FROM NEW YORK
        HON. PETER T. KING, U.S. REPRESENTATIVE FROM NEW YORK

                        NONDEPARTMENTAL WITNESS

STATEMENT OF DAN DONOVAN, CHIEF OF STAFF, ON BEHALF OF 
            HON. GUY V. MOLINARI, BOROUGH PRESIDENT, 
            STATEN ISLAND, NY

                   Opening Remarks of Senator Shelby

    Senator Shelby. The subcommittee will come to order.
    I scheduled this hearing at the request of my friend and 
colleague, Senator D'Amato. I would like to welcome Members of 
the New York delegation, Senator D'Amato, Congressman King, 
former Congressman Guy Molinari, and Congresswoman Susan 
Molinari.
    We are here today to talk about air traffic control 
staffing, specifically the situation in the Northeast. One of 
my top priorities as chairman of this subcommittee is to make 
sure that the United States has the safest air transportation 
system possible. Air travel among the general public is 
increasing every year, and I believe we must have adequate air 
traffic control staffing to meet this demand.
    Our current air traffic control system is antiquated, and 
is in dire need of an overhaul. We gave the FAA the tools to 
reform its acquisition and personnel systems in the 1996 
Appropriations Act. We will be interested to hear the FAA 
explain how they are using these tools to address the problems 
in the New York-New Jersey area.
    I should also point out that in this subcommittee's report 
accompanying the Fiscal Year 1997 Appropriations Act, we took 
note of staffing and equipment problems in the New York-New 
Jersey area and directed the FAA Administrator to report to us 
on the initiation of a local recruiting effort in this region.
    We received that report yesterday afternoon, and it pointed 
out some of the difficulties of moving controllers up to higher 
level facilities in the New York-New Jersey areas. It also sets 
out some new initiatives that FAA plans to implement to 
increase the number of recruits from the immediate New Jersey 
and New York areas.
    We are fortunate to have a great deal of institutional 
expertise in this matter in the members represented on the 
first panel, and in the ranking member of this subcommittee and 
former chairman, Senator Lautenberg. Senators D'Amato and 
Lautenberg both have a great deal of background and experience 
with air traffic controller staffing issues, and we are looking 
forward to hearing both of their comments.
    The second panel today would include Mr. Barry Krasner, the 
president of the National Air Traffic Control Association, Mr. 
David Barger, a vice president of Continental Airlines from 
Newark, NJ; Mr. Raymond D. Maldonado with the FAA Control Tower 
at Newark International Airport; Mr. Tom Monaghan with the FAA 
Control Tower at JFK International Airport; Jack Johnson, 
Professional Airways Systems Specialists president; and Henry 
Brown, New York Systems Management Office PASS representative.
    We will also be joined by Monte Belger, the Acting Deputy 
Administrator, Federal Aviation Administration; and Mr. Ron 
Morgan, Director of Air Traffic Service at the FAA.
    The third panel today will consist of Mr. Charles Barclay, 
the president of the American Association of Airport 
Executives; Mr. Phil Boyer, president, Aircraft Owners and 
Pilots Association; and Mr. Edward Bolen, president of General 
Aviation Manufacturers Association.
    Air traffic safety is critical to the health and security 
of this Nation. Americans deserve to have the highest level of 
confidence in their air traffic control system, and I am 
committed to help bring this about.
    Again, I want to thank all the witnesses that will be 
participating here today, and before we hear from the first 
panel, I want to first ask the ranking member and any of the 
other members if they have any opening statements.
    Senator Lautenberg.

                    STATEMENT OF SENATOR LAUTENBERG

    Senator Lautenberg. Thank you very much, Mr. Chairman, and 
I commend you for calling this very important hearing to 
address the staffing and equipment modernization problems for 
air traffic facilities in the New Jersey-New York area.
    I, too, want to welcome our colleagues both former and 
present, Senator D'Amato, with whom I have done lots of work on 
transportation matters. What happens in one State often 
immediately happens in the other.
    I want to welcome our friends from commerce, and that 
includes all of them, even including the next Oprah Winfrey, 
Barbara Walters, name it as you will. We wish Susan Molinari 
well. I am sure she will succeed in that new venture, as she 
has in past ventures. All one has to do is look at that baby. 
Where is she? But we are delighted to have you here.
    I have been voicing concern, along with others, over the 
staffing and equipment problems for several years, both 
individually and through this subcommittee. Now, there is not a 
deeper level of frustration that anyone holds than I do with 
the slow response to the clear need for increased staffing at 
our air traffic control towers, as well as the air traffic 
control center and TRACON in New York, and no one is more 
frustrated than I with the delays in modernizing the equipment 
our controllers must work with.
    I am tired of the broken commitments, the missed targets, 
the waste of taxpayer dollars that went down the drain when the 
failed aviation advanced automation system did not work. I am 
tired of listening to reasons, excuses, if you will.
    While recognizing that our air traffic control system is 
the safest in the world, we also have got to recognize that it 
remains so because of the exceptional effort by the air traffic 
controllers who face extremely challenging, indeed worsening 
conditions during an era of prosperity in the air, significant 
growth in traffic, and I am sure that everyone here agrees that 
safety must be the No. 1 issue in each and every decision on 
how aviation systems function.
    But as I review the litany of excuses for staffing 
shortages and equipment replacement delays, I have to ask, are 
all parties putting safety first? In my view, when solutions to 
safety problems are at hand, it is the obligation of 
decisionmakers to, as the popular advertisement says, just do 
it, and no agency in the Federal Government is in a better 
situation to just do it than the FAA.
    Two years ago, this subcommittee fought an uphill battle to 
implement meaningful personnel and procurement reforms for the 
Federal Aviation Administration. We fought on the Senate floor, 
as well as in conference. In the end, we succeeded in granting 
the FAA greater flexibility than currently applies to any other 
Federal agency, both in the manner in which it procures 
necessary equipment, and the manner in which it hires and 
assigns personnel.
    We took these unprecedented steps in order to allow the FAA 
to act more like a business, but I can tell you, as a former 
chief executive of a sizable company, that I do not see the FAA 
functioning in quite businesslike form.
    No successful chief executive would allow some facilities 
to be continually overstaffed while other critical facilities 
remain understaffed. They either move people, or they shift 
responsibilities from one facility to another, and that is not 
an easy assignment with the construction of our aviation 
system. They do not just wring their hands and offer excuses. 
They identify the right fix, and they just do it.
    Apparently, the FAA can identify several facilities that 
are seriously understaffed, including the ones we are 
discussing today, but the FAA also has several other facilities 
where staffing levels are above their authorized level.
    Even before the enactment of personnel reform, the FAA had 
the authority to reassign people immediately to where they are 
needed. The time is long past due for the FAA to just go ahead 
and do it.
    When it comes to the distribution of responsibility between 
facilities, there are opportunities at FAA's disposal right now 
to shift responsibilities from an understaffed and overworked 
air traffic control center to a neighboring center with 
adequate staff capacity. If the FAA believes this can be done 
in the interest of improving safety, then once again it is time 
for them to just do it.
    At Newark International Airport we were making some 
progress with the FAA at reducing delays, but recently, and I 
use my own experiences as a yardstick, we have been singled out 
as the airport with the greatest number of delays in the 
Nation.
    Well, part of this problem is related to area weather. An 
important part of the solution rests with the FAA's ability to 
deploy modern equipment and keep traffic moving safely in good 
weather and bad. When it comes to cutting through the 
bureaucracy and getting that equipment up and running at 
Newark, it is time for the FAA to just do it.
    Finally, it must be said that in order to move rapidly on 
implementing these solutions, the FAA needs strong leadership, 
and needs it right now. It is unconscionable that it took until 
yesterday for the administration to announce their intent to 
nominate individuals for the position of FAA Administrator and 
Deputy Administrator. I say that with no disrespect to the 
current Acting Administrator, who I think has done an excellent 
job at the FAA.
    They are doing the best they can, but we have not had a 
confirmed FAA Administrator for more than 7 months. We have not 
had a confirmed Deputy Administrator for more than 4 months. No 
business worth its salt would go ahead without a chief 
executive officer and a chief operating officer for such a long 
time, and I plan to do whatever I can to encourage the Senate 
to move these nominations as quickly as possible.
    Thank you very much, Mr. Chairman.
    Senator Shelby. Senator Domenici.

                     STATEMENT OF SENATOR DOMENICI

    Senator Domenici. Thank you very much, Mr. Chairman. I do 
not have a prepared statement. From time to time I might chime 
in indicating what the budget recommended for this year in this 
area.
    Senator Shelby. Absolutely. We would like to hear it, too.
    Senator Domenici. Senator Lautenberg and I put the 
bipartisan budget agreement together, and there are some facts 
about funding expectations under the budget for the FAA that 
have some bearing.
    Mr. Chairman, I am very pleased that you make the statement 
about what we ought to expect in the United States in terms of 
this system. I think I would like to add one other goal for 
your subcommittee that I hope you would clearly consider.
    From time to time, agencies such as the FAA, IRS, and 
others have justification for their inability to get certain 
things done, and sometimes that is justifiably laid at our 
footsteps in Congress for the way we fund or do not fund 
programs, or limitations we have placed on them. I think the 
issue is getting critical enough that before you have finished 
your markup, this subcommittee ought to be very sure that what 
we fund is indeed moving in a positive direction, not only from 
our individual eyes as Senators, but from the standpoint of 
those who have to put this behemoth together and make it work 
better.
    Personally, I thank you for this hearing, and I welcome the 
New York delegation. Somehow from way out in New Mexico I have 
sort of been adopted by New York. Maybe it is because they have 
so many Italian people there. [Laughter.]
    They invite me to be part of their Italian heritage. I 
welcome that, and I note that they are in predominance even 
here today.
    In any event, I hope things can be worked out where you can 
be proud of what we do this year, that we make some strides 
that are positive with reference to the FAA both in terms of 
safety and modernization of equipment. I think it is imperative 
that we do that, be it for my State or your State or your 
cities. We just have to. It is the mode of transportation for 
people today that used to rely on other modes. They are all 
using airplanes today, airlines are growing, and we have to 
accommodate that.
    Thanks very much.
    Senator Shelby. Senator Domenici, I believe that the 
Italians seated at the table like you personally, but they also 
know you are chairman of the Budget Committee, too. [Laughter.]
    We also like you because you are a member of this 
subcommittee. You and Senator Lautenberg. You are the chairman 
of the Budget Committee. He is the ranking Democrat on the 
Budget Committee. We welcome you and we welcome your experience 
on this committee. You will have a lot to say.
    Senator Bennett.

                      STATEMENT OF SENATOR BENNETT

    Senator Bennett. Thank you, Mr. Chairman.
    I come to this issue with a strong personal sense of 
history. Some of you have heard this before, but I have 
discovered since coming to the Senate there is no such thing as 
repetition in the Senate, so I served in the Nixon 
administration at the Department of Transportation, and one of 
my first assignments was to lobby through the Congress the 
Airport Airways Act that created the airport airways trust 
fund.
    We naively assumed when we created the trust fund, the 
ticket tax, the departure tax, and the rest of it to go into 
the trust fund, that we had put a financial base under the FAA 
that would make them immune from funding problems for all time, 
that from then on there would be a funding base to see to it 
that the air traffic control system would be properly staffed 
and properly equipped, no matter what happened to the ups and 
downs of the economy.
    With all due respect to the Budget Committee and the 
unified budget, that has not happened, and Presidents, both 
Republican and Democrat, have reached into the airport airways 
trust fund under the process of the unified budget and taken 
money that it was the original intent of Congress would go to 
fund the air traffic control system, and they have used that 
money for other purposes.
    As one who was charged with the responsibility of 
convincing Congress to create that trust fund in the first 
place, I am upset that the money has not been there and that 
the air traffic control system has been allowed to fall into 
the state that it now is. I have shared this before, but I 
think in this place it should be raised again.
    Someone did a study of the computers in the Government to 
see how vulnerable they were to hackers who could break into 
the computer system and get at Government data, and they came 
back and said, every portion of the Government, the Defense 
Department, the IRS, every portion of the Government is subject 
to attack by outside hackers save one, and that one is the air 
traffic control system. Their equipment is so old and so 
obsolete and the software so unknown to today's hackers that 
they are immune from outside attack. [Laughter.]
    Somehow I do not find that reassuring, and I am delighted 
that this hearing has been held, and I look forward to hearing 
from these witnesses.
    Senator Shelby. Senator D'Amato, your written statement and 
those of all of you will be made part of the written record in 
its entirety. You may proceed as you wish. Welcome to the 
committee. You have spent a lot of time on this committee 
yourself earlier in your Senate career.

                      Statement of Senator D'Amato

    Senator D'Amato. Well, Mr. Chairman, let me thank you for 
not only holding this hearing but your moving to bring it on so 
quickly, given the tremendous thrust of business that you have 
to deal with, and it was only a matter of weeks ago that I 
requested the subcommittee hold hearings.
    I would like to thank Congresswoman Molinari for appearing 
here today. The Borough President of Staten Island, her father 
and former Congressman Guy Molinari, who unfortunately was not 
feeling up to par to appear today, has sent in his place to 
testify his chief of staff, Dan Donovan. Guy Molinari has 
worked on aviation safety issues over the years when he was a 
Congressman and was on the Aviation Subcommittee. I would also 
like to welcome Congressman King, whose area and district takes 
in some of the people who work in the towers and the air 
traffic control centers.
    Senator Lautenberg and I have worked over the years on a 
number of these aviation safety issues, and it is good to be 
here and to share some thoughts; however, I am sorry under 
these circumstances.
    Senator Bennett raised a point that we will touch on with 
respect to the age and effectiveness of the equipment. It is a 
disaster, and a disaster ready to take place. It will happen, 
unless we do something.
    Mr. Chairman, I want to thank you for giving us the 
opportunity to discuss the air traffic control situation in New 
York. I was going to read this speech, but I am going to just 
pick a couple of points out, because there is so much that has 
to be said, and I think my colleagues are going to touch on 
certain aspects of the problems and concerns that exist in New 
York's air traffic control facilities.
    The current situation, I think, really came to our 
attention very vividly when a memorandum was leaked, a 
memorandum by Terry Bolerjack, who is the air traffic manager 
for the New York Center. I will ask for a copy of that memo, if 
you have not received it, to be made available.
    This memo is in his language. I am certain he did not think 
that this was going to become public, because he would not have 
been as candid. But, Mr. Chairman, I went up there with 
Congressman King and Congressman Forbes and we saw the 
conditions at the New York Center. We have seen what's 
happening there.
    Mr. Bolerjack is a man who deserves tremendous credit for 
calling to the attention of those working for him how serious 
the problem was. ``Recent increases in New York Center 
operational errors and deviations have reached levels of grave 
concern.'' He did not mince words.
    Now people will say, oh, well, these increases really were 
not levels of grave concern. Well, why did he say it? The man 
has been there for years.
    ``Analysis of these incidents has clearly established 
requirements for the immediate emplacement of improvements and 
refinements in our air traffic control [ATC] operations.'' He 
is specific here.
    ``The reduction of operational errors and deviations is our 
No. 1 priority.'' He is saying, we have got a problem here. 
This is our No. 1 priority.
    ``It is imperative that a concerted effort be made by the 
entire facility management team to immediately effect a 
substantial decrease in all categories of errors. The effective 
accomplishment of this priority will require both the 
commitment and best efforts of all of us.''
    Then the memo goes through what he is directing people to 
do, and he concludes with, ``I regret that I must impose such a 
short deadline for this submission, but I firmly believe that 
we must take positive action in the earliest timeframe.''
    Coincidentally, my old roommate and Congressman and friend, 
Borough President Molinari, and Congresswoman Molinari, 
conducted a survey, and they got back a survey from nearly 200 
air traffic controllers.
    They are the controllers who try to man this outdated 
equipment, 26-plus years old. We ought to be ashamed of 
ourselves. Imagine a technology where controllers talk to each 
other and they can be disrupted at any one time. This is what 
you have in America in our skies.
    Ask any pilot, and he will tell you the air traffic control 
system is a joke, it is a travesty, and the operation has been 
a travesty over the years. It has not gotten better. It has 
gotten worse.
    Now, if you ask these people who will come up here and 
testify, the union representatives, what things are really 
like, let me tell you, they cannot tell you what it is like, 
because it means incredible consequences to them and to the 
people they represent. I am concerned that they could face 
unintended consequences where they could be shifted here, 
there, demoted up, down, or even possibly lose overtime.
    Senator Shelby. Mr. D'Amato, but you can tell us and tell 
the American people, and so can the Congress, Congressman King, 
and Congresswoman Molinari, and tell the American people what 
it is like. That is why we are holding this hearing.
    Senator D'Amato. That is right, Senator, and I thank you. I 
think the American people thank you for giving us this 
opportunity, and I thank those who have come to us and shared 
some of this data and this information. It is incredible.
    Let me just say that, over the last 8 months, airplanes 
carrying many hundreds of passengers have been coming too close 
to each other at the rate of more than three times each month. 
This is in the New York corridor, and it is a disaster waiting 
to happen.
    The number of near misses has increased in the complex New 
York airspace by 26 percent. This is a problem. Senator 
Lautenberg alluded to it. It has gotten worse over the years. 
It has not gotten better. There have been six near misses since 
April--six near misses since April, including one this last 
week. Last year there were 760 incidents nationwide.

                      New York Controllers Survey

    Now, the controllers and technicians that I spoke to have 
seen this taking place, and yet they feel powerless, and these 
incidents are taking place for two reasons. First, there are 
not enough fully trained controllers on the job, and second, 
the equipment that they are using is old and outdated.
    Let me refer to a survey that was taken, a blind survey 
with no names, given to the controllers. The survey produced 
182 responses.
    Eighty-four percent of the respondents said that the morale 
was either low, or very low. These are the people whose lives 
we depend on--84 percent--that is a heck of a statement.
    The controllers indicated that their workload is 
overwhelming. About 92 percent of the controllers surveyed said 
that they were required to handle more air traffic than was 
safe.
    When asked what the most serious problems were, about two-
thirds said they had too few fully trained controllers. Even 
the controllers that you have there in many cases are not fully 
trained.
    Morale of the work force and outdated hardware were the 
next two areas of concern. Now, listen to this--amazing--40 
percent of the personnel rated the overall safety of the air 
traffic system as poor, and an additional 4.9 percent said very 
poor, so you have 45 percent of the people who operate these 
systems saying that it was poor or very poor. We are talking 
about the safety of our people.
    At the New York Center, which controls the airspace over 
New York, New Jersey, and parts of Pennsylvania and Maryland 
there are supposed to be 339 fully trained controllers. Today, 
there are 308, but of the 308, only 232 are fully trained.
    Now, is it not interesting that today the FAA announces 
that they are going to hire 100 more controllers--and by the 
way, hiring 100 and getting them in there is far different than 
making a statement, as Senator Lautenberg knows. I dare say 
those 100 will not come online for who knows how long. It is 
not good enough to make such statements to satisfy Congress and 
then continue business as usual. But I fear that is what is 
taking place.
    The number of fully trained controllers is more than one-
third below the FAA's staffing standard, and I am not telling 
you that the staffing standard is sufficient, but at their 
minimum levels they are one-third below. On any given day, 
there are supposed to be 190 controllers on hand; however, the 
New York Center typically runs 20 to 30 percent below that 
number. That is what is happening at the New York Center.
    You are wondering why? Exhaustion, fatigue, greater 
airspace that they have to cover.
    What's more, the FAA enacted a reduction in force program 
nationwide. Hundreds of positions were eliminated. The New York 
Center lost 34. These employees at the New York Center 
performed vital basic tasks, such as carrying data from station 
to station which enabled the controllers to do their job. With 
the loss of these positions, controller and controller trainees 
are forced to perform these additional tasks.
    We have given them more airspace, we have given them more 
tasks, and they continue to have to use outdated equipment.
    That is incredible, because let me tell you about the 
people who maintain the equipment. I did not know this until I 
toured the New York facility, and then one courageous person in 
front of everybody said, ``Senator, don't forget the 
technicians, we are the people who take care of this equipment. 
Did you wonder why you are delayed when you come in from New 
York? Did you wonder why sometimes you were held 3 hours?''
    I do not mind being held on the ground 3 hours, if it is a 
matter of safety; however, I do not enjoy it. But I did ask 
him, why? He said, ``We only have 60 percent of the staff 
necessary to take care of these facilities.''
    He said, ``Did you know that we operate sometimes without 
anyone here?'' He said, ``Do you know in terms of our testing 
of the equipment they keep extending the time because we do not 
have enough people, so we are not even checking on the 
equipment the way we should be?'' So it is outdated equipment, 
it is old equipment, and we are cutting back on the people who 
maintain it and who keep it operational. You wonder why we have 
these outages? Incredible.
    Let me talk about the outages, if I might, because it is 
interesting that just yesterday at 8:35 a.m., at Washington 
National the switching equipment which lets the airplanes 
communicate with the controllers at the tower facilities went 
out. I do not know if my colleagues know about that, because we 
fly out, basically, on weekends.
    Well, why did this outage occur? It took them from 8:35 
until 4:15 for the outage to be fixed. That was 8:35 in the 
morning to 4:15. They had 61 flight delays, lasting an average 
of 45 minutes, some much longer. Delays continued until after 
midnight, on practically the whole east coast. Why?
    Well, I will tell you why. The FAA has the policy now which 
requires that an outside contractor must do the repair work on 
the equipment. They could not get the contractor there to do 
the job. Finally, a technician said, ``listen, we will do it 
ourselves,'' but they had to wait for the contractor.
    By the way, the FAA technicians on the job located the 
problem within 2 hours, so at 10:30 they located it. They could 
have fixed it by 11:30 or so. The contractor wasn't there to 
fix it until 4:15. Now, that is the kind of thing that is going 
on regularly.
    So the FAA today puts out this drivel to try and appease 
this committee--they say, oh, look, we have taken care of the 
New York problem. We want to hire 100 people. Baloney. 
Nonsense. Nonsense. The FAA says they are going to hire them, 
but how long before they get online? How many of them are fully 
trained? How many of them get up in those towers?
    The busiest towers and air traffic facilities in the world, 
and they are going to put people who are not fully trained in 
them? Are you kidding? How many does the FAA have ready to go 
there? Where has been the hiring policy because this problem 
did not just develop yesterday, or the day before. This has 
been going on for years, and if you look at the numbers you 
will see where the staffing increased.
    By the way, the FAA did increase staffing. Do you know 
where? Headquarters. Headquarters. That is where your budget 
money is going, Senator Domenici, instead of putting it out 
there in the field.
    And do you know, they are cutting back on training? Cutting 
back on training. Incredible. What do you expect these poor 
people to do who are out there, the people who are managing 
this system like Mr. Bolerjack. What can he do if you do not 
give him enough personnel? What can he do if you do not give 
him people to maintain the equipment?
    What can the people over here at National Airport do when 
the FAA relies on outside contractors? By the way, the FAA 
might say it saves money hiring outside contractors, but 
according to the GAO it does not. It costs more money. Each 
full-time technician hired saves the FAA $26,000 annually over 
the cost of keeping an outside contractor on the payroll. What 
are we doing?
    You know, it sounds nice when you say, ``hey, guess what, 
we have the private sector coming to help you here. We are 
going to save you money.'' It is not happening. You have got 
chaos and confusion, that is affecting the lives of people.
    Senator Shelby. Senator D'Amato, I think you are on a good 
point. Let us save lives here and train the people right, 
because we are not talking about that much money, but we are 
talking about a lot of lives.
    Senator D'Amato. Mr. Chairman, I am going to conclude my 
remarks, because I know Congresswoman Molinari and Congressman 
King have areas where they will touch on, but the fact of the 
matter is, you have got to have a fully trained work force that 
has sufficient numbers on staff doing the job. The FAA 
management at the top levels here in Washington are 
shortchanging the American people and endangering their lives. 
It is that simple.
    Now, I am not telling you that it is an easy answer to get 
all sophisticated equipment, because that has been gummed up 
for years and years, but it is not a relatively difficult thing 
to make sure that the training facilities are operating at full 
capacity instead of cutting back. It's amazing. Whenever they 
need to save money, they stop training the air controllers and 
they stop training the air technicians.
    By the way, we now maintain about 40,000 pieces of 
equipment and/or sites, and we have about 6,000 people who do 
that. We used to maintain about 20,000 pieces of equipment and 
sites, and we had 11,000 people. So while we have doubled the 
number of facilities that have to be handled, we have reduced 
dramatically the number of online people. What's more, while 
they were reducing staff of the working people they were 
increasing staffing at central headquarters. That is what is 
taking place.
    So I share this with you. I think this is going to have to 
be an ongoing process, Mr. Chairman, where your committee and 
others use their great power. You have started that by calling 
today's hearings, and I commend you for that.
    If you do not watch the FAA day-in and day-out, if you do 
not encourage a line of communication between some of the 
frontline people who are out there doing the real work, you are 
never going to get this pertinent information and significant 
change will never get done. It will be a Band-Aid. It will be a 
press release. They have sent out a release, ``we are going to 
hire 100 people. See, we are going to bring it up to staff.''
    Again, Senator Lautenberg has heard many of these promises 
over the years, and I commend him for never giving up, because 
we cannot. Once we turn away, it is business as usual. The 
situation is deteriorating. It is not getting better. It is 
deteriorating.
    I thank you.
    Senator Shelby. Congresswoman Molinari.

                  Statement of Congresswoman Molinari

    Ms. Molinari. Yes; thank you very much, Mr. Chairman and 
members of the committee. I thank you for your time and 
interest, and certainly, Senator D'Amato, we thank you very 
much for bringing us here all together.
    You know, every so often, as Senator D'Amato has said, we 
have a report that jolts airline passengers from their seats, 
because we have to determine that it is in fact in some cases 
unsafe to fly.
    I would like to say to Senator Lautenberg that Dan and I 
were traveling this morning, and while we were waiting on the 
ground at Newark the pilot said to us that he had been a 
commercial pilot for 30 years and in the Air Force before that, 
and he had never seen a line of planes waiting to take off as 
long as we had to endure.
    People are late for their meetings, people are late for 
their connections, and this happens routinely.
    Over the past 12 years as a Member of Congress and a Staten 
Island Borough President, Guy Molinari has been addressing this 
problem. The serious and potentially dangerous problem that 
started amongst air traffic controllers at individual centers 
is now finally being addressed by the FAA we think--we hope.
    As Senator D'Amato said, the catalyst for today's hearing 
was this internal FAA memorandum, which states clearly our 
current air traffic safety system is inadequately designed and 
staffed to handle the large volume of planes it must on a daily 
basis.
    The catalyst to the memo was that during the past 6 months 
prior to this memo there were 24 incidents at New York Center 
where planes had come dangerously close to one another in 
flight. According to the center's manager, the problem had 
reached ``levels of grave concern.''
    The response from the FAA was puzzling, but it is also very 
telling about their attitude. It described the dramatic 
increase in close calls as statistically unrelated to the 
shortage of air traffic controllers at New York Center. They 
concluded, overall safety has actually increased. That is 
right. They said overall safety has increased, even though one 
controller is now doing the work of two or four.
    Now, that may be acceptable for the FAA, but that is 
clearly not acceptable for airline passengers.
    Mr. Chairman, members of the committee, can any one of us 
believe one person can perform a better task requiring the work 
of four, when there has not been updated equipment to make that 
change? Will the FAA also have us believe that one wing is 
better than two?
    The air traffic controllers, the people charged with the 
task of keeping the skies safe, do not agree with the FAA's 
bizarre explanation, and neither do I. There simply are not 
enough hands nor eyes to do the work, and as Senator Lautenberg 
has said, unfortunately this is not a new problem. Air traffic 
control facilities have been grossly understaffed since 1981, 
and over the past 16 years, the FAA has failed to develop an 
adequate solution.
    A 1989 General Accounting Office study commissioned by then 
Congressman Guy Molinari surveyed FAA workers about safety and 
other conditions at their facilities. The GAO survey revealed 
great differences in the way air traffic controllers and the 
FAA viewed conditions at air traffic facilities. Not 
unexpectedly, controllers and supervisors received a critical 
shortage of full performance level controllers.
    What does this do? The shortages forced controllers to 
handle unmanageable volumes of air traffic and work too long 
without a break.
    These controllers also said that new workers receive 
inadequate training, and that the overall morale was low, and 
these factors hindered their ability to maintain the system 
safely. This is 1989.
    The reason is simple to understand. Let us look at New York 
Center's one example among many. Last year, I visited the 
center and saw firsthand the problems and the fears expressed 
by the controllers. In an all-hands session during my tour the 
controllers cautioned that air traffic equipment was sometimes 
unreliable and often malfunctioning.
    I saw a system, and I hope somebody is going to come up 
here who is going to explain it more professionally, called the 
ODAP system that deals with over the ocean, and basically all 
it does is type out little strips of paper that have the 
longitude and latitude of where planes are taking off. It then 
goes into almost like a puzzle game piece on a wall, and then 
it is up to that controller to study and measure and 
continuously focus and refocus.
    In this age of technology, it is unconscionable that we do 
not have a computerized system that allows the air traffic 
controller to do the backup work but not the sustainable work, 
and it is also not uncommon for that system to go out 
completely, and then the air traffic controllers and the pilots 
are literally flying blind.
    They warned equipment problems during this all-hands 
session, combined with staffing shortages, created an 
unprecedented situation for disaster.
    Since 1981 the volume of air traffic handled by New York 
Center has increased 36 percent. Today, the New York Center 
route, the flights of 6,500 planes per day covering 35,000 
square miles of the Eastern United States, over 3 million 
square miles of the Atlantic Ocean. That is their charge in 
this one center. It is huge.
    Recent inventories show that we have a 45-percent reduction 
of air traffic controllers, so we have seen a tremendous 
increase in the amount of sky they have to cover, the amount of 
planes that are traveling, and a decrease in air traffic 
controllers.
    To make matters worse, and I hope you ask the FAA to 
address this, the number of controllers at New York Center will 
be continuing to decrease. Nearly 60 percent of those 
controllers who are eligible to retire will do so within the 
next 2 years. Where is the backup plan to handle that pending 
crisis, when we have not fixed the pending crisis over the last 
16 years?
    Many others who came to the center from other parts of the 
country on a temporary basis for training would like to return 
to their facilities closer to home, so the number that they 
have is not even accurate, because they have said, based on the 
results of this report and the data provided by the FAA, they 
are out of there.
    Moreover, with working conditions as dismal as they are, it 
is not surprising that the facility has difficulty retaining 
experienced controllers and attracting new ones.
    Senator D'Amato referred to the fact that the FAA said they 
are going to hire all these new air traffic controllers. 
Senator Lautenberg will confirm every time Congress gets 
serious or the borough president gets serious and raises a red 
flag, a memo, a press release comes out from FAA saying they 
are increasing air traffic controller hiring, and then they do 
not have the program to train these air traffic controllers.
    At New York Center, it takes 3 to 5 years to train an air 
traffic controller, because they bring them on, they take them 
off, they have shortages of actual air traffic controllers, 
nevertheless, the people to train them, so to say they are 
hiring 100 is not good enough. When will they be able to do the 
job?
    This has been a longstanding problem at New York Center and 
other hard-to-staff facilities. Although the FAA initiated a 
pay incentive program in June 1989 to beef up its staff at such 
facilities, those pay incentives have since been reduced. In 
areas where it is so difficult, where the quality of life is 
more expensive, the FAA has to answer the question, what do we 
do to provide incentives to get air traffic controllers to 
those areas of the country?
    It is hard to believe that the controller shortage was 
caused by a simple lack of funding, Senator Domenici. The FAA 
budget jumped over $800 million since 1991, to $4.1 billion in 
1996. In 1997, its funding was again increased to $5.2 billion, 
and it will exceed $5.3 billion next year.
    It is also hard to believe that incompetent management 
alone is the cause. In the past 16 years, the FAA has been 
headed by seven different administrators, and it is clearly, 
anyone can tell you, not the work force there.
    I would suggest to you, Senators, that this situation would 
be more tragic, we would have more disasters, if it were not 
for the type of men and women who fill the positions of air 
traffic controllers who work overtime, who do all they can to 
make sure that the system works above and beyond the call of 
duty.
    There is no doubt in my mind that we are cruising toward 
disaster if the FAA does not hire more controllers and have a 
program to train them at once.
    Senators, let us not wait until a collision occurs. Let us 
not wait until another near miss becomes a tragic disaster. Let 
us please assess the problem now, and I thank you all very much 
for giving us this opportunity to bring this crisis and this 
level of frustration to your attention.
    Thank you very much, Senators.
    Senator Shelby. Congressman King.
    Ms. Molinari. Excuse me, Senator, before I go, I just want 
to make sure that the 1997 Air Traffic Controller Work Force 
Study that my dad and I performed is entered into the record.

                           Prepared Statement

    Senator Shelby. It will be made part of the record in its 
entirety along with your complete statement. Thank you.
    Ms. Molinari. Thank you.
    [The statement follows:]

              Prepared Statement of Congresswoman Molinari

    Chairman Shelby, Ranking Member Lautenberg, members of the 
Committee. Thank you for giving me the opportunity to testify 
today.
    Every so often airline passengers are jolted from their 
seats by news that it is unsafe to fly. The most recent alarm, 
but one which Staten Island Borough President Molinari, has 
been sounding for more than a dozen years, is that air traffic 
control facilities are chronically understaffed. The epidemic 
has spread from low whispers among controllers at individual 
centers to the halls of the Federal Aviation Administration 
(FAA) itself.
    The catalyst for today's hearing was an internal FAA 
memorandum. The memo said, clearly stated that the air traffic 
safety system today is unsafe. According to the memo, in the 
past six months there were 24 incidents at New York Center 
where planes had come dangerously close to one another while in 
flights. According to the Center's Manager, the problem had 
``reached levels of grave concern.''
    The response from the FAA was puzzling. It described the 
dramatic increase in ``close calls'' as statistically unrelated 
to the shortage of air traffic controllers at the New York 
Center. They concluded that overall safety is actually 
increased--that's right increased when one controller does the 
work of two or four. That may be acceptable for the FAA, but it 
is not acceptable for airline passengers.
    The air traffic controllers--the people charged with the 
task of keeping the skies safe, do not agree with the FAA's 
bizarre explanation. There are simply not enough hands--or 
eyes--to do the work. And unfortunately, this is not a new 
problem. Air traffic control facilities have been grossly 
understaffed since 1981, and over the past 16 years the FAA has 
failed to develop an adequate solution.
    A 1989 General Accounting Office (``GAO'') study 
commissioned by Borough President Molinari while he was a 
member of Congress surveyed FAA workers about safety and other 
conditions at their facilities. The GAO survey revealed great 
differences in the way air traffic controllers and facility 
managers viewed conditions at FAA air traffic facilities. Not 
unexpectedly, controllers and their supervisors perceived a 
critical shortage of full performance level controllers.
    These shortages, force controllers to handle unmanageable 
volumes of air traffic and work too long without a break. The 
controllers also said that new workers received inadequate 
training and that overall morale was low. And these factors 
hindered their ability to maintain system safety.
    The reason is simple to understand. Let's look at New York 
Center as one example among many.
    I visited the Center last year and saw first-hand the 
problems and fears expressed by the controllers. In an all-
hands session during my tour of the facility, the controllers 
cautioned that the air traffic equipment was sometimes 
unreliable and often malfunctioning. They warned that equipment 
problems--combined with staffing shortages created an 
unprecedented potential for disaster.
    Since 1981, the volume of air traffic handled by the New 
York Center has increased 30 percent. Today, the New York 
Center routes the flights of 6,500 planes per day, covering 
35,000 square miles of the eastern United States and over 3 
million square miles of the Atlantic Ocean.
    To make matters worse, the number of controllers at New 
York Center will be decreasing. Nearly 60 percent of those 
controllers who are eligible to retire within the next two 
years intend to do so. Many others, who came to the Center from 
other parts of the country on a temporary basis for training, 
would like to return to facilities that are closer to their 
home towns.
    Moreover, with working conditions as dismal as they are, it 
is not surprising that the facility has difficulty retaining 
experienced controllers and attracting new ones.
    This has been a long-standing problem at New York Center 
and at other hard-to-staff facilities. Although the FAA 
initiated a pay incentive program in June 1989 to beef up its 
staff at such facilities, those pay incentives have since been 
reduced.
    In the face of this looming staff shortage, the FAA 
responded by closing its main training facility for controllers 
and technicians in Oklahoma.
    It is hard to believe that the controller shortage was 
caused by lack of funding. The FAA's budget jumped over $800 
million since 1991, to $4.1 billion in 1996. In 1997, its 
funding was increased to $5.2 billion and it will exceed $5.3 
billion next year.
    It is also hard to believe that incompetent management 
alone is the cause. In the past 16 years, the FAA has been 
headed by 7 different Administrators.
    Today's hearing is the first step in repairing an air 
traffic safety system that is in trouble. There is no doubt in 
my mind that we are cruising toward disaster if the FAA does 
not hire more controllers at once.
    Let's not wait until a collision occurs.
    Let's not wait until another near miss becomes a tragic 
disaster.
    Let's not wait until our air controller force is hanging by 
a thread.
    The time to act is now. We must not delay.

    [Clerk's note.--The 1997 Air Traffic Controller Work Force 
Study does not appear in the hearing record, but is available 
for review in the subcommittee's files.]

                     Statement of Congressman King

    Senator Shelby. Congressman King.
    Mr. King. Thank you, Senator Shelby. I really appreciate 
the opportunity to be here today. I thank you for convening 
this hearing. I also must commend my colleague, Senator 
D'Amato, for the tremendous leadership he has shown, and of 
course Congresswoman Molinari and Borough President Guy 
Molinari for never giving up on this issue. They realize how 
important it is, how vital it is, and they have just kept this 
fight going, and it is really essential that we try to rectify 
this tragic situation as soon as possible.
    I would just like to say at the outset, though, Senator 
D'Amato says he does not mind waiting 3 hours on the runway on 
La Guardia Airport. I do, if I have to sit next to Senator 
D'Amato and I hear a 3-hour speech on ATM's and the FAA, and I 
get his entire litany of abuse that he was going to give to 
other people, and I have to listen to it for 3 hours on the 
runway. [Laughter.]
    But this is a serious issue, and I just want to touch on a 
few points that Susan brought up, the fact about how there has 
been such a drastic increase by 35, 36 percent in the air 
traffic over the New York corridor, and yet there has been an 
even more significant decrease in the manpower levels of air 
traffic controllers, and you would think perhaps this can be 
explained by the fact that the technology has been improved so 
much we do not need as many air traffic controllers, but as 
Senator Bennett has pointed out, the technology is not up to 
par.
    In fact, my understanding is that some of the technology is 
so antiquated that IBM does not even make the replacement parts 
for the equipment any more. That is how old this technology is, 
how outdated it is, and how antiquated it is.
    Now, on a number of occasions I visited New York TRACON, I 
have visited La Guardia tower, and I have seen firsthand these 
air traffic controllers routinely work 6-day workweeks, they 
put in countless hours of overtime, I have observed radar 
terminals that were unmanned and other positions that were 
designed for two controllers being staffed by only one.
    When I was out at the New York Center last month I was 
surprised to see controllers still using grease pens and 
plotting boards to map the position of planes under their 
surveillance.
    The fact is, as Senator D'Amato said, these are tragedies 
waiting to happen. Thank God we have the outstanding personnel 
we do have among the air traffic controllers, but the 
bottomline is, there is only so long we can put off the 
inevitable, and the inevitable will be tragedy.
    As Susan Molinari pointed out, in the last 6 months alone 
there has been 30 percent increases in near misses. I mean, 30 
percent increase in near misses, and for the FAA to write that 
off as some sort of a statistical aberration I think shows the 
type of shortsightedness that is perhaps the root of this 
problem overall.
    We have to address it. This hearing is absolutely vital in 
helping us come to a way to address it, and I certainly look 
forward to working with the members of this committee and also 
my New York colleagues, Senator D'Amato and Congresswoman 
Molinari. At least for the next 6 or 7 weeks, Susan, I look 
forward to working with you, and then I look forward to going 
on her TV show and explaining it to the public at large, how 
terrible the situation is in New York.
    But very seriously, this is a vital matter that must be 
addressed, Senator, and I just want to thank you for convening 
this hearing today and as you said before, we have to save 
lives. We are talking about human lives, and no responsibility 
of a Member of Congress or a Member of the U.S. Senate can be 
more vital than saving American lives, and that is what we have 
to do, and that is what this hearing is all about.
    I thank you, Senator.
    Senator Shelby. We now have Hon. Dan Donovan. He is the 
chief of staff of Guy Molinari, borough president, Staten 
Island, Long Island.

                        Statement of Dan Donovan

    Mr. Donovan. The borough president regrets that he cannot 
be here to give this statement personally, and he has asked me 
to read the following:

    Good morning. I am Staten Island Borough President and 
former Member of Congress Guy V. Molinari. I welcome the 
opportunity to share with you my thoughts on air traffic 
control staffing. Air traffic controllers are a special breed. 
They are dedicated professionals. No matter how difficult an 
assignment is given to them, the controllers will find a way to 
make it work. They are the ones most competent to identify 
problems in the system. I am therefore going to share with you 
their evaluation of the air traffic control system, 
particularly as it relates to the New York region.
    As you know, in 1981 President Reagan fired 11,400 air 
traffic controllers for participating in an illegal strike 
called by the PATCO union. At that time, we were told that the 
FAA would rebuild the system within a relatively short period. 
Here we are, 16 years later, and staffing remains at less than 
desirable levels at many of our major and minor air traffic 
facilities throughout the country.
    At the New York Center, prior to the 1981 strike there was 
a total of 514 controllers, including 405 FPL's, full 
performance level air traffic controllers.
    Recently, the FAA and the union have agreed that the 
permanent staffing levels for controllers should be set at 374, 
and that a minimum of 335 controllers should be hired at that 
center by the end of the next fiscal year.
    However, recent inventories show there are now only 281 
controllers at New York Center, 229 of whom are fully 
qualified. That is a 45-percent reduction from 1981.
    While it is true that the FAA has transferred some air 
space to other centers, you should also know that air traffic 
has increased 36 percent since the 1981 strike. What, then, do 
the controllers tell us?
    In 1985, the General Accounting Office conducted an 
extensive survey of almost all air traffic facilities in the 
country. Seventeen percent of the controllers rated the system 
as poor or very poor nationwide. Forty-two percent said that 
the shortage of FPL's strongly hindered or somewhat hindered 
the safety of the air traffic system. Ninety-one percent 
believed the total number of FPL controllers was somewhat lower 
or much lower than needed.
    In 1989, at my request, GAO conducted another survey 
entitled, ``Aviation Safety. Serious Problems Continue to 
Trouble the Air Traffic Control Work Force.'' That title alone 
conveys a strong message.
    Again, 16 percent of the controllers warned that the system 
was poor or very poor, virtually unchanged from 1985. Sixty-
five percent believed they were handling too much traffic, and 
43 percent indicated their morale was low, with even 36 percent 
of firstline supervisors labeling their morale low as well.
    In the last few months, with the assistance of GAO and 
Congresswoman Molinari's office, I conducted a similar survey 
at New York Center. A total of 182 air traffic controllers 
responded and revealed the following.
    On the critical issue of safety, 40 percent rated the 
overall safety of the air traffic system as poor or very poor, 
more than double the national finding in 1985 and 1989. Ninety-
three percent of controllers said the shortage of developmental 
controllers puts the flying public in danger. Ninety-seven 
percent stated that the shortage of FPL's strongly hinders or 
somewhat hinders safety. Ninety-three percent of the 
controllers said that they were handling much more or somewhat 
more traffic than they should during peak hours.
    And surprisingly--not surprisingly, excuse me, 84 percent 
said morale at New York Center was very low, or low, more than 
double the national figure from 1989.
    Despite the many studies and many warnings in the past 16 
years, the FAA has failed in its very important mission to 
provide adequate staffing of air traffic controllers, not only 
in the New York Center but in many other facilities nationwide. 
Too frequently, controllers pose the question of, does it take 
a midair collision to give us relief?
    You might ask, what options are available? There have been 
different experiments tried by the FAA. They tried a 20-percent 
pay differential increase in 1989, which met with a fair amount 
of success. When the pay incentive was reduced to 12 percent, 
it did not work. Many of the controllers in the New York Center 
now are seeking transfers, since they do not come from the New 
York region. If the FAA does not implement adequate pay 
incentive programs, the only other solution is the proposal 
suggested by the NATCU Union, embark on an aggressive employee 
recruitment program among local residents. These are people 
with roots in the community, and they are less likely to seek a 
transfer out of State.
    The proposal would have them serve 2 years at the center 
and then be assigned to the Oklahoma City Academy. When they 
graduate, they will be reassigned to the New York Center, and 
that would help alleviate the present problem where controllers 
are seeking transfers to their home region.
    Let me close by saying that for too many years, I have been 
very troubled by this shortage of adequate staffing at many of 
our air traffic control facilities. I have lost faith in the 
FAA, and am convinced that only intervention by Congress will 
answer the problem. I am afraid that failure to act more 
aggressively will ultimately lead to tragedy, and that is 
something I am sure we all want to avoid.

    Thank you, Mr. Chairman.
    Senator Shelby. Senator D'Amato, I take it from your 
testimony and the others here today and other information we 
have that it is obvious that with the staffing issues, with the 
equipment failures and near failures in the New York-New Jersey 
area, the problem is getting a lot worse. It is not getting 
better. That is a given, is it not?
    Senator D'Amato. Mr. Chairman, yes, absolutely, you are 
right.
    Senator Shelby. If it is, if we accept that, what actions 
would you suggest, in addition to additional training, that FAA 
should take to rectify the problems in the New York-New Jersey 
area?
    Senator D'Amato. The first thing I think they should do is 
come in to see the Congress, the leadership of the Congress, 
and tell them that they have an important proposal. I would do 
this on a bipartisan basis, and explain to the leadership why 
it is in various areas obtaining proper staffing levels is such 
a problem. I do not know what the situation may or may not be 
in other high-cost and high-traffic areas.
    Senator Shelby. Like Atlanta, or Chicago?
    Senator D'Amato. Maybe Chicago, yes, or Los Angeles, 
because I would imagine you have the same kind of thing taking 
place. We should reinstitute a plan that would reward those who 
are going to work under these extraordinarily difficult 
situations, at least for the near future. We should reinstate a 
pay differential.
    That would have to be explained with candor to the various 
leaders so that they would understand, and so this would not 
look like anything other than what it really is intended to do, 
that is, to retain people. If we do not, why would someone want 
to stay here or in any one of these high-cost, high-traffic 
regions, when they could go to an area--and I am not going to 
mention any particular area of the country--where one-tenth of 
the flights come in, and they get paid the same? You have to 
address the problem where you have one-half the staff looking 
to transfer out.
    We also need to address the recruiting program. There are a 
number of wonderful technical schools that work in the area of 
training people to become pilots in the aviation industry. 
Recruit people from the New York-New Jersey region, from the 
area schools and in sufficient numbers to fill air traffic 
controller positions. The FAA just started a pilot program. Do 
you know how many people they are going to recruit? Ten. It is 
a joke.
    If you look at how many people will be retiring, the FAA 
indicates that they think it is something in the nature of 211 
people, but the GAO says, oh, no. It is going to be 560 by the 
year 2001, 2002. In other words, much more than what the FAA is 
anticipating. They always underestimate the problem.
    And by the way, let me tell you what is happening at the 
training school in Oklahoma. Do you know what these turkeys 
did? As a matter of fact, they make turkeys have a bad name. 
Turkeys would not operate this way. It is incredible.
    Anyway, here you have a nationwide shortage of fully 
trained people, and what does the FAA do, they close the 
training school whenever they have to save a couple of bucks. 
They should close the headquarters. Throw some people out of 
the headquarters. Do not close the training school which turns 
out these people. We need to know how many times in the past 
years they have done this.
    And then they come to the Appropriations Committee, and 
Senator Lautenberg tries to find more money, and you, Mr. 
Chairman, try to find more money to keep the training school 
open. That is where these turkeys go to save money. Incredible. 
Stop the outside contracts. Stop this kind of nonsense. This is 
poor, disastrous management.
    Senator Shelby. Congresswoman Molinari, do you have any 
comment?
    Ms. Molinari. I would just reaffirm that obviously local 
recruiting is something that is very important to those of us 
in the region. Pay incentives have to be implemented to solve 
the immediate crisis, and the overall problem has to be dealt 
with in terms of long-term planning.
    The situation that Senator D'Amato just described only 
results in the fact that we have no training pipeline. We may 
stick our finger in the dike for today and tomorrow, and then 
you know, 3 years from now we are back to where we started.
    It is clear that management has the tools to make these 
projections, and if they are really concerned about air 
passenger safety, they would account for that with regard to 
the way they deal with training. That has never been done.
    Senator Shelby. Congressman King.
    Mr. King. I would just reaffirm what Senator D'Amato said. 
There does have to be some form of pay incentive.
    Also, Senator, I think it is important to realize that one 
of the jobs of air traffic controllers is to train new 
controllers, and when they are overworked to begin with, it is 
hard for them to go about and do the necessary training that is 
required, and that inevitably slows down the training process, 
so I think all this is just a vicious circle we are going in.
    Senator Shelby. Senator Lautenberg.
    Senator Lautenberg. Thanks, Mr. Chairman. Obviously, I 
listened with interest to the criticism of the system by my 
colleagues, for whom I have respect, and I tried to relate the 
often referenced analogies between how you run a business and 
how you run FAA or other Departments of Government.
    I remember the time--I was not in the Senate at the time. I 
was running a company in New Jersey, that area, and I remember 
how pleased a lot of people were when they kicked out all those 
controllers. They had performed an illegal action, and they 
were gone, and there was almost--I would have to describe it as 
gloating, pleasure, happiness. We paid those suckers back.
    Well, I would tell you, I listened to the criticism again, 
tried to be objective, and I ask, if it was your company, and 
you were breaking out of the windows, and breaking out of your 
capacity, would you say, for crying out loud, let us cut down 
the number of customers. We cannot take care of them. We are up 
to here.
    If it was a theater you would not jam the place so full 
that if there was a fire or an incident, that you could not get 
out of there. If it was a swimming pool in a municipality you 
would not put so many kids in there just because there was a 
line outside. You would put up a sign--I have seen signs at the 
beaches, Long Island. No room. No parking. On your way.
    Well, maybe it is time, and I would ask any of my 
colleagues at the table, do you want to cut down the volume of 
air traffic that we are carrying? What do you think?
    Senator D'Amato. Well, in essence, Senator, that is exactly 
what is taking place, because they are holding you for 3 hours, 
or they are delaying for 45 minutes, and they are putting 
people in huge lines, so that is what is taking place.
    And I said to you initially, I said, oh, I am much more 
happy to wait the 3 hours than to put myself in more danger.
    Senator Lautenberg. Ride Amtrak.
    Senator D'Amato. That is one alternative. But, the FAA is 
doing two things. Not only are they delaying, which I say, 
fine, as opposed to flying into a place where you may have a 
power outage, and the controllers cannot operate their 
equipment, but in addition, they are still operating the system 
in a dangerous manner, one that is absolutely not acceptable.
    Senator Lautenberg. I would say this, that we have a 
comparison, if one wants to make one, the size of the theater 
and the amount of airspace. You can only fit so much traffic, 
and as opposed to a reaction, or perhaps it ought to be an 
action, and I am going to pursue this for a minute, because I 
want someone in here to say, enough. We cannot handle it, and 
you, airline A, B, and C, you are just going to have to limit 
the number of flights that you have.
    Well, I mean, it is easy to sit here and scream about how 
dangerous and how casual, and how turkeyish, and what we want 
to do. These are not assassins. These are people who are trying 
to do a job, for crying out loud, and yes, we have made 
mistakes, and the mistakes have been as much on this side of 
the table as out there, when it comes to funding.
    No; get outside contractors. We do not want any more 
Government bureaucracies managing our--give them the outside 
contractors, until the outside contractor screws up, and then 
we say, we have no control over those outside contractors.
    I think we have to make up our minds. Do we believe in a 
Government that can handle its responsibilities, or do we just 
want to sit by and curse out everybody who tries their best to 
do a job?
    This space may be a little bit dangerous. My kids fly in 
there, my daughter, my grandchild, Susan's child flies in that 
space. Why? It is because fundamentally we believe, despite 
some problems, that it is a darned good system, and we want it 
to continue to operate.
    I would rather--if I am laying on my back in the street 
someplace, and they call up EMS and they dial 911, they say, 
hey, we need a technician, this guy's out cold, I would rather 
have them send a partially trained EMS person than no one, say 
we do not have fully trained--we are in a situation, my 
friends, one that requires our cooperation, just as well as 
pointing a finger.
    And yes, I will tell you, FAA has been screwed up for a 
long time, and Congressman King, I tried to give FAA equipment. 
I was in the computer business. To give it to--rather, to give 
it to charities as a contribution. They would not take it, 
because it costs more to maintain it than the value of the 
equipment that FAA was using.
    I do not want to lay off any of the blame that falls FAA's 
way, but some part of it really is on this side of the table.
    And when it comes to allocating resources, when it comes to 
saying, listen, we just cannot handle that traffic, we cannot 
go any further, we have so much airspace, 35 percent increase 
in aviation constitutes all kinds of changes.
    It is not simply that it is just 35 percent more, because 
if you could widen the airspace, if you could build larger 
airports--how many times have you had an occasion when you land 
in La Guardia, or Newark, or Washington, DC, and you sit and 
wait for a gate almost as long as the flight takes.
    So the system is overburdened, and the question that we 
want to decide is whether or not, instead of just pointing 
fingers, we are going to do whatever we can to fix it by saying 
to Continental and American and United and Delta and Northwest, 
hey, guys, what you have got to do is you have got to cut back 
on your traffic, and then we will see what the American people 
say. That will be the real test.
    It is easy to get them on your side when all you are doing 
is belting out criticism. See if the American people say, OK, 
if I cannot make my reservation today and it takes 2 weeks in 
advance to make it, I am going to be satisfied with that kind 
of a system.
    No, my friends; this is a thing that we are all in 
together. Nobody is exempt. What we want to do is make sure 
that FAA has the resources. I would like to make sure FAA has a 
chief executive that is responsible for his or her actions. To 
maintain their job, that is the exclusive criteria.
    I am with the party that has got the executive now. I would 
prefer that no Chief of our Government has the right to appoint 
an FAA Chairman, Chairperson, because I do not think that when 
the job requires the kind of long-range planning that this 
does--and I come out of a fairly good-sized company. We had 
16,000 people when I left it. Decisions that had to have long-
range results had to have long-range planning and long-range 
supervision, and you do not change skippers in the middle of 
the flight.
    So I think, Mr. Chairman, I am glad to hear what is 
happening, but when you have an FAA Administrator turn over--we 
have seen them. They have come from the military, they have 
come from business, good performers, but they are gone before 
the projects begin to show their weakness.
    We spent $2 billion on a program that absolutely failed 
with one of the finest companies in America, one of the finest. 
If you said, who is the best name, electronics and computers 
and so forth, the name springs to mind. We spent $2 billion 
with them and had no positive result, $2 billion out the window 
like that, so maybe we ought to stop managing this thing so 
closely, make our demands, provide the resources, and let the 
people who have to run it, run it.
    Senator Shelby. Senator Lautenberg, we are not here for 
blame. At least, I am not here to call names and say who is to 
blame, but we are here seeking solutions, and to prevent 
problems in the future.
    We are interested in safety. I will work with you and other 
members of the committee to see that the FAA has the resources 
to hire, also to buy the proper equipment. We owe it to the 
American people to put safety above everything as far as 
airline passengers are concerned, because we are, as you point 
out, all passengers, and we are family, and we are in it 
together.
    Senator Domenici.
    Senator Domenici. Mr. Chairman, since I have to leave 
shortly, I want to spread across the record, if I might--it 
will just take me 2 minutes. Senator Lautenberg and I are on 
the same side in putting this budget together.
    Senator Shelby. Well, as I said, I am glad both of you are 
here today. You both are members of this subcommittee and you 
run the Budget Committee.
    Senator Domenici. I want to make sure that everybody knows, 
whatever the President requested for the FAA, we gave him. 
There was no effort to cut anything in the FAA budget. First, 
transportation was created as a priority item, a priority 
function of Government.
    This particular area of Government was funded in the 
following manner. FAA operations, the President asked for $5.1 
billion. We gave him that. Facilities and equipment, he asked 
for $2 billion, we gave him that--$2 billion.
    Research and development, he asked for $200 million, we 
gave him that.
    The airport improvement program was one area that Senator 
Lautenberg was very, very tough on, and we wanted to make sure 
we were doing as much as we could. Actually the President asked 
for $1 billion, we gave him $1.5 billion, so the total spending 
for the FAA is in excess of what the President asked for.
    Mr. Chairman, you have some latitude in terms of moving 
these numbers around, whether it be the airport improvement 
program or another FAA account. If the committee wants to 
provide some programs less and put more in something else, that 
is the function of this subcommittee.
    Senator Shelby. If the Senator would yield, I am going to 
be working with Senator Lautenberg to make sure that we move 
the money to safety, and safety and nothing else.
    Senator Domenici. I make this point because some people 
assume that when we put a budget together that we do not accept 
the administration's priorities and fund them to the maximum 
level where there have been problems.
    This one and many others were funded at the President's 
level, assuming that the executive branch knows more than we 
do, at least for starters, as to what we ought to fund and 
where the problems are. I ask that my chart showing FAA funding 
in the budget agreement appear in the record.
    Senator Shelby. It will be made part of the record without 
objection.
    [The information follows:]
             FAA Funding in the Bipartisan Budget Agreement
    The Bipartisan Budget Agreement contains annual funding increases 
for the Federal Aviation Administration (FAA). Annual increases of 
three percent are assumed for FAA Operations, Facilities and Equipment, 
and Research, Development, and Engineering accounts.
    These assumptions are the same as the FAA's budget request for 
these programs.
    For the Airport Improvement Program (AIP), the capital construction 
account of the FAA, spending is frozen at its 1997 level of $1.46 
billion through 2002. The President's budget request had been to reduce 
this program to $1 billion in 1998 through 2002.
    Total FAA funding will increase from its current $8.5 billion to 
$8.8 billion in 1998 under the Bipartisan Budget Agreement.
    The Bipartisan Budget Agreement did not include the 
Administration's request to make the FAA fully funded by user fees 
beginning in 1999. The agreement does not include any new user fees for 
the FAA as proposed by the President.

                          [Dollars in billions]                         
------------------------------------------------------------------------
                                                              Five-year 
                                     1997          1998         totals  
------------------------------------------------------------------------
FAA operations.................         $4.9          $5.1         $27.4
Facilities and equipment.......          1.9           2.0          10.5
Research and development.......          0.2           0.2           1.1
AIP............................          1.46          1.46          7.3
                                ----------------------------------------
      Total FAA spending.......          8.5           8.8          46.3
------------------------------------------------------------------------

    Senator Domenici. I thank the delegation from New York for 
appearing. I think you made a good case, and from my standpoint 
every now and then we need appearances like this to recall some 
of the serious problems we have got and get on with trying to 
solve them.
    Thank you, Mr. Chairman.
    Senator Shelby. Senator Bennett.
    Senator Bennett. I cannot add anything to this. I think our 
colleagues have been very exhaustive, and I appreciate their 
coming.
    Senator Shelby. Senator Faircloth.
    Senator Faircloth. Thank you, Mr. Chairman. I do not know 
that I can add a lot to what has been said. I apologize for 
coming late, but the thing that has bothered me, and I have 
been concerned about it right much, and I had Mr. Donahue and 
Mr. Mims from the FAA over in the office one day this week to 
talk about how we spent over $3 billion on this advanced 
automation system.
    Senator Lautenberg. Far more, but $1 billion we know is 
pure waste.
    Senator Faircloth. And yet we talk about money for training 
people. Now, I would think $2 billion would train a lot of 
people.
    The people that did this purchasing for the FAA were not 
severely punished. They were transferred from further 
purchasing, after $2 billion, and Senator Lautenberg, I do not 
question that IBM and Big Blue has a great reputation, but for 
10 years and $3 billion, they fiddled with this thing, and 
nothing happened except a total catastrophe, so what do they 
do, they sell the division that was building it.
    Now, if that is not cutting your losses and getting rid of 
your bad publicity, I do not know what it is. I do not know who 
we go back to. IBM no longer even owns the thing.
    Now, that might be--in the private sector that is known as 
taking a dive in the onion dip--taking cover.
    So we talk about money, but somehow there has got to be 
responsibility for the money, and you try to trace this thing, 
and everybody gives you a plea of insanity. Nobody knows what 
happened, how you could spend $3 billion--$1 billion we could 
have been better to put in a pile and burn on the runway. It 
would have given us more light than what we have gained by a $3 
billion fiasco.
    So when we talk about more money, that has been a 
Government problem forever, because no matter what the problem 
is, no matter how much stupidity or how much waste, pour more 
money in it and it has got to get better.
    Now, I do not know whether IBM has any responsibility in 
this thing or not, but it would appear to me that they did. Any 
time that you waste $3 billion of the taxpayer's money, 
somebody has to have some responsibility, and be responsible, 
other than the pitiful statement that we transferred a few of 
the purchasing agents out of purchasing. That is the weakest 
excuse I have ever heard for throwing away $3 billion.
    Mr. Chairman, I thank you.
    Senator Shelby. Thank you.
    Thank you all for coming here. I know it has been 
exhausting. It gets a little warm, gets a little hot in here, 
but this is a worthwhile hearing, because I believe it points 
out what we need to do here in this committee, that is to make 
sure, Senator D'Amato, that the agency is properly funded, and 
then that they are properly accountable for what they do in 
hiring and buying equipment and everything that goes on with 
the safety of our traveling public.
    Senator D'Amato. Well, Mr. Chairman, let me thank you, and 
let me say, if I seem to be unduly harsh, I make no apology, 
absolutely none.
    Let me tell you something. Look at the record, and when you 
look at the record, you see a pattern of persistent 
misallocation of resources. The training school should be 
turning out more people, absolutely. They should have been 
doing that years ago.
    I did not say it is just the management that is in now, and 
of course you do not even have an Administrator. This has been 
a continuing pattern. I am not going to make any apology here.
    And this business about whether or not you have too much 
traffic in the air, of course you do if you do not have enough 
people to work the traffic, and of course, when you are working 
people overtime. Of course, when you have a guy who is covering 
twice the area and twice the responsibility. Of course it is 
dangerous when you do not have sufficient technicians.
    Just look at what happened yesterday. I do not have to be 
here to apologize for what took place at National Airport 
yesterday. We are all accountable for this, and indeed, I 
believe that if it were not for the Congress of the United 
States and your oversight, Mr. Chairman, this situation would 
have been worse. I commended you, Senator Lautenberg, for your 
attempt to handle this, but let me tell you what is taking 
place is that the situation has deteriorated, notwithstanding 
the promises that have been made by the FAA.
    Now, that evaluation comes from the men and women who man 
these systems--good, decent, hardworking people. Also, I think 
we have to ask, how is it that a tower went out at 8:35 at one 
of the busiest airports in the Nation, National Airport, and 
did not come back online until 4:15? When I indicate what took 
place, I have to tell you, I do not make any apologies.
    But, I have to ask why do we have so many problems with our 
current system? We talk about the delays, of course, and that 
is why the planes were backed up. But if there was only one 
isolated example, then fine. These things happen. But this is 
not isolated. It is becoming more routine. Hence, Mr. 
Bolerjack's letter of warning.
    I did not make that letter up. That gentleman meant every 
single word, and if you had him here now, he would have you 
think that this is the safest, the best operational situation 
that we ever had. Why do you think? Because the bosses are on 
his back. He is a good man.
    I did not make up when he said that ``increases in 
operational errors and deviations have reached levels of grave 
concern. The reduction of operational errors and deviations is 
our No. 1 priority. I regret I must impose such a short 
deadline for this submission.'' I have only taken three little 
sentences out. This is real.
    Now, we have not come forth without there being a 
constructive suggestion as it relates to dealing with this, 
both short term and long term. Long term, you have got to see 
that the facilities for training people, whether they be the 
technicians or the controllers, are operating at full staffing 
levels and are operating and increasing the capacity as opposed 
to decreasing capacity. You cannot get away from that.
    We are going to have to take those men and women and get 
them into the facilities, get them trained as quickly as 
possible, not just to meet a critical situation today, but for 
the future as well. Long term, we are going to have to see to 
it that where we have some of these areas where we have a 
difficult time getting the needed amount of staff that we meet 
our responsibility. I am not saying that because it happens to 
be in the New York/New Jersey area. Whether it is in Chicago or 
Los Angeles, we must ask how do we keep the people we have and 
how do we attract new applicants?
    One of the ways is to go to the great technical schools 
that we have, as well as the universities and colleges where 
young people who live in the area and can train in the industry 
can be recruited. In this way, the likelihood of them staying 
in the area as opposed to coming in de novo is much greater. It 
makes common sense.
    So I suggest that there are a number of alternatives, as 
opposed to what is taking place now, because the status quo 
will lead to trouble.
    Senator Shelby. The status quo is too dangerous.
    Senator D'Amato, I want to tell you that this committee is 
going to do whatever it takes to properly fund the FAA, and we 
are also going to have oversight and make sure that this money 
that we send is spent for safety and safety and safety. The 
American people deserve nothing less.
    Thank all of you for coming. If you want to join us, you 
can. I am sure you have got a busy schedule.
    Senator D'Amato. Thank you, Senator, and I want to thank 
you for your kindness and your cooperation, and I think that 
this committee can play a very important role in seeing to it 
that the resources that you do allocate are properly used, and 
that they do not close down the training center.
    Senator Shelby. And that we not waste billions of dollars 
of the hard-earned money of the taxpayers in buying services 
that are never used, as Senator Lautenberg pointed out. Thank 
you.
    Senator D'Amato. I thank the Chair.
    Ms. Molinari. Thank you very much.
    Senator D'Amato. I thank the members of the subcommittee.
                                Panel 2

                       NONDEPARTMENTAL WITNESSES

STATEMENTS OF:
        BARRY KRASNER, PRESIDENT, NATIONAL AIR TRAFFIC CONTROL 
            ASSOCIATION
        DAVID BARGER, VICE PRESIDENT-NEWARK, CONTINENTAL AIRLINES
        JACK JOHNSON, PRESIDENT, PROFESSIONAL AIRWAYS SYSTEM 
            SPECIALISTS [PASS]
        HENRY BROWN, NEW YORK SYSTEMS MANAGEMENT OFFICE, PASS
        RAYMOND D. MALDONADO, FAA CONTROL TOWER, NEWARK INTERNATIONAL 
            AIRPORT
        TOM MONAGHAN, FAA CONTROL TOWER, JOHN F. KENNEDY INTERNATIONAL 
            AIRPORT

                      DEPARTMENT OF TRANSPORTATION

                    Federal Aviation Administration

STATEMENT OF MONTE BELGER, ACTING DEPUTY ADMINISTRATOR
ACCOMPANIED BY RON MORGAN, DIRECTOR, AIR TRAFFIC SERVICE

                       Introduction of Witnesses

    Senator Shelby. Our next panel will be Mr. Barry Krasner, 
president, National Air Traffic Control Association; Mr. David 
Barger, vice president, Continental Airlines, Newark, NJ; Mr. 
Jack Johnson, president, Professional Airways System 
Specialists; Mr. Henry Brown, New York Systems Management 
Office; Mr. Raymond Maldonado, FAA Control Tower, Newark 
International Airport; Mr. Tom Monaghan, FAA Control Tower, 
Kennedy International Airport; Mr. Monte Belger, Acting Deputy 
Administrator, Federal Aviation Administration; Mr. Ron Morgan, 
Director, Air Traffic Service, Federal Aviation Administration.
    This is a big panel. I know you are eager to get started, 
and we are eager to hear you. All of your written testimony 
will be made part of the record in its entirety, and if you 
would take about 3 or 4 minutes apiece to just orally suggest 
what you think we need to do, and we will listen to you. That 
will give us some time for some questions.
    We will start with Mr. Barry Krasner.

                       Statement of Barry Krasner

    Mr. Krasner. Good morning, Mr. Chairman. I would like to 
thank you for the opportunity to address this subcommittee. I 
think what I found is in listening to all that was said before, 
I found myself going and frantically crossing things out that 
have already been said. So if you will bear with me, I will try 
to give you a little bit of a summary.
    I represent the National Air Traffic Controllers 
Association, which is the organization that represents the 
Nation's air traffic controllers. The individuals I brought 
with me today, and that would be Ray Maldonado, who is a 
controller at Newark Tower; Tom Monaghan, a controller at 
Kennedy Tower; and Chris Bond, who is a controller at New York 
Center. These are truly the frontline controllers, and while I 
will deliver you the formal statement, then they are certainly 
available for any questions you may have, since they are the 
ones who work in the trenches, so to speak.
    I would like to begin by echoing Senator Lautenberg's 
statement, because I never miss an opportunity to do this in 
talking about the air traffic controllers. I believe this 
Nation's air traffic controllers have justifiably earned the 
reputation of operating the safest and most efficient system in 
the world. And I appreciated hearing it from the good Senator 
from New Jersey, and I certainly hope that you and the members 
of the committee concur with this assessment and will certainly 
help us to build in these accomplishments, not only for the air 
traffic system but for the entire aviation community.

                           Staffing Solutions

    I come here today, and I want to talk about a number of 
issues. I have a lot more in my formal testimony. What I am 
really going to do, I guess, in this part is focus more on the 
staffing part, and I want to offer you some solutions, which we 
believe are viable solutions to the problem.
    As Senator D'Amato said, this is not a new issue. In 1970, 
DOT Secretary Volpe charged the Carson Commission to study the 
air traffic controller career. In this study, Carson wrote that 
the system has experienced serious shortcomings, that the 
existing system will not change for a number of years. In the 
meantime, the controller will continue to bear a heavy burden 
in making an understaffed and underfinanced system work. This 
was in 1970. We are 27 years later, and it could have been 
written today.
    I think as far as staffing goes, I think we have to be real 
clear on one thing. Insufficient staffing does impact current 
aviation safety. Now, we do believe that it limits future 
growth in aviation, it absolutely limits it. And growth in 
aviation accounts for too much of the gross national product 
for us to take this situation lightly.
    As said before, air traffic operations have increased 36 
percent since 1981. Controller numbers have continually 
decreased. Firstline supervisor numbers, on the other hand, are 
up over what they were. So we do not have to worry about being 
supervised, we only have to worry about who there is to 
supervise.
    We believe the only thing that we can find to account for 
the lower numbers is the failed AAS system, which we heard a 
little about before. The only thing we could assume is that the 
system was meant to work under less controllers, there was 
never an intent to raise those numbers up again, and that after 
the failure of the AAS system we simply adopted that mode and 
never raised those numbers back up again to the system we have 
now, which is the system we had prior to that.
    Now, the GAO put out a report, 97-84, entitled ``Aviation 
Safety: Opportunities Exist for FAA to Refine the Controller 
Staffing Process.'' That was published in April 1997. As part 
of that report, GAO cited some impediments to staffing 
facilities at required levels. A few of those impediments were 
limited ability to recruit staff locally, so that is a 
recognized problem. And another one was limited hiring in 
recent years has not kept the pipeline full. That, too, is a 
recognized problem.
    I think one of the points that we are missing is the FAA 
has--well, starting in 1981, when there were 11,400 controllers 
fired, we had to replace a whole new work force. In doing so, 
we have since managed the FAA on the backs of the youth of 
those people. But most of those people were hired between 1981 
and 1986, and we have to understand that if that is the case, 
given their retirement when they are eligible, then by the year 
2009, 80 percent of the air traffic controllers in this system 
will be eligible for retirement. If we do not start hiring that 
pipeline now, then we are in serious trouble, especially when 
you consider it takes 3 to 5 years to train an air traffic 
controller once they leave the academy in Oklahoma City.
    But the other point that I really wanted to make very 
strongly is while I appreciate the issue in New York, this is 
not a local problem. This is nationwide. New York happens to be 
the one that is high pressure enough to hit the media, high 
pressure enough to get before the Congress. But are we to 
forsake Van Nuys, CA, or Aspen, CO, or Meridian, MS, simply 
because they do not have the clout to find themselves on the 
front page of the New York Times? I think we do ourselves a 
great travesty if we do not look at this as a nationwide 
problem.
    We have different problems in New York, and they center 
around retention of people, because clearly people do not want 
to be there because of the cost of living, unfamiliarity--
except myself because I am from there--but that clearly is a 
problem. So you have to have a multifaceted kind of approach to 
it.
    If you are going to bang that, Mr. Chairman, then I will 
end it before you do.

                           Prepared Statement

    Senator Shelby. Thank you, Mr. Krasner. We will insert your 
complete statement in the record.
    [The statement follows:]
                  Prepared Statement of Barry Krasner
    Chairman Richard Shelby and members of the subcommittee, we are 
members of the National Air Traffic Controllers Association (NATCA) 
which represents over 14,000 air traffic controllers of the Federal 
Aviation Administration (FAA). I want to first thank you for this 
opportunity to appear before the appropriations subcommittee on 
transportation and also thank you for your past support of our issues.
    NATCA's mission is to guarantee and improve aviation and air 
traffic safety, serve as an advocate for air traffic controllers, and 
promote competence and pride within our profession. We are also 
responsible for promoting technological advances, providing reliable 
and accurate information for air traffic controllers, and serving as a 
credible source of information for this committee, the traveling 
public, and the news media. Our goals include protecting the lives of 
aviation travelers, preserving expensive equipment, and reducing mishap 
frequency and severity. The nation's air traffic controllers have 
justifiably earned the reputation of operating the safest and most 
efficient system in the world. I hope you and the members of the 
committee concur with our assessment and will help us to build on these 
accomplishments to enhance not only the air traffic system, but the 
entire aviation community.
    In 1970, Department of Transportation Secretary Volpe charged the 
Corson commission to study the air traffic controller career. In it, 
Corson wrote, ``This system has experienced serious shortcomings''. . . 
and that the ``existing system will not change for a number of years. 
In the meantime, the controller will continue to bear a heavy burden in 
making an understaffed and underfinanced system work.'' It is difficult 
to tell that this statement was made 27 years ago because not much has 
happened to improve the working conditions of the air traffic 
controllers.
    The issues we would like to talk to you about today include 
staffing shortages in the New York area and across the country, and 
equipment shortfalls with regard to air traffic control technology.
                                staffing
    Insufficient staffing impacts current aviation safety and will 
limit future growth in aviation. For example, since 1981, air traffic 
operations have increased 36 percent while the number of critical, 
front-line air traffic controllers has decreased by 1,914. These 
controllers represent an effective margin of safety and efficiency. To 
date, the only explanation for this deficiency we have found is the 
failure of the Advanced Automation System (AAS), which anticipated the 
need for fewer controllers when deployed. We can attest to the fact 
that today's controllers are showing the strain of chronic six-day work 
weeks, increased workload, and intense traffic conditions. In many 
cases, due to sector capacity, severe restrictions are imposed on air 
traffic to ensure safety. In certain air traffic sectors on a given 
day, controllers are stretched to the limit. This Congress recognized 
the controller staffing inadequacies and ordered FAA to request a study 
of the agency's staffing standard. The GAO report (97-84), entitled 
``Aviation Safely: Opportunities Exist for FAA to Refine the Controller 
Staffing Process,'' was published in April 1997. GAO cited FAA's 
impediments to staffing facilities at required levels, including: 1) 
holding funding to relocate and hire controllers until the end of the 
fiscal year, 2) limited ability to recruit staff locally, and 3) 
limited hiring in recent years has not kept the pipeline full.
    The FAA has managed the current air traffic control system at the 
expense of the youth of 14,343 air traffic controllers, most of whom 
were hired between 1981 and 1986. To increase staffing levels to meet 
projected growth, it is imperative to recruit, select and train the air 
traffic controllers of the future now. In the best-case scenario, 80 
percent of the controllers on duty today will become eligible for 
retirement by 2009; therefore, we must be prepared to completely 
replace the current work force over the next 12 years. With the current 
shortage of staff, the aviation system is subject to a decreasing 
margin of safety and increased delays and inefficiencies as controllers 
are forced to cope with increasing traffic volume and density--as they 
have for the past three decades.
    Following is a breakdown of the 36,464 Air Traffic Services 
employees as of September 1996. In total 23,904 employees provide air 
traffic control operational services, support for those who actually 
provide air traffic control services, managerial and/or supervisory 
functions, administrative/operational support of field facilities, 
regions and headquarters, or other administrative assistance.
[GRAPHIC] [TIFF OMITTED] T12JU12.026

[GRAPHIC] [TIFF OMITTED] T12JU12.027

    The FAA continues to misrepresent the true air traffic controller 
numbers by using misleading terminology. It claims to have 17,080 
employees in the controller work force. However, when you remove 
supervisors and traffic management coordinators (who work air traffic 
control positions for only 96 hours per year), the controller work 
force drops to a true number of 14,343. The shortage of staff is 
further aggravated because full performance controllers must train 
developmental controllers in addition to working the airspace. In 1970, 
the Corson commission wrote, ``The shortage of staff is further 
aggravated by the presence in busy facilities of a plethora of 
untrained developmentals whose training adds substantially to the 
workload of journeyman.'' I ask this committee and this Congress to be 
the ones to finally fix the long-standing training problems.
    Prior to the 1981 PATCO strike, there were 16,220 line air traffic 
controllers, 2,121 supervisors and 169 traffic management coordinators, 
for a total of 18,510. Since 1981, the number of flights has increased 
by 36 percent system wide. The number of controllers today is only 
14,343. The reason for this decline, aside from neglecting to fully 
staff after the strike, is primarily due to early buy-outs offered only 
to managers, supervisors and office staff whose vacancies were then 
back-filled from the air traffic controller ranks.
    As of April 1997, the New York En Route Air Traffic Control Center 
has had a dangerously low number of air traffic controllers. The FAA 
and NATCA have since signed an memorandum of understanding in which the 
FAA agrees to staff the center with 294 controllers by the end of 
fiscal year 1997 and 339 by the end of fiscal year 1998. This is a sign 
of progress on the complex issue of staffing numbers. The work ahead 
lies in solving the day-to-day problems of training and retention of 
work force. The answer we have proposed to the FAA is establishing a 
local hire program to recruit trainees from the New York area who want 
to remain in the area (see attached brief). FAA responded there is no 
need to adopt our proposal at this time because its solution--an influx 
of Midwestern students and former PATCO controllers is adequate. We 
disagree. Not only do you continue to breed a work force of individuals 
whose primary goal is to leave New York but also this method only 
exacerbates an already deficient training program. This training 
program is deficient because, for example, some have been stuck on the 
data positions for more than a year and have not had the opportunity to 
advance in the program. And, there are some who have been in the 
training program three to four years and have yet to certify. At a 
fully-staffed facility with a focused training program, training should 
be complete within two years; however, at an understaffed facility such 
as New York it can take up to six years. Staffing, together with the 
apprenticeship program, is the solution. NATCA's proposed 
apprenticeship program requires a two year commitment on the data 
control position--after which the FAA will send them to the academy for 
training and subsequent return to New York center as an air traffic 
controller. This helps the FAA by immediately removing the largest 
impediments in the training process and also allows the employee to 
gain confidence, experience and a comfort level in dealing with air 
traffic. This will help ensure successful completion to full 
performance level in an environment which now claims a minimum failure 
rate of 20 percent.
    We would like a four to five year test period of the apprenticeship 
program. We believe this to be the answer, but the FAA refuses to 
explore it as a solution to New York's staffing problems. It has 
established a local hire program in San Juan--so why would we assume 
this is not a viable solution for New York?
    Staffing shortages are by no means a problem solely characteristic 
of the New York area, they are indicative of a nationwide problem. For 
example, at the Meridian Approach Control in Mississippi, staffing 
shortages have impacted flight service for both the military and the 
public. In 1994 and 1995, the facility was authorized 17 full 
performance level controllers. In 1997 it was only authorized 14, but 
today it has only nine in actuality. The staffing is so limited that 
controllers cannot open positions--they have three, but are, at best, 
only staffed to operate two, and regularly only open one sector without 
enough staff to provide a second. On occasion, they have had the 
Memphis and Atlanta centers hold aircraft due to saturation of 
airspace. Saturation occurs most frequently when the Navy is flying 
missions and there is only one sector to monitor 13 frequencies at a 
time. Meridian approach control, in contrast, has plenty of 
supervisors, just not enough staff to supervise. The controllers they 
do employ operate on a massive overtime budget just to keep the two 
sectors working.
    The fiscal year 1997 budget called for hiring 500 air traffic 
controllers. The FAA's historical attrition rate for the GS-2152 series 
(23,904) has been approximately 10 percent per year of those eligible. 
It is anticipated that 250 GS-2152 series employees will leave due to 
attrition in 1997. The recent GAO report (97-84) is concerned that FAA 
is overestimating the number of expected retirees; however, our numbers 
are based on the best information available and we need to get prepared 
for this eventuality because it takes three to five years to train FPL 
air traffic controller candidates. Also, the air traffic controller 
training program today has a minimum failure rate of approximately 20 
percent. So, if the FAA hires 500 air traffic controller candidates 
today, with 250 lost to attrition and 100 training failures. we will 
have a net gain of approximately 75 full-performance level air traffic 
controllers in each of the years 2000 and 2001.
    Between 2002 and 2007, 12,000-14,000 GS-2152 series employees will 
be eligible for retirement. Statistically speaking, the air traffic 
controller ranks will decline at an alarming rate starting in 2002. If 
you consider the lengthy training cycle necessary and the fact that we 
are currently understaffed by nearly 3,000 air traffic controllers, the 
critical need to immediately begin a massive hiring process is obvious.
    Controllers are already stretched to maximum productivity and 
maximum workload levels. They run the safest, most comprehensive air 
traffic system in the world with access 24 hours a day, 365 days a 
year. Yet, the number of controllers is lagging far behind the growth 
in air traffic volume. Clearly, something must be done to increase the 
staff of full-performance level air traffic controllers. We ask this 
committee to do everything in its power to increase funding for more 
controllers and increased staffing levels. The FAA can insert 
additional controllers on an MOUR but, without funding for across-the-
board hiring, controllers will not be hired. Congress is a vital link 
to adequate staffing.
    Productivity is at its highest ever for every full performance 
level controller--the same number of controllers are handling 36 
percent more aircraft today than in 1981, so solutions must be found 
elsewhere. Some proposals include hiring controllers at the beginning 
of the fiscal year, instead of using the funds for other projects; 
reclassification of current grade levels and pay to a more equitable 
formula; hiring former PATCO employees; hiring air traffic assistants 
locally; and moving contract tower controllers to larger, busier 
facilities since they have experience.
    The solution, for the vast majority of the country, is to accept 
the joint NATCA and FAA working group proposed standards, supported in 
earlier discussions with Office of Personnel Management (OPM) staff. It 
states the terminal and en route air traffic controller is a unique 
occupation requiring a classification standard that focuses on duties 
unique to the occupation, and distinguish the various levels of 
controller work with related levels of controller pay.
    The current classification standard for air traffic controllers is 
over 18 years old. As a result of occupational changes in the control 
environment and substantial increases in the volume of air traffic over 
this period of time, the classification standard has become outmoded. 
It is now a deficient and inappropriate measure of the differences in 
the degree of difficulty among positions and the knowledge, skills, 
abilities, responsibilities, and accountability of controllers assigned 
to various control facilities throughout the country. The application 
of the current standard and related compensation system: 1) is based 
solely on volume of traffic. It does not recognize other complexities 
associated with the control of traffic; 2) results in all en route 
controllers located at centers within the contiguous 48 states having 
the same full-performance level (FPL) grade and pay, with huge 
differences in the demands on the air traffic controller depending on 
the center to which he/she is assigned; 3) provides no incentive--in 
fact, there is a disincentive--for controllers to move to hard-to-
staff, more complex facilities; 4) results in large differences in 
annual pay for small differences in traffic; 5) results in no 
difference in annual pay among controllers where there are large 
differences in traffic density; and 6) does not provide coverage for 
controllers assigned to some categories of facilities (e.g. tower with 
BRITE, up/down terminals, CERAPS). The present standard is also non-
specific in nature and permits manipulation of controller duties for 
classification purposes regardless of safety and/or efficiency 
consequences.
    The proposed standard is unique to air traffic controllers (and 
closely related positions) and is easily understood. While pay for the 
proposed grades has not yet been determined, the reaction of all those 
personnel briefed about the proposed rankings of facilities (absent 
definitive FPL salary amounts) is that they provide internal equity. In 
addition, the proposed standard addresses and corrects deficiencies in 
the current standard by: 1) acknowledging the varying complexities 
associated with the different controller functions and different 
environments. It assigns different weights to the various types of 
control exercised, different categories of airspace, varying mixes of 
type of traffic, and other factors pertinent to the six categories of 
terminals. It also assigns different weights to departing/arriving 
aircraft, transitioning traffic, overflights, Visual Flight Rules (VFR) 
advisories, etc. in the centers; 2) providing at least 10 FPL grade 
levels instead of the current five. This, together with the new 
classification criteria, will assure that there will be an adequate 
incentive for controllers to move to the most difficult, hard-to-staff 
facilities; 3) there will not be significant differences in controller 
duties without an appropriate difference in controller pay; 4) there 
will not be minor differences in controller duties with large 
differences in controller pay; 5) all categories of control facilities 
will be specifically and appropriately addressed in the standard and 
related compensation system; and, lastly, 6) there will be at least 
three different FPL grade levels for controllers assigned to centers 
and each of the six categories of terminals.
    We implore this committee to ensure adequate funding is provided 
for this new classification and compensation system. As you will 
recall, this committee requested that NATCA and FAA develop a new 
personnel system in the fiscal year 1996 transportation-appropriations 
bill (Public Law 104-50). Without additional compensation the new 
classification system will not work. Adequate funding is necessary to 
ensure that the goals and incentive of optimal staffing are met.
    Current forecasts estimate a 5 percent annual increase in air 
traffic for the next 10 to 15 years. Without significant improvements, 
our present system will simply be unable to cope with future demand. 
Further inefficiencies will result as the need to maintain the safety 
margin becomes even more critical. There is serious concern about the 
number of controllers that will be required to support current demands, 
let alone future growth.
                        technology and equipment
    The second issue I want to address is air traffic control 
technology and equipment. After many years of documented problems, the 
FAA must modernize the ancient air traffic control infrastructure. The 
equipment used by air traffic controllers is antiquated and fraught 
with increasing failures of critical safety technological components. 
The equipment that today's air traffic controllers must rely on, such 
as the Host computer system, surveillance radar and other navigational 
aids, are part of a system that regularly experiences failures and is 
at least 10 years behind in technology and procedures. At present, 
there are 20 en route centers with an average age of 35 years, and 50 
major towers, average age 27 years. Equipment failures, overhaul, 
relocation and modifications caused approximately 1.4 million hours of 
outages in fiscal year 1994; in fiscal year 1995 the number grew to 
almost two million and over 2.5 million hours in fiscal year 1996. 
These delays come at a high cost--it is estimated that the 25 airports 
with greater than 20,000 hours in delays in 1995 each had $32 million 
in delay costs (Aviation System Capacity Plan).
    The safety of today's air traffic control system relies mainly on 
the human element--the air traffic controller and the airways 
facilities technicians that continue to work very hard under adverse 
conditions to keep our deteriorating infrastructure functional. With no 
new workload-reducing technology in the foreseeable, each air traffic 
controller will work 62 percent more traffic than existed in 1981.
    A major hindrance to the development and implementation of advanced 
equipment is that controllers--the end users--are not consulted enough 
in the development process. NATCA is concerned about the lack of human 
factors considerations in developing future technology and procedures. 
Air traffic controllers and their current work environment deserve 
careful study to accurately determine future requirements in both 
technology and ergonomics. It is absolutely necessary to establish a 
central authority to coordinate both the developing technology and 
attendant human factors issues. Presently, these responsibilities are 
separate and unequal within the FAA.
    Projects currently underway demonstrate the need for a coordinated 
effort regarding new technology. For example, ergonomic factors may 
result in deployment delay of Display System Replacement (DSR). Another 
example is the National Route Program (NRP) which clearly demonstrates 
how not to implement a new procedure without modeling and analytical 
support. System development designed without the influence of 
controllers and human factors expertise will inevitably create hurdles 
down the road which will affect cost, schedule or performance, if not 
all three.
    Most of the new technology merely replaces old unreliable equipment 
without adding to system capacity and in some cases actually increase 
controller workload. One small example, is the Voice Switching 
Communications System (VSCS), originally designed for use with the AAS 
equipment, hinders controllers' ability to post, read and mark flight 
progress strips.
    In the early 1990's, the FAA initiated a program known as the 
Oceanic Automation System (OAS). The goal of the OAS was to develop and 
deploy interim replacement equipment at Oakland and New York Air Route 
Traffic Control Centers' oceanic areas. The OAS is nearing its final 
phase, with the final installation scheduled for late this year. 
Unfortunately, even after deployment of the OAS, our oceanic 
controllers are left using grease pencils. tissue and plotting boards.
    In contrast, since the inception of the Center TRACON Automation 
System (CTAS), controllers have worked with Ames Research Center in 
production and development. It is the only piece of equipment in a long 
time that will be beneficial to air traffic controllers from a capacity 
standpoint. In Dallas/Ft. Worth CTAS is allowing controllers to handle 
20 more aircraft per hour--a substantial productivity increase.
    On February 12, the National Research Council released their report 
titled ``Flight to the Future: Human Factors in Air Traffic Control,'' 
which concluded that human factors activities within the FAA are 
fragmented. We agree, and would add that human factors considerations, 
too often, come too late in the acquisition process to prevent the kind 
of mistakes that were made in the 1980's with AAS. Without the proper 
human factor focus and necessary resources to support it, the mistakes 
made in AAS are destined to be repeated. One key system, Standard 
Terminal Automation Replacement System (STARS), is an example of where 
a coordinated human factor approach would significantly increase the 
chances of the FAA deploying an operationally-suitable system. 
Controllers were involved in STARS too late to help in the system's 
development, and, when they were included, were instructed by the 
agency to focus on fixing the system because it is unusable in its 
current state. These late changes to STARS have led to significant cost 
and schedule overruns. The June 6 issue of Aviation Daily said that the 
FAA informed Raytheon Electronic Systems that they are putting STARS in 
``high risk status'' because of delays.
    In its report, the National Research Council concludes that user 
participation is necessary for effective system development, but it is 
not a substitute for specialized human factors knowledge. It recommends 
that representative users and human factors specialists be included on 
product development teams and that the user inputs be systematized to 
the design process according to human factors test and evaluation 
procedures. We agree. We have long recognized that, while we are the 
world's best air traffic controllers, we are not world class system 
designers or human factors experts. We ask this subcommittee to direct 
the FAA to include early and significant participation by controllers 
in a coordinated human factors analysis in the development and 
deployment of air traffic control automation systems.
    Presently, the air traffic is truly dependent on the professional 
and dedicated men and women who are responsible for the day-to-day 
operations of the system. However, due to inadequate support 
technology, the system is restrictive and creates significant problems 
for both controllers and the entire aviation community. System-wide, 
the success of the process depends on the human element interpreting 
data generated by ancient technology which in some areas, creates 
instances where capacity is exceeded and aircraft must endure 
convoluted flight paths to maintain safety.
    NATCA focuses on controller errors and the associated human 
factors. Presently, the system has about 750 reportable operational 
errors per year. This number has declined over the years from a high of 
approximately 900. However, the system must continue to strive for zero 
errors.
    The FAA has a comprehensive system that tracks operational errors 
and this data will give the committee a valuable insight on the error 
rate for the entire air traffic system. Also, the FAA is able to issue 
reports on errors for any given air traffic facility. I do not have 
sufficient data to submit to the committee. I suggest the committee 
request the specific data from the FAA.
    Controller errors constitute serious events that affect the safety 
of the entire air traffic system. Controllers desperately need decision 
support tools to cope with the increasing volume and demands of 
aircraft operations. Additionally, there needs to be a scientific study 
accomplished that focuses on human factors and why controllers commit 
errors. Numbers and types of errors can provide useful information, but 
do not identify the reasons for a controller's actions, nor how to 
prevent repeat errors.
    Controllers need the tools to provide for increased capacity--
without the necessary tools, both safety and capacity will be 
compromised. The impact of the aviation industry on the economy is $947 
billion and is projected to be $1,446 billion by 2010--while the total 
``cost'' of present air traffic service is only $3.9 billion--a small 
price to pay.
    Cost savings in the near-term may increase risk in the long-term. 
Additionally, the following elements must form the cornerstone of any 
discussion:
  --Safety is paramount--any proposal which could compromise safety 
        must be rejected.
  --Alternative funding strategies must be developed and implemented.
  --Control, governance and oversight of the FAA must remain a 
        government responsibility.
  --Employee union involvement is essential for success of any 
        transition.
    These discussions will require much effort and great cooperation to 
become reality. Having said this, I cannot overstate the specific 
requirement: NATCA's position regarding change is ``safety first!''
    In conclusion, NATCA is prepared to play an even greater role in 
aviation safety; to strive for constant improvement in all aspects of 
aviation safety; to build coalitions with other nations and 
organizations to promote positions on safety and technology issues; and 
to work with the Executive and Legislative branches of government and 
the aviation industry for continual improvement of the national 
airspace system.
    Thank you, Mr. Chairman and committee, for your time and 
consideration of our important issues. I will be happy to answer any 
questions.

    [Clerk's note.--The attachments to Mr. Krasner's statement 
will not appear in the hearing record, but are available for 
review in the subcommittee's files.]

                       Statement of David Barger

    Senator Shelby. Mr. David Barger, Continental Airlines. Mr. 
Barger, if you will briefly sum up your oral statement, your 
written statement, if any, will be made part of the record.
    Mr. Barger. Thank you very much.
    Good morning, Mr. Chairman and members of the subcommittee, 
and I certainly will summarize my written testimony, and thank 
you for submitting that for the record.
    I am joined here by Jay Salter, our Continental vice 
president for operations out of Houston. Continental has hubs 
in Newark, Houston, and Cleveland, and several people were 
talking about Newark today, and it is only our Newark hub which 
imposes onerous delays on our overall system. My purpose today 
is to accomplish three tasks: One, to express Continental's 
strong support for the FAA work force, which provides the 
Nation's air carriers with a safe air transport system; two, to 
highlight flaws in FAA procedures and equipment priorities that 
leave Newark at a distinct disadvantage when it comes to air 
traffic management and delay issues; and three, most 
importantly, to advocate for a complete redesign of the New 
Jersey and New York airspace as soon as this is possible.
    In the past year, Continental has won several awards which 
highlight the kind of quality service that we deliver to our 
customers. All these awards were accomplished with virtually 
the same personnel that have been in place at this airline over 
the past years. We believe that the similar case exists at the 
FAA in a similar position. FAA personnel are well trained and 
dedicated to maintaining a safe air transportation system here 
in the United States. Unfortunately, they do not have the tools 
and the resources they need to get the job done effectively, 
and therefore, despite their best efforts, they are unable to 
deliver a reliable and a consistent product.
    Senator Lautenberg has gone to great lengths to work with 
the FAA, Continental, and other airlines which serve New York 
to identify and put in place the equipment, personnel, and 
procedures that can improve the air traffic control situation 
at Newark. We are grateful for his efforts. Frankly, it is only 
when he highlights an installation's schedule or prioritizes an 
item that the FAA adheres to any reasonable timeframe; for 
example, Senator Lautenberg, for the authorization and 
procurement for the instrument landing system on one of our 
long parallel runways in 1994, which is just installed this 
year, and again, on behalf of Continental we certainly thank 
him.

             Problems with FAA Installation and Procedures

    Despite these successes, I want to detail just a few 
examples of our frustration with the FAA's procedure to install 
valuable procedures and/or equipment that could improve the air 
traffic control system. We know that the FAA is committed to 
trying to improve the efficiency of the airspace system in the 
New York region, and we support any and all efforts made to 
achieve that goal. But the priorities and methods by which the 
Agency goes about accomplishing this goal are sometimes flawed.
    Consider the following, and I will give you two examples 
that were submitted out of the five. First of all, if you 
consider the integrated terminal weather system [ITWS]--ITWS is 
a thunderstorm microburst detection and forecast movement 
system. Delay savings at Newark are estimated to be 
approximately 3,566 hours in delay minutes for Continental, 
alone. Unfortunately, installation of ITWS at Newark is not 
FAA's top priority, despite the extraordinary delays caused by 
thunderstorms in the New York area.
    Discouraged by the FAA's protracted installation schedule, 
the airlines, in conjunction with the port authority, are 
proceeding with an independent procurement of this equipment at 
a cost of over $3 million. However, the picture here gets more 
complicated because the ITWS component is dependent on terminal 
doppler weather radar, commonly known as TDWR. Newark's TDWR is 
yet to be commissioned due to a manufacturing defect, and the 
fact that the TDWR's for JFK and La Guardia are caught up in a 
protracted environmental review process. Frankly, ITWS 
installation in the New York/New Jersey area will be 
ineffective without additional terminal doppler weather radar 
coverage.
    Also, along the lines of ITWS, when you take a look at 
departure sequencing and engineering developmental models 
commonly known by the acronym DSEDM, as I mentioned in the 
previous example, thunderstorms cause severe disruptions to 
airline operations in the New Jersey and New York area. A root 
cause of the significant delays is FAA's inability to 
expeditiously develop and issue alternative routings which 
safely avoid the weather. This deficiency is due to the lack of 
automation equipment to handle the administrative burden of 
revising flight times. FAA needs to automate the departure pit 
at New York Center, as the existing equipment and procedures 
have been in use for over 20 years. To date, we have seen no 
evidence of the needed automation, and now the thunderstorm 
season is upon us once again.
    Let me move on to my third and final point, and in closing 
and summarizing, at Continental we certainly feel that it is 
very important that this group take a very hard look and that 
the FAA take a very hard look in terms of a new redesign of the 
airspace serving the Northeast corridor. Before I close, I want 
to reemphasize that as frustrated as we have been with some of 
these automated and equipment issues, we are proud of the 
ongoing partnership we have attained with the FAA in our 
region. We appreciate all the FAA has done on behalf of 
Continental and our passengers. This partnership has had a 
positive impact.
    Mr. Chairman, once again, I appreciate this opportunity to 
testify. Any attention paid to the New Jersey/New York airspace 
is welcome. Any action taken to bring in new equipment, hire 
additional personnel, or initiate innovative airspace design is 
even more welcome.
    Jay and I would be happy to answer questions at the end of 
today's presentations. Thank you.

                           Prepared Statement

    Senator Shelby. Thank you, Mr. Barger. We will insert your 
complete statement in the record.
    [The statement follows:]
                 Prepared Statement of David A. Barger
    Good Morning Mr. Chairman and Members of the Subcommittee. On 
behalf of my 37,500 colleagues at Continental Airlines, I want to thank 
you for giving me the opportunity to speak to you this morning. My name 
is David Barger and I am Vice President for the Newark hub, 
Continental's second largest hub. Jay Salter, Continental's Vice 
President for Operations Administration is accompanying me today. 
Continental is the nation's fifth largest airline with hubs in Newark, 
Houston and Cleveland but it is only our Newark hub which imposes 
consistent and onerous delays on our overall system. My purpose today 
is to accomplish three tasks: 1) to express Continental's strong 
support for the FAA work force which provides the nation's air carriers 
with a safe air transport system; 2) to highlight flaws in FAA 
procedures and equipment priorities that leave Newark at a distinct 
disadvantage when it comes to air traffic management and delay issues; 
and 3) to advocate for a complete redesign of the New Jersey/New York 
airspace as soon as it is humanly possible to complete.
    In the past year, Continental Airlines has won several awards which 
highlight the kind of quality service that we deliver to our customers. 
These awards include Airline of the Year from Air Transport World, back 
to back J.D. Power Awards for Flights over 500 miles from Frequent 
Flyer Magazine and Best International Business Class by SmartMoney 
Magazine. All of these awards were accomplished with virtually the same 
personnel who were a part of this company when we did not operate on 
time or produce a reliable or consistent product. As our Chairman and 
CEO Gordon Bethune has said repeatedly, there were always good and 
talented people at Continental--they just needed to have good tools, a 
good plan and ample resources to get their jobs done. My point is 
simple--we view the FAA to be in a similar position today--there are 
plenty of good people to be found at the FAA. They are well trained and 
dedicated to maintaining a safe air transportation system here in the 
United States. Unfortunately, they do not have the tools or the 
resources they need to get their jobs done effectively and therefore, 
despite their best efforts, they are unable to deliver a reliable and 
consistent product to our mutual customers--the traveling and shipping 
public.
    While we have been frustrated in the past with staffing levels at 
the Newark Tower, the New York TRACON, and the New York Air Route 
Traffic Control Center, we believe the FAA has begun to turn that issue 
around. Our single recommendation on the issue of staffing would be to 
urge the FAA to consider using the new personnel rules to establish a 
program where future air traffic controllers are hired locally. Our 
experience in the New York region is that many controllers who are 
brought in from across the country (whether they be rehires or newly 
graduated from college) are somewhat overwhelmed by the complexities of 
the New York system and its environs. Once they are fully trained, in 
many cases, they want to return to the area of the country from which 
they came. Hiring locally would mean that controllers would enter the 
job with a pre-existing commitment to the region--once they are fully 
trained, they might be more likely to stay in the area and those of us 
who serve the New Jersey/New York region would benefit from leaving a 
more seasoned and permanent work force.
    For the balance of my statement, I would like to focus on equipment 
and procedures as they relate to delays at Newark International 
Airport. As you may have read in your local papers, Newark has just 
reclaimed the dubious honor of being the airport with the greatest 
number of air traffic control delays in the country. According to FAA 
statistics, delays at Newark more than doubled from 14,004 in 1995 to 
28,454 in 1996. Newark's airport neighbors did not fare much better 
with La Guardia placing third and JFK placing 6th. Certainly there is a 
great deal of traffic moving in and out of these airports--on just one 
day last week, Newark had 1,400 operations; La Guardia had 1,080 
operations; Kennedy had 1,060 operations; Teterboro had 750 operations; 
and White Plains had 765 operations. Our friends at the FAA will tell 
you that Continental's schedule does not help the Newark delay problem 
but in fact we regularly structure our schedule to minimize congestion 
and we frequently seek suggestions from FAA to make our operation more 
efficient. Nevertheless, the volume of operations in the New Jersey/New 
York airspace every day does not and should not justify the delays that 
we endure at Newark--rather the volume of passengers and cargo should 
serve as a challenge to the FAA to ensure their best equipment and 
their best personnel are devoted to delivering the safest, most 
efficient and reliable air traffic control service.
    Let me explain why we care about delays. Not only is every minute 
of delay an inconvenience for our passengers, every one minute of delay 
costs Continental Airlines $28. This is a significant financial burden 
to impose on a company and it is an even greater logistical burden to 
impose on our employees as they try to cope with the operational 
challenges that result from these endless delays--delays which are 
endemic to Newark in good weather and bad. I think my point is clear--
it is unacceptable for the nation's ninth largest airport to be the 
nation's most delayed airport in seven out of the last ten years (and 
for the record, in the last twelve years, Newark has never been better 
than the third most delayed airport in the country!). Now, the issue is 
what can be done to fix this problem?
    Senator Lautenberg has gone to great lengths to work with the FAA, 
Continental and the other airlines which serve Newark to identify and 
put in place the equipment, personnel and procedures that can improve 
the air traffic control situation at Newark. We are grateful for his 
efforts--frankly, it is only when he highlights an installation 
schedule or prioritizes an item, that the FAA adheres to any reasonable 
timeframe. For example, we can thank Senator Lautenberg for the 
installation of the Instrument Landing System for the commuter runway 
which was installed after a lengthy delay. We can also thank Senator 
Lautenberg for the authorization and procurement of the Instrument 
Landing System funded by this Committee in 1994 which was installed 
earlier this year on one of Newark's parallel runways.
    Despite these successes, I want to detail a few examples of our 
frustration with the FAA's procedures to install valuable procedures 
and/or equipment that could improve the air traffic control system. We 
know that the FAA is committed to trying to improve efficiency of the 
airspace system in the New York region and we support any and all 
efforts made to achieve that goal. But the priorities and methods by 
which the agency goes about accomplishing this goal are sometimes 
flawed. Consider the following:
    Example No. 1.--The FAA intends to install the Aircraft Situation 
Display equipment in the Newark Tower later this year. This equipment 
shows all the air traffic operating in the national airspace system and 
will permit air traffic facilities to more accurately predict arrival 
and departure demand and enable them to more efficiently manage the 
system. This equipment has been available for at least four years and 
will be of great use to the Newark Tower. What is beyond comprehension 
is the fact that Newark, which is first in delays, is last on the list 
of major airports to receive the equipment.
    Example No. 2.--Information Display System-4 (IDS-4)--This 
equipment provides the controller with an accurate/timely display of 
critical information for operations in the entire New York Air Traffic 
Control system. The good news is that this equipment is also scheduled 
to be installed later this year. The bad news is that this equipment 
has been available at other locations for several years and that the 
next generation of this system has already been installed at the new 
TRACON at DFW, an airport that does not have anywhere near the delay 
problems as Newark.
    Example No. 3.--An Instrument Landing System for Teterboro Runway 
19. The installation of an ILS on Teterboro Runway 19 will eliminate 
conflicts between existing ILS approaches at Newark and Teterboro--
presently, these procedures cannot be run simultaneously. FAA's 
attention to this project has been less than aggressive and in fact, 
they are just re-starting the environmental process after a lengthy 
delay.
    Example No. 4.--The Integrated Terminal Weather System (ITWS). ITWS 
is a thunderstorm-microburst detection and forecast movement system. 
Delay savings at Newark are estimated to be approximately 3,566 hours 
(and a reduction in costs of $5.6 million) for Continental alone. 
Unfortunately, installation of ITWS at Newark is not FAA's top priority 
despite the extraordinary delays caused by thunderstorms in the New 
York area. ITWS will not be commissioned at Newark until 2002. 
Discouraged by the FAA's protracted installation schedule, the 
airlines, in conjunction with the Port Authority, are proceeding with 
an independent procurement of this equipment at an expected cost of 
over $3 million. However, the picture here gets more complicated 
because ITWS is dependent on Terminal Doppler Weather Radar (or TDWR). 
Newark's TDWR has yet to be commissioned due to a manufacturing defect 
and the fact that the TDWR's for JFK and LaGuardia are caught up in a 
protracted environmental review process. Frankly, ITWS installation in 
the New York/New Jersey area will be ineffective without additional 
TDWR coverage. By the way, the Committee should be aware that the 
accident that spawned microburst research and the development of TDWR 
and ITWS occurred at JFK.
    A fifth and final example.--Departure Sequencing Engineering 
Development Model--DSEDM. As I mentioned in the previous example, 
thunderstorms cause severe disruptions to airline operations in the New 
Jersey/New York area. A root cause of the significant delays is FAA's 
inability to expeditiously develop and issue alternate routings which 
safely avoid the weather. This deficiency is due to the lack of 
automation equipment to handle the administrative burden of revising 
flight plans. FAA needs to automate the departure pit at New York 
Center as the existing equipment and procedures have been in use for 
twenty years. In fact, a recent internal FAA operational assessment 
report (October 1996) recommended quick introduction of automation at 
the New York Air Traffic Control Center departure ``pit'' (the 
coordination sector) to enable FAA to reroute aircraft more 
efficiently. To date we have seen no evidence of the needed automation 
and now the thunderstorm season is here again. We believe equipment and 
software associated with DSEDM, a developmental program, could be 
adapted and deployed for evaluation at the New York Center within six 
months of FAA authorization. Clearly, delays at Newark and the other 
New York airports will not decline significantly until this problem is 
addressed.
    Each of these five examples serves as proof to us that the FAA, 
through their own process of setting priorities, is unintentionally 
contributing to Newark's delay problems. In our business, when we 
identify a problem critical to our operations, we apply the resources 
necessary to address that problem. And in fact, we have done so on 
several occasions at Newark. In this case, though the FAA's own 
statistics show that Newark has been the most delayed airport, we are 
not convinced that the FAA necessarily applies a ``best efforts'' 
approach. When they have the opportunity to install equipment that 
might reduce delays, such as those cases I have just cited, they have 
allowed projects to languish.
    But let me move on to my third and final point. While much of this 
equipment would provide some relief to the delay problem in the New 
York airspace, we believe that a comprehensive redesign of the airspace 
holds the greatest promise for improvement. We are not alone in this 
belief. In a recent letter sent to FAA Managers in the Eastern and New 
England regions from the National Air Traffic Controllers Association 
(NATCA) Presidents in Boston and New York Centers, NATCA said ``While 
there may be some short term solutions to pressing needs, it must be 
understood that they are just that, short term. The airspace system 
cannot function on a regular basis with a patchwork of interim fixes. 
These short term solutions must be part of a comprehensive well 
planned, permanent design that will accommodate existing and future 
technologies.'' We agree. It is absolutely imperative that this review 
be conducted with participation from all segments of the system as well 
as the communities. This is not a project that should be allowed to 
languish--it should receive the very highest priority within the FAA 
from both a funding and a personnel perspective. NATCA is right--all 
other fixes are just a temporary fix. I hope this Committee will add 
its voice to the chorus of support for radical overhaul of the New York 
airspace.
    Before I close, I want to reemphasize that as frustrated as we have 
been with some of these equipment issues, we are proud of the ongoing 
partnership we have attained with the FAA in our region. We appreciate 
all that FAA has done on behalf of Continental and our passengers. This 
partnership has had a positive impact. Last Fall, with FAA's 
assistance, Continental assumed control of the taxiway system adjacent 
to Terminal C. It may not sound like much, but this action enabled 
Continental to improve the movement of aircraft in and around the ramp 
and tarmac. Furthermore, the FAA and Continental are cooperating on the 
design of the new Air Traffic Control Tower at Newark so that a ramp 
control facility could be placed in this space, at our expense. With 
these and other positive examples of the power of the airline/FAA 
partnership, Continental looks forward to the day when Newark is not 
consistently on the top of the list of our nation's most delayed 
airports.
    Mr. Chairman, once again, I appreciate this opportunity to testify. 
Any hearing or any attention paid to the New Jersey/New York airspace 
is welcome--any action taken to bring in new equipment, hire additional 
personnel or initiate innovative airspace design is even more welcome. 
Jay and I would be happy to answer any questions you may have at this 
time.

                       Statement of Jack Johnson

    Senator Shelby. Our next panelist is Mr. Jack Johnson, 
president, Professional Airways Systems Specialists.
    Mr. Johnson. Good morning, Chairman Shelby and members of 
the subcommittee. I will try to rapidly go through my points.
    I am Jack Johnson. I am the president of the Professional 
Airways Systems Specialists. We represent over 10,000 FAA 
employees, including systems specialists more commonly known as 
technicians, safety inspectors in the flight standards area, 
and also the pilots who fly for the FAA. PASS is the exclusive 
representative for all those people. In today's testimony I 
will try to focus on how all of this discussion about the air 
traffic control system relates to the folks that we represent.
    As you are hearing about air traffic controllers, I would 
like you to remember that the air traffic controller's right 
hand is the FAA technician, and the FAA technicians have been 
there for years and years maintaining the obsolete equipment 
that is currently still in use by the FAA, and the air traffic 
controllers' confidence has always been there with the airways 
facilities technicians.
    As Senator D'Amato said, we have gone from about 11,600 
technicians to about 6,000 technicians, while we have gone from 
about 19,000 facilities and pieces of equipment to about 
40,000. That is an awful lot of change, and we seem to be going 
in the wrong direction. As you heard Senator D'Amato say, this 
group of people, dedicated as they are, are very, very 
stressed. They do not have the people there, they do not cover 
all the shifts anymore, there is overtime that we are needing, 
the training dollars are just not there anymore, and our 
biggest problem is that they do not have people in the pipeline 
to fill for the 38 to 50 percent of the technicians that will 
be retiring over the next 3 to 5 years.
    The poor planning and decisionmaking by the FAA around the 
advanced automation system has created a situation where we 
have the right work force for the wrong FAA air traffic control 
system. As you heard from Senator D'Amato, staffing decreases 
have forced the agency to adopt a costly and dangerous 
alternative to in-house maintenance--contracting out the 
maintenance. I would offer to you today that you cannot--you 
cannot--contract out the safety of your families, of the 
American people, and the national airspace system. That is not 
a good alternative. It is bad for Government, and it is bad for 
business.
    In 1996, the existing 29 maintenance contracts cost the 
airway facilities piece of the FAA $47 million. The generated 
workload for that contracting maintenance was 503 employee 
years. If you equate that to the cost of the maintenance by the 
in-house staff, that would give us over 700 employee years. 
Typically the FAA will contract out the first few years of 
maintenance in order to get the training for the technicians 
out in the field.
    The FAA just recently contracted with Raytheon to put in 
the standard terminal automation system [STARS], and we believe 
that while we are concurrently running the old system with the 
new system, there is a better way to train than to send 
everybody out to Oklahoma City one or two at a time. We can 
train right in the facility on the new equipment while it is 
being tested to make sure that it is going to do the job.
    Mr. Henry Brown is seated next to me today. He is the 
technician from New York, and I would like to give him enough 
time to speak today, but I would also like to say that any 
questions that you might have, we will be glad to answer them, 
and we have submitted written testimony. Thank you.

                           Prepared Statement

    Senator Shelby. Thank you, Mr. Johnson. We will insert your 
complete statement in the record.
    [The statement follows:]
                   Prepared Statement of Jack Johnson
    Chairman Shelby and Members of the Subcommittee: Good morning. My 
name is Jack Johnson, and I am the National President of the 
Professional Airways Systems Specialists (PASS). Seated next to me is 
Henry Brown, an Environmental Systems Specialist and PASS 
Representative from the New York Air Route Traffic Control Center. Mr. 
Brown will testify on FAA staffing, training, and equipment problems in 
the New York area. Thank you for inviting us here today.
    As the exclusive representative for over 10,000 Systems 
Specialists, Flight Inspection Pilots, and Aviation Safety Inspectors 
working for the Federal Aviation Administration (FAA), PASS has a 
strong interest in FAA staffing levels. The services that our members 
perform range from systems maintenance, installation, and 
certification, to aviation and flight inspection. These dedicated men 
and women have a direct impact on the commercial and general aviation 
industries and on the safety, the efficiency, and the reliability of 
the air traffic control system.
    Earlier this gear, PASS provided testimony to this Subcommittee on 
the FAA's Fiscal Year 1998 budget request, including information on 
each of our bargaining units. Today's testimony will focus specifically 
on our Systems Specialists--the men and women who form the backbone of 
the air traffic control system. We will explain how the FAA's choices 
to cut staffing and training, to contract out, and to attempt 
modernization without appropriate planning are misguided, waste money, 
and jeopardize the future safety and reliability of the National 
Airspace System (NAS).
                                staffing
    Airway Facilities (AF) Systems Specialists (or Technicians, as they 
are more commonly known) are primarily responsible for the maintenance, 
repair, and operation of the air traffic control system. Yet, because 
their positions are not as visible as those of the Air Traffic 
Controllers, Systems Specialists are often overlooked. By no means, 
however, are they any less important; in fact, FAA Systems Specialists 
are the only people authorized to certify the operation and safety of 
facilities and to return the systems to service.
    Just as critical to the safe operation of the air traffic control 
system are the FAA's Air Traffic Control Specialists employed in the 
agency's Flight Service Stations (FSS) throughout the country. These 
employees are represented by the National Association of Air Traffic 
Specialists (NAATS), and they provide pre-flight weather and flight 
planning information, in-flight updates, and aeronautical facility data 
to commercial, military, and general aviation pilots.
    Today, there is a major shortfall in both AF an FSS staffing. In 
1981, for example, 11,600 Systems Specialists were responsible for 
maintaining 19,000 FAA facilities and equipment. As of September 30, 
1996, the entire field maintenance work force (including supervisors, 
managers, Systems Specialists, and support personnel) totaled 8,209; 
\1\ there are now nearly 40,000 FAA facilities and equipment.
---------------------------------------------------------------------------
    \1\ Department of Transportation, Federal Aviation Administration, 
Administrator's Fact Book, November 1996.
---------------------------------------------------------------------------
    Meanwhile, between 1981 and 1995 (the most recent period for which 
the agency has provided accurate data), the FAA has systematically 
downsized the personnel working at its flight service stations by 
almost one thousand individuals: from some 3,500 to roughly 2,500. 
During this same period, the number of FSS management and supervisory 
personnel assigned to Flight Service has been reduced by only six 
through 1995.
    The FAA's staffing standards indicate that an AF work force of 
11,815 Technicians, logistical and support staff personnel, supervisors 
and managers will be needed for the current fiscal year. Yet, an 
analysis of AF staffing levels shows that, on average, each of the nine 
FAA regions experienced a 13.2 percent decline in staffing between 
fiscal year 1992 and fiscal year 1996. Ironically, FAA Headquarters and 
the Technical Center show a 72.63 percent staffing increase during this 
same timeframe.
    Recently, at the request of Vice President Gore and the White House 
Aviation Safety and Security Commission, PASS calculated the number of 
FAA employees directly engaged in systems maintenance, as opposed to 
those who support systems maintenance. As of December 5, 1996, only 
5,888 Airway Facilities employees provided hands-on maintenance of the 
entire National Airspace System (NAS). The FAA's staffing breakdown 
follows:

                                                             Fiscal year
                                                                    1996
Field Maintenance: Employees in the Systems Management Offices 
    (SMO), and Atlantic City and Oklahoma City Centers. They 
    provide maintenance and certification of facilities, 
    engineering, program and administrative support, management, 
    and supervision............................................... 8,209
Planning and Technical Support: Employees located in Regional 
    Offices, Centers, and FAA Headquarters. These employees manage 
    national programs by providing engineering and program 
    analysis, resource management, and administrative support..... 1,090
                        -----------------------------------------------------------------
                        ________________________________________________
      Total Operations (Systems Maintenance) Staffing............. 9,299

    The true distribution of systems maintenance staffing, however, 
includes the number of supervisors and managers, the number of 
employees in support positions, and the number of employees directly 
engaged in maintenance of the NAS. PASS obtained the following data by 
contacting FAA field and regional offices directly:

                                                             Fiscal year
                                                                    1996
FAA Headquarters: Including Atlantic City and Oklahoma City 
    Centers.......................................................   885
Regional Offices: This includes regional offices only, without 
    headquarters elements.........................................   841
SMO Offices: Includes the technical, program, and administrative 
    support for the System Support Centers (SSC's), as well as the 
    first-line supervisors of the field maintenance employees..... 1,685
AF Employees Providing Hands-On Maintenance of the NAS............ 5,888
                        -----------------------------------------------------------------
                        ________________________________________________
      Total Operations (Systems Maintenance) Staffing............. 9,299

    As you can see, a very different picture is painted when ``systems 
maintenance'' staffing is distributed by operational structure. What 
this shows is the number of systems maintenance employees assigned to 
hands-on maintenance jobs is approximately 63 percent of the total 
systems maintenance work force. It is no wonder that AF overtime usage 
in fiscal year 1996 increased by fifteen percent for the systems 
maintenance work force.
    Following is a breakdown of Airway Facilities staffing levels at 
selected SMO's nationwide. It is important to remember that the on-
board staffing figures are inclusive and that the FAA does not track 
the number of Technicians that perform hands-on maintenance of the 
system. The on-board staffing levels below include at least 22 percent 
overhead; generated staffing refers to the amount of people the FAA 
calculates are needed to maintain all of the equipment in the SMO.
    Liberty SMO: Includes JFK, La Guardia, Newark, Stewart, Islip, 
Teterboro, Morristown, Caldwell, and White Plains airports. Also: 
Riverhead Long Range Radar (LRR), New York Tracon, and New York Center. 
Generated Staffing, 377; Authorized Staffing, 275; On-Board Staffing, 
266; and Retirement Eligible, 40 by end of fiscal year 1998.
    Independence SMO: Includes Philadelphia, Syracuse, Allentown, 
Trenton, Atlantic City, Harrisburg, Wilkes Barre, Scranton airports. 
Also: facilities in Eastern New York (excluding New York City), eastern 
Pennsylvania, and New Jersey (excluding Newark). Generated Staffing, 
309; Authorized Staffing, 228; On-Board Staffing, 208; and Retirement 
Eligible, 20 percent.
    Pittsburgh SMO: Includes Greater Pittsburgh, Erie International, 
Buffalo International, Rochester International, Roanoke, Charleston, 
Huntington, Clarksburg, Allegheny County, Lynchburg, State College, 
Martinsburg, and DuBois airports. Also: Bedford LRR, Oakdale LRR, 
Clearfield LRR, Pittsburgh Tracon, Lambs Knoll, and Altoona Flight 
Service Station. Generated Staffing, 297; Authorized Staffing, 216; On-
Board Staffing, 196; and Retirement Eligible, 20 percent by end of 
fiscal year 1997.
    Los Angeles SMO: Includes Burbank, Los Angeles, Van Nuys (busiest 
general aviation airport in the world), Inyokern, Palmdale, Oxnard, 
Camarillo, and Santa Barbara airports. Also: Edwards Air Force Base, 
R2508 (military test range), Los Angeles Center, High Desert Tracon, 10 
long range radars, and Hawthorne Flight Service Station. Generated 
Staffing, 327; Authorized Staffing, 202; On-Board Staffing, 200; and 
Retirement Eligible, 40 percent (Center), 30 percent.
    Chesapeake SMO: Includes Andrews Air Force Base, Washington 
National, Dulles, BWI, Richmond, Norfolk, Charlottesville, Salisbury, 
Patrick Henry, Manassas, and Shenandoah airports. Also: Leesburg 
Center, Leesburg Flight Service Station, and Baltimore Tracon. 
Generated Staffing, 312; Authorized Staffing, 249; On-Board Staffing, 
255; and Retirement Eligible, 40+.
    Within a 1995 cost-benefit analysis for the NAS Infrastructure 
Management System (NIMS), the FAA acknowledged that ``service and 
system management efficiencies will not make up for the shortfall in 
available AF personnel during the period 1997 through 2001. (Note: The 
shortfall in service and system management effectiveness will result in 
a reduction of overall AF facility and service operational 
availability.)'' \2\ Given the known impact of this staffing shortfall, 
why does the agency plan to hire only 25 additional Technicians in 
fiscal year 1998?
---------------------------------------------------------------------------
    \2\ Federal Aviation Administration, Cost-Benefit Analysis of the 
National Airspace System (NAS) Infrastructure Management System (NIMS), 
October 1995. (Final Draft Copy).
---------------------------------------------------------------------------
    FAA management's poor planning and decisionmaking have led to 
today's staffing problems. First, the agency calculated the field 
staffing reductions that it believed the now defunct Advanced 
Automation System (AAS) would achieve. Then, it cut the field 
maintenance staff by not hiring Technicians to fill the pipeline. But 
the system never materialized.
    Had the agency fulfilled the AAS promise, we may now have the 
correct number of employees. However, the agency terminated the AAS 
project, leaving us with the right work force for the wrong air traffic 
control system. Consequently, the use of overtime has increased; 
restoration times have grown; open watches are commonplace; contractor 
maintenance costs have skyrocketed; and training dollars have been 
slashed.
    Mr. Chairman, if just one-fourth of the overhead in Airway 
Facilities (defined as support, managerial, or supervisory support not 
directly engaged in NAS maintenance) was converted to the true 
maintenance work force, it would mean 850 more employees in the 
pipeline who are eventually trained to maintain the NAS. This would be 
a fifteen percent increase in the number of field Technicians available 
to help keep our skies safe.
                            contracting out
    Unfortunately, staffing decreases have forced the agency to adopt a 
costly and dangerous alternative to in-house maintenance--contracting 
out. The FAA is allowing maintenance on the NAS--which is an inherently 
governmental function--to be performed by private contractors. PASS 
believes the agency's decision to contract out the installation, 
repair, maintenance, and certification of FAA systems and equipment 
vital to the safe operation of air traffic is both bad government and 
bad business.
    Both the FAA and the General Accounting Office have estimated that 
the agency would save approximately $45,000 per staff year if it 
utilized its in-house staff rather than contractor staff. Not only is 
contracting out more expensive to the agency, it is also 
counterproductive to the agency's mission. In fact, in testimony last 
year before Congress, the GAO concluded that one of the prime factors 
hindering the FAA's ability to bring new ATC systems on-line is its 
``inadequate oversight of contractor performance.'' \3\
---------------------------------------------------------------------------
    \3\ Kenneth Mead, Director, Transportation Issues, ``Issues Related 
to FAA Reform,'' (General Accounting Office, August 2, 1995.)
---------------------------------------------------------------------------
    In fiscal year 1996, the existing 29 maintenance contracts cost 
Airway Facilities $47,700,000. The generated workload for contract 
maintenance for fiscal year 1996 was 503.8 employee years (or ``the 
number of people that would be required if FAA employees were to 
perform this workload in-house.'') This equates to $94,680 per employee 
year.
    Now, if this maintenance was actually done in-house, using the 
FAA's labor rate for Systems Specialists, $68,000 per employee year or 
701.5 employee years of work could be realized. This equates either to 
a net increase of 198 Systems Specialists to be used in areas of 
staffing shortfalls or a net savings to the FAA of $13,433,600 for the 
same amount of work.
    Typically, the FAA will contract out the first few years of 
maintenance of a new system simply because it cannot train our 
Technicians fast enough to support these new systems. Despite the fact 
that Congress legislated personnel and acquisition reform to give the 
FAA greater flexibility, the agency has failed to reform training.
    Recently, the FAA contracted with Raytheon for the installation and 
maintenance of the Standard Terminal Automation Replacement System, or 
STARS, as it is commonly known. This system will replace aging radar 
display systems, controller workstations, and related equipment at 
about 170 FAA terminal ATC facilities by February 2005.
    Assuming that Raytheon will perform most site preparation and 
installation work, the STARS contract is estimated to be worth $2.2 
billion--$940 million for facility and engineering and $1.3 billion to 
operate and maintain the system. According to the General Accounting 
Office (GAO), STARS costs could increase by $529 million over FAA's 
baseline.\4\
---------------------------------------------------------------------------
    \4\ Gerald Dillingham, Associate Director, Transportation Issues, 
General Accounting Office, ``Air Traffic Control: Status of FAA's 
Standard Terminal Automation Replacement System Project,'' March 1997.
---------------------------------------------------------------------------
    Just last week Aviation Daily reported that FAA officials 
overseeing implementation of STARS have told Raytheon they propose to 
elevate STARS software development to ``high risk status'' because of 
delays in meeting milestones. According to the article, a March report 
shows software development to be 75 percent behind schedule. ``It is 
unclear how Raytheon could recover with the existing plan that 
increases in both size and complexity with each incremental build,'' 
the FAA told Raytheon.
    Clearly, Technicians and Controllers should have been given hands-
on involvement in this project from the onset; instead our roles have 
been limited. As such, PASS fully expects that the STARS project--like 
most FAA modernization efforts--will run over budget and take longer 
for deployment. Consequently, the agency will raid resources from other 
programs to cover the shortfalls.
    The FAA is also missing the opportunity to save money by giving on-
site training on STARS to AF Technicians. When appropriate, on-site 
training can save time and money because the cost of sending an 
instructor to one site, or a group of sites, is much less than sending 
fifteen or twenty Technicians to the Oklahoma City Academy.
    STARS will be deployed with the current automation system, which 
would make on-site training of AF Technicians for a project of this 
magnitude not just appropriate, but extremely cost effective. However, 
the FAA has said it will contract out the first year of maintenance for 
STARS because it can't train enough people in time to assume the 
maintenance.
    How long will this excuse be acceptable? Why would the agency spend 
millions of dollars on the STARS contract when the agency's AF 
Technicians can bring systems online faster and cheaper? The Display 
Complex Channel Rehost (DCCR) program, for example, was completed on 
time and $3 million under budget. The Voice Switching Control System 
(VSCS) was also commissioned on time and on budget. Technicians were 
responsible for both projects.
    Until now, PASS has addressed contracting out as merely a 
``numbers'' issue--or as a costly ``Band-Aid'' for the FAA's true 
staffing problems. We would now like to explain the dangers and the 
safety shortfalls that contracting out generates, for it is common 
knowledge at FAA facilities that contractors will always place their 
company's needs before the FAA's safety mission.
    The National Airspace System is not just one piece of equipment. 
The NAS is a complex system which includes thousands of different 
smaller systems, many of which interface with one another. When 
contractors come into an FAA facility to maintain a piece of the NAS 
system, they often do not understand the effect they can have on the 
intricacies of the whole system and on the safety of the flying public.
    AF Technicians have a proven track record, while private 
contractors often have failed to measure up to this high standard. An 
example of the satisfaction that FAA Technicians provide is evidenced 
in a letter to the FAA dated April 30, 1997. Mr. George Larson, Airport 
Director of the Jackson Hole, Wyoming Airport Board, writes:
    ``The Jackson Hole AWOS has been maintained by FAA Technicians for 
a considerable amount of time. It is evident that the maintenance 
performed by your people is far, far superior to the services performed 
by the previous contract with Qualmetrics.
    Since AWOS is not the most reliable weather system available, it is 
extremely important to our Airport, commercial air carriers serving 
this airport, and all general aviation pilots that we can promptly and 
expertly repair our AWOS when necessary. Your Technicians always 
provide us with that assurance, unlike the previous outside contract 
effort.''
    Because our Systems Specialists work with the NAS equipment 
everyday and are the only people who can certify the systems, they 
understand the need to exhibit caution and to communicate with others 
before performing any maintenance on a system. There are also rules 
that Congress has imposed on our work force, such as strike 
prohibitions, that are not imposed on contractors. These rules help to 
ensure the safety of the air traffic control system. Increased demand 
on the NAS, combined with the attrition of the current work force, make 
it impossible to explain why the FAA would want to hire contractors 
instead of permanent workers.
    Until contractors can guarantee immediate restoration and quality 
service--which PASS maintains will never happen--the FAA must return 
all maintenance to its own personnel. The idea of having anyone outside 
of Airway Facilities employees conducting installation and operation of 
systems impacting live air traffic is unacceptable. The maintenance and 
operation of NAS systems that are used to separate traffic or to 
maintain safety are inherent governmental functions, whether the FAA 
owns the systems or not.
                         modernization efforts
    Any discussion on air traffic control staffing levels must include 
a section on modernization, for without adequate Technician staffing 
levels and support, FAA modernization efforts will fail. For fiscal 
year 1998, the facilities and equipment (F&E) budget request is a three 
percent decrease from the fiscal year 1997 enacted level. F&E employees 
are directly involved in systems engineering and design. They are 
critical to the agency and will play a key role in modernization. PASS 
steadfastly believes that cutting the F&E budget is neither safe nor 
responsible.
    There are now 2,869 new FAA systems and equipment (designated by 
the agency as units) in FAA storage/warehouses. In several instances, 
cuts in F&E funding are cited as the reason why delivery has been 
delayed to the field. For example, there are currently 439 
Communications Facilities Enhancement radios (UHF and VHF transmitters/
receivers) in storage. The project cost is $3,736,000. The reason for 
delay is cited by the FAA as ``F&E funding shortfalls caused by 
cutbacks in funding for establishment or relocation of communications 
facilities.'' \5\
---------------------------------------------------------------------------
    \5\ FAA Storage/Warehouse Report, February 19, 1997.
---------------------------------------------------------------------------
    Similarly, because of ``partial F&E funding provided in fiscal year 
1996,'' 64 Doppler VHF Omnidirections Range (DVOR) systems are in 
storage. These systems cost $108,000 each for a project cost of 
$6,912,000. Unless F&E is funded at higher levels, more and more new 
systems will sit in boxes awaiting delivery to the field. Meanwhile, 
the current systems will age, and modernization goals will fail. The 
FAA has reached a stage where incremental improvement is not 
sufficient.
    The White House Commission on Aviation Safety and Security found 
that the FAA's ``proposed schedule for modernization is too slow to 
meet projected demands, and funding issues are not adequately 
addressed.'' This has been the case for years. Since the early 1980's, 
the FAA's modernization program has experienced substantial delays and 
cost overruns.
    PASS believes the FAA can succeed in modernizing the air traffic 
control system by building on its proven strength--its employees. The 
same ingenuity and perseverance that now enable the men and women of 
PASS to keep the NAS running is what is needed to bring the FAA into 
the 21st century. Instead of telling these employees--who are 
stakeholders in the system--how they must change to be part of the 
future, the FAA should be asking its employees to show the agency the 
future.
    According to the GAO, ``in organizations with more constructive 
cultures, employees are more likely to involve others in decisions 
affecting them, openly share information, and resolve differences 
collaboratively.'' In the FAA, however, ``ineffective coordination has 
caused the agency to acquire systems that cost more than anticipated 
and look longer to implement.'' \6\
---------------------------------------------------------------------------
    \6\ John H. Anderson, Jr., Director, Transportation Issues, General 
Accounting Office, ``A Comprehensive Strategy is Needed for Cultural 
Change at FAA,'' August 22, 1996.
---------------------------------------------------------------------------
    PASS employees are a vital part of developing the future NAS and 
are the FAA's best insurance that this new system will work as 
advertised. But FAA management excludes its Technicians and 
Controllers--who are the subject matter experts in the field and the 
end users of the product--from devising and developing ATC 
modernization solutions and plans. Instead, they are merely asked to 
help implement management's plan.
                               conclusion
    PASS firmly believes that the status quo is no longer feasible. The 
FAA simply cannot maintain the world's safest airspace with shrinking 
budgets and reduced staffing levels. Nor can it turn over its 
maintenance responsibilities to contractors, masking the decision as 
cosmetic cost savings. The bottom line is that contracting out costs 
taxpayers many times more than what it costs the government to have 
federal employees provide the same services.
    Senator Shelby and Members of this Subcommittee, PASS urges you to 
mandate that the FAA immediately increase Technician staffing levels, 
revamp training programs, and eliminate the costly practice of 
contracting out. These changes will lead to increased productivity and 
will ensure the safety and efficiency of the National Airspace System.
    Thank you for your time and consideration. I would be more than 
happy to answer any questions that you may have.

                       Statement of Monte Belger

    Senator Shelby. The next witness is Mr. Monte Belger. He is 
the Acting Deputy Administrator, Federal Aviation 
Administration.
    Mr. Belger. Thank you, Mr. Chairman. I do have a prepared 
statement, and my staff has armed me with a barrage of numbers 
and statistics and data, but I would prefer just to take my 
time to talk to you about some of the things that have been 
discussed this morning.
    First, there is no question that there is no disagreement 
between FAA management and the Air Traffic Controllers Union or 
the PASS Union in terms of these fundamental issues that we 
have talked about today. No one wants to fix this problem more 
than senior FAA management. No one wants to fix this problem 
more than I. I have spent an extraordinary amount of my 
personal time on the New York issues. I have been to the 
center, I have been to the TRACON, I have visited with 
Congresswoman Molinari, and have tried my best to understand 
from the big picture where we are there. And I am not here 
today to appease the committee nor to tell you that everything 
is OK, because it is not.
    Senator Shelby. Excuse me. I hope you are not here to 
appease us, but I hope you are here to tell us how you can fix 
a problem before we have a huge airline disaster in this 
country.
    Mr. Belger. I am going to do that, sir.
    Senator Shelby. I believe that is part of your 
responsibility.
    Mr. Belger. Yes, sir.
    Do we have enough controllers at the New York facilities? 
The answer is no. Are we satisfied with either the staffing 
levels or the status of the equipment in the New York area? The 
answer is no. We will not be satisfied, I will not be 
satisfied, until we reach the target levels that we have 
established for staffing at each one of the facilities; will 
not be satisfied in the equipment area until we install the new 
computer systems in the center, which is on schedule and on 
budget and will happen in 1999 at the New York Center. I will 
not be satisfied until we complete the installation of the 
terminal automation modernization in all the terminals 
throughout the country. That will happen starting in the 1999 
to 2003 timeframe.
    Are we doing all that we can? I think we are. I do not 
think that we can install the new equipment any more quickly 
than the current schedule that we have. Are we doing all we can 
in the staffing area? I think we are. Do we have an agreement 
with the Air Traffic Controllers Union on target levels for 
staffing at the New York Center and the New York TRACON? Yes, 
we do. It is in Mr. Krasner's statement, although he did not 
refer to it, but we have an agreement for the first time in the 
history of relationships between the FAA and NATCA, and we are 
reaching those target levels. And the data is in the statement, 
and I will be glad to provide specific numbers, but we are 
committed to meeting those target levels at the New York Center 
and the New York TRACON at the end of this year and at the end 
of 1998.

                    Air Traffic Controller Increase

    We will hire this year and next year, if our budget request 
for fiscal year 1998 is favorably received, 1,300 new 
controllers. That is more than we hired in the 5 previous years 
combined. We have the flexibility and the opportunity now to 
aggressively respond to these problems. We are not just hiring 
people, we are doing things as was suggested by the previous 
panel to build a pipeline in the New York metropolitan area 
from which we can draw, so that we are hiring people who want 
to be in that area. We want to hire people who want to be 
there. We want to hire people who have ties there, who do not 
want to go there and get trained and get the grade and go 
somewhere else. We want to hire people who want to be there in 
the New York and the New Jersey area.
    We instituted last year, at my direction, what we call a 
co-op program, working with Dowling College and the College of 
Aeronautics at La Guardia, through which college students will 
come to the facilities to work part time. They get credit for 
it, and we hire them when they graduate, that clearly prepares 
them for the future. Do we have enough people in that program 
now? No; but it is just getting reinstituted after it was cut 
years ago by the FAA. We are also expanding the college 
training initiative program, which is a group of universities 
that train controllers for us, and we are trying to get 
colleges in the New York metropolitan area to do that.
    Senator Lautenberg correctly admonished us to just do it. I 
think we are doing our best to just do it, and I am committed 
to doing that. Senator Lautenberg suggested that perhaps one of 
the things that might be looked at, and I can assure you we are 
looking at it, is potentially readjusting some of the work load 
and the airspace to equitably put the workload where the people 
are--and we are aggressively looking at that, and that is a 
potential option.
    Is the air traffic control system in New York/New Jersey 
area safe? Well, of course it is. It is absolutely safe. My 
daughter just recently moved to Boston after living in 
Montclair, NJ, for several years. She flew out of Newark 
regularly on her business. That is the ultimate test for me. It 
is safe. At the end of the day, we will be judged by how safe 
the system is.
    Do we agree with some suggestions that were made in the 
first panel that the pay system for both controllers and 
engineers and technicians ought to be changed so that it more 
accurately reflects the complexity and the value of the service 
provided? Yes, we do. And given the flexibility that we have in 
the personnel reform, we are doing that. We are working 
aggressively with both NATCA and PASS to develop new 
classification standards and pay schemes that will acknowledge 
that an individual working at the most complex facilities ought 
to be paid more than one working at a less complex facility.
    But I should also put a balance to this whole discussion, 
and then I will pause, although I could speak for hours about 
the things that were said this morning. We have to put some 
counterbalance to this discussion. At the same time we are 
doing those things I said, are we also, as good stewards, 
looking at how we can reduce and control our operating costs? 
And yes, sir, I can assure you that we are.
    I just spent a day and a half--a full day and a half--with 
the National Civil Aviation Review Commission, which was 
chartered by the Congress to look at how the FAA should be 
funded in the future. They, appropriately, are very concerned 
about our growing and escalating operating costs. We all should 
be concerned. NATCA should be concerned, PASS should be 
concerned. I can assure you I am concerned. We have to solve 
these problems in a way that also controls our growing 
operating costs.
    This is not easy, but I can assure you all, I can assure 
the committee, and I can assure the American public, that we 
are committed to doing both those things, providing the safest 
system that we can. I want our air traffic controllers and 
technicians to have the very best equipment in the world, but 
we also have to do it in a way that is responsible to the 
taxpayers, and do the best we can to control our costs.
    Thank you, sir.

                           Prepared Statement

    Senator Shelby. Thank you, Mr. Belger. We will insert your 
complete statement in the record.
    [The statement follows:]
                 Prepared Statement of Monte R. Belger
    I welcome the opportunity to appear before you today to discuss the 
important issue of air traffic controller staffing. We in the FAA 
firmly believe that the primary reason that the United States is able 
to operate the world's safest and most complex air traffic control 
system is because of the excellent performance of the technicians and 
air traffic controllers who operate the air traffic system 24 hours a 
day. We are committed to maintaining an adequately sized and properly 
trained controller work force.
    During the 1980's, the FAA hired large numbers of controllers as we 
rebuilt the controller work force from the strike of 1981. By 1992, the 
controller work force had been rebuilt, and at a level of 17,982, was 
several hundred controllers over the controller work force staffing 
standard requirement.
    From 1993 through 1996, the controller work force was reduced 
primarily as a result of our successful initiative to contract the low 
activity level I airport traffic control towers. Once this initiative 
is completed, we will have effectively reduced the controller work 
force requirements by approximately 1,000 for an annual savings of 
approximately $25M, with no adverse impact on safety. During this 
period, controller hiring averaged only 100 per year because we were 
also reassigning approximately 200 controllers per year from the closed 
level I towers to higher level facilities.
    The limited hiring over these years exacerbated staffing imbalances 
among some facilities. By the end of fiscal year 1996, the controller 
work force was at 17,080 including 14,360 air traffic controllers, 
2,162 first line supervisors, and 558 traffic management coordinators. 
In the same period, the other-than-controller work force was reduced 24 
percent from 8,959 in fiscal year 1992 to 6,824 at the end of fiscal 
year 1996.
    The fiscal year 1997 budget recognized that the controller work 
force had to start growing again because there soon would no longer be 
controllers available from closing level I towers, and because of 
increases in forecasted traffic, new equipment, training, and 
retirements. Starting in fiscal year 1997, we plan for several years of 
increases to the controller work force to keep pace with increasing air 
traffic activity. This plan calls for the controller work force to 
increase to 17,300 in fiscal year 1997, with 14,560 air traffic 
controllers, and our fiscal year 1998 budget submittal requests a 
further increase to 17,800. This means we plan to hire 1,300 
controllers in fiscal year 1997 and fiscal year 1998. The 1,300 
includes the 750 increase in the size of the controller work force and 
550 to replace attrition expected in fiscal year 1997 and 1998.
    This growth means that annual controller hiring will be 500 in 
fiscal year 1997 and approximately 800 in fiscal year 1998. We fully 
expect to meet the hiring targets for fiscal year 1997, and we ask for 
your support to fund our request for hiring in fiscal year 1998.
    The new controller hires will come from a variety of sources 
including former controllers, who became eligible for consideration for 
reemployment after President Clinton removed the ban on their 
employment with the FAA, veterans, cooperative education students, and 
graduates of the College Training Initiative.
    We are concerned about maintaining adequate staffing at some large, 
complex facilities such as those in the New York area. In order to 
encourage controllers to move to these major facilities and to retain 
those already there, we implemented an interim incentive pay of 10 
percent at seven key facilities in the New York, Chicago, and Oakland 
areas. In addition, after in-depth review of staffing requirements at 
the New York area facilities and the Washington Air Route Traffic 
Control Center, we have signed agreements with National Air Traffic 
Controllers Association (NATCA) on appropriate staffing levels for 
Washington Center, New York Center, and New York TRACON. We are 
targeting the fiscal year 1997 and fiscal year 1998 controller hires to 
ensure that the staffing levels agreed to are achieved. In the first 
eight months of fiscal year 1997, we have hired 31, 31, and 14 new 
controllers in the Washington Center, New York Center, and New York 
TRACON respectively.
    We have focused on the New York facilities in the past few years. 
Even though the national CWF staffing levels decreased by 5.0 percent 
since 1992, staffing in the New York facilities increased by 3.4 
percent, a net difference of 8.4 percent.
    Operational errors are up at New York Center and New York TRACON. 
However, past studies have shown that there is no statistical 
significance between staffing and operational errors. These studies 
have indicated the following ``key factors'' generally exist in 
operational errors:
  --Sectors were not combined when the incident occurred.
  --The controller was working five to six aircraft.
  --The controller's last day off was usually 2 days prior to the 
        incident.
  --The incident occurred in the third hour of the workday and overtime 
        was not a factor.
    One other area I would like to touch on briefly is the controller 
staffing standard. The controller staffing standard has been developed 
and refined over many years. It uses complex algorithms that calculate 
the controller staffing requirements facility by facility. It considers 
the amount of aircraft a controller can handle, the air traffic 
activity, and the number of sectors of airspace in use and various 
shift times. It also makes adjustments for the 7-day operations and the 
amount of time controllers are not available for work for such reasons 
as sick leave, annual leave, training, medical checks, union activity, 
work groups, and details. Finally, it calculates staffing requirements 
based on the 90th percentile day. That means it provides staffing 
adequate to handle activity on a facility's 37th busiest day of the 
year.
    On the national level, the staffing standard is very accurate. It 
is less accurate at an individual facility and we estimate the facility 
accuracy to be plus or minus 10 percent. That is why we primarily use 
the staffing standard to support budget and resource requirements at 
the national and regional level. Regional Air Traffic Division managers 
consider local facility requirements along with the controller staffing 
standard when allocating controllers to specific facilities. The 
staffing standard is updated annually with the latest information on 
changes in air traffic activity projections and facility 
characteristics.
    There have been several outside reviews of the controller staffing 
standard. The latest review was recently conducted at the direction of 
Congress by the National Research Council which is part of the National 
Academy of Sciences. The report was completed in April 1997. Its 
general findings were that the strategies for sampling, data 
collection, and model design are geared to the development of national 
staffing estimates and do not necessarily provide accurate predictions 
of staffing requirements at individual facility levels. Although the 
National Research Council found that it was unlikely that the staffing 
standard could be modified to provide precise stand-alone estimates of 
facility staffing requirements, it did make some recommendations for 
improving the process for determining staffing requirements. These 
recommendations included: Strengthening the headquarters staffing 
estimation process; developing a uniform regional approach for 
estimating facility staffing; establishing a headquarters oversight 
process for resolving differences between regional and headquarters 
estimates of staffing at specific facilities; and developing 
performance measures for testing the validity of facility staffing 
estimates. We agree with most of the National Research Council's 
recommendations and are already taking action on its suggestions.
    In summary, let me reiterate that we are committed to maintaining 
adequate controller staffing levels to ensure continued safe and 
efficient operation of the air traffic control system. Your continued 
support, particularly for our fiscal year 1998 request to increase the 
size of the controller work force to 17,800, is essential if we are to 
meet that commitment.
    Thank you for giving me the opportunity to appear before you, and I 
will be happy to answer any questions.

                     Statement of Raymond Maldonado

    Senator Shelby. Mr. Maldonado, do you have a statement to 
give? If you would highlight, Mr. Maldonado, your statement, 
the whole statement will be in the record. Do you have anything 
to add?
    Mr. Maldonado. Well, let me first just say, Mr. Chairman 
and committee members, thank you for the invitation, privilege, 
and opportunity to speak before you this morning. I have been 
employed by the Federal Aviation Administration since 1989, and 
I am extremely proud of the work that I do and the profession 
that I have chosen. Air traffic controllers are the cornerstone 
of what should be the safest and most efficient air traffic 
system in the world. While I will not say that the system is 
unsafe, I will say that it is not as safe as it could or should 
be. Of course, this all relates, in my opinion, to some of the 
staffing problems and equipment problems that have hindered 
that distinction.
    My draft was submitted, I guess. I am prepared to answer 
questions or offer testimony in the area of equipment, delays, 
and certainly staffing, to the best of my knowledge.

                           Prepared Statement

    Senator Shelby. We appreciate that, and I am sure we will 
have some. We will insert your complete statement in the 
record.
    [The statement follows:]

               Prepared Statement of Raymond D. Maldonado

    Mr. Chairman and committee members, thank you for the 
invitation, opportunity and privilege to appear before you this 
morning. My name is Raymond Maldonado, I am an Air Traffic 
Control Specialist at the Newark Air Traffic Control Tower in 
New Jersey. I have been employed by the Federal Aviation 
Administration since 1989. Today I speak before you as the 
Newark Tower Representative of the National Air Traffic 
Controllers Association.
    I am extremely proud of the work that I do and of the 
profession that I have chosen. Air Traffic Controllers are the 
cornerstone of what should be the safest and most efficient air 
traffic system in the world. While I will not say that the 
system is unsafe, I must say that it is not as safe or 
efficient as it could or should be. Controllers are the 
professionals that organize and expedite the flow of air 
traffic, and most importantly we prevent collisions between 
aircraft operating in the system.
    Newark Tower operates 24 hours a day, 365 days a year 
providing air traffic control services to the aviation 
customers of Newark Airport, and radar service within a 6.5 
mile radius of the airport. In 1991 Newark Tower had 
approximately 30 Air Traffic Control Specialists, the overtime 
budget was approximately $40,000 and the airport conducted 
roughly 380,000 operations. In 1996, five years later, Newark 
Tower had 27 working Air Traffic Control Specialists, the 
overtime allocation for fiscal year 1996 was $21,800 and the 
airport conducted over 454,000 operations. That translates to a 
10 percent DECREASE in controller staffing, a nearly 50 percent 
DECREASE in overtime allocations, and an INCREASE of almost 20 
percent in air traffic. Mr. Chairman, please believe me when I 
say that a lack of air traffic controller staffing, and the 
resources necessary to augment these shortfalls are a recipe 
for disaster.
    Since 1991 the FAA has conducted four separate staffing 
studies designed to determine the staffing needs of Newark 
Tower. All of the studies called for staffing levels at or 
above Newark Tower's current authorization. The most recent 
study was a collaborative effort between NATCA and the FAA. It 
recommended the staffing level of controllers necessary to 
provide the level of service expected by the users of Newark 
Airport should be between 37 and 41 specialists. Although 
authorizations have recently been adjusted, staffing levels for 
full performance level controllers throughout the NY/NJ 
metropolitan area still remain at approximately 70 percent of 
the authorizations.
    Newark Tower currently staffs eight operational positions. 
A two week study conducted by NATCA in May 1996, revealed that 
four of those control positions, that is one half of the 
positions at Newark Tower, were combined with another control 
position almost 12 hours each day, between 7 a.m. and 11 p.m., 
our high traffic period. In the fall of 1996 a Federal Aviation 
Administration Operational Assessment Team stated in their 
report ``critical positions were combined during some heavy 
traffic periods, the CBA (radar) position was closed and 
service was denied'', and lastly they concluded that 
``combining positions appears to be the standard operating 
practice at Newark Air Traffic Control Tower''. I assure you 
that even during periods of moderate traffic, combining two or 
more control positions under the responsibility of one Air 
Traffic Controller is not desirable nor is it safe.
    The combining of positions dramatically increases workload 
and drastically diminishes the level of service and safety 
being provided. The FAA's own ``Operational Error Reduction 
Plan'' calls for the de-combining of positions which will help 
accomplish increased safety and efficiency. Additionally, the 
FAA's Operational Assessment Team also recommended the 
splitting or de-combining of critical positions. In July 1996 I 
myself was assigned the responsibilities of three air traffic 
controllers. It was because of this overburden that an aircraft 
under my control, inadvertently entered into and flew 
unmonitored approximately 10 miles through the most complex 
airspace in the world--directly above the island of Manhattan. 
When positions are combined because of inadequate staffing 
levels, relief breaks are reduced, time on position soars, and 
inattention to detail occurs. No one wants or needs a fatigued 
controller directing his or her flight, unfortunately in the 
NY/NJ metropolitan area this is the case more often than not. 
When controllers are overburdened, the safety of the flying 
public is compromised.
    At facilities around the country that are short staffed, 
air traffic services are frequently denied or reduced and 
ultimately the end results are delayed flights. To our aviation 
customers, we know time is money. However it is only through 
the combined efforts of adequate staffing and reliable 
equipment that we can work to reduce delays.
    A May 30, 1997 Newark Star Ledger article cited a Port 
Authority Study that states ``delays cost EWR airport users 100 
million dollars annually. Delays at all 3 of the major New York 
airports are estimated to cost the users 215 million dollars 
annually''.
    Although there are many future technological initiatives 
and equipment installations scheduled for Newark Airport, 
designed to help reduce delays, many of those initiatives such 
as Converging Runway Display Aid (CRDA) and Terminal Doppler 
Weather Radar, are months if not years away from actual 
implementation.
    Our nation's Air Traffic Controllers service the world. The 
impact of an overburdened system is felt far beyond the 
boarding gate. Members of Congress have helped to raise 
awareness and have been instrumental in helping correct some of 
the problems throughout our air traffic system. While there is 
a tremendous amount of work that still needs to be done in 
other areas such as incentives, retention, hiring and 
technology, I am confident that with your support and 
assistance we can re-establish the type of air traffic system 
that our flying public expects and deserves.
    Once again, thank you for your time, consideration and the 
opportunity to speak before you today.

                       Statement of Tom Monaghan

    Senator Shelby. Mr. Monaghan, do you have a statement to 
make?
    Mr. Monaghan. Yes, Senator.
    Senator Shelby. I am sure we have got some questions. Your 
written statement will be made part of the record, if you have 
one.
    Senator Lautenberg. You are in the Kennedy tower, is that 
right, Mr. Monaghan?
    Mr. Monaghan. Yes, I am.
    Chairman Shelby and members of the subcommittee, I am 
Thomas Monaghan, of the National Air Traffic Control 
Association. I am a control specialist at Kennedy tower and the 
NATCA representative for New York/New Jersey metropolitan 
control towers. These are some of the issues that have been 
affecting towers over the last couple of years.
    The understaffing at smaller towers in the region, which 
traditionally provided staffing for the larger towers, being so 
low, in some cases it has taken up to 2 years once we do 
identify a controller, say at a Teeterboro tower to go to a 
Newark tower, 2 years to get that controller to that tower. In 
some cases at Kennedy I think it also took about 2 years. So we 
are not able to respond fast enough to the outflow of 
controllers from the metropolitan towers. And La Guardia tower, 
60 percent of the controllers there are certified. They have 
lost 16 controllers over the last 3 years. They are going to 
lose another five this year. So in some cases we are moving the 
problem around.
    The incentives that have been often mentioned have never 
been in place at the control towers in metropolitan New York/
New Jersey area. So we just move it. And we need to have the 
most experienced people at all levels of the system. The same 
level of safety is necessary at the airports, TRACON, and 
center airspace.
    When I did call around, just to try to get a handle on the 
attrition rate at other areas of the country, it seems that at 
Chicago O'Hare, where the incentive is in place at the tower, 
they suffer on average, maybe some years 4, some years none, 
but an average of 2 controllers a year move into other 
positions; as compared to La Guardia tower out of 33 
controllers losing the 16 plus 5 coming up. That has to 
undermine the experience level both of the controllers who are 
working the traffic, and as they are also training the other 
controllers coming in.
    So you have 2-year experience level controllers teaching 
people just coming into the system. In this airspace, in this 
complexity, it suffers errors not lightly. I mean, everything 
is threading the needle, and you have to have people with the 
experience level necessary to see this.
    It is not that the controllers do not have the talent. It 
is not that they do not have what it takes. It is that often we 
just keep training them and they keep repeating the same 
errors. And it is very frustrating to people.
    Senator Shelby. Why? Why do they keep repeating the same 
errors?
    Mr. Monaghan. Because as soon as they get to the experience 
level, sir, they move out either into FAA management, another 
locality, or a radar facility on Long Island, and then we start 
the whole process over again.
    Senator Shelby. OK. I see.

                   Problems with Air Traffic Control

    Mr. Belger, I want to assure you over at FAA from my 
standpoint as the chairman of this subcommittee, and Senator 
Lautenberg I believe would agree with this, I hope so, that we 
are going to do on this subcommittee everything we can--
everything--to see that FAA is properly funded, that there will 
not be a shortage of money, because safety should not be bought 
and sold, not the safety of our traveling public in America. 
Would you agree with that?
    Mr. Belger. Absolutely. I think you have been responsive.
    Senator Shelby. And to use your words, we are not here to 
appease you, but we are here to assure you that we are going to 
work together to see that that is done. There cannot be ever 
any substitute for safety.
    I realize that you have got to have trained quality 
personnel, you have got to pay them, you have got to keep them 
any way you can once they are trained. I think the American 
people deserve nothing less.
    Now, are the problems, Mr. Belger, that have been outlined 
here today by the first panel and some of the others, dealing 
with New York and New Jersey areas, also common to some extent 
around the country in some of the busy airports like Chicago, 
Atlanta, Dallas, Los Angeles?
    Mr. Belger. The equipment problems that have been discussed 
today are common throughout the entire country. The equipment 
in the centers is old. It needs to be replaced. And as I say, 
we have a plan to do that. The equipment in the radar approach 
control facilities is old. It needs to be replaced, and we have 
a program to do that. And I believe we are doing that as 
quickly as we can.
    In my opinion, the staffing situation is probably more 
acute in the New York area than it is in other locations. That 
is not to say that we do not have some staffing shortages in 
other locations, but a combination of factors make it very 
difficult to recruit as rapidly as we would like.

              Recommendation on Collision Avoidance System

    Senator Shelby. Mr. Belger, on a different topic, one of 
the recommendations I understand was made by the National 
Transportation Safety Board is for the FAA to require that all 
cargo plains be equipped with a collision avoidance system 
known as traffic advisory and collision avoidance system. These 
systems are currently required, it is my understanding, on all 
passenger planes carrying 10 or more people, is that right?
    Mr. Belger. Yes, sir; that is correct.
    Senator Shelby. The need to assess whether some type of 
collision avoidance system should be installed on cargo planes 
was highlighted, you recall, last month when a UPS cargo plane 
came within 7 seconds of colliding with Air Force One. Can you 
tell us if the FAA is reviewing whether air cargo aircraft, 
which there are a lot of in the country and in the world, 
should be required to be equipped with some type of collision 
avoidance system, and if not, why not?
    Mr. Belger. Yes, sir; we are reviewing that. That is very 
active on our plate. We have several petitions from groups 
asking us to require the use of collision avoidance systems on 
cargo aircraft.
    Senator Shelby. That is just common sense, is it not?
    Mr. Belger. There are two questions: One, should we require 
today the existing technology, TCAS, on cargo aircraft? And I 
should also say there are other types of aircraft on which we 
do not today require collision avoidance systems, either, 
business jets, business general aviation, the high end of 
general aviation we do not require today either. There is also 
a new technology which I have been told that the cargo industry 
is absolutely committed to, which is called the ADSB, which 
also provides a collision avoidance system that will be 
compatible with the satellite technology of the future.
    But the short answer is we are reviewing that. I expect 
that the Administrator will make some public decision regarding 
those petitions very soon, and I can assure you it is high on 
our priority list for review.
    I can also say that I have seen an accident investigation 
report from the instance you referred to that occurred in the 
Shannon, Ireland, airspace, and the conclusion of the Irish 
investigative authorities, from the report I saw, was there was 
no collision potential in that incident even if----
    Senator Shelby. But it was reported that way, was it not?
    Mr. Belger. It was reported, yes, sir. A lot of things are 
reported for whatever reasons not necessarily related to the 
facts. But yes, sir; and we take all of those incidents very 
seriously, and we obviously followed up and found out what the 
Irish authorities learned from that incident.

                           Equipment Failure

    Senator Shelby. Mr. Belger, from your knowledge of the 
equipment failures occurring at the New York and New Jersey 
facilities--maybe it is New York--is this an increasing 
problem, or one which your organization, the FAA, is making 
progress toward correcting?
    Mr. Belger. As I said, we are not satisfied with where we 
are, but I do believe that we are making extraordinary 
progress. If you recall, a couple of summers ago we had a rash 
of incidents in the centers, a very significant one in the New 
York Center, that were caused by power outages. We have since 
that time replaced what we call a power conditioning system, 
which is nothing more than a super complex power conditioning 
system much like you would have on your computer to purify 
commercial power. In every one of the centers we have now done 
that. Those new systems are in place, and they are there.
    We had problems also several years ago in the summer with 
five centers in particular that had the very oldest radar 
processing computers in the centers. The Administrator at that 
time made a decision to do a quick $60 million replacement 
program of those computer systems. That has now been done. This 
new interim computer system is in place in the five centers.
    Senator Shelby. But you do have backup power?
    Mr. Belger. Oh, absolutely. Absolutely, we have backup 
power.
    Senator Shelby. So if you had a power shortage, it should 
not affect you?
    Mr. Belger. I am one who says that any time we have to go 
to a backup system there is some degradation in service, we 
lose some capability. But I will also tell you that I think the 
backup systems are such that we will not let it get to the 
point where it causes a safety problem.

                        Air Traffic Controllers

    Senator Shelby. We received testimony this morning from the 
controllers at the New York facilities. They are working an 
extraordinary amount of overtime. Does this mean that most 
controllers at the New York area and New Jersey facilities are 
working 50 to 60 hours a week, or more, and if so, is this 
safe? This is a highly stressed job.
    Mr. Belger. It is an extraordinarily important and 
stressful job. I think the scenario that we are seeing at New 
York Center is a safe scenario, as I have said before. I have 
asked Mr. Morgan, who is the Director of our Air Traffic 
Service, to look closely and analyze the staffing and the 
overtime situation at the New York Center, and with your 
permission I would ask him to answer the question more 
specifically.
    Senator Shelby. Mr. Belger, one last----
    Mr. Belger. I am sorry. I have asked Mr. Morgan to look at 
that very closely. With your permission, I would like for him 
to answer specifically.
    Senator Shelby. Let us hear him.
    Mr. Morgan. Good morning, Mr. Chairman.
    In looking at the overtime situation at New York Center, 
what we have found is that we do use a significant amount of 
overtime. The two primary reasons for that overtime usage is to 
enhance our training capability. It takes more people when you 
use controllers to train than it does to just operate the 
facility.
    Second, we have an agreement with the National Air Traffic 
Controllers Association to be able to allow them a certain 
period of time through the summer months that they are 
guaranteed leave, and it is our obligation, our commitment, to 
make good that memorandum that we have with them.
    The particular overtime usage that we have, what we find is 
that the overtime is usually a voluntary type activity with the 
controller work force. At times it is mandated, but it is 
usually volunteers who utilize the overtime. When they are 
assigned 6-day workweeks, what we have found is that 60 percent 
of the controllers actually work a 6-day workweek when they are 
assigned. Others will combine that 6-day assigned workweek with 
either a day of annual leave or, if required, a day of sick 
leave, and what we find is that the other 40 percent are 
working less than a 6-day workweek, even though they are 
assigned that period of time.
    Senator Shelby. We appreciate that.
    Mr. Belger, some airports that do not currently qualify for 
a contract tower have suggested a call-sharing partnership in 
which the FAA and the local airport would split the annual 
operating costs of a contract tower. This type of partnership 
between the FAA and the local airports could enhance aviation 
safety at a minimum cost to the FAA. What are your thoughts 
about this?
    Mr. Belger. I am very much in favor of those types of 
arrangements.
    Senator Shelby. This would also affect a lot of medium-
sized cities.
    Mr. Belger. I am very much in favor of those types of 
arrangements, particularly if it will provide a service in the 
form of an air traffic control tower that we otherwise could 
not provide because it does not meet our criteria.
    Senator Shelby. Senator Lautenberg.
    Senator Lautenberg. Thanks, Mr. Chairman.
    Mr. Belger, and all of you, I am sorry that everybody did 
not have the opportunity to testify, but we have your statement 
in the record, and that will be examined thoroughly, and I tell 
you that we only lost the opportunity to hear the charm of your 
voices.
    Senator Shelby. And the substance of their statement.
    Senator Lautenberg. Well, that is going to be in the 
record, I hope.
    Senator Shelby. That is right.

                       Air Traffic Control School

    Senator Lautenberg. I want to ask you, Mr. Belger, you have 
heard some of the concerns expressed, and one of the things 
that was kind of addressed turkey roost was this school in 
Oklahoma. Now, to be candid, you and I both discussed this in a 
meeting that we had, and you gave me a reason as to why that 
facility was not being used. Can you, in short form, tell us 
why? And you did say that you are now using local educational 
institutions to try and grow controllers in the vicinity in 
which they are going to live after they get their jobs. So tell 
us about that.
    Mr. Belger. Yes, sir; from 1992 until this fiscal year, we 
hired into the controller work force, new controllers, on the 
average of less than 150 a year. Most of those that we did hire 
during that period were graduates of the college training 
programs that I spoke about, and those graduates go directly to 
the facilities where they begin on the job training, because 
they have already been trained in the universities on the basic 
principles of air traffic control.
    The other category of folks that we hired from during those 
years were former military controllers and others who did not 
have to go through the basic training. We literally hired 
virtually no one. I will not say no one, but virtually no one 
at the entry level where they had to come up through the FAA's 
traditional training program. So that is the reason that we did 
not have an active ongoing initial training program at the 
academy.
    I do believe that the reference in the first panel to 
closing down the training academy, although it was not 
perfectly clear to me, I do believe the reference was to airway 
facilities training for our technicians and engineers, and the 
decision was made earlier this year because of funding 
priorities to cancel some training courses--cancel all training 
courses. When I learned about that decision in a matter of 2 
days we found the money and turned those courses back on.
    But the short answer to your question is we have not had an 
initial training program because we have not been hiring people 
from those sources.
    Senator Lautenberg. You have not been hiring people. Is it 
a necessary part of your development for controllers to have 
that facility?
    Mr. Belger. No, sir.
    [Additional information follows:]

    Since fiscal year 1992 the demand for controller trainees 
entering the system, who require developmental training, has 
been very low. The FAA has been meeting the hiring requirements 
through the College Training Initiative (CTI) program and, for 
the past couple of years, with rehired PATCO controllers.
    During this same timeframe we have had a continuing (at 
times an increasing) need to provide advanced or post 
journeyman level training. While the CTI program has met the 
demand for new hire training, the Academy has met the need for 
other types of training as well as courseware development and 
maintenance for ongoing resident courses at the Academy and 
field developmental training.
    As the demand for increased hiring rises we plan to expand 
the CTI program to facilitate hiring from the local commuting 
area. And, we are developing a systematic approach for hiring 
ex-military controllers to take advantage of their background 
in air traffic control so that training time will be reduced to 
a minimum. We also plan to ``spool'' the Academy up to 
accomplish new hire developmental training. Our goal is to 
accomplish developmental training in a cost efficient manner 
while ensuring that all training needs are met.

    Senator Lautenberg. How much does it cost to operate it?
    Mr. Belger. I can provide that sir, but I do not have that 
data with me.
    Senator Lautenberg. Does anyone have it?
    [No response.]
    Mr. Belger. We certainly can provide it.
    [The information follows:]

    The following information is regarding the Air Traffic 
Division only--not the FAA Academy as a whole. The cost to 
operate the fiscal year 1997 Air Traffic Training Program (AMA-
500) includes the following: $3,312,000 is allocated for the 
per diem/travel for students; and $14,691,000 is allocated to 
support 126 FTE's and about 110 contractor FTE's.
    Listed below is a partial list of accomplishments that will 
be made with the fiscal year 1997 dollars: 2,000 resident 
students trained; 24 percent initial qualification/
developmental controller training 76 percent advanced/post 
journeyman level training; development/maintenance of 31 
resident courses; development/maintenance of 36 non-resident 
conventional courses; development/maintenance of 20 CBI 
courses; development of the Precision Runway Monitor (PRM) 
system training simulator; development of site specific tower 
simulator capability; and development and support of the 
Technical Center tower simulator.

                   Hiring of Air Traffic Controllers

    Senator Lautenberg. For the information of the people 
within our voice and those who will examine the record, the 
fact is that it was a conscious decision not to reduce the 
number of controller recruits, but rather a decision to try and 
expedite better training and more familiarity with the area 
where a controller trained finally would be assigned. Is that 
the right phrase?
    Mr. Belger. That is true in part. The other fact is because 
of a variety of reasons we just were not hiring.
    Senator Lautenberg. Now, you were not hiring because you 
did not want to or because you did not have them to hire?
    Mr. Belger. We did not have the money. We did not have the 
resources to hire more.
    Senator Lautenberg. But you were hiring controllers during 
this period of time.
    Mr. Belger. Like I said, on the average of 150 or so, 
roughly, during that period. Now, I do not want to mislead. Do 
not let that statement that I said, we did not have the money, 
be any implication that I am blaming anybody. It is just that 
that is where we were.
    Senator Lautenberg. I think it is important to understand 
what took place.
    Mr. Belger. That is where we were.
    Senator Lautenberg. You said that advances in technology 
have brought about the need for fewer controllers to handle 
increased air traffic. What kind of advances are we talking 
about?
    Mr. Belger. If I said that, I was wrong. I am not sure I 
said that.
    First of all, let me back up. If you go back to 1981----
    Senator Lautenberg. I am sorry. No; you did not say it.
    Mr. Belger. Yes, sir; thank you. I do not think I agree 
with that.
    Senator Lautenberg. It was Mr. Hinson. I just was testing 
your memory. [Laughter.]
    It was Mr. Hinson who I wrote to, and I expressed concern 
about the decline of the size of the air controller work force 
and so forth. In response, he cited the improvements in 
technology, and I just wonder whether you can specify whether 
in fact maybe that statement was accurate at one time and not 
now.
    Mr. Belger. I certainly do not want to disagree with Mr. 
Hinson, the former Administrator, and so I would have to look 
at the context. But there have been improvements in technology 
which to some extent--in my opinion a very small extent, 
though--have improved our productivity over the years. The big 
increases in productivity over the years, if you go back to 
1981, I think are the result of a better traffic management 
capability that we have today than we did in 1981.
    But let me answer your question for the future. People talk 
about productivity, they talk about how are we going to be more 
productive in the future. The fact of the matter is the air 
traffic control work force today is extraordinarily 
productive--extraordinarily productive.
    Senator Lautenberg. Have they picked up their capacity to 
handle the job significantly?
    Mr. Belger. Absolutely. Absolutely.
    Senator Lautenberg. Is there a measurement by which we 
could----
    Mr. Belger. Yes, sir; I do not have it with me.
    Senator Lautenberg. Is it 10 percent, 20 percent, or is it 
26 percent?
    Mr. Belger. I will not state a number because I honestly do 
not remember, but I have a chart that shows operations per 
controller, and it shows it steadily going up.
    Senator Shelby. Would you furnish that for the record?
    Mr. Belger. Yes, sir; absolutely.
    [The information follows:]

    The attached charts show operations per controller work force (CWF) 
and operations per air traffic control specialist (ATCS). The data are 
presented for air route traffic control centers and airport traffic 
control towers. Data are actual for fiscal years 1993 to 1996 and 
estimated data for fiscal years 1997 and 1998.
    The operations data for airport traffic control towers include 
instrument operation totals for air carrier, air taxi/commuter, general 
aviation, and military operations.
    The air route traffic control center data include the number of 
instrument flight rules aircraft handled for air carrier, air taxi/
commuter, general aviation, and military.
    The CWF consists of air traffic control specialists (ATCS), first-
line supervisors, and traffic management coordinators (TMC).
    For May 1997 the CWF numbers were:

ATCS's........................................................    14,253
First-line Supervisors........................................     2,208
TMC's.........................................................       583
                    --------------------------------------------------------------
                    ____________________________________________________

      Total CWF...............................................    17,034

                  TABLE 38.--INSTRUMENT OPERATIONS AT AIRPORTS WITH FAA TRAFFIC CONTROL SERVICE                 
                                                  [In millions]                                                 
----------------------------------------------------------------------------------------------------------------
                                                              Air     Air taxi/   General                       
                       Fiscal year                          carrier    commuter   aviation   Military    Total  
----------------------------------------------------------------------------------------------------------------
                      Historical \1\                                                                            
1991.....................................................       13.5        9.5       18.1        4.0       45.1
1992.....................................................       13.4        9.9       18.2        4.1       45.6
1993.....................................................       13.6       10.4       17.7        3.9       45.6
1994.....................................................       14.3       10.8       18.0        3.7       46.8
1995.....................................................       14.6       10.8       18.1        3.5       47.0
1996E....................................................       14.7       10.6       17.7        3.3       46.2
                                                                                                                
                         Forecast                                                                               
1997.....................................................       15.1       10.7       17.8        3.2       46.8
1998.....................................................       15.4       10.9       18.0        3.1       47.4
1999.....................................................       15.8       11.1       18.1        3.1       48.1
2000.....................................................       16.3       11.4       18.3        3.1       49.1
2001.....................................................       16.7       11.7       18.4        3.1       49.9
2002.....................................................       17.1       11.9       18.6        3.1       50.7
2003.....................................................       17.5       12.2       18.8        3.1       51.6
2004.....................................................       17.9       12.4       18.9        3.1       52.3
2005.....................................................       18.3       12.6       19.1        3.1       53.1
2006.....................................................       18.8       12.9       19.3        3.1       54.1
2007.....................................................       19.2       13.1       19.5        3.1       54.9
2008.....................................................       19.7       13.3       19.6        3.1       55.7
----------------------------------------------------------------------------------------------------------------
\1\ Source: FAA Air Traffic Activity.                                                                           


                    TABLE 40.--IFR AIRCRAFT HANDLED AT FAA AIR ROUTE TRAFFIC CONTROL CENTERS                    
                                                  [In millions]                                                 
----------------------------------------------------------------------------------------------------------------
                                                                            IFR aircraft handled                
                                                          ------------------------------------------------------
                       Fiscal year                            Air     Air taxi/   General                       
                                                            carrier    commuter   aviation   Military    Total  
----------------------------------------------------------------------------------------------------------------
                      Historical \1\                                                                            
1991.....................................................       18.2        5.5        7.3        5.1       36.1
1992.....................................................       18.2        5.8        7.3        5.1       36.5
1993.....................................................       19.0        6.2        7.4        4.8       37.4
1994.....................................................       20.0        6.6        7.7        4.6       38.8
1995.....................................................       20.9        6.9        7.8        4.4       40.0
1996E \2\................................................       21.9        6.6        7.8        4.0       40.3
                                                                                                                
                         Forecast                                                                               
1997.....................................................       22.4        6.9        7.9        3.7       40.9
1998.....................................................       23.0        7.1        8.1        3.6       41.8
1999.....................................................       23.6        7.2        8.1        3.6       42.5
2000.....................................................       24.4        7.4        8.1        3.6       43.5
2001.....................................................       25.0        7.5        8.3        3.6       44.4
2002.....................................................       25.4        7.7        8.3        3.6       45.0
2003.....................................................       26.2        7.8        8.4        3.6       46.0
2004.....................................................       26.8        8.0        8.6        3.6       47.0
2005.....................................................       27.4        8.1        8.6        3.6       47.7
2006.....................................................       28.0        8.3        8.6        3.6       48.5
2007.....................................................       28.6        8.4        8.8        3.6       49.4
2008.....................................................       29.2        8.6        8.8        3.6       50.2
----------------------------------------------------------------------------------------------------------------
\1\ Source: FAA Air Traffic Activity.                                                                           
\2\ Due to an accounting change in 1996, approximately 360,000 operations at the New York ARTCC were shifted    
  from Air Taxi/Commuter to Air Carrier.                                                                        
Note: Detail may not add to total because of rounding.                                                          

[GRAPHIC] [TIFF OMITTED] T12JU12.028

[GRAPHIC] [TIFF OMITTED] T12JU12.029

    Mr. Belger. Now, I will say, though, for the future, when 
we get this new infrastructure in place, when we get the new 
computer systems in the centers and we get the new computer 
systems in the terminals, then we will be able to, from a 
software standpoint, add a lot of functional capabilities which 
will have enormous productivity improvements. And when I say 
productivity improvements, I do not necessarily mean fewer 
controllers, I mean the ability to handle more aircraft.

                           Operational Errors

    Senator Lautenberg. You said earlier, and I just want to 
confirm, we have a larger number of operational errors than we 
have had in the past. Does it challenge the integrity of the 
system? Is it a modicum or a lot less safe than it was 10 years 
ago, 12 years ago? I am asking you that in the context of 
increased traffic, more activity, not only increased traffic 
but the controllers are concerned in the towers about ground 
movements and trucks on the airport, et cetera, et cetera. So 
with that, tell me.
    Mr. Belger. Well, a couple of facts first. If you look at 
operational errors nationwide first, for example, in 1996 there 
were 760 operational errors, last full year. The previous year 
there were 778. The previous year, 790. So you see a gradual 
decrease in operational errors. Now, that is in spite of 
increased traffic. So the rate of operational errors per 1,000 
or 100,000 movements is going down, and that is a good trend. 
That is a very good trend. The air traffic control system is 
safer today than it was yesterday. It is safer than it was 10 
years ago. It will be safer tomorrow because of the new 
equipment and things that are being added to the system.
    It is also more complex. With increased operations comes 
increased complexity. So the challenge to our air traffic 
controllers and the challenge to us is to keep up with that. 
And we will not, as we have said repeatedly, we will not be 
able to keep up from an efficiency standpoint if we do not get 
these tools in place to keep up with an industry that is 
growing dramatically.
    If you look at Newark, for example, for years publicized as 
one of the most delayed airports in the country, it is also 
today one of the fastest growing airports in the country. That 
presents a tremendous challenge.

                  Staffing of Air Traffic Controllers

    Senator Lautenberg. It does, and I was on the Pan Am 103 
study, and I have spent a lot of time with the information 
about TWA 800. The Pan Am 103 study, Senator D'Amato and I 
shared the investigation, we were in Lockerbie, Scotland, and 
we are very much concerned. And I fly a lot in the second seat, 
and I test the control system by talking every now and then. I 
get someone who sounds like they are talking a different 
language than I am, but maybe that is the way I sound to them.
    But I can tell you, Mr. Chairman, and I fly through a busy 
space, I get quick response, I get lots of good alerts, traffic 
here and traffic there and where they are, and there is plenty 
of traffic around. I have problems spotting it sometimes, but 
they are letting me know that it is happening. And I come down 
to this: Can we continue to overload--let me modify that--to 
load the system up without creating a condition that might have 
an occasional operational error? Not accident. Not accident. 
Because what we are doing is satisfying the public demand.
    I can tell you that shortly after the accident, Mr. 
Chairman, Pan Am 103, known to be sabotaged, people were making 
commitments like the alter promises, I call them. Oh, I do not 
mind getting to the airport 2 hours and waiting. No, sir; if 
that plane is going to be safer, that is what I want to do. And 
when my kids are going to travel, I want them to be there 2 
hours. And that lasted about 2 weeks, Mr. Chairman, because 
pretty soon people wanted it just the way they loved it--get 
your baggage to the curb, have the skycap take it away, get in 
the airplane, 5 minutes left to go, hey, that was not bad, 
yesterday I made it by 3 minutes.
    The fact of the matter is that people make demands of the 
system. And I say to you--and I do not put this as a question, 
I do not want to put you on the spot. If we had less traffic, 
then obviously the work force, et cetera, could accommodate 
this with a significant breadth of comfort. But nobody wants to 
say that. Nobody wants to suggest that we are going to say to 
the business people, the recreational travel, the school 
traveler, that OK, you are only going to be able to fly three 
times a day Boston to New York, or three times a day Washington 
to New York.
    So we are demanding an awful lot, and I think part of that 
has to be included in the discussion so that we know what is 
taking place.
    Mr. Maldonado, between 1990 and 1996 Newark's air traffic 
jumped 32 percent while controller staffing decreased by 10 
percent. Last year at this time the authorized level for 
controllers was 27. This year, however, the authorized level is 
34. Now, I have assurances from FAA that Newark will be fully 
staffed by the end of September. Do you think that 34 is the 
right number of controllers for the Newark tower?
    Mr. Maldonado. Well, I am glad you raise that point. Mr. 
Belger mentioned that Newark airport is one of the fastest 
growing airports in the country. From a working air traffic 
controller's standpoint, I can tell you that that is very true. 
That is true.
    Between 1991 and 1996 there have been approximately four 
staffing studies, staffing studies which were designed to 
determine the staffing needs for the airport at that time. One 
of those studies was a collaborative effort between the FAA and 
NATCA. That was the most recent one, and that was the only 
study that took into account future demands of the airport. 
That report stated that the need for air traffic controllers 
would be somewhere in the area of 40, or upward of 40, 41 
controllers.
    Senator Lautenberg. So even if we were able to be staffed 
at the current suggested levels, you think that we would 
actually need more than that target?
    Mr. Maldonado. Absolutely.
    Senator Lautenberg. Mr. Belger.
    Mr. Belger. The target, as you accurately stated for 
Newark, for this year is 35. There are actually today 31 on 
board.
    Senator Lautenberg. Thirty-one?
    Mr. Belger. Thirty-one on board. These are air traffic 
controllers. Now, it does not consider supervisors or others, 
31 versus a target level of 35. And we have committed to you 
that we will meet that 35 by the end of this fiscal year.
    Now, given the number of folks that we will hire next year, 
assuming our budget request is favorably received, we will have 
the ability to increase staffing at airports and at approach 
control facilities and at centers where the traffic justifies 
it. And if need be, we will do that.
    Senator Lautenberg. So then you are not locked in at 34, 
35?
    Mr. Belger. Oh, no, sir; no.
    Senator Lautenberg. You could agree with Mr. Maldonado that 
maybe 40 is the required number to manage what we have got 
there?
    Mr. Belger. I will certainly agree to look at it, agree 
that air traffic will look at it with the local employees, who 
obviously know it better than we do in the headquarters, and 
make the right decision.
    Senator Lautenberg. Well, we will take a look together, 
because I want to keep it in mind, and I think we ought to do 
that.
    Yes, Mr. Maldonado.
    Mr. Maldonado. I would like to just provide you with the 
most current numbers. Right now Newark tower has 33 air traffic 
controllers in the building. Twenty-five of those are 
journeymen or full performance level controllers. Eight of 
those are training.
    Senator Lautenberg. How many of those are up for retirement 
in the next couple of years, do you know?
    Mr. Maldonado. I believe approximately four. And I am 
sorry, that is within the next--I believe within the next 5 to 
10 years, approximately four of those.
    Senator Lautenberg. Oh, so that situation is manageable.
    Mr. Maldonado. Yes.
    Mr. Belger. Thank you. My data was the end of April, so you 
are right. Thank you for being more accurate.
    Senator Lautenberg. We will have a chance to chat, as we do 
over the year, and I look forward to working with you, and I 
would say to all of you who work for FAA in the towers, either 
in inspections or what have you, you do a good job. I want you 
to keep on doing a good job. I want you to be honest if you 
have criticisms, if you have complaints, speak up, because it 
is the responsibility that you have. And barring anything else, 
we are going to try to give you the resources, we are going to 
try and give you the equipment, try and give you the process 
that you can operate by.
    Mr. Brown, did you want to say something?

                        Statement of Henry Brown

    Mr. Brown. Yes, Senator; if I could impose myself upon the 
panel for just a second. I came down to testify in front of 
this esteemed group, and have not had the opportunity to do 
that, and I understand my written testimony will be placed 
within the record.
    Senator Shelby. Absolutely.
    Mr. Brown. But I feel my testimony in front of you would 
take on a different flavor, and it is unfortunate at this point 
that hearing the questions and the responses from the other 
members at the table that my testimony would change 
dramatically at this point.
    I would like to say that it seemed to have taken a 
decidedly air traffic controller turn. I am a technician. I am 
kind of the lowest person on the food chain, where the rubber 
meets the road, and I think it would have been beneficial to 
this group and this body to hear what I have to say.
    Senator Lautenberg. I want to say this to you: I listened 
very carefully to what Mr. Johnson said, and I looked at his 
testimony, and we will, I promise you, look at yours. The staff 
will review it.
    I use the term controller as a generic thing. Forgive me. I 
recognize that the technicians--today we heard about a power 
outage up in New York--I do not know whether that is true, Mr. 
Belger--yesterday a power outage here. You folks have a 
responsibility to work with those, have you not?
    Mr. Brown. Yes, sir; and I wanted to make comment about the 
answer to the power outage that was up in New York, because I 
am an environmental systems specialist. That is my job. I am a 
critical power systems specialist.
    Senator Shelby. Mr. Brown, would your testimony disagree 
with Mr. Johnson's testimony in any way?
    Mr. Brown. No, sir; I do not.
    Senator Shelby. What did you want to say?
    Senator Lautenberg. Because now you have piqued our 
curiosity.
    Senator Shelby. Absolutely. [Laughter.]
    Tell us what you want us to know. This is why you are here.
    Mr. Brown. Most of this has been covered by the rest of the 
members of the panels. From a purely New York perspective, and 
I appreciate the fact that Senator D'Amato and Congressmen 
Forbes and King came up to visit us to discuss this issue, we 
are running 40 percent under staff in the systems specialist 
area.
    Senator Lautenberg. You have 60 percent of the people you 
need, you are saying.
    Mr. Brown. We have 63 percent, actually. These are the 
people that keep the equipment running for the air traffic 
controllers, and I would like to give you a visual, and the 
visual would be that you are flying in from Florida, you have 
come from visiting your mother, you are in thunderstorms, you 
have--I was buoyed by the fact that Mr. Belger said that he has 
agreed with NATCA to go ahead and make sure that their staffing 
needs are met, but we do not have that agreement with PASS and 
Mr. Belger, but you are flying into New York and you are in 
thunderstorms and you are reading the paper and you have got a 
fully staffed air traffic controller facility and they are 
handling traffic, and then they are looking at nothing. They 
have no scopes, they have no communications with the aircraft, 
and you are on that airplane, and it is 4:15 in the afternoon 
and it is a Friday afternoon, which is the busiest air traffic 
time in the New York area.
    That scenario, we had. We had that scenario on May 25, 
1995, when we lost one-third of the radar scopes at New York 
Center and we lost one-third of the communications to the 
aircraft for an entire 15 minutes. An aircraft traveling at 350 
miles an hour goes a long way in 15 minutes. The saving grace 
to that problem was the fact that it was late at night, there 
was very low air traffic, we managed to combine sectors to pick 
up what we needed to get, so we did not really run into a 
problem. Luck saved us there.
    We are on the verge of being out of luck, and that is the 
point I am trying to make. If we have fully staffed air traffic 
controllers----
    Senator Lautenberg. What do we have to do to correct that? 
Have back up--redundant power systems? What do we have to do?
    Mr. Brown. It had nothing to do with the redundant power 
system. The power system that failed was the brandnew ASEPS 
power system that has been installed. I was a member of Senator 
Paul Simon's blue ribbon report panel on that particular 
incident, and we made recommendations and I made 
recommendations as a specialist in that field on what needed to 
be done. Those things were not done. There are modifications 
that need to be made to that system.
    Senator Lautenberg. I would ask you to submit your 
recommendations to this committee.
    Senator Shelby. We would like to hear it. If they were not 
done, we want to know why they were not done.
    Senator Lautenberg. I used to run a computer company, and 
we had generators that were never used, but were always there 
in case we needed them, and when you are talking about sitting 
up there and not being able to get a response that says I do 
not know where you are, what is your altitude, where are you, 
what is your heading, well, here I am, and you are trying to 
figure out with a pencil and piece of paper where the other 
guys who were calling in almost screaming the same thing.
    I just want to ask, if I may----
    Senator Shelby. Go right ahead.

                          Redesign of Airspace

    Senator Lautenberg. Mr. Barger, thanks very much for coming 
and your patience. You have said that a comprehensive redesign 
of the airspace around the city, around New York/New Jersey, 
holds the greatest promise for improvements and minimizing 
delays at Newark. Now, how can the redesign of the space 
improve the air traffic capability and reduce delays? Would a 
redesign of the airspace automatically trigger a new series of 
outcries from surrounding communities regarding air noise?
    When he finishes, Mr. Maldonado, listen carefully because I 
am going to ask you. We need to do this in a hurry because the 
chairman has been too gracious, and he is going to run out of 
patience.
    Mr. Barger. Senator, I appreciate the question. Really, 
from Continental's perspective, certainly the staffing issue 
has been discussed in the first two panels today. That was the 
first item we put forth. And also, we have touched on 
technological advancements, some that are out there today, some 
that are developing. That is in the testimony, as well, that we 
believe makes a great deal of sense, that the FAA take a very 
hard look at in terms of increasing technological capability in 
the Northeast region, specifically at Newark Airport.
    Along those lines, a third piece, and everything has to be 
done in terms of partnering and working together, taking a 
comprehensive look at the airspace to allow for things such as 
new technologies, which would again increase efficiencies.
    Senator Lautenberg. That would shorten the space between 
aircraft, right?
    Mr. Barger. Yes; absolutely, it would. And we have 
certainly seen some advancements with, for example, global 
positioning. We are certainly seeing advancements with aircraft 
situational display.
    Senator Lautenberg. How would that make a difference in the 
use of the airspace? I mean, here we are, now the power of the 
ground control--not the ground control, but the TRACON still 
has the airplane, and they know where they are.
    Mr. Barger. All of it really creates greater efficiency. 
And when we take a look at Newark Airport, just a 
clarification, we are actually at a level of operations at 
Newark Airport right about 1,450 per day that actually there 
used to be about 10 years ago, before some consolidations 10 
years ago. So really, taking a look at the airspace in 
conjunction with technology and staffing, it really just 
creates better efficiencies and just tighter paths of aircraft 
up in our region.
    Senator Lautenberg. Is a longer runway going to help?
    Mr. Barger. Well, a couple of things, and you touched on 
noise, and I certainly do not want to let that go away, because 
really----
    Senator Lautenberg. I cannot.
    Mr. Barger. Absolutely--the whole issue of redesign also 
would take that into consideration, as well, combined with the 
new generation aircraft which is a quieter aircraft, and so 
there are many pieces that have to be taken in combination.
    And just your comment on the longer runway, the extension 
certainly will help in terms of our runway 4 left 22 right. We 
look forward to expanding the outboard runway at some point in 
the future, as well.
    Senator Lautenberg. Thanks, everybody.

                        New York TRACON incident

    Mr. Belger. Could I take less than 1 minute to respond to 
your question in the sense of full disclosure? We did have an 
occurrence in New York this morning. It was at the New York 
TRACON, and I will tell you what I know based on the note I was 
handed when we came up here, so that is all I know.
    We were testing the new converging runway display aid 
[CRDA], which is a new software program we are trying to 
install to be used at Newark to improve the sequencing and 
spacing for arrivals. We were testing it at the TRACON. There 
was a problem as a result of the testing that we were doing, 
and that caused us to lose some of the capability.
    I do not know any more than that at this point, but I can 
certainly give you all the details.
    It was a software problem.
    Mr. Brown. Mr. Chairman, if I may beg your indulgence for 1 
minute, please.
    Senator Shelby. Go ahead.
    Mr. Brown. The FAA announced this morning they are going to 
hire 100 new controllers in the New York area. That is four 
times as many as they are going to hire for 1998 in systems 
specialists technicians. They are going to hire 1,300 
controllers in 1998. They are going to hire 25 technicians.
    Our pipeline is absolutely dry. We have nobody out there 
training in the technician area.
    Senator Lautenberg. Mr. Brown, you are invited to come to 
my office--not at this moment--make an appointment, come in, if 
Senator Shelby----
    Senator Shelby. I will be glad to see him, too.
    Senator Lautenberg. We will join in, and we want to talk to 
you. So follow on.
    Senator Shelby. We want to make sure that you, the 
technicians that make all the equipment run and keep it up and 
everything that goes with it, have the training and the 
personnel to make and feed the whole controller system.
    Mr. Brown. Yes; which is our need so we can supply the 
product we are supposed to supply to the air traffic 
controllers.
    Senator Shelby. Absolutely, because without you, they will 
not be able to function.
    Mr. Brown. That is correct.
    Senator Shelby. Thank you, gentlemen.
                                Panel 3

                       NONDEPARTMENTAL WITNESSES

STATEMENTS OF:
        CHARLES BARCLAY, PRESIDENT, AMERICAN ASSOCIATION OF AIRPORT 
            EXECUTIVES, ALSO REPRESENTING AIRPORTS COUNCIL 
            INTERNATIONAL
        PHIL BOYER, PRESIDENT, AIRCRAFT OWNERS AND PILOTS ASSOCIATION
        EDWARD BOLEN, PRESIDENT, GENERAL AVIATION MANUFACTURERS 
            ASSOCIATION

                       Introduction of Witnesses

    Senator Shelby. Our last panel will be industry 
representatives, Mr. Charles Barclay, president, American 
Association of Airport Executives; Mr. Phil Boyer, president, 
Aircraft Owners and Pilots Association; and Mr. Edward Bolen, 
president, General Aviation Manufacturers Association. Mr. 
Barclay is also representing the Airports Council International 
here today.
    Gentlemen, I know it has been a long morning. I think we 
have had a spirited hearing and a well-attended hearing, 
perhaps an intense hearing. All of your written testimony will 
be made part of the record in its entirety. You have had the 
benefit of the other testimony. If you will sum up what you 
want to say as briefly as possible, I think we would appreciate 
it.
    Mr. Barclay, please proceed.

                      Statement of Charles Barclay

    Mr. Barclay. Thank you, Mr. Chairman. I just would like to 
make two points about our testimony, and the first is to try to 
put the AIP request that we have before the committee in 
perspective.
    The major cost driver for airports, of course, in the 
system is how many passengers there are. In the past 5 years we 
have seen passengers grow by over 20 percent. That is over 100 
million new passengers in the system, while we have decreased 
our investment in airport infrastructure by over 20 percent.
    In the next 5 years we are looking at another 165 million 
passengers coming into the system, but we are looking at an FAA 
request for a 31-percent decrease, on top of the 23-percent 
decrease we have had in the last 5 years.
    Senator Shelby. What does that mean? What does that mean, 
Mr. Barclay?
    Mr. Barclay. We have gone from $1.9 billion down now to 
$1.45 billion, and thanks to the committee, they held it up 
there last year. The administration is saying take that down to 
$1 billion, but we are going to wind up, over that 10-year 
period of time, with the equivalent of the population of the 
United States added onto the existing system flying.
    Senator Shelby. Tell the American people, and they will be 
watching this now, what this means, though. What is the 
significance of this?
    Mr. Barclay. Right. And that is part of the perspective we 
want to build. The second largest economy in the world fits in 
a land mass the size of New England. Japan can use roads and 
railroads to run their internal economy.
    Senator Shelby. But we cannot.
    Mr. Barclay. The United States, four time zones wide, has 
to have a high capacity, highly efficient air traffic control 
and airport system, or we simply cannot move goods and people 
and resources to compete.
    Senator Shelby. Our economy will not function without air.
    Mr. Barclay. And that relative importance to us is going to 
get more important as more products speed up to keep up with 
semiconductor product cycles. So the speed of movement is 
driven for us by our economy.
    We are investing less in infrastructure than any other G-7 
country. And one of the points we have tried to make to the 
folks on the Budget Committee is that if you reduce the Federal 
deficit at the expense of creating an infrastructure deficit 
you have not done future generations any good at all.
    Senator Shelby. Mr. Barclay, let me just agree with you on 
what you are saying. We cannot afford to do that. We will not 
only reach a point and probably have diminishing returns. It is 
foolish. It is very foolish not to build the infrastructure, 
including air safety and everything that goes with it, is it 
not?
    Mr. Barclay. Absolutely. We have to leave future 
generations the tools to create wealth in their society and to 
compete in a world economy. And in fact, most economists will 
tell you, the good type of debt to leave future generations by 
any country is debt for facilities that create wealth over the 
term of their indebtedness.
    Senator Shelby. But we are not creating debt here. We have 
got the money. It is a question will the Congress have the will 
to spend it in the right way, and the right way is always 
infrastructure and safety, is it not?
    Mr. Barclay. Absolutely. Let me give you some comparisons, 
Mr. Chairman. The Government of Malaysia at Kuala Lumpur for 
one new airport is spending $3.8 billion. Munich, for one new 
airport, spent $6 billion. The Government of Hong Kong, a 
country with one-fiftieth of our economy, is spending $25 
billion for one new airport, while we are sitting here debating 
a $1 to $1.5 billion program for 3,300 airports nationwide, 
after we have just discussed how important this capital system 
is to running our whole economy.
    So if you just look at the scale of things, this 
perspective is very important to try to get through to the 
whole institution of Government. We know this committee 
understands that.
    Our specific request is to please keep AIP as high as 
possible, at least to this year's level. We know that is 
difficult in this atmosphere, but the 31.5-percent request of 
the administration just will not work. Small airports in 
particular will be devastated. But things like the noise 
program will be severely slashed, and it is that kind of 
program that we need to help get us the capacity at the larger 
airports, and from a safety point of view and a security point 
of view, the Gore Commission had recommended $500 million more 
in spending for airport security, but then the administration 
reduced the request for AIP by $500 million, and that just does 
not make sense.
    Senator Shelby. It does not make any sense.
    Mr. Barclay. GAO found that for safety and security alone 
each year the needs are about $1.4 billion.
    Senator Shelby. But that is the least thing we owe to the 
American people, and the people from other countries that are 
coming to this country, and thinking they are coming safely. We 
should make sure they are safe, should we not, to the best of 
our ability?
    Mr. Barclay. Absolutely, Mr. Chairman.
    Thank you.

                           Prepared Statement

    Senator Shelby. Thank you, Mr. Barclay. We will insert your 
complete statement in the record.
    [The statement follows:]
                Prepared Statement of Charles M. Barclay
    Mr. Chairman and members of the subcommittee: I am Charles Barclay, 
President of the American Association of Airport Executives. I am 
pleased to be here today to present the views of AAAE and the Airports 
Council International-North America (ACI-NA) regarding fiscal year 1998 
appropriations for the Federal Aviation Administration (FAA).
    ACI-NA's members are the local, state and regional governing bodies 
that own and operate commercial service airports in the United States 
and Canada. ACI-NA member airports serve more than 90 percent of the 
U.S. domestic scheduled air passenger and cargo traffic and virtually 
all U.S. scheduled international travel. AAAE is the professional 
organization representing the men and women who manage primary, 
commercial service, reliever and general aviation airports which 
enplane 99 percent of the passengers in the United States.
    To begin our testimony, we would like to thank this subcommittee, 
for its efforts on last year's bill. We recognize that the subcommittee 
was faced with the very difficult task of allocating too few federal 
resources among too many competing demands. We also want to express our 
gratitude for the full committee's decision last year to increase the 
AIP allocation from $1.4 billion to $1.46 billion after $60 million in 
increased outlays were made available as a result of the Congressional 
Budget Office ``scoring'' of the measure. Last year's enacted level for 
the Airport Improvement Program (AIP) of $1.46 billion represented a 
$10 million increase over the previous year. The fiscal year 1997 
enacted level of $1.46 billion represented the first time in five years 
that the program received a funding increase, however modest. We 
recognize that in fiscal year 1998, you will be faced with a similarly 
difficult task in allocating resources.
    Your task was not made any easier by the submission of the 
Administration's proposed aviation budget for fiscal year 1998. Of 
particular concern to the airport community is the proposal to reduce 
funding for the Airport Improvement Program by $460 million in a single 
year--a 31.5 percent reduction! This massive reduction in funding for 
airport safety, security, capacity and noise projects directly 
contradicts the Administration's aviation safety rhetoric. To further 
confuse the situation, less than one week after the submission of this 
budget request, the White House Commission on Aviation Safety and 
Security, headed by Vice President Gore, recommended spending an 
additional $500 million over five years on aviation security capital 
projects. We have yet to understand how these funds would be made 
available and from what source.
    For the past two years, the Administration has recommended an 
artificially low AIP request and Congress has moved to increase funding 
for the program above the Administration's request. Unfortunately, 
Congress must once again restore funding beyond the Administration's 
request if the AIP program is to remain viable and the safety and 
security projects that are needed across the country are to move 
forward.
             investment in airport infrastructure is vital
    In order to achieve the goal of balancing the federal budget by 
2002, Congress must continue to make difficult choices regarding 
hundreds of programs throughout government. Without significant 
entitlement reform, this task moves from the category of extremely 
difficult to nearly Herculean. Airports agree that as a part of this 
process, every program in the federal government needs to be 
``scrubbed'' to ensure that not a single federal dollar is wasted and 
that the return on investment of federal funds is as significant as 
possible. We believe that funding airport infrastructure should, and 
does, score very high on those measures. But we must also remind the 
Congress, that aviation dollars are supposed to be dedicated fees paid 
into the aviation trust fund by the passengers and other users of the 
aviation system for the purpose of funding capital investment in a 
national aviation system. Therefore, every effort should be given to 
fully spending these revenues for the airport and air traffic control 
improvements that are desperately needed.
    Airports are ``economic engines'' that generate and support local 
economic development by providing complete transportation services, 
stimulating business activity and investment, and creating jobs. As an 
example, Mr. Chairman, there are 15,000 jobs on or within 2 miles of 
the Huntsville International Airport and 28,600 indirect jobs. This 
example, of course, is repeated throughout the country many times over.
    Today, the air transportation system is the linchpin of our 
national and local economies, essential to the safe transportation of 
people and goods, both domestically and internationally. As we move 
toward global economic competition, airport capacity in the United 
States is increasingly critical to our national economy. Germany and 
Japan may be our largest economic competitors, but in terms of size and 
geography, each can produce goods and services internally with modern 
systems of roads and railroads. The United States, due to its size and 
geography, must have an efficient, high capacity airport system to move 
its people and resources in order to compete. Ironically, we are in 
danger of seriously under-investing at a time when we can least afford 
it. With the expenditure of discretionary funds so constrained by the 
federal budget, we as a nation should maximize those expenditures on 
investments that will help our economy grow and on aviation facilities 
that will be available for use today, tomorrow and for years to come. 
We must build the infrastructure that will allow not only our 
generation, but our children and grandchildren the opportunity to 
compete and prosper in the global economy.
    Since airline deregulation in 1978, the number of passengers using 
the domestic aviation system has exploded. Last year, around 575 
million passengers were enplaned in the United States. In 1994, 528 
million were enplaned and in 1993, 488 million were enplaned. The FAA 
projects that by 2002, the year we are hoping to achieve a balanced 
federal budget, that number will grow to 740 million and it will go 
over the 800 million mark sometime in 2005.
    Already, we have significant capacity and delay problems in our 
system. Currently, there are 22 airports that are seriously congested, 
experiencing more than 20,000 hours of delay or more per year. These 
delays cost the airlines, alone, over half a billion dollars a year and 
impose tremendous costs and disruptions to millions of passengers and 
businesses. FAA forecasts that unless major airport capacity 
investments are made, this number of congested airports will grow to 32 
in less than 10 years.
    This means that over the next several years, as we move toward a 
balanced budget, we also have to somehow make sure that there is 
sufficient investment in our nation's airport infrastructure to handle 
not only the current passenger traffic but an additional 200 million 
passengers by the year 2002. This will be a major challenge. We as a 
nation cannot afford the billions of dollars in annual delay costs and 
lost productivity to the airlines, air travelers and businesses, nor 
can we afford to weaken our economic competitiveness abroad, by 
settling for an inefficient and inadequate air transportation system.
    Congress has set a target date of balancing the federal budget by 
2002. In this context, it is worth noting that it generally takes at 
least 5-7 years to undertake and complete an airport development 
project. That means that as politically difficult as it may be to 
provide an increase in airport construction funding in today's 
budgetary environment, it is absolutely imperative that Congress do 
just that. Without the increased investment, we cannot realistically 
hope to close the existing investment gap and will have no chance to 
build the infrastructure to meet the increased demand that will be 
placed on the system during this time period. We must act now. If we 
wait, the funding gap will be impossible to close.
[GRAPHIC] [TIFF OMITTED] T12JU12.030

         airport capital development needs continue to go unmet
    ACI-NA and AAAE have conducted numerous surveys to assess the 
capital development funding needs of all airports throughout the United 
States. The latest survey we conducted (in 1996) showed that U.S. 
airports required more than $10 billion each year over a six-year time 
period--at least $60 billion for needed capital improvement and 
capacity expansion projects. Of this $10 billion a year, only 60 
percent ($6 billion dollars) are projects defined as eligible for AIP 
funding.
    These projects are essential to increase capacity, improve safety 
and security, reduce delays for the traveling public, reduce aircraft 
noise for communities surrounding airports, help pay for unfunded 
federal mandates and regulations, and to build and improve facilities 
that will promote air service competition and the industry's economic 
health.
    In April of 1997, the General Accounting Office (GAO) completed a 
report on airport development needs. The results of the GAO validated 
the AAAE/ACI-NA survey results. AAAE/ACI-NA have argued that total 
airport capital development needs in the U.S. are at least $10 billion 
a year; and GAO found $10.129 billion a year. AAAE/ACI-NA have argued 
that of that $10 billion a year, $6 billion is AIP-eligible; and GAO 
found $6.110 billion.
    Still, for some, however, it has become popular to question the 
needs of the airport community. It is instructive to look at the 
numbers. In 1996, the aviation trust fund appropriation for airport 
construction projects (AIP) was $1.46 billion. Local airport passenger 
facility charges generated about $1 billion in 1996. Combine these two 
revenue streams and airports receive less than $2.5 billion dollars of 
the $6 billion dollars needed each year that is acknowledged as 
eligible for federal funding. This is less than half of that total. We 
know of no organization that questions whether there are $6 billion a 
year in AIP-eligible projects (this figure has been corroborated by FAA 
and GAO), although some have an interest in questioning how necessary 
some of these projects are. There should be no question that this is a 
solid figure and these projects are indeed necessary.
    However, for the sake of argument, suppose the airport community 
has overestimated our needs by as much as 25 percent, that would reduce 
the $6 billion figure to $4.5 billion. In that case, AIP and PFC funds 
combined would still be $2 billion less than what is needed. If 
airports overestimated our needs by a whopping 50 percent, the need 
would still be $3 billion, which is $500 million a year below what is 
funded by the combination of AIP and PFC revenue today. The point of 
these examples is to show that arguing over ``needs'' might be a useful 
exercise if the federal government were in a position to double the 
current funding for airport development. At the levels of federal 
involvement that exist today, or those contemplated in the future as a 
result of today's budgetary climate, however, this argument over 
``needs'' misses the mark badly. Rather, it instead appears to be a 
convenient mechanism to provide justification to cut AIP in order to 
fund other programs.
    A similar issue emerges within the FAA allocation. AIP has already 
shouldered a major portion of the funding reductions in the FAA over 
the past four years. We were greatly encouraged two years ago when the 
House Transportation Appropriations subcommittee recommended, and the 
full House approved, a funding level of $1.6 billion for AIP. This 
represented the first funding increase in four years and airports 
believed that if funding reductions were necessary in FAA, they would 
finally come from somewhere other than AIP. We were equally 
discouraged, however, when at the eleventh hour of the process, 
airports lost the proposed $150 million increase in order to fund bonus 
pay for air traffic controllers. Once again, the AIP level was 
negatively affected by other funding priorities within the agency.
                              aip funding
    Mr. Chairman, by any rational measure, airports have lost ground in 
recent years. If Congress permits the AIP program to be reduced 
further, without giving airports additional tools to raise needed 
funds, the national system of airports we enjoy and rely on today will 
be jeopardized. Under the new authorization law passed by Congress last 
year, an AIP appropriation of at least $1.46 billion is necessary to 
avoid triggering across-the-board reductions in entitlement funding to 
primary airports and the allocations to general aviation, reliever and 
non-primary commercial service airports. This $1.46 billion figure is 
approximately a billion dollars below the authorized level, which 
Congress and airports believe is a justifiable level.
    Once again, AIP has been targeted for reduction by the 
Administration. The Administration's request of $1 billion for AIP for 
fiscal year 1998 would severely undermine the integrity of the program. 
Last year's FAA reauthorization legislation passed by Congress modified 
formula allocations in light of today's constrained federal budgetary 
climate. The Administration has submitted a budget proposal with a 
funding level that simply does not work. Below is a chart which shows: 
1) how AIP funds were allocated in fiscal year 1996 under the old 
allocations; 2) how AIP funds are allocated in fiscal year 1997 under 
the new allocations (assuming Congress moves to reinstate the airport 
and airway excise taxes); and 3) how AIP funds would be allocated in 
fiscal year 1998 under the Administration's budget proposal.

                         COMPARISON OF AIP FUNDING IN FISCAL YEARS 1996, 1997, and 1998                         
----------------------------------------------------------------------------------------------------------------
                                                                                Fiscal year--                   
                     Funding category                      -----------------------------------------------------
                                                                  1996              1997              1998      
----------------------------------------------------------------------------------------------------------------
Appropriation limitation..................................    $1,450,000,000    $1,460,000,000    $1,000,000,000
                                                           =====================================================
Primary airports..........................................       428,226,519       525,435,591       392,445,465
Cargo \1\.................................................        38,945,243        36,500,000        18,459,909
Alaska supplemental.......................................        10,672,557        10,672,557        10,672,557
``States'' allocation \2\.................................       159,148,385       270,100,000       136,603,326
Carryover entitlement.....................................        91,056,641        61,866,629        61,866,629
Noise \3\.................................................       181,250,000       143,540,158        20,830,466
Reliever..................................................        48,000,000           ( \5\ )           ( \5\ )
Commercial service........................................        21,750,000           ( \5\ )           ( \5\ )
System planning...........................................        10,875,000           ( \6\ )           ( \6\ )
MAP \4\...................................................        26,000,000        18,521,311         2,687,802
                                                           =====================================================
Small Airport Fund:                                                                                             
    Non-hub airports......................................        58,186,123        61,594,971        46,753,291
    Non-commercial service................................        29,093,061        30,797,485        23,376,645
    Small hubs............................................        14,546,531        15,398,743        11,688,323
                                                           -----------------------------------------------------
      Subtotal Small Airport Fund.........................       101,825,715       107,791,199        81,818,259
                                                           =====================================================
C/S/S/N...................................................       249,187,455       214,179,417       205,961,690
Remaining discretionary...................................        83,062,485        71,393,139        68,653,897
                                                           =====================================================
      Grand total.........................................     1,450,000,000     1,460,000,000     1,000,000,000
                                                           =====================================================
Total percent reduction in entitlements...................             23.26  ................             26.16
----------------------------------------------------------------------------------------------------------------
\1\ Cargo: 3.5 percent in fiscal year 1996; 2.5 percent in fiscal year 1997.                                    
\2\ States: 12 percent in fiscal year 1996; 18.5 percent in fiscal year 1997, including general aviation,       
  relievers and non-primary commercial service airports.                                                        
\3\ Noise: 12.5 percent of total AIP in fiscal year 1996; 31 percent of discretionary AIP in fiscal year 1997.  
\4\ MAP: 2.5 percent of total AIP in fiscal year 1996; 4 percent of discretionary AIP in fiscal year 1997.      
\5\ See ``States''.                                                                                             
\6\ Eliminated.                                                                                                 

    As one can see from the chart, funds for primary airports 
(entitlement allocations based on enplaned passengers) would be 
significantly reduced--by 26.16 percent. Funds for general aviation, 
reliever and non-primary commercial service airports would be reduced 
by an even greater proportion. And of major concern, set-aside funding 
for noise projects would be reduced from $143 million to $20 million! 
As a point of reference, in fiscal year 1996, California and Texas 
received $22 million and $24 million respectively; and 28 of the 50 
states received at least $1 million in noise funding.
    As noted above, at the Administration's proposed level of $1 
billion, entitlement allocations would be cut by 26.16 percent. By law, 
the minimum entitlement allocation is set at $500,000 and the maximum 
allocation is capped at $22 million. This allocation is made by 
formula, based on the number of enplanements at each facility. As part 
of the Administration's budget proposal, non-hub airports would receive 
their full entitlement allocation, which, if adopted, would cause 
entitlement allocations for hub airports to shrink by an even greater 
percentage.
    If one assumes that this proposal is not adopted and instead a 
percentage reduction in entitlement funds are spread evenly across 
airports of all sizes, what would be the result? At the smallest 
primary airports across the country this would have a dramatic impact. 
Rather than receiving the $500,000 at each of these smallest 
facilities, they instead would receive only $369,200 this year--a 
reduction of over $130,000. At airports in places such as Dothan, 
Alabama or Morgantown, West Virginia, it is almost impossible to make 
up for the loss of over $130,000 a year. In the state of Alaska alone, 
there are at least 20 airports that fall into this category, which 
would result in a loss of $2.6 million!
    The implications for somewhat larger airports are equally striking, 
since this 26.16 percent reduction would not be limited to the smallest 
airports. The entitlement allocation received by all primary airports 
would be reduced by this amount. Again, a few examples are illustrative 
of the potential revenue loss. Albuquerque, New Mexico would lose 
almost $400,000. Spokane, Washington would lose almost $300,000. Salt 
Lake City, Utah would lose more than $750,000. Newark International, 
Pittsburgh International and Lambert-St. Louis International would all 
lose over $1 million (attached is a chart comparing selected fiscal 
year 1997 allocations with fiscal year 1998 allocations, assuming a $1 
billion program). And if Congress adopted the Administration's 
requested level and the proposed language protecting entitlements for 
smaller airports, these reductions would be even larger.
    Since the larger airports are almost exclusively user-funded, those 
users who are now paying a portion of their taxes to fund the aviation 
trust fund and its airport capital grants, will now have to pay again 
for the needed improvements. This does not even begin to deal with the 
need to accommodate projected growth at any level. Simply put, current 
funding levels for the AIP program are inadequate to meet the needs of 
the system today, and with every day that goes by, we are falling 
further behind. The airport community needs an AIP funding level around 
$2 billion a year to help fund needed safety, security, capacity and 
noise projects. At minimum, last year's level of $1.46 billion is 
necessary to ensure that we do not fall further behind. We must act now 
to close the gap between the needs of the system and what the federal 
aviation trust fund contributes to meet those needs. Simultaneously, 
Congress must begin to focus on other, non-federal means to enable 
airport operators to generate adequate funds for capital improvement 
projects, to make up for the shortfall in AIP funding and to begin 
bridging the gap between airport funding sources and needs.
    Before closing Mr. Chairman, we also want to bring two additional 
items to your attention. First, we note the importance of the Contract 
Tower program. It is imperative that Congress fully fund and expand the 
FAA Contract Tower program where appropriate. This program enhances 
safety, provides significant savings to the FAA and increases economic 
productivity at the 128 airports that are currently participating in 
the program. The future viability of this program is important, 
particularly in light of the runway collision involving a commuter 
aircraft at a non-towered airport last year in Quincy, Illinois.
    And finally, we are very concerned about the proposal in the 
National Airspace System Architecture to transfer responsibility for 
current and future visual navigational aids, presently owned and 
operated by the FAA, over to the airport community. The existing strain 
placed on airports from shrinking AIP funds leaves no obvious source of 
funding for either the maintenance of the current equipment nor the 
acquisition for replacement technologies as we transition to satellite-
based navigation by the year 2005. Accordingly, we ask the committee to 
prohibit the FAA from taking this action.
    Mr. Chairman, we look forward to working with you and other members 
of the subcommittee and the staff to fashion a bill this year that 
balances the competing needs of the entire transportation community 
fairly. Clearly, it won't be an easy job. We appreciate your leadership 
and I would be happy to respond to any questions you or other members 
of the subcommittee may have.

        AIRPORT IMPROVEMENT PROGRAM ENTITLEMENT COMPARISON CHART        
------------------------------------------------------------------------
                                             Funding levels--           
                                 ---------------------------------------
      State/Member/Airport         Fiscal year 1997    Fiscal year 1998 
                                   at $1.46 billion      at $1 billion  
------------------------------------------------------------------------
             ALABAMA                                                    
Sen. Richard Shelby                                                     
Sen. Jeff Sessions                                                      
Cong. Earl Hilliard:                                                    
    Birmingham..................          $2,145,086          $1,583,932
    Dannelly Field..............             881,741             651,078
                                 ---------------------------------------
      Total, Cong. Hilliard.....           3,026,827           2,235,009
                                 =======================================
Cong. Callahan: Mobile Regional.           1,187,651             876,961
                                 ---------------------------------------
      Total, Cong. Callahan.....           1,187,651             876,961
                                 =======================================
Cong. Bud Cramer: Huntsville                                            
 Intl.-Carl T. Jones Field......           1,472,835           1,087,541
                                 ---------------------------------------
      Total, Cong. Cramer.......           1,472,835           1,087,541
                                 =======================================
Cong. Terry Everett: Dothan.....             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Everett......             500,000             369,200
                                 =======================================
      Total, Alabama............           6,187,313           4,568,712
                                 =======================================
           NEW MEXICO                                                   
Sen. Domenici                                                           
Sen. Jeff Bingaman                                                      
Cong. Richardson:                                                       
    Four Corners Regional.......             550,680             406,622
    Santa Fe County Municipal...             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Richardson...           1,050,680             775,822
                                 =======================================
Cong. Steven Schiff: Albuquerque                                        
 Intl...........................           1,521,611           1,123,558
                                 ---------------------------------------
      Total, Cong. Schiff.......           1,521,611           1,123,558
                                 =======================================
Cong. Joe Skeen:                                                        
    Cavern City Air Terminal....             500,000             369,200
    Roswell Industrial Air                                              
     Center.....................             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Skeen........           1,000,000             738,400
                                 =======================================
      Total, New Mexico.........           3,572,291           2,637,780
                                 =======================================
          PENNSYLVANIA                                                  
Sen. Arlen Specter                                                      
Sen. Rick Santorum                                                      
Cong. Bud Shuster:                                                      
    Altoona-Blair County........             500,000             369,200
    DuBois-Jefferson County.....             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Shuster......           1,000,000             738,400
                                 =======================================
Cong. John Peterson:                                                    
    Bradford Regional...........             500,000             369,200
    University Park.............             620,584             458,239
                                 ---------------------------------------
      Total, Cong. Peterson.....           1,120,584             827,439
                                 =======================================
Cong. Paul Kanjorski: Wilkes-                                           
 Barre/Scranton.................             961,854             710,233
                                 ---------------------------------------
      Total, Cong. Kanjorski....             961,854             710,233
                                 =======================================
Cong. Frank Mascara: Pittsburgh                                         
 Intl...........................           6,487,897           4,790,663
                                 ---------------------------------------
      Total, Cong. Mascara......           6,487,897           4,790,663
                                 =======================================
Cong. Philip English: Erie Intl.             733,273             541,449
                                 ---------------------------------------
      Total, Cong. English......             733,273             541,449
                                 =======================================
Cong. Joseph Pitts: Lancaster...             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Pitts........             500,000             369,200
                                 =======================================
Cong. Paul McHale: LeHigh Valley                                        
 Intl./Allentown................           1,589,513           1,173,696
                                 ---------------------------------------
      Total, Cong. McHale.......           1,589,513           1,173,696
                                 =======================================
Cong. Tim Holden: Reading                                               
 Regional.......................             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Holden.......             500,000             369,200
                                 =======================================
Cong. Joe McDade: Williamsport-                                         
 Lycoming County................             500,000             369,200
                                 ---------------------------------------
      Total, Cong. McDade.......             500,000             369,200
                                 =======================================
Cong. John Murtha:                                                      
    Johnstown-Cambria...........             500,000             369,200
    Westmoreland County.........             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Murtha.......           1,000,000             738,400
                                 =======================================
Cong. Tom Foglietta:                                                    
 Philadelphia Intl. (PFC) \1\...           2,955,343           2,182,225
                                 ---------------------------------------
      Total, Cong. Foglietta....           2,955,343           2,182,225
                                 =======================================
Cong. George Gekas: Harrisburg                                          
 Intl...........................           1,770,965           1,307,681
                                 ---------------------------------------
      Total, Cong. Gekas........           1,770,965           1,307,681
                                 =======================================
      Total, Pennsylvania.......          19,119,429          14,117,786
                                 =======================================
            MISSOURI                                                    
Sen. Christopher Bond                                                   
Sen. John Ashcroft                                                      
Cong. Roy Blunt:                                                        
    Joplin Regional.............             500,000             369,200
    Springfield Regional........           1,246,947            $920,746
                                 ---------------------------------------
      Total, Cong. Blunt........           1,746,947           1,289,946
                                 =======================================
Cong. Karen McCarthy: Kansas                                            
 City Intl......................           1,943,253           1,434,898
                                 ---------------------------------------
      Total, Cong. McCarthy.....           1,943,253           1,434,898
                                 =======================================
Cong. James Talent: Lambert-St.                                         
 Louis Intl. (PFC) \1\..........           3,955,176           2,920,502
                                 ---------------------------------------
      Total, Cong. Talent.......           3,955,176           2,920,502
                                 =======================================
Cong. Kenny Hulshof: Columbia                                           
 Regional.......................             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Hulshof......             500,000             369,200
                                 =======================================
      Total, Missouri...........           8,146,376           6,014,546
                                 =======================================
           WASHINGTON                                                   
Sen. Slade Gorton                                                       
Sen. Patty Murray                                                       
Cong. Norm Dicks: William R.                                            
 Fairchild Intl.................             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Dicks........             500,000             369,200
                                 =======================================
Cong. Doc Hastings:                                                     
    Tri-Cities..................             838,482             619,135
    Grant County................             500,000             369,200
    Pangborn Memorial...........             500,000             369,200
    Yakima Air Terminal.........             583,534             430,882
                                 ---------------------------------------
      Total, Cong. Hastings.....           2,422,016           1,788,417
                                 =======================================
Cong. Jim McDermott: Seattle-                                           
 Tacoma Intl. (PFC) \1\.........           3,526,868           2,604,239
                                 ---------------------------------------
      Total, Cong. McDermott....           3,526,868           2,604,239
                                 =======================================
Cong. Jack Metcalf:                                                     
    Bellingham Intl.............             724,571             535,023
    Friday Harbor...............             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Metcalf......           1,224,571             904,223
                                 =======================================
Cong. George Nethercutt:                                                
    Pullman-Moscow Regional.....             500,000             369,200
    Spokane Intl. (PFC) \1\.....           1,130,710             834,916
    Walla Walla Regional........             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Nethercutt...           2,130,710           1,573,316
                                 =======================================
      Total, Washington.........           9,804,165           7,239.395
                                 =======================================
              UTAH                                                      
Sen. Orrin Hatch                                                        
Sen. Robert Bennett                                                     
Cong. James Hansen:                                                     
    Wendover....................             500,000             369,200
    St. George Municipal........             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Hansen.......           1,000,000             738,400
                                 =======================================
Cong. Merrill Cook: Salt Lake                                           
 City Intl. (PFC) \1\...........           2,942,941           2,173,068
                                 ---------------------------------------
      Total, Cong. Cook.........           2,942,941           2,173,068
                                 =======================================
      Total, Utah...............           3,942,941           2,911,468
                                 =======================================
         NORTH CAROLINA                                                 
Sen. Jesse Helms                                                        
Sen. Lauch Faircloth                                                    
Cong. Cass Ballenger: Hickory                                           
 Regional.......................             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Ballenger....             500,000             369,200
Cong. Eva Clayton:                                                      
    Pitt-Greenville.............             500,000             369,200
    Kinston Regional Jetport....             500,000             369,200
    Craven County Regional......             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Clayton......           1,500,000           1,107,600
                                 =======================================
Cong. Howard Coble: Piedmont                                            
 Triad Intl.....................           2,398,158           1,770,800
                                 ---------------------------------------
      Total, Cong. Coble........           2,398,158           1,770,800
                                 =======================================
Cong. Bob Etheridge:                                                    
    Rocky Mount-Wilson..........             500,000             369,200
    Moore County................             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Etheridge....           1,000,000             738,400
                                 =======================================
Cong. David Price: Raleigh-                                             
 Durham Intl....................           2,984,416           2,203,693
                                 ---------------------------------------
      Total, Cong. Price........           2,984,416           2,203,693
                                 =======================================
Cong. Walter Jones: Albert J.                                           
 Ellis..........................             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Jones........             500,000             369,200
                                 =======================================
Cong. Sue Myrick: Charlotte/                                            
 Douglas Intl...................           6,746,561           4,981,661
                                 ---------------------------------------
      Total, Cong. Myrick.......           6,746,561           4,981,661
                                 =======================================
Cong. Mike McIntyre:                                                    
    Fayetteville Regional/                                              
     Grannis Fld................             816,421             602,845
    New Hanover Intl............             875,246             646,282
                                 ---------------------------------------
      Total, Cong. McIntyre.....           1,691,667           1,249,127
                                 =======================================
Cong. Charles Taylor: Asheville                                         
 Regional.......................           1,113,947             822,538
                                 ---------------------------------------
      Total, Cong. Taylor.......           1,113,947             822,538
                                 =======================================
      Total, North Carolina.....          18,434,749          13,612,219
                                 =======================================
           NEW JERSEY                                                   
Sen. Frank Lautenberg                                                   
Sen. Robert Torricelli                                                  
Cong. Frank LoBiondo: Atlantic                                          
 City Intl......................           1,268,870             936,934
                                 ---------------------------------------
      Total, Cong. LoBiondo.....           1,268,870             936,934
                                 =======================================
Cong. Donald Payne: Newark Intl.                                        
 (PFC) \1\......................           4,065,241           3,001,774
                                 ---------------------------------------
      Total, Cong. Payne........           4,065,241           3,001,774
                                 =======================================
Cong. Chris Smith: Mercer County             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Smith........             500,000             369,200
                                 =======================================
      Total, New Jersey.........           5,834,111           4,307,908
                                 =======================================
          WEST VIRGINIA                                                 
Sen. Robert Byrd                                                        
Sen. Jay Rockefeller                                                    
Cong. Alan Mollohan:                                                    
    Benedum.....................             50O,000             369,200
    Morgantown Muni-Walter L.                                           
     Bill.......................             500,000             369,200
    Wood County/Gill Robb Wilson             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Mollohan.....           1,500,000           1,107,600
Cong. Nick Joe Rahall:                                                  
    Tri-State/Milton J. Ferguson                                        
     Field......................             518,658             382,977
    Greenbriar Valley...........             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Rahall.......           1,018,658             752,177
                                 =======================================
Cong. Robert Wise: Yeager.......             966,732             713,835
                                 ---------------------------------------
      Total, Cong. Wise.........             966,732             713,835
                                 =======================================
      Total, West Virginia......           3,485,390           2,573,612
                                 =======================================
            MARYLAND                                                    
Sen. Paul Sarbanes                                                      
Sen. Barbara Mikulski                                                   
Cong. Roscoe Bartlett:                                                  
 Washington County Regional.....             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Bartlett.....             500,000             369,200
Cong. Gilchrest:                                                        
    Baltimore-Washington Intl.                                          
     (PFC) \1\..................           2,374,189           1,753,101
    Salisbury Wicomico County                                           
     Reg........................             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Gilchrest....           2,874,189           2,122,301
                                 =======================================
      Total, Maryland...........           3,374,189           2,491,501
                                 =======================================
             NEVADA                                                     
Sen. Harry Reid                                                         
Sen. Richard Bryan                                                      
Cong. John Ensign:                                                      
    McCarran Intl. (PFC) \1\....           4,O68,437           3,004,134
    North Las Vegas Air Terminal             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Ensign.......           4,568,437           3,373,334
                                 =======================================
Cong. James Gibbons:                                                    
    Elko Municipal-JC Harris                                            
     Field......................             740,592             546,853
    Reno/Tahoe Intl. (PFC) \1\..           1,438,209           1,061,974
                                 ---------------------------------------
      Total, Cong. Gibbons......           2,178,801           1,608,827
                                 =======================================
      Total, Nevada.............           6,747,238           4,982,161
                                 =======================================
            WISCONSIN                                                   
Sen. Herbert Kohl                                                       
Sen. Russ Feingold                                                      
Cong. Ronald Kind:                                                      
    Chippewa Valley Regional....             500,000             369,200
    LaCrosse Municipal..........             673,780             497,519
                                 ---------------------------------------
      Total, Cong. Kind.........           1,173,780             866,719
                                 =======================================
Cong. Gerald Kleczka: General                                           
 Mitchell Intl. (PFC) \1\.......           1,403,510           1,036,352
                                 ---------------------------------------
      Total, Cong. Kleczka......           1,403,510           1,036,352
                                 =======================================
Cong. Scott Klug: Dane County                                           
 Regional-Truax Fld.............           1,704,792           1,258,818
                                 ---------------------------------------
      Total, Cong. Klug.........           1,704,792           1,258,818
                                 =======================================
Cong. David Obey:                                                       
    Central Wisconsin...........             691,410             510,537
    Rhinelander-Oneida County...             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Obey.........           1,191,410             879,737
                                 =======================================
Cong. Thomas Petri: Wittman                                             
 Regional.......................             500,000             369,200
                                 ---------------------------------------
      Total, Cong. Petri........             500,000             369,200
                                 =======================================
Cong. Jay Johnson:                                                      
    Outagamie County............             889,936             657,129
    Austin Straubel Intl........           1,150,107             849,239
                                 ---------------------------------------
      Total, Cong. Johnson......           2,040,043           1,506,368
                                 =======================================
      Total, Wisconsin..........           8,013,535           5,917,194
------------------------------------------------------------------------
\1\ (PFC) indicates a large or medium hub airport is collecting a PFC   
  and 50 percent of the airport's entitlement is returned to the Small  
  Airport Fund.                                                         

                        Statement of Phil Boyer

    Senator Shelby. Mr. Boyer.
    Mr. Boyer. Well, Mr. Chairman, I am going to just submit my 
formal remarks.
    Senator Shelby. They will be made part of the record, 
without objection.

                         How System Is Paid For

    Mr. Boyer. Great. They cover a wide range of topics, but I 
would like to concentrate--we have talked all morning about how 
to do it. I would like to talk just a moment about how we pay 
for it, because there has been an ongoing debate about how we 
do pay for this system. The administration has made it clear in 
this next year's budget $300 million would come from user fees, 
and by fiscal year 1999 that the entire FAA budget would come 
from user fees.
    As you know, I represent the Aircraft Owners and Pilots 
Association. These are the pilots of general aviation aircraft. 
We use the smaller airports, but do use the system on occasion 
that we have talked about all morning.
    Senator Shelby. That fuels a lot of small- and medium-sized 
business, does it not?
    Mr. Boyer. Absolutely. It provides about $44 billion to the 
economy that we were just discussing. And one of our concerns, 
like yours all morning, is safety. Just how safe is a system in 
which you begin to charge for individual uses of the system 
rather than very passively through a passenger ticket tax for 
the airlines, or for our members through a very, very passive 
fuel tax that is paid for at the pump? And with the permission 
of your new clerk and yourself, I would like to illustrate that 
with a short videotape.
    Senator Shelby. You go right ahead, sir.
    [A videotape was played.]
    Mr. Boyer. It is merely a coincidence that Senators 
Lautenberg and D'Amato are really responsible for much of the 
geography that is covered in this short 48-nautical-mile 
flight. But as you can see, in addition to all the cost for the 
fuel tax, the maintenance, the insurance, and the other 
requirements on a general aviation operator, this flight in 
this example using Reason Foundation numbers, these we did not 
invent, would have cost an additional $71.18.
    Senator Shelby. Do you have this in your record today?
    Mr. Boyer. Yes.
    Senator Shelby. Thank you.
    Mr. Boyer. And the critical factor that I think we have 
been talking about all morning--how does this affect safety 
when you begin to pay for a weather briefing, pay for use of 
the instrument system?
    There is one example that you have been very helpful on 
this committee, and that is the pledge of the FAA to charge 
user fees to overlying airports or foreign governments, and 
they were given that authorization, about $75 million, for this 
fiscal year. And the FAA consistently says no, we are not going 
to charge general aviation operators, mainly these would be 
Canadian operators. When they first announced the charges, they 
do have some charges that we cannot even figure out how it 
would be economical to collect them for GA airplanes.
    We applaud this committee, by the way, for its attempt in 
trying to stipulate that your intent when this was established 
was not to charge the small airplanes, and the reason I bring 
this up, even though it is a Canadian problem, is that Canada 
is now setting up their own private air traffic system, and 
they have told us that if you charge our small airplanes we 
will turn around and do the same to you.
    Senator Shelby. They are going to reciprocate.
    Mr. Boyer. That is exactly right.
    Thank you, Mr. Chairman.

                           Prepared Statement

    Senator Shelby. Thank you, Mr. Boyer. We will insert your 
complete statement in the record.
    [The statement follows:]
                    Prepared Statement of Phil Boyer
    Mr. Chairman, my name is Phil Boyer, and I am President of AOPA 
Legislative Action.
    AOPA Legislative Action enjoys the financial support of 340,000 
dues paying members. Together with our affiliated organization, the 
Aircraft Owners and Pilots Association, we promote the interests of 
those who contribute to our economy by taking advantage of general 
aviation aircraft to fulfill their business and personal transportation 
needs. More than half of all pilots in the United States are members of 
AOPA, making it the world's largest pilot organization.
    Mr. Chairman, I am pleased to have the opportunity to offer our 
input in the process of funding our nation's aviation needs. Today I 
would like to offer an overview of our thoughts on funding priorities 
and a promise that we will continue to provide our input and support 
during the appropriations process.
    I would like to begin with our views on charging user fees for FAA 
services in the context of the President's fiscal year 1998 budget 
request. Then I would like to discuss the most pressing appropriations 
issues we have identified at this time--clarifying the intent of 
Congress with regard to foreign aircraft overflight fees, funding the 
Airport Improvement Program in an era of declining federal budgets, 
continuing transitional funding of Loran as a backup to the Global 
Positioning System, and assuring a smooth transfer of the aeronautical 
charting function between government agencies.
    The FAA, Congress, and the aviation community have all spent many 
years struggling with the airway system modernization effort. In the 
last two years, both the FAA and Congress have completed several 
worthwhile initiatives that will move modernization forward.
    Thanks to the Subcommittee's leadership, Mr. Chairman, Congress 
adopted legislation freeing the FAA from most federal personnel and 
procurement rules. Because of these reforms, the FAA is now equipped to 
transform itself into a more efficient and effective agency.
    With these significant advances in place, the debate concerning 
airway modernization has shifted prematurely from ``how to do it'' to 
``how to pay for it.'' Dictated by the goal of balancing the federal 
budget, the FAA, Congressional leaders, and the industry have already 
begun considering the financing issue. To the extent funding will be a 
problem in the future, what will be needed are innovative approaches, 
not drastic, hasty solutions.
    Yesterday, the House Ways and Means Committee began consideration 
of the tax component of the reconciliation legislation. Chairman 
Archer's package includes some restructuring of the aviation excise tax 
structure. However, the mark is more notable for what it does not 
contain. It does not include drastic new user fees; instead, it allows 
general aviation to continue to contribute to the aviation trust fund 
through the taxes on aviation gasoline and jet fuel. The message is 
clear: the Administration's request for user fees is way out of line. 
We hope this Committee will follow suit by rejecting the $300 million 
in user fees the Administration proposes in its budget request for 
fiscal year 1998.
                        faa funding is adequate
    Last year, this Committee established and provided funding for the 
National Civil Aviation Review Commission (NCARC) to seek a rational 
solution to the FAA's funding needs. However, the Clinton 
Administration chose to brush aside this Committee's reasonable and 
rational approach to the question of future funding needs of the FAA. 
Instead, the Administration has jumped the gun by requesting $300 
million in new unspecified user fees for fiscal year 1998 and a 100 
percent user-funded system in the following fiscal year.
    By prejudging the work of the NCARC, and failing to appoint a 
general aviation representative to the Commission as the law required, 
the Clinton Administration is cynically ignoring the will of the people 
as expressed through Congress. This Administration is determined to 
impose destructive new fees on the aviation industry before finding any 
evidence that they are needed. The Administration has put the cart 
before the horse. For more than a quarter of a century, user excise 
taxes have adequately funded our aviation transportation system and 
generated a surplus for the aviation trust fund. The steady, reliable 
source of revenue allowed this Committee to adequately fund the FAA 
during that time. Thanks to this Committee, we enjoy the safest and 
best aviation system in the world.
    User fees are nothing more than new taxes. As the representative of 
the interests of general aviation pilots and aircraft owners 
nationwide, we are obviously concerned about the tremendous impact user 
fees would have on our members. In fact, a closer examination of the 
budget proposal shows the Administration also proposes to change the 
definition of ``user fee'' to one which no longer holds a direct link 
between the fee and the service rendered.
    However, my concern extends beyond our own members and their 
pocketbooks. User fees would bring with them substantial liabilities 
that would upset the entire air transportation system. Any system of 
direct charges to users is sure to require a large and costly 
bureaucracy to collect, a politicized system for setting the fees, and 
possible threats to safety because of the unavoidable disincentive 
raised by imposing user fees. And we would oppose any mechanism that 
reduces the essential role of this Committee in the process of 
providing resources to the FAA and setting its spending goals and 
priorities.
    The original justification the Administration used for requesting 
user fees was a scare tactic--the FAA claimed it would experience a $12 
billion shortfall as Congress moved to balance the budget by 2002. We 
are now two years into that seven-year budget-balancing process, and I 
would like to pose some questions for the Administration. Has the 
Appropriations Committee failed to provide the FAA with adequate 
funding since it proclaimed the $12 billion crisis? Has the 
Appropriations Committee ever failed to provide the FAA with adequate 
funding? The answer to both questions is, ``No.''
         current aviation tax structure is most cost-effective
    At the request of AOPA Legislative Action, the House Treasury 
Appropriations Subcommittee requested detailed information from the 
Internal Revenue Service (IRS) as to the exact costs of administering 
the current aviation excise tax system. We think the information 
provided by IRS is significant and cautionary in terms of establishing 
a fee based collection system. As you may know, Internal Revenue Code 
sections 4261 and 4271 impose the taxes on air transportation. In 
fiscal year 1996, less than 24 full time equivalents (employees), 
costing the Internal Revenue Service approximately $1.7 million, 
certified collections of aviation transportation taxes. That's over 
$5.5 billion raised with $1.7 million!
    We think any new funding system that replaces the excise taxes 
should not exceed this $1.7 million collection cost. However, I can say 
with confidence that user fees wouldn't come close. In fact, the FAA 
says it will require $1 million a year alone to collect the $75 million 
in fees on foreign aircraft that fly over U.S.-controlled territory 
that it began charging last month. Imagine translating that $75 million 
to $8 billion or more--the amount needed for a 100 percent user fee-
funded system, and you get $160 million in collection costs, which is 
100 times the cost of collecting the excise taxes. In Europe, simple 
user fees based on weight and mileage are charged on en route traffic. 
Yet even these relatively easy-to-calculate fees can cause six month 
delays in billing. The Administration contemplates a much more 
complicated user fee scenario.
    Consistent with the goal of a balanced budget, we think there are 
constructive and honest ways to deal with any funding problem which may 
arise in the outyears. One of our ideas is called ``Linked Financing.'' 
Instead of using fancy new definitions and complex scoring changes, and 
handing the FAA a blank check as user fees would do, Linked Financing 
works within the traditional tax and appropriations structure and 
existing congressional budget procedures to provide FAA with the 
resources it needs.
                            overflight fees
    Another important issue that has emerged recently is the 
implementation of fees for foreign aircraft which fly over the U.S., 
but neither take off from nor land on U.S. soil. The Committee allowed 
FAA to develop an overflight fee schedule as part of the fiscal year 
1997 bill. Most foreign countries charge a modest fee when U.S. or 
other airliners fly over their airspace, so the Act took advantage of 
this untapped source of revenue.
    The resulting overflight fee schedule developed by the FAA includes 
overflight fees for general aviation flights in addition to commercial 
flights. While the law does give the FAA latitude in deciding which 
overflight costs may be recovered, we do not believe this Committee 
intended to require fees for international overflights by general 
aviation aircraft.
    There is clear evidence that Congress did not intend to impose 
overflight fees on general aviation. The Congressional intent of the 
legislation was demonstrated in floor debate, which was limited solely 
to discussion of fees on commercial air carriers. At no time were fees 
on general aviation discussed.
    On April 16, 1997, the leadership of the House Transportation and 
Infrastructure Committee, and its Aviation Subcommittee, wrote to 
Acting FAA Administrator Barry Valentine. In the letter, they said 
``[i]mposing a fee on general aviation was certainly not our focus when 
we drafted the Federal Aviation Administration Reauthorization Act.''
    On April 30, 1997, this Committee adopted an amendment offered by 
Sen. Gorton to the fiscal year 1997 emergency supplemental 
appropriations bill which amends Public Law 104-264 to exempt GA from 
foreign overflight fees. The amendment was later dropped in conference 
for technical reasons.
    An overflight fee levied on general aviation would likely provide 
only a tiny proportion of the total revenue generated by the fees, and 
even the FAA admits that such fees could have serious safety 
implications. We request the continued assistance of this Committee in 
clarifying for the FAA that Congress did not intend that foreign 
overflight fees be levied on general aviation aircraft.
                      airport improvement program
    Let me turn now from the general funding issue to a specific 
program that is bound to experience significant changes. The Airport 
Improvement Program is a model of success for federal involvement in 
national transportation infrastructure improvements. AIP is an 
important program that must continue as a means of ensuring a national 
system of public airports able to connect rural America with the larger 
commercial service airports in major metropolitan areas.
    The Airport Improvement Program also offers an opportunity for 
significant savings. With perhaps as little as $1 billion annually, 
coupled with increased reliance by primary airports on Passenger 
Facility Charges (PFC's) and other financing resources, a refocused AIP 
program would more efficiently address the financial needs of non-hub 
commercial service and general aviation airports providing vital 
community access to the air transportation system. We believe this 
approach offers the most cost-effective use of shrinking federal funds.
    As you know, overall AIP funding levels have declined steadily 
since 1992. During the same period that aggregate AIP grants have 
declined, the proportion of that aid received by the large primary 
airports increased from less than a third in the 1980's to three-
quarters of total AIP funding in 1994--all at a time when larger 
airports began tapping into the substantial potential of locally 
imposed passenger facility charges.
    Funding of large primary airports at this increasingly higher level 
is coming at the expense of the smaller non-hub and general aviation 
airports which communities depend on as their link to the air 
transportation system. However, these smaller airports have the least 
access to other sources of capital. Most primary airports can and do 
levy passenger facility charges, and PFC revenue accounts for a greater 
and greater share of primary airport resources. Large airports also can 
finance capital improvements through bond issues.
    For these reasons, we believe the Committee should consider 
refocusing the priorities of the Airport Improvement Program by 
allowing large airports to increase the PFC amount they charge and 
targeting remaining AIP funds to help smaller airports meet their 
needs.
                                loran c
    AOPA Legislative Action appreciates the Committee's strong support 
in recent years for steps prompting action on initiatives to take 
advantage of the substantial investment made by the federal government 
and users in Loran C and the compatibility the technology has with the 
Global Positioning System (GPS). Loran is a well-proven, cost-
effective, and highly reliable system. In view of uncertainties about 
the Coast Guard budget, there has also been bipartisan support in 
Congress for the DOT to consider joint, shared funding arrangements 
among the various modes that benefit from the use of Loran technology.
    AOPA Legislative Action is among the most vocal advocates of an 
early transition to GPS as the sole means of aerial navigation. 
However, we believe it is essential that Loran be available until it is 
proven that GPS can meet the sole-means-of-navigation requirement. 
Recent developments have indicated that reliance on GPS as the sole 
means of navigation will be further delayed. Nevertheless, some DOT and 
FAA officials to advocate early termination of Loran. This Committee 
has been explicit in its direction to the DOT and FAA regarding the 
need for Loran, but DOT, FAA, and other agency officials refuse to 
listen. Users clearly want Loran to back up GPS, but these same 
officials seem willing to ignore safety and the strong backing of 
virtually every segment of the user community.
    We want to emphasize the importance of continuing funding for 
operating and upgrading Loran. The Loran system is a cost-effective 
complement to GPS. It is compatible with GPS and can easily serve as a 
backup navigation technology in the event of any GPS problems. It would 
be short-sighted to place all our hopes on GPS without such a backup. 
Since Loran equipment is already installed in more than 100,000 general 
aviation aircraft, it is the most logical choice.
    We appreciate the Committee's previous support for our position 
regarding Loran. We hope the Committee will again support continued 
funding of Loran, with funding shared among agencies of the DOT.
                    transfer of aero charts function
    As you know, AOPA Legislative Action has urged special attention to 
aeronautical charting improvements several times during the past 
decade. We have targeted specific charting enhancements which improved 
the utility of aeronautical charts and ultimately translated into a 
safer flying environment for general aviation pilots. Thanks to the 
past efforts of this Committee, funding was secured on several 
occasions to ensure that FAA could implement these enhancements and 
enable the pilot community to realize direct and immediate safety 
benefits.
    We are now working cooperatively with the FAA, DOT and the National 
Oceanic and Atmospheric Administration (NOAA) to address a more general 
problem which has threatened to force the elimination of at least some 
important aeronautical charting products altogether. While FAA 
determines most of the content and format of aeronautical charts, the 
charts themselves are actually produced and distributed by NOAA. 
Serious funding shortfalls during the past several years have caused 
the agency to reexamine its mission and priorities, and the 
aeronautical charting function has been directly impacted. In the past, 
we have successfully worked through the appropriations process to 
develop short-term fixes for NOAA's funding needs. Now, we hope we can 
work with the Committee to find a long-term solution for this problem.
    Acting in response to an investigation of this issue by the 
Inspectors General of the Departments of Commerce and Transportation, 
the fiscal year 1998 Administration request proposes to transfer 
responsibility for producing and distributing aeronautical charts from 
NOAA to FAA in a two-step process. In fiscal year 1998, the 
Administration proposes that NOAA operate the program for FAA on a 
reimbursable basis, with the program being completely transferred to 
the FAA in fiscal year 1999. Others suggest that the program be 
relocated to the Department of Transportation or other agencies. AOPA's 
priority is to continue to provide the high quality charting services 
that our members have relied upon for many years.
    If the charting program is transferred from NOAA to another agency, 
there will be transitional issues which must be worked out between the 
two agencies and in Congress. It would require authorizing legislation 
and other adjustments at the beginning of the budget process before a 
transfer can occur. We know that there will be significant concerns 
about the source of funding for the program if it is transferred to 
another agency. We want to work with you to ensure that adequate 
funding is provided, whether from this Subcommittee or from the 
Commerce and Justice Subcommittee, so that the receiving agency does 
not have to absorb any additional costs.
                                summary
    To summarize, AOPA Legislative Action believes that the current 
aviation excise tax system is sufficient to adequately fund the FAA, 
making user fees unnecessary. We urge the Committee to reject the 
Administration's request for user fees.
    We urge the Committee to continue to provide the necessary 
resources to small airports, especially those that lack alternative 
sources of revenue.
    We request the assistance of this Committee in clarifying for the 
FAA that Congress did not intend that foreign overflight fees be levied 
on general aviation aircraft.
    We hope the Committee will again support continued funding of Loran 
as a backup for GPS.
    Finally, we want to work with the Committee to ensure that adequate 
funding is provided, whether from this Subcommittee or from the 
Commerce and Justice Subcommittee, for the proposed transfer of aero 
charting functions from NOAA so that the receiving agency does not have 
to absorb any additional costs if the transfer is carried out.
    That concludes our testimony. I appreciate the opportunity to 
present our views to the Committee. AOPA Legislative Action is pleased 
to remain involved in the appropriations process throughout the 
congressional session, and we will gladly offer further comments on 
specific funding items as the need arises.

                       Statement of Edward Bolen

    Senator Shelby. Mr. Bolen, of the General Aviation 
Manufacturers Association.
    Mr. Bolen. Thank you, Mr. Chairman, and I am going to be 
brief and submit my statement for the record.
    Just to follow up on a couple of things, you and Mr. Boyer 
talked a little bit about the importance to general aviation 
and the development it brings to small and rural communities.

                        User Fees and Fuel Taxes

    Senator Shelby. We talked a little, but I believe it is 
very, very important to America and to our economy. There are a 
lot of airports in America that serve small- and medium-sized 
cities that the only air traffic in there is business planes, 
small- and medium-sized business planes that are so important 
to the local economy, and the companies that operate in and 
out.
    Mr. Bolen. And not only do they help drive the economies in 
a lot of these small and rural communities, general aviation is 
also a primary training ground for the commercial airlines. And 
it also is an industry in the United States that contributes 
positively to our Nation's balance of trade. So it is a very 
vital segment of a very vital air transportation system.
    I guess the point that I would like to make is that general 
aviation, the entire general aviation community, feels very 
strongly that we should pay to use our national air 
transportation system. And we feel that the way we pay now, 
which is through a fuel tax, is the best, and we would like to 
see it be the only way that general aviation contributes.
    Senator Shelby. It has worked, has it not?
    Mr. Bolen. It has worked.
    Senator Shelby. And it is uniform.
    Mr. Bolen. And it combines with the general fund 
contribution, which helps cover the military's cost of using 
the system, cover some of the safety and regulatory costs of 
the FAA, and it reflects the public benefit that is inherent in 
this air transportation system. And those two mechanisms are 
just very, very good.
    As Phil mentioned, the general aviation community very much 
opposes user fees to either supplement or replace the current 
fuel tax system. And I think Phil's video was very, very good, 
but I would like to follow that up. That is something that was 
based very much on the real world.
    I submitted as a part of my testimony a letter I received 
from a French pilot. And that French pilot talked about some of 
the charges he has. In addition to the ones that we saw in the 
video tape he also has noise charges and lighting charges and 
ramp charges, it goes on and on. And the conclusion of the 
French pilot are an unbearable impediment to the development of 
general aviation in France, that it is depressing businesses 
there, that it is making aviation more and more only for the 
very wealthy, and his admonishment to us was I hope the 
Americans will fight hard against these user fees, because if 
they do not, general aviation will be grounded. And I think not 
only from that perspective, Phil talked a lot about the safety 
perspective, and I think that is very important. The FAA itself 
has stated that user fees can have the potential to discourage 
safety.
    I would like to just relate a story that was told by the 
chairman of GAMA last year at our industry review when he 
talked about when he was flying in Germany, which does have 
user fees, and he went up with a young student pilot and they 
were going to practice touch and go's, practice takeoffs and 
landings. And he went up with the pilot and they came down, and 
when they got within a few feet of the runway they began to 
ascend. And he did not want to be rude, so he did not say 
anything, but when it happened again he said, you know, we are 
here to practice takeoffs and landings. Why are we not touching 
down? And the woman pilot said, well, in Germany we charge 12 
marks every time the wheels touch the ground, so we do not 
really put them down here. We try to get virtual takeoffs and 
landings. And, Mr. Chairman, that is just not in the best 
interest of safety.
    Senator Shelby. Slipshod training, is it not?
    Mr. Bolen. Absolutely. And the ramifications are very 
serious.
    I think also when you look at fuel taxes versus user fees 
from the Government's point of view, the current excise taxes 
are very efficient to collect. They do not have a lot of 
collectors, administrators, auditors, you are not trying to 
collect from 600,000 pilots and 180,000 planeowners. You are 
simply collecting from a handful of fuel companies.
    Senator Shelby. Would the user fees raise more revenue, or 
would our current system raise more revenue?
    Mr. Bolen. Well, I think our current system can more 
efficiently raise revenue than a user fee. There has been a 
study that was done. We are currently spending--the FAA 
currently spends, I believe it is $1.7 million to collect $5.5 
billion in excise taxes. To collect $75 million in foreign 
overflight fees, the fees that Phil talked about, they are 
going to spend $2 million to set up the system, and another $1 
million a year to collect it. So just from an efficiency 
standpoint, that is very clear. And as I mentioned, we also 
have, with a lot of taxes in the United States, a compliance 
problem. You do not have that problem with fuel taxes.
    We have a system in Europe where actually software is sold 
to help people negotiate around some of the places where the 
charges are the highest.
    Senator Shelby. How to beat the system.
    Mr. Bolen. Yes; and then from a taxpayer's point of view, 
we really like the fuel taxes because they are easy to 
understand, there is not a lot of paperwork, they are not 
intrusive, and they are not subject to bureaucratic 
manipulation. In the area of certification, where my 
manufacturers deal a lot, the foreign governments that charge 
certification fees, because they are paid on an hourly and per 
person basis, they often take in Europe much longer to complete 
the task and use a lot more people to complete the task than 
they do here in the United States. They simply are manipulating 
the fees that are coming in. And then they have got flat fees, 
they are raising them much faster than the rate of inflation.
    So I do not want to take a lot of your time, but we believe 
and feel very strongly that the fuel taxes are the best method, 
and we would like to see them remain the only method.

                           Prepared Statement

    Senator Shelby. Thank you, Mr. Bolen. We will insert your 
complete statement in the record.
    [The statement follows:]
                 Prepared Statement of Edward M. Bolen
                              introduction
    Mr. Chairman, Senator Lautenberg and members of the subcommittee, 
thank you for the opportunity to testify today. My name is Edward M. 
Bolen, and I am President of the General Aviation Manufacturers 
Association (GAMA). GAMA represents 53 general aviation aircraft, 
engine, avionics and component parts manufacturers throughout the 
United States.
                            general aviation
    As this subcommittee well knows, general aviation is defined as all 
aviation other than commercial and military aviation. It is the 
backbone of our air transportation system and is the primary training 
ground for the commercial airline industry. It is also an industry that 
contributes positively to our nation's balance of trade.
    General aviation aircraft range from small, single-engine planes to 
mid-size turboprops to the larger turbofans capable of seating as many 
as 19 passengers. These planes are used for everything from emergency 
medical evacuations to border patrols to fire fighting. They are also 
used by individuals, companies, state governments, universities and 
other interests to quickly and efficiently reach the more than 5,000 
small and rural communities in the United States that are not served by 
commercial airlines.
                         state of the industry
    Given the importance of general aviation to our nation and its 
economy, it is a pleasure for me to be able to report that the industry 
is healthier today than it has been in well over a decade. The action 
taken by Congress to revitalize the industry by limiting the product 
liability exposure of manufacturers is working. Employment and 
production are up at virtually all of GAMA's member companies. More new 
models of general aviation aircraft will be introduced to the market 
between now and the year 2000 than were introduced in the past ten 
years. Our companies are investing in plants and equipment and new 
research and development projects. Several are working with NASA to 
develop a new generation of aircraft engines. In addition, the industry 
has just begun the largest program in aviation history designed to 
generate new student pilots--GA TEAM 2000.
                    general aviation and faa funding
    The Clinton Administration has proposed that the Federal Aviation 
Administration (FAA) be given the authority to raise $400 million of 
its total fiscal year 1998 budget from ``user fees.'' Approximately 
$100 million in user fees are to come from an expansion in the current 
FAA charges on foreign overflights. The Acting FAA Administrator has 
indicated that at least a portion of the remaining $300 million in user 
fees would come from some type of charge on ``turbine-powered general 
aviation.''
    The grant of fee authority to the FAA represents a very serious 
threat to the future of general aviation in the United States. For that 
reason, the industry is asking the subcommittee to deny the 
Administration's request and instead, continue to fund the FAA through 
a combination of aviation excise taxes and the General Fund 
contribution.
    Mr. Chairman, general aviation currently pays a 21.9 cent per 
gallon federal tax on jet fuel and a 19.4 cent per gallon federal tax 
on aviation gasoline. These taxes are universally supported by 
industry. In fact, the entire general aviation community believes that 
the general aviation fuel taxes are the BEST, and should be the ONLY 
mechanism through which the users of general aviation fund the Federal 
Aviation Administration.
    The general aviation community is also united in its support for a 
continuation of the General Fund contribution to help fund such things 
as the FAA's safety and regulatory functions. For decades, Congress has 
recognized that a strong and safe air transportation system benefits 
all members of the general public regardless of whether or not they 
ever set foot on an airplane. That ``public benefit'' has been 
consistently reflected in the contribution of General Fund revenues 
toward FAA operations.
    The strength of general aviation's support for fuel taxes and a 
continued General Fund contribution is matched only by the strength of 
its opposition to user fees. This opposition is not based merely on 
philosophy but real world experiences that have clearly demonstrated 
the negative impact fees have on general aviation.
    Attached to my testimony is a copy of a letter that was recently 
faxed to me by a general aviation pilot in France. It is an 
extraordinary letter that I hope every member of the subcommittee will 
take time to read. The letter describes the fees this pilot is 
confronted with in France, including noise fees, lighting fees, ramp 
fees, en route fees, approach fees, etc.
    The pilot says that the ever growing list of fees are ``an 
unbearable obstacle to development of general aviation and air commerce 
in France and in Europe.'' He goes on to say ``The aviation businesses 
are heavily depressed and a number of pilots, flight schools, aircraft 
sales and air carriers are disappearing at a dangerous rate. Aviation 
is more and more reserved to the wealthiest people.''
    The letter concludes with the pilot saying ``I hope that Americans 
involved in aviation understand how important it is to fight hard 
against these proposed user fees. If implemented, these charges may 
ground them sooner than the expectation.''
       why general aviation fuel taxes are better than user fees
    At GAMA, we agree with the French pilot that the general aviation 
fuel taxes are better than user fees.
    From a Safety Perspective:
  --Fuel Taxes Do Not Adversely Impact Safety. According to the FAA, 
        user fees can discourage the safe practices of pilots (see 
        Federal Register, March 20, 1997). For example, if user fees 
        are charged for weather updates, talking to control towers or 
        filing flight plans, some pilots will seek to avoid the fees by 
        refusing these services. The general aviation fuel taxes do not 
        discourage safe practices.
    Last year, at GAMA's Industry Outlook Press Conference, the 
President of Jeppesen, Horst Bergmann related one of his experiences 
with user fees in Germany. Mr. Bergmann was flying with a young general 
aviation pilot who announced that she wanted to practice her takeoffs 
and landings. Mr. Bergmann said the airplane descended to just a couple 
of feet above the runway and then began to ascend. Miffed, Mr. Bergmann 
asked the pilot why she did not touch down. She responded, ``In 
Germany, there is a 12-mark charge if your wheels hit the ground, so 
people here don't really touch down when practicing takeoffs and 
landings.'' From a safety standpoint, we want people to put their 
wheels on the ground when practicing takeoffs and landings. ``Virtual 
landings'' are not in the best interest of safety.
    From the Government's Perspective:
  --Fuel Taxes Are Inexpensive For The Government To Administer. The 
        government collects the fuel taxes from a handful of fuel 
        companies rather than 600,000 pilots and 180,000 aircraft 
        owners. This allows the taxes to be collected without a large 
        and expensive bureaucracy of collectors, administrators, 
        auditors and accountants.
    Just last year, the country of Mexico announced that it found the 
administration and collection of user fees to be so complex and 
expensive that it was replacing its system of user fees with a fuel 
tax.
  --Fuel Taxes Are Difficult for Taxpayers to Avoid. Because the fuel 
        taxes are included in the amount charged for fuel, compliance 
        with the tax is extremely high. This is not the case with user 
        fees.
    Earlier I referenced Mr. Bergmann, the President of Jeppesen, 
regarding safety. It is also worth noting when discussing user fees 
that Mr. Bergmann also mentioned a service his company provides which 
shows companies the routes they can take when flying in Europe to 
minimize user charges. In other words, his company has found a market 
niche helping people avoid user fees.
  --Fuel Taxes Approximate Use. There is no more simple and accurate 
        way to distinguish between heavy and light users of the system 
        than to measure the amount of fuel burned.
    From the Taxpayer's Perspective:
  --Fuel Taxes Are Easy to Pay. Unlike fees, paying the fuel taxes is 
        not an administrative hassle or paperwork nightmare. The taxes 
        are simply included in the price of the fuel and paid at the 
        time of purchase.
  --Fuel Taxes Are Well Established. The general aviation fuel taxes 
        have been in existence since 1970 and they have proven to be 
        reliable revenue generators. Today, the entire general aviation 
        community believes the fuel taxes are the best way for our 
        industry to contribute to the funding of the Federal Aviation 
        Administration.
  --Fuel Taxes Are NOT Subject to Government Manipulation. In some 
        foreign countries, the civil aviation authorities charge for 
        their services with a per person and/or a per hour fee. When 
        this happens, it is not unusual for government to use more 
        people than necessary and take longer than necessary to 
        complete the task. Governments which charge a flat fee for a 
        service tend to raise the fee faster than the rate of 
        inflation.
                certification in a user fee environment
    One particular type of user fee that GAMA member companies have had 
to deal with repeatedly is the certification fee. As a result, I would 
like to focus some of my comments today on that important regulatory 
process.
    Since 1926, the Federal Aviation Administration or one of its 
predecessors has been charged with ``certifying'' the manufacture of 
all aviation products. FAA certification does not signify that a given 
product is better than the competition or even safer than the 
competition. Instead, its sole purpose is to ensure that aviation 
products do not pose an unreasonable safety risk to the public.
    Although it is the public--not the manufacturer--who benefits from 
the certification process, those of us in aviation are very interested 
in working with the FAA to constantly improve safety. Consequently, we 
devote a great deal of time and resources to the certification process.
    It is estimated that approximately 90 percent of all costs 
associated with the certification process are borne by the 
manufacturer. According to the Challenge 2000 report by Booz, Allen & 
Hamilton commissioned by the FAA, the agency's Office of Regulation and 
Certification could actually improve safety under a flat or declining 
budget by placing more administrative responsibility for regulatory 
compliance in the hands of those manufacturers with a proven culture of 
safety while maintaining a high level of involvement and oversight in 
key phases of development programs.
    From a practical standpoint, allowing manufacturers to absorb even 
more of the costs of the certification process is preferable to forcing 
them to make cash payments to regulators through user fees. For one 
thing, costs absorbed by manufacturers through delegation cannot be 
manipulated by bureaucrats looking to generate fee revenue. For 
another, it does not put a toll booth between manufacturers and 
regulators when important matters of safety are at stake. Economists 
know that if you place a tax on an activity, an incentive is created 
for less of that activity to occur. Placing a tax on manufacturers for 
sharing information with the FAA will discourage the free flow of 
safety information.
    From a philosophical standpoint, certification is a government 
function that benefits the general public. As such, this function 
should be paid for with general taxpayer revenues. To ask a 
manufacturer that is operating in accordance with all regulations to 
pay for what is, in essence a safety audit, would be similar to asking 
a taxpayer who has prepared his or her returns in a legal manner to pay 
for the cost of an IRS audit.
    A final point on certification fees is that, because manufacturers 
must cover all of their costs of production or go out of business, it 
is the owner/operator that ultimately is forced to pay for all of the 
costs associated with certification. In this respect, certification 
fees would function as a type of Valued-Added Tax (VAT). The owners and 
operators of general aviation aircraft understand this reality and that 
is why they have joined with manufacturers in opposing certification 
fees.
                               conclusion
    General aviation is a vital link in our air transportation system 
and an important engine for our economy. Today, after years of decline, 
the industry is finally on its way to recovery.
    The entire general aviation community believes that the general 
aviation fuel taxes are the BEST, and should be the ONLY mechanism 
through which the users of general aviation fund the Federal Aviation 
Administration. After all, the fuel taxes are well established, they 
closely approximate how much one uses the system, they are easy to pay 
yet difficult to avoid, and they are inexpensive for the government to 
administer.
    Supplementing or replacing the general aviation fuel taxes with a 
new system of ``fees'' could, even according to the FAA, discourage the 
safe practices of pilots. Fees could also restrict the growth of the 
industry in the same manner they have restricted general aviation in 
Europe and the other parts of the world where they have been tried.
    If Congress determines that general aviation needs to pay a larger 
portion of the FAA's costs than it is currently paying, it should work 
with industry to determine what can be done without reversing the gains 
that have been made since passage of the General Aviation 
Revitalization Act. Congress should not, however, give up on a system 
that works and turn to a system that could be anti-growth and anti-
safety.
                                 ______
                                 
       Letter From Remy Bouin, Member, Cessna Owner Organization
                                        Athis-Mons, April 27, 1997.
    Dear Aviation Friends: As a Cessna 172 owner and CPL-IR pilot 
flying in France I am very interested in the debate over user fees 
taking place in the USA.
    France is one of the most active general aviation countries in the 
world (around 10,000 aircraft and 60,000 active pilots for 57 million 
citizens) and the following testimony on what is happening over there 
(and in fact in most European countries) might be of help to those in 
your country fighting against implementation of user fees to fund the 
FAA.
    From the end of WW2 to nowadays France has gradually drifted from 
an aviation system (ATC, Met, airports, regulatory aviation authorities 
. . . etc.) that was entirely funded by taxpayer money to one that is 
almost exclusively paid by aviation users.
    It is not a great surprise to say that this evolution has a very 
negative impact on our aviation industry be it on general aviation or 
on commercial air transportation. Not only because of the higher costs 
that have to be beared by the aviation community but because of the 
fact that the other means of transportation needs have continued to be 
generously paid by taxpayers (discrimination).
    Let me depict more precisely how our aviation system is financed:
    The French equivalent of FAA (called DGAC).--This administration is 
tasked with approximately the same duties as FAA with the exception of 
technical oversight over aircraft maintenance and of aviation weather 
services which are responsibilities of semi-pivatized agencies. French 
FAA is responsible for ensuring En route control, approach control and 
tower control at around 100 airports in the country.
    The budget for this administration in 1997 has been voted at 8 
billion francs (1.40 billion dollars) and is almost entirely funded by 
aviation user fees (that go to the aviation fund) which are mainly:
    En route fees.--Those fees are to be paid by aircraft with MTOW 
over 2,000 Kg (4,400 lb) flying IFR whatever the operation (private or 
commercial). The rate for this fee is a factor of the distance flown 
and MTOW.
    Approach control fees.--Those fees are to be paid by aircraft with 
MTOW over 2,000 Kg (4,409 lb) flying IFR whatever the operation 
(private or commercial) and landing at airports where approach and 
tower control are provided. This fee is established as a factor of 
MTOW. This aviation fund is also fed by an aviation tax on airline 
tickets that is supposedly aimed at financing airport security. It is 
also funded by other fees established for pilot licensing, tie-down and 
hangar at administration-managed airports, avionics annual check . . . 
etc.
    The airports.--Most airports in France are run and funded by 
Chambers of Commerce with the busiest of them receiving subsidies from 
the aviation fund. Consequently these entities are authorized to charge 
very high fees in order to recover their expenses: landing fees, 
lighting fees, ramp fees, hangar fees, handling fees, passenger fees, 
airport re-opening fees (most airports in France are not open 24 hours) 
and fuel fees.
    Oversight of aircraft maintenance and airworthiness.--A civil 
aviation safety agency (GESAC) has been established some years ago to 
cheek aircraft maintenance operations. This agency is authorized to 
establish fees that aircraft owners must pay each time this 
administrative agency signs a paper.
    The noise tax.--This tax is to be paid by aircraft flying out of 
``busy'' airports to the environment protection agency.
    The aircraft property tax.--Must be annually paid to the general 
fund. None of this money is invested in the aviation system. It depends 
on the horsepower and ranges from 175 $ to 2650 $.
    The fuel.--This is one of the most taxed items in this country. 
Currently a 100 LL gallon is priced between 5 $ and 6 $ excluding fees 
that airports are authorized to charge on fuel. These sky-rocketing 
taxes go directly to the general fund and are not used for aviation 
purposes.
    The sales tax on aviation services and products.--It is currently 
set at 20.6 percent and goes directly to the general fund with no use 
for aviation.
    The National Weather Service.--This semi-privatized agency has the 
monopoly on any weather service be it for farmers or aviators. The 
French equivalent of the FAA is not tasked with providing aviation 
weather services to pilots. This administration gives money from the 
aviation fund to the NWS to establish and maintain aviation weather 
services. As the aviation fund is mainly paid by IFR users, met is free 
for them but not for VFR pilots. As an example talking to a briefer 
costs 2 $ plus 0.5 $ each minute spent talking with him.
    These ever growing taxes and fees are an unbearable obstacle to 
development of general aviation and air commerce in France and Europe. 
The aviation businesses are heavily depressed and number of pilots, 
flight schools, aircraft sales and air carriers are disappearing at a 
dangerous rate. Aviation is more and more reserved to the wealthiest 
people and as a consequence tends to be less and less popular amongst 
citizens.
    The fact that VFR flights and IFR flights with aircraft with MTOW 
below 4,400 lb don't pay any en route and approach fees is good and bad 
at the same time:
  --Good because it gives some ``oxygen'' to this part of aviation 
        which is already overwhelmed by aviation taxes.
  --Bad because as this part of aviation doesn't contribute at all to 
        the aviation fund, nothing is done to build and improve general 
        aviation airports. On the 420 public airports in France, only 
        30 percent have an instrument approach and 6 percent are 
        accessible 24 hours.
    Airlines want their fees invested only on the few airports where 
they fly. Moreover our national airspace system and air traffic control 
system are more and more designed to meet the only needs of air 
carriers. IFR route structures don't take into account the problems of 
general aviation IFR flights (icing, low speed, low altitudes . . . 
etc.) and radar services to VFR flights are virtually non-existent.
    New regulations coming soon as mandatory B-RNAV equipment, 8.33 khz 
channel spacing and mode S transponder don't take care of the burden on 
general aviation. Right of general aviation to fly to busy airports 
doesn't exist any more with prohibited access for single engine 
aircraft and implementation of class A airspace.
    Met services are very expensive for VFR pilots and once again are 
mainly designed to meet the needs of airlines. This is certainly one of 
the reasons why general aviation in this country has one of the worst 
accident rates in the world.
    In conclusion on this part, the fact that VFR and light IFR 
aviation is not charged with En route and approach fees means that this 
aviation is only tolerated in this country but should not be too 
demanding because this exemption could be stopped at any time.
    Moreover some airlines are not happy at all that these users don't 
pay ATC fees. They require that each flight whatever the MTOW should 
pay the same cost for the same distance flown because they say the 
burden on the ATC system is the same.
    The implementation of ATC user fees (in 1972 for En route fees and 
1990 for approach fees) and the fact that not a single cent of taxpayer 
money goes to the aviation system has had other bad side effects as for 
example:
  --The bureaucracy implemented to establish the invoices for ATC fees 
        is paid by the users and is extremely expensive. A tax system 
        on fuel, ticket sales and airfreight bills is far more simple 
        and cost efficient.
  --Pilots prefer to fly VFR to avoid IFR fees, which has sometimes 
        dramatic effects.
  --VFR flight is prohibited in more and more airspace, so users are 
        compelled to pay fees (for example airspace above 11,500 Ft in 
        northern France is prohibited to VFR flights since 1992).
  --No airport improvement program which leads to a shortage of runways 
        and terminals. The consequence is that air transportation 
        development is halted by lack of airport slots.
  --Development of air taxi, regional airlines, business aviation and 
        low-cost carriers is very limited because of these fees.
  --Airlines pay the same amount of fees whatever the number of 
        passengers or quantity of freight. So when times are hard to 
        fill aircraft, user fees can literally kill an operator. The 
        ticket tax is fair because it is directly linked to the 
        economic shape of the airline. When times are hard, dues are 
        lower, and when business is good dues are fair.
    Sorry for this long explanation, but here is a real example of the 
costs associated with an IFR typical business trip on a Cessna 340 
between Paris Toussus le Noble executive airport and Toulouse-Blagnac 
airport (300 NM southwest of Paris):
    1. Departure from Toussus le Noble early in the morning: Lighting 
fee=34 $
    2. En route fee for the 300 NM trip: 90 $
    3. Approach fee in Toulouse: 15 $
    4. Landing fee in Toulouse: 32 $
    5. Lighting fee in Toulouse: 32 $
    6. Ramp fee in Toulouse for 12 hours: 3.5 $
    7. Noise fee for departure from Toulouse: 10 $
    8. Lighting fee for departure from Toulouse: 32 $
    9. En route fee back to Paris-Toussus le Noble: 90 $
    10. Approach fee in Paris-Toussus le Noble: 15 $
    11. Landing fee at Toussus le Noble: 13 $
    12. Lighting fee at Toussus le Noble: 34 $
    So this trip costs 368.5 $ in fees and taxes, without the handling 
fees if services of an FBO are used and without the taxes on fuel. The 
same IFR trip on my Cessna 172 costs me 148.5 $ in fees because as 
explained above IFR aircraft below 4,400 lb don't pay ATC fees for the 
time being
    At airports not opened 24 hours, re-opening service costs me 
between $50 and $300 depending on the airport.
    During my flight training for CPL-IR in the USA, I had the 
opportunity to discover the extraordinary quality of your aviation 
system (ATC, airports, weather services, FBO's, flight service stations 
. . . etc.) which is almost everytime provided free. This aviation 
system is probably the best in the world and it seems that the five 
excises taxes financing the Airway and Airway Trust Fund are doing an 
extraordinary great job.
    Of course you do have some problems, but you can be sure that they 
are no problems compared to those aviation people must deal with in 
this country and Europe.
    I really enjoyed your perfect aviation system and I think it would 
be foolish to destroy something that works greatly.
    The U.S. way of funding aviation is for European general aviation 
pilots the living example of the funding system that politicians should 
establish in Europe to foster civil aviation.
    I hope that Americans involved in aviation understand how important 
it is to fight hard against these proposed user fees. If implemented, 
these charges may ground them sooner than they expect.
    I hope this letter brings useful information to you. Do not 
hesitate to contact me if you need more information and testimonies on 
this subject. I wish you good luck in this important battle to keep 
aviation strong in your country.
            Yours faithfully,
                                                        Remy Bouin.

                           User Fees and Tax

    Senator Shelby. Mr. Barclay, your testimony notes that the 
administration has requested only $1 billion for AIP in 1998. I 
might note that the budget request amendment we received early 
this week does not request--does not request--any additional 
AIP funding for 1998. Can you walk the subcommittee briefly 
through what the impact of this cut would mean to the various 
categories of funding within the AIP program?
    Mr. Barclay. I can, Mr. Chairman. If you take a look at 
entitlements first, the amount of money the airports get from 
passengers, those would be cut about 26 percent. In the case of 
Huntsville, that would be about $385,000; in the case of 
Birmingham, about $560,000. Each of the smallest airports in 
the system would lose about $130,000 with that cut.
    Cargo funding would be cut by more than 50 percent. The 
small airport funding, we are talking about the relievers and 
general aviation, would be cut by 50 percent under the current 
formulas.
    Noise is cut 85 percent. Noise funding goes from $143 
million to $20 million for the whole country, and the military 
airport program goes from $18 million to $2 million.
    So the current formulas that we just put into the law in 
the authorizing committees last year simply do not work at the 
$1 billion program.
    Senator Shelby. Mr. Boyer, what are your thoughts, how 
would you feel about a system where the airlines could pay user 
fees directly to the FAA, but general aviation would continue 
to pay the fuel tax which would be appropriated by Congress? 
That is a bifurcated system, anyway.
    Mr. Boyer. That is being debated on several fronts right 
now, and I guess our greatest concern is it sets up two classes 
of users. And as you said, general aviation provides a 
significant benefit, particularly for rural areas. But what 
happens then if one group of people pay through a fuel tax, 
others pay these user fees, first of all, I have never seen 
anything stet, so therefore Congress would someday perhaps look 
and say, well gee, this group is not paying user fees, perhaps 
we can raise more money this way, so there is an obvious trend 
toward that that occurs.
    The other thing that could happen is we would have two 
classes of users and we would begin to look at areas in which 
we would begin discriminating against those users. Well, you 
cannot use this airspace because you only pay a fuel tax, you 
do not pay a user fee.
    I think our country has worked, as you have said, for 30 
years, 20 years under deregulation, under the present system of 
a passenger ticket tax, for those who pay----
    Senator Shelby. It has worked has it not?
    Mr. Boyer. That is right.
    Senator Shelby. Yesterday, the House Ways and Means 
Committee began consideration of the tax component of the 
reconciliation bill. Mr. Boyer are you supportive of the 
committee's approach to alternatives to the ticket tax and its 
treatment of general aviation?
    Mr. Boyer. Well, to put it backward, we certainly support 
their treatment of general aviation. It goes along with the 
theory of a fuel tax is efficient. And they have taken a 
creative approach to how to fund the system, keeping in place a 
passenger ticket tax modified with a head fee.
    It is up to Congress to debate that, but what it does not 
do is set up two classes of users, or user fees versus fuel 
tax. So therefore, we applaud their efforts at this point and 
continue to watch the debate.
    Senator Shelby. I understand from your comments, Mr. Bolen, 
that you favor the general aviation tax that we just went 
through. However, since you represent here today general 
aviation manufacturers, would it be accurate to say that the 
manufacturers do not pay the fuel tax and therefore do not 
contribute to the funding of the FAA?
    Mr. Bolen. Let me make two comments on that, sir. First of 
all, the manufacturers already assume about 90 percent of the 
cost related to the certification process. We do that through 
administrative stuff and through staffing. So we are already 
bearing the brunt of 90 percent of the cost of the 
certification process. So that is being paid.
    Senator Shelby. That is a lot of safety there, is it not?
    Mr. Bolen. Yes; but I would also like to point out that 
obviously as manufacturers we have got to pass along the cost 
of doing business or cease to exist. If we do not charge enough 
for our products to cover the cost of creating them, we go out 
of business. And that is something that the pilots, represented 
here by Mr. Boyer, understand, and they have been supportive of 
this, as well.
    If you try to go back and build in cost on the 
manufacturers, it in essence works as a value-added tax for the 
customers at the end of the day. And they do not want to pay it 
that way, we do not think it is the best way, and we also do 
not think it is in the interest of safety, because what those 
fees would end up doing is putting a tollbooth between 
manufacturers and regulators, and anyone will tell you, if you 
tax something you are going to get less of it, and we do not 
want to reduce that communication between manufacturers and 
regulators.

                          Subcommittee Recess

    Senator Shelby. Gentlemen, I know it has been a long 
morning. It is in the afternoon now. Senator Lautenberg was 
going to try to get back. He had some other commitments. I want 
to leave the record open for any questions that he or any of 
the other Senators might want to submit in writing.
    Thank you for being here, and this hearing is recessed.
    [Whereupon, at 1 p.m., Thursday, June 12, the subcommittee 
was recessed, to reconvene at 10:58 a.m., Thursday, July 17.]



 DEPARTMENT OF TRANSPORTATION AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 1998

                              ----------                              


                        THURSDAY, JULY 17, 1997

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10:58 a.m., in room SD-124, Dirksen 
Senate Office Building, Hon. Richard C. Shelby (chairman) 
presiding.
    Present: Senators Shelby and Lautenberg.

                                Panel 1

                          DEPARTMENT OF LABOR

                       Railroad Retirement Board

STATEMENT OF STEVEN BARTHOLOW, DEPUTY GENERAL COUNSEL
ACCOMPANIED BY FRANK BUZZI, CHIEF ACTUARY

                   Opening Remarks of Senator Shelby

    Senator Shelby. The subcommittee will come to order. Sorry 
about the delay, but when you have three back to back votes it 
just happens.
    The purpose of our hearing today is a very specific one--to 
get to the facts with respect to Amtrak's payments to the 
Railroad Retirement Account. The subcommittee's fiscal year 
1998 transportation appropriation bill currently includes $283 
million for Amtrak operating assistance, which is the same 
level as in the House Appropriations Committee-reported bill. 
The administration has requested $344 million and Amtrak has 
requested $387 million.
    Funded within the subcommittee bill are two elements of 
Amtrak's operating assistance identified in the 
administration's request: $202 million for the general 
operating subsidy to support day-to-day operations of Amtrak; 
and $82 million for tier II railroad retirement benefits that 
Amtrak is obligated to pay by law, but are greater than the 
tier II benefits collected by former Amtrak employees.
    The only difference between the subcommittee level and the 
administration's request is $61 million, which the Federal 
Railroad Administration's budget submission mysteriously 
describes as ``a portion of the amount Amtrak is required to 
pay to the Railroad Retirement Board for the benefits of its 
employees.''
    Correspondence between Congresswoman Molinari and OMB 
Director Raines suggests that Amtrak may not, in fact, need the 
money for that purpose. The statements displayed on the panel 
to the right addressing this issue are from Amtrak and from the 
Office of Management and Budget. They appear to me to be 
inconsistent.

    Amtrak's current calculations assume, as part of its 
corporate liability, those liabilities which are mandated by 
statute to be paid by employees of Amtrak.--OMB Director 
Raines' May 23, 1997, Letter to Chairman Susan Molinari.

    It is Amtrak's position that the excess RRTA liability 
should be fully funded by the Federal government and not 
considered a part of Federal operating support.--Amtrak's 
Fiscal Year 1998 Federal Grant Request.

    I believe this subcommittee ought to be given accurate 
information about how funds it is being asked to appropriate 
will be used. This hearing is intended to get that information.
    Our first witnesses will be from the Railroad Retirement 
Board. We hope those witnesses can give us a simple explanation 
of the Railroad Retirement Account and of what Amtrak must pay 
for that account, from what sources, and for what purpose.
    Then we will have a panel including witnesses from the 
Office of Management and Budget, the Department of 
Transportation, and Amtrak. Our questions for each of those 
witnesses will be simple: What are the components of the $61 
million in mandatory payments in the President's budget that 
the House and the Senate subcommittee have not provided? Are 
they legitimately within the definition of excess payments and 
not otherwise financed? Do the budget justifications that have 
been provided to this subcommittee accurately reflect those 
components?
    The subcommittee had not originally planned to hold this 
hearing, and subcommittee members have a full Appropriations 
Committee meeting today, as well as other commitments they have 
made. In view of that, I propose to dispense with a lot of 
opening statements from our witnesses, although we will be 
happy to include in the record any written statements our 
witnesses wish to provide.
    Further, I would ask that each of our witnesses today 
answer clearly and concisely the questions they are asked. I 
believe those questions will be simple ones that will have 
simple answers. We will also limit each subcommittee member to 
10 minutes to ask questions and hear the witnesses' answers. 
With the cooperation of the witnesses, each subcommittee member 
will be able to get the information the member wants and we 
will be able to complete this hearing in a reasonable amount of 
time and get to other commitments.
    Senator Lautenberg.

                    Statement of Senator Lautenberg

    Senator Lautenberg. Mr. Chairman, thanks very much for 
agreeing to delay full committee markup so that we can hold 
this hearing to review in greater detail the financial needs of 
our national passenger rail system, Amtrak. Again, I want to 
note, Mr. Chairman, that you have been interested in hearing 
all the sides of this and were willing to hold this extra 
hearing when we are jammed, as you have noted.
    I think it is essential that we convene to review this 
issue since the appropriations bill put before this 
subcommittee 2 days ago has a cut of almost $300 million, 34 
percent, from the 1997 appropriation for Amtrak, and these 
drastic cuts are contained in a bill that provides a historic 
boost in the overall level of funding for the Department of 
Transportation.
    I also think that it is essential that we demystify the 
confusion that surrounds Amtrak's participation in the Railroad 
Retirement System. But we cannot do that without discussing the 
likely ramifications of Amtrak going into bankruptcy if we do 
not revisit the funding levels in the appropriations bill. 
Amtrak covers a large percentage of its annual operating costs, 
a larger percentage than any national passenger railroad system 
in the world. As the Senator from Utah observed during 
Tuesday's markup, no national railroad is able to completely 
cover the operating costs entirely through farebox revenues.
    It is for that reason that this subcommittee makes an 
annual appropriation to cover the operating losses of Amtrak. 
Amtrak has made great strides in reducing costs and its 
operating losses, but over the last 3 years this subcommittee 
has reduced Amtrak's operating subsidy even more rapidly, 
leaving Amtrak with a larger and larger deficit. That is why 
Amtrak is in such tenuous financial condition, and that is the 
reason why the funding level we set for Amtrak's operating 
budget this year will likely mean the difference between the 
continuation of Amtrak and bankruptcy.
    I am not just throwing out words. I come out of the 
business community, as does my colleague, the chairman of the 
subcommittee. We do not flout the notion of a bankruptcy to use 
it as a scare tactic. That is the reality.
    We are going to begin our hearing this morning with 
witnesses from the Railroad Retirement Board, and as we look 
into the specific issue as to how Amtrak budgets for its 
railroad retirement costs. I think it is critical to point out 
that this subcommittee does not make an explicit appropriation 
for Amtrak's retirement costs. We make an annual appropriation 
to cover the total operating cost, which includes of course the 
railroad retirement costs.
    For the coming fiscal year, Amtrak will be required to make 
the appropriate contribution for railroad retirement tier I and 
tier II payments as determined by the Railroad Retirement 
Board. That amount of money is expected to be $342 million in 
1998. Under law, there is nothing that Amtrak can do to make 
any amount of that debt go away. Amtrak will be required to pay 
that $342 million whether we give them an operating subsidy of 
$387 million, the level that Amtrak has requested, or $283 
million, the level proposed by the House Appropriations 
Committee and our chairman.
    Beginning in 1991, at the request of both the House and the 
Senate Appropriations Committees, Amtrak developed a 
methodology to present what it calls its excess railroad 
retirement costs. Those excess costs are the amount of funds 
that Amtrak must pay to the Railroad Retirement Board for 
retirees that never worked for Amtrak. That is the structure. 
In each year since 1991, at the direction of the Congress, 
Amtrak has shown these figures and discussed their methodology 
in their annual budget submitted to the House and Senate 
Appropriations Committees.
    Suddenly in 1997, the House and the Senate subcommittees 
have taken exception to the manner in which Amtrak calculates 
this figure. Now, I am not here to say that Amtrak's 
calculation is right or wrong. I have not done the arithmetic.
    I am here, however, to point out that it does not matter 
one bit if the retirement cost for these ghost employees is $10 
million lower and the retirement costs of Amtrak employees are 
$10 million higher. They are both expenses of the corporation. 
The bottomline is affected the same way.
    Amtrak will be required to write a check for $342 million 
to the Railroad Retirement Board in the fiscal year 1998, and 
there is nothing in our discussion that can change that. I 
believe our witnesses this morning will confirm that fact. It 
is ludicrous to maintain that Amtrak is using some budget 
gimmickry to squirrel away $61 million and that this 
subcommittee can take that funding away with no harm to the 
railroad.
    An analogy for the typical family budget might be as 
follows. Some people might argue that the purchase of my 
children's school clothes count against my family's clothing 
budget. Some might argue that it should be counted against my 
family's educational expense. But the fact is I cannot send my 
kids to school naked. I have to buy the clothes no matter what 
expense category they come from.
    The real question before this subcommittee, the question 
that will be before the full committee on Tuesday, is whether 
we are going to appropriate sufficient funds to keep Amtrak out 
of bankruptcy in fiscal year 1998. It is my view that if this 
committee is going to establish a budget that will shut Amtrak 
down, then we ought to just say: We are turning the key; we are 
shutting down.
    It is a tough issue, and I appreciate very much the 
chairman's observations made on Tuesday regarding the viability 
of the Northeast corridor and the fact that our passenger 
trains in the Northeast corridor cover a greater percentage of 
its costs than those in the other corridors in the Nation. 
Indeed, certain trains in the Northeast corridor are 
profitable.
    But as Amtrak will testify this morning, it is not feasible 
to simply cut Amtrak's operating budget and state in the report 
that the funds are provided only for the Northeast corridor. 
Amtrak is one corporation and Amtrak's debts and liabilities 
from all its rail corridors will not disappear on October 1 
when the new fiscal year begins.
    If it is the desire of the Senate to only fund Amtrak 
operations in the Northeast corridor, then it will require a 
massive authorizing bill to restructure the corporation. We 
cannot move that kind of legislation on our annual 
appropriations bill.
    Notwithstanding the views of my colleague from Utah, whose 
views I respect--he has had an involvement he talks about with 
Amtrak from the day of its inception back in the early 
seventies--I do not think the Senate is ready to terminate 
Amtrak everywhere but in the Northeast corridor. And if we are 
not ready to do that, we need to fund the railroad in a fashion 
such that it can cover its bills.
    I close, Mr. Chairman, with this statement. I know how hard 
you have worked, and you have been very fair, to try to balance 
all the needs that this subcommittee has. The best way to 
balance it would be if we had a flush of money someplace.
    Senator Shelby. It would.
    Senator Lautenberg. But we do not have, and therefore we 
have to work and skimp and perhaps change things, because we 
just do not have the resources to do it. But one of the things 
that we do have to uphold is our contractual obligations. There 
is not much that we can do about that.
    I see the statements that were taken from Frank Raines' 
letter to Susan Molinari. I worked with Mr. Raines on 
negotiating the budget and he is a man who has a lot of 
knowledge. But I think that in this case he is in error there, 
or else we are not looking at the full context of what he said, 
or he, frankly, just did not, as they say around here, get it.
    So Mr. Chairman, I thank you. I hope that we will give our 
witnesses from Railroad Retirement a couple minutes just to 
explain the situation and make sure that in the process of 
questioning that we do not miss an important part.
    Senator Shelby. Thank you, Senator Lautenberg.
    As I said earlier, your written statements will be made 
part of the record. I will give you as much time as you want, 
but I want to get into some questions.
    We have with us today Mr. Steve Bartholow, Deputy General 
Counsel; and Mr. Frank Buzzi, Chief Actuary, of the Railroad 
Retirement Board. We appreciate you being with us today.

                  Railroad Retirement System Explained

    Mr. Bartholow, could you describe the Railroad Retirement 
System as your organization administers it? How does the 
Railroad Retirement System compare, for example, to Social 
Security?
    Mr. Bartholow. The Railroad Retirement System is a 
comprehensive federally administered retirement program for 
railroad employees and their families. Simply stated, I think, 
the Railroad Retirement Act replaces the Social Security Act 
for the railroad industry. The Railroad Retirement Act provides 
retirement and disability benefits for railroad employees and 
also provides benefits for----
    Senator Shelby. But only railroad employees? Nobody else?
    Mr. Bartholow. Railroad employees and their families and 
survivors. Well, let me just add to that. There are affiliated 
companies with railroads that are covered employers, and 
employees of those affiliated companies under certain 
circumstances are covered as well.
    Senator Shelby. Like what?
    Mr. Bartholow. If you had a company that did leasing of 
railway cars and it was owned by Conrail, for example, then the 
employees of that company would be covered as well.
    Senator Shelby. OK.
    Mr. Bartholow. During fiscal year 1996 the Railroad 
Retirement Board paid benefits under the Railroad Retirement 
Act totaling approximately $8.1 billion to nearly 818,000 
beneficiaries.
    Benefit payments under the Railroad Retirement Act are 
funded primarily by employer and employee payroll taxes, 
transfers from the Social Security trust funds under the 
financial interchange system with that program, and also trust 
fund investments and the earnings that we earn on those 
investments.
    Although the Railroad Retirement System has been around 
since the midthirties, in 1974 Congress restructured the 
Railroad Retirement Act to more closely coordinate the Railroad 
Retirement System with the Social Security System. In doing so, 
it provided that the basic railroad retirement annuity would be 
computed in two components or tiers. The tier I benefit is a 
benefit that is computed based upon an employee's combined 
railroad retirement and Social Security covered employment, and 
in making that computation we use the benefit formulas in the 
Social Security Act. So as a general rule that benefit is the 
amount that the person would receive if all of his or her 
service were covered under the Social Security Act.
    The Railroad Retirement Act of 1974 also provides for the 
payment of a tier II benefit, which is a benefit that is 
computed solely on the basis of railroad service and is 
computed on the basis of a computational formula in the 
Railroad Retirement Act itself that looks at an employee's 
average monthly compensation and years of railroad service.
    The Railroad Retirement System is similar to Social 
Security in concept and also provides similar types of 
benefits. As I indicated earlier, in fact, the tier I benefit 
is generally the benefit that the person would receive if he or 
she were covered under the Social Security Act.

  Description of Tier I Benefits in Excess of Social Security Benefits

    However, this is not always the case. Where the eligibility 
conditions between the Railroad Retirement Act and the Social 
Security Act differ, the tier I annuity component under the 
Railroad Retirement Act may exceed the benefit that would be 
payable under the Social Security Act. This amount in excess of 
what would be payable under the Social Security Act is commonly 
referred to as the non-Social Security equivalent tier I 
benefit.
    The two largest categories of beneficiaries where this 
occurs are occupational disability annuities under the Railroad 
Retirement Act, for which there is no comparable benefit under 
the Social Security Act, and also early retirement payments to 
employees who have 30 years of service in the railroad 
industry. They can retire at an earlier time than under the 
Social Security Act. So until such person would actually be 
entitled to a benefit under the Social Security Act if covered 
under that act, any payments that are made by the Railroad 
Retirement Account are non-Social Security equivalent level 
benefits.
    Social Security equivalent tier I benefits, the ones that 
are identical to the Social Security benefit, are paid from the 
Social Security Equivalent Benefit Account, while non-Social 
Security equivalent tier I benefits, like tier II benefits 
under the Railroad Retirement Act, are paid from the Railroad 
Retirement Account. So there is a difference between Social 
Security equivalent level benefits and non-Social Security 
equivalent level benefits in terms of the payment source for 
those benefits.
    Another difference between the Railroad Retirement System 
and the Social Security System is that railroad retirement 
benefits are generally higher than their Social Security 
benefit counterparts. For example, at the end of fiscal year 
1996 the average age retirement benefit payable to career 
railroad employees under the Railroad Retirement Act was $1,565 
per month. The average for all rail employees at that time, 
career and noncareer, was $1,175. This compares to the average 
retirement benefit under the Social Security Act, which was 
$725 per month at that time.
    Can I provide any more information?

                           Prepared Statement

    Senator Shelby. Thank you, Mr. Bartholow. We will insert 
your complete statement in the record.
    [The statement follows:]
       Prepared Statement of Steven A. Bartholow and Frank Buzzi
    Good Morning. My name is Steven Bartholow and I am Deputy General 
Counsel of the Railroad Retirement Board. With me is Frank Buzzi, Chief 
Actuary of the Railroad Retirement Board. We appreciate the opportunity 
to appear before you this morning.
    It is our understanding that the Subcommittee has requested 
testimony from the Railroad Retirement Board concerning the nature of 
the benefits that the Board pays and how those benefits are financed in 
order to assist the Subcommittee in its consideration of authorizing 
appropriations for Amtrak.
    Before specifically discussing railroad retirement benefits and the 
particular status of Amtrak under the railroad retirement program, 
perhaps it would be helpful to provide some general background 
information about the Railroad Retirement Board and the programs that 
the agency administers.
    The Railroad Retirement Board is an independent agency in the 
executive branch of the United States Government. The Railroad 
Retirement Board administers the Railroad Retirement Act and the 
Railroad Unemployment Insurance Act. Under the Railroad Retirement Act, 
the Railroad Retirement Board pays retirement, disability, and survivor 
benefits based on employment in the railroad industry, including 
employment with Amtrak. Funding for these benefits is derived primarily 
from taxes imposed on railroad employers and employees under the 
Railroad Retirement Tax Act, funds transferred under the financial 
interchange with the social security system, and investment earnings 
from the trust funds. During fiscal year 1996, the Railroad Retirement 
Board paid some $8.1 billion in benefits under the Railroad Retirement 
Act to nearly 818,000 beneficiaries.
    The Railroad Retirement Tax Act imposes an employment tax on all 
railroad carriers engaged in interstate commerce, including Amtrak, and 
certain other railroad employers. The Railroad Retirement Tax Act is 
administered by the Internal Revenue Service and taxes imposed under 
that Act are collected by the Service. The Railroad Retirement Tax Act 
imposes a Tier I tax on employers and employees equal to the tax 
payable by employers and employees under the Federal Insurance 
Contributions Act. In addition, the Railroad Retirement Tax Act imposes 
a Tier II tax on employers at the rate of 16.1 percent of the annual 
maximum taxable compensation and a Tier II tax on employees at the rate 
of 4.9 percent of the annual taxable amount. Although the payroll tax 
obligation on employers and employees is higher under the Railroad 
Retirement Tax Act than under the Federal Insurance Contributions Act, 
the benefits provided under the Railroad Retirement Act are more 
generous, generally, than those available under the Social Security 
Act. For example, at the end of fiscal year 1996, the average age 
annuity being paid under the Railroad Retirement Act to career rail 
employees was $1,565 a month and the average for all retired rail 
employees was $1,175 a month. The average retirement benefit payable 
under the Social Security Act at the end of fiscal year 1996 was $725 a 
month.
    The Railroad Retirement Board was created in the 1930's by 
legislation establishing a retirement benefit program for the nation's 
railroad workers. Private industrial pension plans had been pioneered 
in the railroad industry; the first industrial pension plan in America 
was established on a railroad in 1874. By the 1930's, pension plans 
were far more developed in the railroad industry than in most other 
businesses or industries; but these plans had serious defects which 
were magnified by the great depression.
    The economic conditions of the 1930's demonstrated the need for 
retirement plans on a national basis, because few of the nation's 
elderly were covered under any type of retirement program. While the 
social security system was in the planning stage, railroad workers 
sought a separate retirement system which would continue and broaden 
the existing railroad programs under a uniform national plan. The 
proposed social security system was not scheduled to begin monthly 
benefit payments for several years and would not give credit for 
service performed prior to 1937, while conditions in the railroad 
industry called for immediate benefit payments based on prior service.
    Legislation was enacted in 1934, 1935, and 1937 to establish a 
railroad retirement system separate from the social security program. 
Such legislation, taking into account particular circumstances of the 
rail industry, was not without precedent. Numerous laws pertaining to 
rail operations and safety had already been enacted since the 
Interstate Commerce Act of 1887. Since passage of the Railroad 
Retirement Acts of the 1930's, numerous other railroad laws have been 
enacted.
    While the railroad retirement system has remained separate from the 
social security system, the two systems are closely coordinated with 
regard to earnings credits, benefit payments, and taxes. The financing 
of the two systems is linked through a financial interchange under 
which, in effect, the net of payroll tax cost of railroad retirement 
annuities that are equivalent to social security benefits is reinsured 
through the social security system. The purpose of this financial 
coordination is to place the social security trust funds in the same 
position they would be in if railroad service were covered by the 
social security program instead of the railroad retirement system.
    Legislation enacted in 1974 restructured railroad retirement 
benefits into two tiers, so as to coordinate them more fully with 
social security benefits. The first tier is based on combined railroad 
retirement and social security credits, using social security benefit 
formulas. The second tier is based on railroad service only and is 
comparable to the pensions paid over and above social security benefits 
in other heavy industries.
    Let us turn now to the structure and nature of the benefits 
provided under the Railroad Retirement Act. As noted previously, the 
basic annuity under the Railroad Retirement Act is comprised of two 
components, known as tiers. The Tier I component of a railroad 
retirement annuity is computed using an employee's combined railroad 
retirement and social security covered employment and the computation 
is made using social security benefit formulas. In most cases, the Tier 
I benefit payable under the Railroad Retirement Act is the precise 
amount that would be payable under the Social Security Act. Such 
benefits are commonly referred to as social security equivalent 
benefits. In the case of certain beneficiaries, however, Tier I 
benefits payable under the Railroad Retirement Act exceed the amount 
that would be payable under the Social Security Act. Such additional 
amounts are commonly referred to as non-social security equivalent 
benefits. Tier II benefits payable under the Railroad Retirement Act 
are computed using an employee's railroad service only and are computed 
under benefit formulas in the Railroad Retirement Act. The Act also 
provides for the payment of supplemental annuities to certain career 
railroad employees, vested dual benefits to certain employees who had a 
vested status to both social security and railroad retirement benefits 
prior to 1975, and lump sum payments in certain cases.
    Social security equivalent benefits are payable from the Social 
Security Equivalent Benefit Account, which is funded by Tier I railroad 
retirement taxes and transfers from the social security trust funds 
pursuant to the financial interchange. Both non-social security 
equivalent Tier I benefits and Tier II benefits are payable from the 
Railroad Retirement Account, and are funded by Tier II railroad 
retirement taxes.
    The two largest categories of beneficiaries who receive non-social 
security equivalent Tier I benefits are: 1) persons who have been found 
to be occupationally disabled from work in their last railroad 
occupation but do not meet the social security definition of disabled; 
and 2) employees with 30 years of railroad service and their spouses. 
The Social Security Act has no benefit comparable to an occupational 
disability annuity; accordingly, the entire Tier I annuity component of 
an occupationally disabled employee, who does not meet the social 
security definition of disabled, is a non-social security equivalent 
benefit. Employees with 30 years of railroad service may retire as 
early as age 60 with an age-reduced Tier I benefit and as early as age 
62 with no age reduction. Under the Social Security Act, age-reduced 
benefits may not begin prior to age 62 and full age benefits are not 
payable until age 65. Thus, the amount of any Tier I railroad 
retirement annuity paid to an individual prior to age 62 is a non-
social security equivalent benefit and in the case of an employee who 
retires at age 62, the amount by which his or her benefit would have 
been reduced for early retirement under the Social Security Act is a 
non-social security equivalent benefit. There are several other 
categories of beneficiaries where the Tier I benefit exceeds the amount 
that would be payable under the Social Security Act by reason of an 
inconsistency in entitlement qualifications, but these categories 
comprise only a small portion of the cost of non-social security 
equivalent benefits.
    As noted earlier, railroad retirement benefits are financed 
primarily by taxes imposed on railroad employers and employees, by 
financial interchange transfers from the social security trust funds, 
and by trust fund earnings. In recent years, a portion of the railroad 
retirement tax obligation of Amtrak has been paid on behalf of Amtrak 
from funds appropriated to the Secretary of Transportation. These tax 
payments from appropriated funds are designed to cover what Amtrak 
alleges to be an ``excess'' railroad retirement tax obligation. The 
alleged ``excess'' tax obligation is the amount of tax in excess of the 
benefit payments made to Amtrak employees and their families. Let me 
state here that it is the position of the Board that neither Amtrak nor 
any other railroad pays an ``excess'' tax. As an employer under the 
Railroad Retirement Tax Act, Amtrak is obligated to pay the full amount 
of taxes imposed on railroad carrier employers just like all other 
covered employers. Amtrak is treated no differently than any other rail 
employer except that part of its tax obligation is paid by the 
Secretary of Transportation out of appropriated funds.
    As to the question concerning the appropriate method of calculating 
Amtrak's so-called ``excess'' railroad retirement tax obligation, let 
me make it clear that the Railroad Retirement Board has no 
responsibility for making that calculation or for reviewing the 
calculation once made. However, the Board has, since fiscal year 1992, 
provided Amtrak with annual estimates of the benefits to be paid to 
former employees of Amtrak and their families to assist in making this 
determination. These estimates have been broken out by annuity 
component as follows: 1) social security equivalent Tier I benefits; 2) 
non-social security equivalent Tier I benefits; 3) Tier II and lump sum 
benefits; 4) railroad retirement supplemental annuity payments; and 5) 
railroad unemployment and sickness insurance benefits. Although the 
Railroad Retirement Board has no responsibility with respect to the 
method of computing the amount of Amtrak's so-called ``excess'' tax 
obligation, it is the position of the Board that Amtrak's full tax 
liability must be paid under any circumstance.
    That concludes my prepared remarks. Mr. Buzzi and I would be happy 
to answer any questions that you may have.

                 Amtrak's Retirement and Tax Liability

    Senator Shelby. Is Amtrak statutorily required to pay the 
same retirement taxes that other railroads pay?
    Mr. Bartholow. The simple answer is, yes. As a carrier 
engaged in interstate commerce, Amtrak is an employer under the 
Railroad Retirement Act, the Railroad Unemployment Insurance 
Act, and the Railroad Retirement Tax Act.
    Senator Shelby. What are those taxes? Can you explain the 
employer and the employee shares that they pay?
    Mr. Bartholow. OK. The basic employer tax under the 
Railroad Retirement Tax Act is comprised of two parts. The tier 
I tax is levied at the same rate and on the same amount of 
compensation as taxable under the Federal Insurance 
Contributions Act. The tier I tax rate currently is 7.65 
percent, and the non-Medicare portion of this tax applies to 
compensation up to $65,400 per year. That is the same for both 
employers and employees for the tier I tax.
    The employer tier II tax is levied at a rate of 16.1 
percent and applies to compensation up to $48,600 per year. The 
employee pays a tax of 4.9 percent on that same compensation 
base.
    Senator Shelby. When any railroad pays its retirement 
taxes, does it go into a pool system like the Social Security 
or do the taxes tie directly to that retirement's particular 
employees, similar to a 401[k] plan in a private company?
    Mr. Bartholow. All taxes collected under the Railroad 
Retirement Tax Act are deposited to the railroad retirement 
trust funds. In those funds they are commingled with taxes from 
all other taxpayers and they are not designated for any 
particular----
    Senator Shelby. They are pooled, then.
    Mr. Bartholow. They are pooled. They are not designated for 
any particular employer or any particular employee.

          Is Amtrak's Calculation of Excess Payments Accurate?

    Senator Shelby. Mr. Buzzi, each year Amtrak requests $142 
million for what the railroad represents to us as excess 
payments, which Amtrak defines as the difference between their 
tier II pension plan tax responsibilities and what the Railroad 
Retirement Board pays to former Amtrak employees. If for the 
sake of argument we assume that the excess payments construct 
is legitimate, does Amtrak's calculation of these excess 
payments accurately reflect all benefits paid by the Railroad 
Retirement Board to Amtrak employees and, if not, how much and 
what types of costs are they not including in their 
calculations?
    Mr. Buzzi. Sir, the calculation does not include an 
estimated $18 million of non-SSEB tier I payments in fiscal 
year 1998. These payments are made from the Railroad Retirement 
Account to former Amtrak employees and their dependents, and 
they are financed through tier II payroll taxes.
    Senator Shelby. Is Amtrak leaving out $18 million in non-
Social Security equivalent benefit payments from their 
calculations?
    Mr. Buzzi. Yes; that calculation does not include the $18 
million.
    Senator Shelby. Thus underestimating the amount of benefits 
that the Railroad Retirement Board pays out; is that correct?
    Mr. Buzzi. It does not reflect all of the benefits paid out 
of the Railroad Retirement Account, that is correct.
    Senator Shelby. Since the Railroad Retirement Board 
considers this a legitimate benefit, should it not be 
considered an excess payment by Amtrak?
    Mr. Buzzi. Based on my understanding of the calculation, 
this is a payment that is made by the Railroad Retirement 
Board, yes.
    Senator Shelby. Senator Lautenberg.
    Senator Lautenberg. Thank you, Mr. Chairman.

                  Adjusting Railroad Retirement Policy

    Just to be certain that I understand it fully, can Amtrak 
legally adjust its railroad retirement policy? Can it control 
it?
    Mr. Bartholow. From the tax standpoint?
    Senator Lautenberg. Sure.
    Mr. Bartholow. No, no; it is liable for the full amount of 
the tax imposed under the Railroad Retirement Tax Act.
    Senator Lautenberg. Is there any relationship to your 
knowledge whatsoever between the level of funding that we, this 
subcommittee, provides Amtrak and the obligation of its annual 
payment for railroad retirement?
    Mr. Bartholow. None whatsoever. The amount of the tax 
obligation of Amtrak--or the appropriation, rather, has no 
bearing on the tax obligation of Amtrak.
    Senator Lautenberg. We still owe that, that money?
    Mr. Bartholow. Amtrak would owe whatever its tax obligation 
is. Whatever appropriation would be made for that purpose and 
paid on behalf of Amtrak would reduce that obligation by that 
amount.
    Senator Lautenberg. In the committee report accompanying 
the transportation appropriation bill there is an assertion 
that Amtrak has overstated its liability for railroad 
retirement. The report says: ``It is clear to the committee 
that the overpayment should be immediately discontinued,'' the 
asserted overpayment.
    Based on this directive in the committee report, will 
Amtrak then have the flexibility to discontinue any part of its 
annual payment to the railroad retirement?
    Mr. Bartholow. No.
    Senator Lautenberg. In order to limit Amtrak's railroad 
retirement liability by the $61 million that has been deducted 
from their operating grant, would we have to change the law?
    Mr. Bartholow. Yes; you would have to amend the Railroad 
Retirement Tax Act in some way, I guess, to relieve Amtrak of 
some degree of its obligation and liability under that act.
    Senator Lautenberg. If Amtrak is relieved of this $61 
million liability, who would have to pick up the cost for the 
retirees?
    Mr. Bartholow. Well, Mr. Buzzi, do you want to address 
that?
    Mr. Buzzi. In the short term it is likely that railroad 
retirement taxes would not need to be changed immediately, 
although over the long term the benefits must be funded and in 
the long term the benefit costs would be absorbed by the other 
railroads. Ultimately, these costs would be absorbed.
    Senator Lautenberg. Thank you very much.
    Mr. Chairman, thank you.
                                Panel 2

                      DEPARTMENT OF TRANSPORTATION

STATEMENT OF HON. MORTIMER L. DOWNEY, DEPUTY SECRETARY

                    OFFICE OF MANAGEMENT AND BUDGET

STATEMENT OF HON. JACOB LEW, DEPUTY DIRECTOR

            NATIONAL RAILROAD PASSENGER CORPORATION (AMTRAK)

STATEMENT OF HON. THOMAS M. DOWNS, PRESIDENT AND CHIEF 
            EXECUTIVE OFFICER
ACCOMPANIED BY TIM GILLESPIE, VICE PRESIDENT, GOVERNMENT AND PUBLIC 
            AFFAIRS

                       Introduction of Witnesses

    Senator Shelby. I have another panel. Thank you, gentlemen. 
The Honorable Jacob Lew, Deputy Director of the Office of 
Management and Budget; the Honorable Mort Downey, Deputy 
Secretary, U.S. Department of Transportation; Mr. Tom Downs, 
President and CEO, Amtrak. If you gentlemen would come forward.
    Your written statements, if any, will be made part of the 
record in their entirety and I will go right into some 
questions.

                Components of Amtrak's Operating Subsidy

    Mr. Downey, what are the components of $61 million in 
mandatory payments in the President's 1998 budget that the 
House committee and the Senate subcommittee have not provided?
    Mr. Downey. My understanding of that, Mr. Chairman, is that 
they include employee contributions and another element of what 
the Retirement Board people spoke to as the non-Social Security 
equivalent benefit. But I would make the point that the request 
from the administration was for a total operating subsidy to 
Amtrak. In the total of $344 million, it included the ability 
to use these toward mandatory or other retirement payments, but 
did not specifically direct funds to those.
    Senator Shelby. Mr. Lew, I am going to ask you the same 
question. What are the components of the $61 million in 
mandatory payments in the President's 1998 budget that the 
House committee and the Senate subcommittee have not provided?
    Mr. Lew. I would like to amplify Mr. Downey's answer. The 
President's budget did not distinguish the different payments. 
It calculated a subsidy payment for Amtrak----
    Senator Shelby. Why did it not distinguish?
    Mr. Lew. The calculation of the Amtrak subsidy relates to 
the expenses paid by Amtrak and the expected revenue. As the 
previous witnesses and as Senator Lautenberg noted in his 
introductory remarks, the technical distinction being made as 
to where these payments should be categorized in no way affects 
the bottomline. It does not affect the subsidy amount required 
by Amtrak to prevent bankruptcy.
    So we fundamentally do not have a difference in opinion as 
to what the total amount needed is.
    Senator Shelby. But we have a difference on what you say 
the funds can be used for, though.
    Mr. Lew. Well, if I may, a lot of discussion has been had 
around a letter dated May 23----
    Senator Shelby. Sure.
    Mr. Lew. A paragraph of which is posted there. I fear that 
the letter has been read very selectively. The letter 
underscored the budget request and the need for the full budget 
request. The fact that there is a difference in how to 
categorize certain funds is really a technical scoring issue, 
which we do have some differences about. OMB has a view that 
perhaps is different from Amtrak's. It is an issue that in no 
way affects the bottomline.

                         Amtrak's Requirements

    We were asked a very specific question. We responded to it. 
The answer has now been taken out of context. In no way has OMB 
ever suggested that there has been any exaggeration in Amtrak's 
requirements, and the $61 million is very much necessary.
    The analogy that Senator Lautenberg made is a very 
appropriate one. We would be moving it from one box to another, 
but Amtrak needs that $61 million. The payments to the Railroad 
Retirement Board are statutory. You would have to go in and 
amend the Railroad Retirement Tax Act and a decision would have 
to be made on how to allocate that burden to other payers. It 
is not impossible to do that, but the appropriations language 
does not do that. It would have the effect of leaving Amtrak 
short of cash.
    Senator Shelby. Well, we understand that. But what we are 
trying to do is, if you say something is something, it ought to 
be that.

       Legitimacy of Amtrak's Characterization of Excess Payments

    Are these components legitimately within the definition of 
excess payments and not otherwise financed?
    Mr. Lew. Our view is that the excess payment is part of the 
analysis. The question of benefit is part of the analysis. We 
see there as being employee benefit. We therefore categorize it 
differently. But we in no way question----
    Senator Shelby. Why do you categorize it differently?
    Mr. Lew. The question is whether a tax is being paid on 
behalf of an employee. If it is being paid on behalf of an 
employee, there is presumed to be benefit to the employee and 
it is treated as a current operating expense. That is a view.
    There is a legitimate difference here. It is a difference 
that in no way suggests that Amtrak has in any way cooked its 
books or created an obligation that does not exist. It is not 
relevant if there is a single appropriation for operating 
expenses. For example, if you were truly to conform to the 
letter that Director Raines sent, you would perhaps decrease 
your appropriation by $61 million in one place and increase it 
by $61 million in another place.
    It is a legitimate expense of Amtrak. The fact that it fits 
in a different box in no way undermines the legitimacy of the 
payment. It is a payment due under the Railroad Retirement 
Acts.

                           Prepared Statement

    Senator Shelby. Thank you, Mr. Lew. We will insert your 
complete statement in the record.
    [The statement follows:]
                    Prepared Statement of Jacob Lew
    Mr. Chairman and distinguished members of the Subcommittee. I am 
Jack Lew, Deputy Director of the Office of Management and Budget. After 
my brief statement I will be happy to answer your questions.
    This past Tuesday, the Subcommittee met to consider the 
appropriations for the Department of Transportation and Related 
Agencies. As part of this consideration, the Subcommittee addressed the 
question of the appropriate level of operating assistance for Amtrak. 
During both this Subcommittee's and the House Appropriations 
Committee's consideration of operating assistance for Amtrak, questions 
have arisen about a May 23, 1997, letter written by OMB Director Frank 
Raines to Chairwoman Susan Molinari of the House Transportation and 
Infrastructure Subcommittee on Railroads. This letter discussed the 
technical question of how to best measure the increment between 
Amtrak's corporate liability for contributions to the Railroad 
Retirement Board and benefits received by retirees who are not Amtrak 
employees. I ask that a copy of this letter be made an official part of 
the Subcommittee's record in considering this issue.
    We stand behind the May 23, 1997, letter. This letter states that 
Amtrak needs $344 million in operating assistance in fiscal year 1998. 
In that letter, while explaining the technical details of Amtrak's 
contributions to the Railroad Retirement Board, we emphatically and 
strongly reaffirmed our support for the full $344 million in operating 
funds for Amtrak in fiscal year 1998. Director Raines wrote:

          ``These funds are an integral part of Amtrak's efforts to 
        remain viable. Although we differ with Amtrak over the minor 
        technical issues you raise in your March 19 letter, our 
        differences in no way affect our commitment to the funding 
        level sought in the President's budget.''

    Portions of this May 23 letter have been cited by the House 
Appropriations Committee and this Subcommittee to support an operating 
level for Amtrak in fiscal year 1998 of $283 million, or $61 million 
lower than we seek in the President's budget. These citations of the 
May 23 letter are selective and do not accurately represent the 
Administration's position.
    The May 23 letter notes that Amtrak mistakenly includes certain 
expenses of doing business in the category of so-called ``excess 
retirement'' costs. The letter notes that these expenses are salary 
costs for Amtrak but not salary costs properly allocated to the so-
called ``excess retirement'' category. Accordingly, even though Amtrak 
has misclassified these costs and allocated them to the ``wrong'' 
category, these costs remain expenses of the Corporation and the total 
expenses of the Corporation remain unchanged.
    In determining how much operating support Amtrak needs in fiscal 
year 1998, the Administration, in formulating its budget, evaluated the 
gap between Amtrak's projected revenues and expenses. In 1998, as in 
every year where the Federal government has provided operating 
subsidies to Amtrak, the operating assistance is meant to help close 
the gap between Amtrak's expenses and revenues. This assistance is not 
the only way we expect Amtrak to try to close the gap between expenses 
and revenues. We expect Amtrak to pursue new business opportunities 
such as the recently signed deal to lease use of the Northeast Corridor 
for telecommunications ventures and to cut expenses by pursuing 
efficiencies in business activities. Nevertheless, regardless of the 
steps Amtrak takes to close this gap (whether cost cutting, or revenue 
increases), each dollar of the $344 million in Federal assistance goes 
to close the gap.
    As part of Amtrak's expenses, it must, under current law, like all 
railroads, remit tax payments to the Railroad Retirement Board (RRB) to 
cover the costs of the corporation's share of railroad retirement taxes 
and it must remit tax payments to the RRB to cover amounts withheld 
from employees' paychecks to fund retirement benefits. Amtrak must 
remit over $300 million each year to the Railroad Retirement Board. The 
size of this remittance will not change regardless of the level of 
operating support provided by this Subcommittee and regardless of how 
Amtrak characterizes its corporate liability to the Railroad Retirement 
Board. The amount of this remittance is calculated under the provisions 
of the Railroad Retirement Act.
    The decision by this Subcommittee and the House Appropriations 
Committee to reduce Amtrak's operating level by $61 million below that 
level sought by the President guarantees that some expense, whether a 
portion of the over $300 million owed to the Railroad Retirement Board, 
a portion of the millions of dollars in costs of train operations, a 
portion of the millions of dollars in costs of facilities operations, 
or a portion of the millions of dollars in other costs, will not be 
met. The failure to fund this $61 million places Amtrak in jeopardy of 
not being able to carry out its planned operations for fiscal year 
1998. The consequences of not funding this $61 million could result in 
the insolvency of Amtrak--at a cost to the taxpayers far greater than 
the $61 million in dispute.
    Our appropriations request recognizes an essential fact--the $344 
million total operating assistance amount is fungible. Our request for 
$344 million in operating assistance goes only part way in permitting 
Amtrak to cover its expenses of doing business. Because these funds are 
fungible, we anticipate that the $344 million in funds would cover a 
series of expenses owed by Amtrak. Our proposed appropriations language 
does not earmark portions of the operating assistance to cover specific 
expenses--whether they be train operations, employee salaries, 
advertising costs, or costs owed to the Railroad Retirement Board.
    Let me add one more point--we feel that our May 23, 1997, letter 
accurately describes the amount that Amtrak's liability to the Railroad 
Retirement System exceeds the benefits received by non-Amtrak 
employees. We do not think that Amtrak's description in its budget 
submission to Congress is completely accurate. As we stated there, 
Amtrak's inclusion, as part of its calculation of its corporate 
liability for railroad retirement taxes, improperly included $43 
million in payments for which employees are liable. We view Amtrak as 
acting as a withholding agent in this case and that these withholdings 
are liabilities of the employees, not Amtrak. Further, we feel that 
Amtrak has improperly excluded, as part of the calculation of benefits 
received by its employees, $18 million in so-called non-Social Security 
Equivalent Benefits which are paid to Amtrak retirees. The inclusion of 
the $43 million in employee liabilities and the exclusion of the $18 
million in retiree benefits has led to Amtrak overstating the level of 
excess retirement benefits by $61 million.
    Even so, Amtrak, OMB, and DOT share a common view that Amtrak has 
enormous costs of doing business and that it cannot meet them through 
its revenues alone. The $344 million in operating assistance the 
President seeks is the appropriate level. We hope this Subcommittee 
will agree. With only $283 million in operating assistance, not the 
$344 million in federal operating assistance sought in the President's 
budget, we do not think that the necessary funds will be available to 
support the current national passenger rail system.
    We look forward to working with the Subcommittee and full committee 
in identifying possible offsets within the Committee's mark to allow 
full funding of Amtrak's operating needs. This full funding is 
necessary to avoid the unacceptable alternative of possible insolvency. 
I would be happy to answer your questions.

                Amtrak's Calculation of Excess Payments

    Senator Shelby. Mr. Gillespie, what are the components of 
the $61 million in mandatory payments in the 1998 budget that 
the House committee and the Senate subcommittee have not 
provided?
    Mr. Gillespie. Mr. Chairman, first let me apologize.
    Senator Shelby. That is OK.
    Mr. Gillespie. Mr. Downs was called to another meeting in 
the Senate, but he should be on his way back.
    The way Mr. Lew calculated this is very similar to the way 
we would describe it. We have an Amtrak tier II payment that is 
called Amtrak's liability. That is about $138.5 million 
estimated for fiscal year 1998. The employer tier II tax 
liability is about $42.1 million for fiscal year 1998. And the 
Amtrak supplemental tax liability is about $17.8 million. The 
total tier II is about $198 million or about $200 million that 
we pay.
    We then subtract the amount that is paid to Amtrak 
beneficiaries. That is about $57 million.
    The two things that you talked to the other witnesses 
about, with respect to the $60 million, is that $42 million and 
about $18 million that we did pay, and that we include in our 
calculation, and that is done by Amtrak primarily as a result 
of the House Appropriations Committee report language that, if 
you have not seen it, I will read the one or two sentences that 
describe that calculation. This is fiscal year 1991 DOT 
appropriations bill report. It says:
    ``The committee directs Amtrak to then estimate the total 
amount of Amtrak payments into the two trust accounts and to 
provide the committee with its estimate of excess railroad 
retirement'' and then they say parenthetically ``Tier II and 
supplemental benefits''--``payments and railroad unemployment 
insurance benefits.''
    That is the basis that we used to calculate this payment 
since 1991, and that calculation is what we have been 
submitting to this committee since then.

             Accuracy of Budget Justification Presentation

    Senator Shelby. Do you believe that the budget 
justifications that have been provided to this subcommittee 
accurately reflect these components?
    Mr. Gillespie. Yes, sir.
    Senator Shelby. Do you, Mr. Downey?
    Mr. Downey. Yes; they do, and they have been consistent 
over the years.
    Senator Shelby. Mr. Lew?
    Mr. Lew. I think that the budget itself----
    Senator Shelby. Would it not be better to say what things 
are more accurate, and there would be no misunderstanding?
    Mr. Lew. Sometimes there is a distinction that does not 
make a difference, and I think this is a case where it is a 
distinction that for the purpose of the appropriation does not 
make a difference. We have a lot of technical discussions----
    Senator Shelby. Why does it not make a difference?
    Mr. Lew. It would make a difference if it affected the 
bottomline requirements of Amtrak. But since it does not, it is 
a question of scoring and obligation. The budget itself, the 
fat appendix document, does not break it out. The only place it 
is broken out is in a supporting document which is submitted by 
the agency.
    There has for years been a discussion about how this should 
be treated. We have never stopped the agency from sending that 
up. The fact that there is an ongoing discussion of how it 
should be treated is important and were there to be a policy 
decision to move it from a discretionary to a mandatory it 
would be relevant. Should there be a decision to decrease the 
amount of the total appropriation and to allocate it between 
the two different accounts, it would be relevant.
    But if it is appropriated as a single amount, it is not 
relevant, which is what we proposed in the President's budget. 
So yes, we think that the representations that have been made 
are correct. There are technical issues on how to support the 
$344 million that reasonable people can discuss without 
changing the conclusion that $344 million is the right number.
    Senator Shelby. So basically you are saying that the budget 
justification does not make a difference? That is what we use 
to appropriate Federal funds, is it not?
    Mr. Lew. Oh, no, no; I would never say that the budget 
justification does not make a difference. But I would suggest 
that there is----
    Senator Shelby. Well, what are you saying if you are not?
    Mr. Lew. There is often detail provided in the budget 
justification that is of technical significance that does not 
affect the bottomline requirement of dollars, and were the 
budget justification to change and were that $61 million 
reallocated to another category the bottomline total would not 
change by one penny. So it is a difference, but it is a 
difference that does not really change the bottomline. It just 
moves the categories. The subtotals would be different; the 
total would be the same.
    Senator Shelby. But should not in the budget we reflect 
what things are really for? I guess that is what I am getting 
at.
    Mr. Lew. Well, I think that----
    Senator Shelby. Rather than come up with some term that 
probably confuses.
    Mr. Lew. I think we agree on this, Senator Shelby. To the 
extent that we were asked a question by Congresswoman Molinari, 
we answered it very directly. If we had realized what we were 
getting into, maybe we should not have answered it so directly, 
because frankly I feel like our words are being twisted and 
used against us.
    Our letter clearly said that we strongly support our 
original budget and that the technical issue we were addressing 
has nothing to do with the bottomline requirements of Amtrak. 
The quote on the wall is being repeated over and over and over 
again, mischaracterizing the administration's position. That, 
frankly, is more troubling to me than the question of the 
technical characterization of details in a justification that 
do not change the bottomline requirement.
    This is a tempest in a teapot. There is no issue here.

                        Increased Clarity Needed

    Senator Lautenberg. Mr. Chairman, would it have helped, do 
you think, if we had a separate line with the operating 
expenses that indicated the cost for the railroad retirement?
    Senator Shelby. Sure it would help. I think, Senator 
Lautenberg, anything would help that would keep us out of being 
confused or thinking we were misled in any way. Clarity of 
writing, clarity of budget, is very important, not only to us 
as appropriators, but to the people who interpret these 
documents, including writing letters. Right?
    Mr. Lew. Sure, absolutely.
    Senator Shelby. You use technical detail in the 
justification for $42 million that is being paid for by the 
employees; is that what you are using?
    Mr. Lew. Well, there are several different documents that 
went up. The Federal Railroad Administration budget contained 
the aggregate totals the way the budget did. There were other 
documents that came out that broke it out differently, which 
drew this distinction that the larger budget documents did not.
    The issue as the representatives from the Railroad 
Retirement Board set them out are really the issue, and the 
question is are these or are these not benefits to the 
employee? And if they are benefits they belong on one side of 
the line; if they are not benefits, they belong on the other.
    I think we probably do have a little bit of a difference 
between OMB's view of which side of the line they should go on 
as opposed to perhaps Amtrak's. But the reason I say it is a 
distinction without a difference is we agree that the dollars 
are there.
    Senator Shelby. That is a good phrase, a distinction 
without a difference. But oftentimes it does make a difference. 
It makes a difference on what line it is because we interpret 
it differently.
    Mr. Lew. It may be that this technical difference has led 
to a misinterpretation, and that is why we are testifying here 
today.
    Senator Shelby. Well, how do we straighten this out? 
Clarity is very important, is it not?
    Mr. Lew. I think the way to straighten it out, frankly, is 
to start with the bottomline and work up, because the way the 
budget is constructed for Amtrak, it does not take account of 
all of the--it is not worked from all the details down. We look 
at a stream of expenses for Amtrak. We look at a stream of 
revenues for Amtrak. The stream of expenses are governed by in 
this case the Railroad Retirement Tax Act, which puts an 
obligation on Amtrak, which unless Congress amends the Railroad 
Retirement Tax Act, they have to pay.
    Now, how you categorize some of the payments under the 
Railroad Retirement Tax Act has caused some confusion. We say 
that there is a benefit, therefore it is an expense. Others say 
there is not a benefit, therefore it is excess retirement 
costs. It does not change the fact that the tax is due.
    If I have a tax due and I disagree with my accountant as to 
what line of the 1040 it should go on, it does not mean I do 
not owe the tax. I owe the tax. Amtrak owes this tax. It pays 
the tax. All we are discussing is which side of the ledger to 
put it on.
    If Congress wants to get into the issue of how much taxes 
Amtrak should pay, it is a very complicated policy question. 
You will be faced, or the authorizing committee would be faced, 
with decisions as to how to allocate a burden. There is no 
doubt that Amtrak is paying part of the cost of the retirement 
of employees who are not Amtrak employees, who are not there 
now. That is true at other railroads as well. Should the tax 
not be paid by Amtrak, the tax would still ultimately have to 
be paid and the implicit assumption is that it would be shifted 
to other freight carriers. That may be a decision Congress 
wants to make, but it is a policy decision of some consequence 
in terms of our transportation policy.
    I would suggest that the question of how Amtrak should 
internally book its tax payments is a very different one from 
what the amount of the tax payment is and what the consequences 
to the Railroad Retirement Board would be if the tax was not 
paid, and the issues have been conflated. The question of how 
Amtrak books it internally has been turned into should Amtrak 
pay it, and that is an error. Amtrak has to pay it and nothing 
we have ever said suggests otherwise.
    Senator Shelby. Senator Lautenberg.
    Senator Lautenberg. Thank you very much, Mr. Chairman.
    Since I have 10 minutes, if either of the three of you or 
all three of you would like to make a 2-minute statement, I 
would be happy to have it, and then answer my questions quickly 
thereafter. Anybody?
    Mr. Downs, welcome. And Downey is not little Downs. 
[Laughter.]
    Mr. Downs. It is a diminutive.
    Senator Lautenberg. We have Downs, now we have Downey.
    Mr. Downs. It is the Irish factor.
    Senator Lautenberg. Is there anything that you would like 
to say in capsule form?
    Mr. Downs. I did have my statement entered into the record 
and the only thing that I would add is that, however this came 
to be, I considered it to be nothing more than a tempest in a 
teapot when it started because I believed then, I believe now, 
we were following in best of intentions the direction given us 
by the House Appropriations Committee in language in fiscal 
year 1991.
    Senator Lautenberg. Right.
    Mr. Downs. We have had that reaffirmed every year. As I 
said half in jest, that if I am in this much trouble as a 
corporation for having tried to follow the language direction 
in an appropriations bill, I promise I will not do it again.

                           Prepared Statement

    Senator Shelby. Thank you, Mr. Downs. We will insert your 
complete statement in the record.
    [The statement follows:]
                 Prepared Statement of Thomas M. Downs
    Mr. Chair and Members of the Subcommittee: I appreciate your taking 
the time to allow us to fully explain the impact of the proposed 
funding level for Amtrak operating support and Excess Railroad 
Retirement payments (RRTA), as provided in both the House and Senate 
Fiscal Year 1998 Department of Transportation and Related Agencies 
Appropriations bills.
    First, as a matter of public policy, I see no reason why Amtrak 
should have to provide any funds to pay for retirement benefits for 
railroad employees who never worked for Amtrak. These obligations are 
totally unrelated to Amtrak and the business of providing a national 
passenger service.
    The reality, however, is that the Internal Revenue Code mandates 
that in fiscal year 1998 Amtrak remit an estimated $342 million in RRTA 
payments: $140 million in Tier I and $202 million in Tier II. By law, 
this obligation must be met. (26 USC Section 3221, and 45 USC Section 
231 et seq.)
    The Railroad Retirement Board (RRB) will provide approximately $200 
million of this amount to Amtrak retirees. The additional $142 million 
will go to railroad retirees who did not retire from, and perhaps never 
worked a day for, Amtrak.
    Amtrak has no discretion in paying these obligations--it is a 
mandatory payment--and the retirees, by law, are entitled to receive 
it. Unless this Committee is ready to amend the Internal Revenue Code, 
it is a federal government obligation, and Amtrak is currently used as 
the conduit to meet those legal obligations.
    Of the total payment, Amtrak will be paying an estimated $60 
million in Tier II taxes for its own employees. The rest--the 
additional $142 million will be going to support the retirees of other 
railroads. Everyone here today should recognize excess mandatory 
payments as a substantial, albeit indirect, subsidy to the profitable 
freight railroad industry. As I think everyone here understands, 
payments to the Railroad Retirement Board are based on the current 
number of employees that are on the payroll. Between mergers, 
downsizing and the freight railroads contracting out work, those with a 
more stable work force (i.e., the publicly supported passenger 
railroads like Amtrak and the commuter operations) absorb the brunt of 
these so-called excess railroad retirement costs. Everyone here should 
understand if we want to minimize taxpayer exposure for passenger 
operations, we should not ask the federal government to subsidize non-
Amtrak retirement costs.
    It is interesting to note that the pending merger which divides 
Conrail between CSX and Norfolk Southern will result in thousands of 
fewer railroad workers, and hence a loss of funds being paid into the 
Railroad Retirement Fund.
    The fact is, Amtrak must abide by the current legal mandates. We 
advocate changing it. However, as long as it remains unchanged, no 
matter how these payments are categorized, our tax liability remains 
the same.
    These payments can be characterized as ``Excess Mandatory 
Payments'', as they have been both in Appropriations bills and in 
Budget Requests submitted by this and previous Administrations. They 
can be characterized as operating support, which they have been, both 
in Appropriations bills and in Budget Requests submitted by this and 
previous Administrations. However, no matter how you characterize them 
the amount will not change, nor will the liability go away.
    Amtrak calculates its excess mandatory payment in accordance with 
the direction of House Committee Report 101-584, which accompanied 
passage of H.R. 5229, the Department of Transportation and Related 
Agencies Appropriations Act for fiscal year 1991. It was then that the 
House Transportation Subcommittee recognized that these payments 
represented a cost that had nothing to do with the operation of 
passenger trains. It was simply a federal formula to determine 
payments.
    In that Report Amtrak was directed by the Committee to: ``estimate 
the total amount of Amtrak payments into the (Retirement) trust 
account(s) and to provide to the Committee an estimate of excess 
Railroad Retirement (Tier II and Supplemental benefit) payments . . . 
for the next fiscal year.'' (emphasis added)
    Amtrak did that for the next fiscal year, and every year 
thereafter. This was directed by the Congress, and remained 
unquestioned by either the Office of Management and Budget (OMB) and 
the Department of Transportation. Seven years later, a question is 
being raised as to whether or not the employee and the employer 
contribution should both be counted as a corporate liability. Amtrak 
read at that time, and still reads, ``total'' to mean both the employee 
and the employer Tier II contributions.
    If Amtrak were to be terminated, net railroad employment would 
probably decrease by the full number of Amtrak employees, and all Tier 
II payments now made by Amtrak would cease. But Railroad Retirement 
benefits to all former rail employees would continue. Hence Amtrak 
views the measure of its subsidy to the freight railroad retirement 
system as including both the employer and employee share of Tier II.
    More important, however, is that when OMB did raise the question of 
employee contribution being included or excluded from the calculation, 
they did not ever dispute that this is a cost of running Amtrak--a cash 
outlay that Amtrak is required to make. In fact, they have strongly 
reiterated this in the May 23 letter, in the Statement of 
Administration Policy on the House Transportation Appropriations bill, 
and again today.
    If this Committee feels that the Tier II employee contribution 
should not be part of the calculation, Amtrak will no longer include 
it. But what has to be realized is that this will not make that cost go 
away. Amtrak is liable for the $60 million, whether it's in the 
``operating'' column or the Excess Mandatory RRTA'' column.
    The appropriate action to take in this case, if the Committee 
changes the methodology for calculating Excess RRTA payments, is to 
provide the requested level of funding for this year and begin the new 
methodology as part of the President's budget request for fiscal year 
1999. The implications for Amtrak are of course far reaching: our 
Strategic Business Plan has us achieving operating self-sufficiency 
based on a number of assumptions--one of those assumption being the 
continued provision of full funding for excess mandatory payments. If 
this is to become an additional operating expense, the glidepath in our 
Plan must be adjusted accordingly in order for us to still be able to 
reach operating self-sufficiency in 2002.
    The single most disastrous action this Committee could take is to 
decide, mid-stride, to change the methodology, reduce mandatory excess 
railroad retirement, and not increase the operating grant by a 
commensurate amount for fiscal year 1998.
    Amtrak has requested $245 million for an operating grant for fiscal 
year 1998, and we need every penny of it. Right now this Subcommittee 
is providing $141 million. I can tell you that we will not survive 
fiscal year 1998--we will not have a national passenger rail system--on 
October 1, 1998.
    I hope the Subcommittee will take that into account as you move 
toward mark-up by the full Committee on Tuesday.
[GRAPHIC] [TIFF OMITTED] T12JY17.047

                      Amtrak's Financial Integrity

    Senator Lautenberg. Mr. Downey, is there anything?
    Mr. Downey. Let me just associate myself with the point 
that Mr. Lew made. Amtrak needs these funds. The President's 
request for $344 million was based on what it needs to keep the 
railroad in its present form operating. However we categorize 
any of these payments, they are essential to the level of 
service that we think is necessary.
    Senator Lautenberg. Mr. Lew, do you want to?
    Mr. Lew. I have indicated what our view is, but I would 
just underscore what Mr. Downey just said. We should not lose 
sight of what the issue really is here. The issue is not $61 
million. The issue is the financial integrity of Amtrak. We 
would welcome a discussion of the technical matters and to 
reach an understanding of how to deal with them. But we should 
separate the issues and one ought not to be used as a means to 
another end.
    If the end is to reduce Amtrak's fiscal viability, that is 
a very different question from how you score payments on their 
ledger.
    Senator Lautenberg. I agree, and I think, in deference to 
the chairman's request, he defines it as clarity. And I think 
you folks have to understand that in that request of his is to 
say: Hey, fellows, take it easy, show us what part is railroad 
retirement, show us what part is current operations, and let us 
decide, as opposed to having to make a case over what really is 
very, very little in my view.
    If we did not, Mr. Downey, if we reduced that $344 million 
to something one-half that, less than that, what would be the 
first call on the money? Would it be the railroad retirement 
obligation?
    Mr. Downey. That would have to be paid ahead of anything 
else, and the ability to pay that and keep operating would call 
into question the solvency of the railroad.
    Senator Lautenberg. So that demonstrates, I think, what 
happens. They have tended to lump all the current costs 
together and so it helped to make some confusion here, but I 
think that is easily straightened out.
    Did Amtrak, Mr. Downs, or DOT for that matter, ever seek a 
legal opinion as to whether or not it was proper for Amtrak to 
account for employee contributions as part of the excess 
payments? If so, what was the determination?
    Mr. Downs. I believe there was--I understand there was such 
a determination from U.S. DOT. I am not familiar with it, but--
--
    Mr. Downey. Senator, during the years in which the Congress 
specifically appropriated funds for excess railroad retirement 
based on calculations similar to those that have been presented 
this year, the Department did look at the legality of making 
the payments under those calculations and gave a legal opinion 
that these were appropriate uses of the funds as appropriated.
    Senator Lautenberg. The term ``excess payments,'' it even 
sounds like it is a bonus or something like that. I do not know 
whether we could change the terminology, but the fact is that 
it is a requirement under law and we have little or nothing to 
do about it except to say to the railroad: OK, stop operating 
and we will continue with those obligations.

                       Costs of Amtrak Bankruptcy

    As a matter of fact, one of the questions I wanted to ask 
Mr. Lew--as I mentioned at the markup on Tuesday, we had seen 
widely varying estimates of the cost to the taxpayer of Amtrak 
bankruptcy. Estimates range from $3 to $10 billion. That is 
quite a spread. Has OMB taken an independent look at this 
question and, if so, could you venture any kind of an opinion 
as to what realistically that figure might be?
    Mr. Lew. Senator Lautenberg, I cannot give you an exact 
number. I have not seen an estimate. If we have done one, I 
would be happy to get it to you.
    We have discussed the consequences, which would be very 
severe. It would be very disruptive to the transportation 
system. It would be very unfortunate as a policy outcome. The 
dollars are something we could perhaps calculate, but it is 
certainly the purpose of our budget proposals to prevent any 
kind of a situation that would call into question the fiscal 
viability.
    Senator Lautenberg. The damage to the transportation system 
would be severe. Just again in capsule form, if you could tell 
me why? Where would the severity be felt?
    Mr. Lew. I would defer to Mr. Downey in terms of 
transportation policy.
    Mr. Downey. Across the country service would be limited and 
access would be denied.
    Senator Lautenberg. Limited on the railroad?
    Mr. Downey. Right, and denied to many communities. In the 
Northeast in particular, the consequences would be severe 
because Amtrak is the host railroad not only for its own 
services, but for a variety of commuter lines which, if Amtrak 
were unable to make its payments, might be unable to operate 
their services.
    Senator Lautenberg. So the severity, however, would be how 
else do I get there, how else do they get there? I think it is 
10,000 DC-9's to fly between here and Boston. The roads would 
be impossible. And of course, one need not talk about air 
quality these days to know what might happen.
    I want to just make a point here. Mr. Downs, as we entered 
the subcommittee markup on Tuesday, your operating grant was 
almost $200 million, or 51 percent below the level you 
requested. The chairman, who has tried hard to work with all of 
us, agreed at the markup to increase the funding level to $283 
million, which is still $104 million or 27 percent below the 
request.
    If you are required to live with a final funding level of 
$283 million, what will be the impact on Amtrak's operations 
next year and what is the likelihood of further route 
eliminations or a complete shutdown of the railroad?
    Mr. Downs. Senator, we will end this year with, our best 
projection is right now, negative, net negative cash of $82 
million. We will borrow that from commercial banks. It means 
that we start over by taking one-half of our operating grant at 
the beginning of the year. If these operating numbers stay the 
way they are, one-half of our operating grant would equal the 
amount of money that we would need to pay off our temporary 
financing at the end of the year.
    It would leave us with zero operating subsidy. We would 
probably run out of cash in January or February. That is 
called, the technical term is, ``bankruptcy,'' and there are 
provisions that automatically click in after that, in law, that 
would force the liquidation of the company. I hate saying 
things like that because it sounds a lot like what people 
normally come to the committee and say: If we do not get the 
funding we will have to turn the lights out on the Washington 
Monument.
    In this case we have bankers that own a lot of our 
commercial paper. We have short-term financing obligations to 
commercial banks. Those are all marketplace decisions and those 
decisions then rest in the private sector, not in the public 
sector, about outcome.
    I cannot tell you that I could make, in all honesty, that I 
could figure out now how to make the company work longer than 
January, February if these numbers turn out to be the final 
operating numbers. We have been underfunded under the budget 
agreement for the last 3 years. Our net underfunding on our 
business plan was $150 million. We have eaten $70 million of 
that so far in additional plan actions. We are running out of 
rabbits. As a matter of fact, I think we have eaten all the 
rabbits. We cannot make it at this number.

                      Amtrak's National Ridership

    Senator Lautenberg. I would make mention of something. 
During Tuesday's markup, there was a lot of discussion as to 
whether Amtrak performs any valuable service outside the 
Northeast. Since that time I have had a chance to review 
Amtrak's ridership figures and was surprised to see, Mr. 
Chairman, how many people ride Amtrak in other regions of the 
country.
    In the West, for example, California has more than 6 
million Amtrak riders. Oregon has one-half of a million. The 
State of Washington, almost 700,000. In the South, Virginia and 
Florida have about as many riders as New Jersey. And in the 
Midwest, Illinois has almost 3 million riders, Michigan 1.5 
million, Missouri and Wisconsin each about 400,000.
    In your experience, Mr. Downs, have the long-distance 
trains outside the Northeast seen any increase in ridership?
    Mr. Downs. They are increasing in ridership. Our year to 
date over last year ridership is up about 3 percent and 
revenues are up about 9 percent over the same period last year.
    But I would also speak to what other members of this body 
have told me about the value of long-distance service around 
the United States. Senator Burns has told me a number of times 
how valuable this service is for isolated rural communities in 
Montana. That is not necessarily reflected in the numbers, but 
it is important about the economies in places like Cut Bank, 
MT, or Havre, MT.
    I hear the same thing from North Dakota. In particular, I 
hear from Senator Lott the value of this service to 
Mississippi, where he has said without a national system 
Mississippi and the Nation could not support a Northeast 
corridor, because there is a balance here about a national 
transportation system and national investments. He has said 
Amtrak is an important part of the economic future of 
Mississippi.
    Those speak, I think, to other issues than simply the gross 
ridership numbers. It is about small urban and rural America on 
longer distance lines.
    Senator Lautenberg. Thanks.
    The ridership in New Jersey on and off, 1,250,000 people. 
So that we have Virginia and Florida with about as many riders 
as that. To close my session, Mr. Chairman, Utah, where Senator 
Bennett was talking the other night about the very late--the 
other day about the very late night passengers who get on or 
off in some remote places. There were 55,000 movements on 
Amtrak in Utah for the year 1995.
    So, Mr. Chairman, I hope that the case is at least cleared 
and that we will be able to take a second look. Once again, I 
do want to thank you. The chairman has tried to be helpful. He 
has got a tough assignment looking for little kernels where the 
corn has hardly grown. So we are where we are.

              Are Some Retirement Expenses Double-Counted?

    Senator Shelby. Thank you, Senator Lautenberg.
    What I have heard today is that, of the remaining $61 
million between the current subcommittee mark for Amtrak 
operating assistance and the President's budget request level, 
that there is some question as to whether the money is 
justified for the purpose for which it was requested, in other 
words clarity. I know you go to the bottomline, all of you. You 
did, Mr. Lew.
    To review, under the excess payment construct offered by 
Amtrak $18 million of the $61 million is related to an 
understatement of benefits being provided by the Railroad 
Retirement Board to retirees of Amtrak. We have heard from the 
Railroad Retirement Board that Amtrak's calculation fails to 
recognize all the benefits currently being provided to Amtrak 
retirees.
    So even if we buy this concept of excess payments, you 
know, call it that, whatever, Amtrak I believe is overstating 
the size of the amount.
    Second, the remaining $43 million relates to the current 
tax liabilities that are mandated by statute to be paid by 
employees. Appropriating the $43 million would be, I think, 
like appropriating funds to Senators' offices to pay for their 
employees' share of Social Security taxes. To provide that 
funding to Amtrak would be reimbursing Amtrak for a cost that 
the corporation does not bear liability for. This looks like 
budget padding to me.
    It is not clear to me. I used the word ``clarity.''
    Mr. Lew. Senator Shelby, could I try to clarify that?
    Senator Shelby. Let me finish and then I will recognize 
you.
    I believe it is inappropriate to ask the taxpayers to pay 
Amtrak for costs that are already borne by Amtrak's employees 
or for a miscalculation. I would hope that Amtrak's budget 
justification will provide in the future a clearer--clarity--
justification of what appropriations are to be used for. I 
think that is important, clarity. You know, you say the 
bottomline is the same, but it is a confusing presentation.
    Go ahead, Mr. Lew.

                    Purpose of Funds Must Be Clearer

    Mr. Lew. That is a point well taken and we should all do as 
good a job as we can on all the budget justifications to give 
the committee and all the subcommittees the understanding that 
they deserve in terms of what the purpose of the dollars are.
    Senator Shelby. Help us and help the staff and help the 
public understand what this expenditure is for, is it 
justified, and the clarity of what it is really for.
    Mr. Lew. The difference between those two elements is very 
important. The payment is justified. There is no doubt the 
payment is justified. If Amtrak has withheld as an employer, it 
still has to make a payment. The employee contribution is made 
by all employers--small businesses, large businesses, Amtrak. 
The payment goes from Amtrak to the Railroad Retirement Board.
    When I say it is the bottomline, if you are looking at the 
total dollars that Amtrak pays and the total revenue that 
Amtrak brings in, there has to be enough to cover it. That is 
why it really does not make a difference whether one defines it 
as being a current expense, an operating expense, or as an 
excess payment in terms of the fact that the dollar has to be 
paid. It does make a difference in terms of the understanding, 
yes.
    Senator Shelby. It does make a difference in clarity.
    Mr. Lew. Yes.
    Senator Shelby. It might not--just for the sake of 
argument, if I picked up your words, it might not make a 
difference on the bottomline. It might or it might not; I do 
not know. But it does make a difference of what you call 
something. It is not always what you call it, but what it is.
    Mr. Lew. I would welcome a discussion of how this 
categorization should work. I just do not want to leave any 
room for misunderstanding. Our view is that the obligation is 
there.
    Senator Shelby. That is why we are having this hearing 
today.
    Mr. Downs.
    Mr. Downs. Mr. Chairman, you know, there has been a lot of 
concern about whether or not we have accurately characterized 
these costs. I also want to, though, go back to the exact 
language in the fiscal year 1991 appropriations act. It says:

    The committee directs Amtrak to estimate the total amount 
of Amtrak payments into the two trust fund accounts and to 
provide to the committee its estimate of excess Railroad 
Retirement [Tier II and supplemental benefit] payments and 
railroad unemployment insurance benefits and repayment tax 
payments for the next fiscal year.

    We have followed that language. If the committee chooses to 
change that language, I think that is more than appropriate and 
I would welcome a clarification through the Appropriations 
Committee language to put this issue to rest.
    We have done our best to try to adhere to that language 
direction and the appropriations bill. We have done nothing 
other than that in the characterization of these costs. If we 
have erred, it was not continually raising this language 
direction from the Appropriations Committees back to Amtrak to 
get a reconfirmation. But we have had reconfirmation through 
the administration, through the U.S. DOT, of the 
appropriateness of this characterization.
    It is appropriate for this committee to decide how those 
costs are classified, and I would welcome a clarification.
    Senator Lautenberg. May I just say this, Mr. Chairman?
    Senator Shelby. Senator Lautenberg.
    Senator Lautenberg. In 1991 when I was chairman, I did 
provide a separate appropriation using the current calculation. 
The House agreed to this approach, the current approach, and 
that is why Amtrak continues the budget this way.
    So we heard from the chairman. I submit: Do not argue; do.

                 Amtrak's Obligation Under Current Law

    Senator Shelby. Mr. Lew, help me here. Is what you are 
saying, is it that we could save the employees' share of the 
tax liability if someone other than Amtrak withheld the tax?
    Mr. Lew. I am saying, as with any tax, policy can be made 
to reallocate tax burden. Under the current law, under the 
current law Amtrak has no choice. It has to pay the tax that is 
due. I am not recommending that Congress----
    Senator Shelby. Let me ask you this. Are we really 
reimbursing Amtrak for something that we should not be 
reimbursing them for? It looks that way.
    Mr. Lew. No; I do not think so. I think that----
    Senator Shelby. Why?
    Mr. Lew. When Congress wrote and the Railroad Retirement 
Tax Act was enacted into law, it set up a tax system to fund 
the railroad retirement payments. Amtrak is paying its share of 
that, just as any other carrier is. There are some freight 
carriers who are paying more than they should, I am sure, than 
others, or they would argue that they are paying more than they 
should.
    Senator Shelby. Are the employees paying their share, too?
    Mr. Lew. Well, in any system, just like Social Security, 
where there are employee withholdings, the employees are paying 
their share and it is being remitted through the employer.
    Senator Lautenberg. How much of this is transmitting 
withheld deductions?
    Mr. Lew. I can give you the numbers if you would like, 
Senators. The total amount that Amtrak pays as an employer, as 
a corporation, is $230.5 million. The total amount of payment 
by Amtrak as a withholding agent is $113.1 million.
    Senator Lautenberg. That is employees' money----
    Mr. Lew. That Amtrak is withholding.
    Senator Lautenberg. Deducted from their wages----
    Mr. Lew. Correct.
    Senator Lautenberg. And forwarded. You are a custodian 
simply in that?
    Mr. Lew. Just like any other employer. It is against the 
law not to pass on the payments that are withheld, so Amtrak 
has no choice.
    Senator Lautenberg. You are a custodian. You are not asking 
for more money here because of that?
    Mr. Lew. No, no; it would require rewriting and 
reallocating the burden of paying for the Railroad Retirement 
System, which I would submit is fairly substantial policy. I am 
not an expert on it. I do not know how I would recommend such 
an issue be addressed.
    I would just say that it is not a question of Amtrak having 
any choice. They are bound under the current tax law, and all 
we are saying is that if they have to pay the tax that goes 
into their outlays, and when we calculate the subsidy required 
it is part of the calculation.

                 Clarity in Budget Presentation Needed

    Senator Shelby. Mr. Lew, is it not important, though, to 
have clarity?
    Mr. Lew. I agree about clarity.
    Senator Shelby. Now how are we going to get it?
    Mr. Lew. We would be delighted to pursue this with your 
staff.
    Senator Shelby. Work with the staff.
    Mr. Lew. Yes; absolutely. We have always been open to this 
discussion, and I only half facetiously suggest we may be too 
open to this discussion. We are delighted. OMB always 
encourages better understanding of these scoring issues, and if 
we get into a technical discussion we sometimes change our 
minds. I am not saying this is an area where we would, but we 
did not view this as a policy judgment. We viewed this as an 
attempt to get clarity.
    Obviously, our attempt to get clarity has created something 
of an issue because it has been misread and I would argue 
perhaps selectively quoted.
    Senator Shelby. Could you work with the staff to try to 
clear up what we are trying to get at?
    Mr. Lew. Sure.
    Senator Shelby. Which is really truth in budgeting, is it 
not?
    Mr. Lew. We would be delighted to.

                         Conclusion of Hearings

    Senator Shelby. Thank you, gentlemen. That concludes the 
hearings. The subcommittee will recess and reconvene at the 
call of the Chair.
    [Whereupon, at 12:01 p.m., Thursday, July 17, the hearings 
were concluded and the subcommittee was recessed, to reconvene 
subject to the call of the Chair.]



 DEPARTMENT OF TRANSPORTATION AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 1998

                              ----------                              

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

    MATERIAL SUBMITTED BY AGENCIES NOT APPEARING FOR FORMAL HEARINGS

    [Clerk's note.--The following agencies of the Department of 
Transportation and independent related agencies did not appear 
before the subcommittee this year. Chairman Shelby requested 
these agencies to submit testimony in support of their fiscal 
year 1998 budget request. Those statements and answers to 
questions submitted by the chairman follow:]

                      DEPARTMENT OF TRANSPORTATION

                     Federal Highway Administration

            Questions Submitted by Senator Richard C. Shelby

                intelligent transportation system (its)
    Question. We understand that the ITS program is continuing to 
expand to include an array of diverse groups and to serve numerous 
purposes. For example, do you plan on expanding your involvement with 
the Maritime Administration, the intermodal freight industry, the 
railroad industry, and FRA? If so, how is this reflected in the fiscal 
year 1998 budget request and the fiscal year 1997 spending plan?
    Answer. The ITS program was established to explore, evaluate, and 
promote deployment of effective advanced transportation technologies 
and strategies, regardless of mode. Indeed, we have found that the 
integrated deployment of technologies across modes often provides the 
most benefits, to the widest cross section of transportation system 
users.
    We have proposed a modest highway/rail intersection program within 
the fiscal year 1998 budget request to explore warning and control 
technologies and techniques with the potential to significantly reduce 
highway-rail crossing hazards. We also plan to propose a modest 
intermodal freight program in the fiscal year 1999 budget request, 
which will explore technologies and techniques for improving the safe, 
seamless, and efficient movement of intermodal freight.
    The primary purpose of these modest programs is to determine the 
cost effectiveness of applying ITS technologies and strategies in new 
modal settings. If found to be cost effective, support for widespread 
deployment of these technologies and strategies will be more heavily 
emphasized within the program.
    There are no projects funded within the fiscal year 1997 spending 
plan which directly support these program areas, although there have 
been some past investments in these areas (e.g. fiscal year 1996 
development of Highway-Rail Intersection user service; fiscal year 1996 
intermodal freight study), as well as continued devotion of Department 
staff to further exploring these areas.
    Question. Has the program reached the point where you are serving 
too many transportation communities and needs? Would it be worthwhile 
refocusing your efforts on only those user services and transportation 
problems which could be most cost effectively addressed with ITS 
monies?
    Answer. We believe the current program balance among the various 
modes is appropriate. As noted above, the charge of the ITS program is 
to explore, evaluate and promote deployment of effective advanced 
transportation technologies and strategies, regardless of mode. The 
modest investments we are making and proposing to make in ``new'' modal 
areas of exploration will provide us with fundamental information on 
the cost effectiveness of ITS deployment for these modes. The vast 
majority of ITS program resources continue to be invested in those 
program areas which we already know to be very cost effective.
    Question. How are you achieving a balance between the increased 
political support you gain by including numerous segments of the 
transportation community in the ITS program versus the benefits of 
funding only the most cost effective investments?
    Answer. The implication in this question that we are trading 
political support for cost effective investment is inaccurate. As noted 
above, the charge of the ITS program is to explore, evaluate and 
promote deployment of effective advanced transportation technologies 
and strategies, regardless of mode. The vast majority of ITS program 
resources continue to be invested in those areas which we already know 
to be very cost effective. Political support for ITS from a wider cross 
section of the transportation community is a byproduct, not a goal, of 
the diversity of the program.
    Question. If ITS is so cost-beneficial, why in your reauthorization 
proposal are you requesting $10,000,000 for training related to ITS? 
Won't the documented benefits of ITS catalyze additional investments 
without spending so much on training?
    Answer. Because many transportation professionals are finding 
various ITS applications cost beneficial, the levels of deployment of 
individual components are steadily increasing. It this situation two 
issues are at stake: 1) Stewardship--federal funds are being used for 
implementation. Lack of experience and skill in designing, specifying, 
procuring and managing the implementation of these systems can lead to 
dramatic cost increases and waste of money. 2) Shaping the deployment. 
The components can be deployed as individual islands in the current 
paradigm of stove piped modes and agencies, or they can become a part 
of an information and communication platform that enables the bridging 
of this fragmentation, creating an intermodal ``system of systems.'' 
This opportunity will be lost within about five years because the 
current rate of ``isolated'' deployment will have cast the die--unless 
we intervene with training. The professional capacity building effort 
is designed to address these two needs.
    Question. Is FHWA spending about $5 million during fiscal year 1997 
on professional capacity building? Were these monies derived from ISTEA 
or GOE? How was this amount arrived at and why does this activity need 
to continue? How much are you planning to spend on this area during 
fiscal year 1998? Why is the requested increase judged important?
    Answer. The fiscal year 1997 budget for the Professional Capacity 
Building program is $5 million. Of that total, $2 million is GOE money 
and $3 million is ISTEA money. The $5 million will address training 
needs across ITS traffic management, transit management, traveler 
information and commercial vehicle operations program areas. The goal 
of the first year of the Professional Capacity Building Program is to 
educate the entire field staff of FHWA and FTA with some inclusion of 
NHTSA and FRA staff. As such, much of the fiscal year 1997 funding is 
allocated to distribution and presentation expenses. Other significant 
costs are for development of several specialty modules such as a short 
course on transit management and a four-day ITS system integration 
course.
    Developing and providing this training initially to USDOT staff and 
soon thereafter to state and local agency personnel is crucial to the 
successful deployment of ITS applications. ITS is, in many ways, a 
fundamental shift from the traditional ways of conceiving, procuring, 
designing and installing transportation improvements. New skills are 
required in each of these areas. Without a significant skill building 
effort in a number of technical areas, ITS deployment efforts will be 
less efficient. USDOT projects that a number of metropolitan and rural 
areas will need technical training over the next few years. USDOT has 
historically been a leading provider of training to state and local 
agencies, and in the case of ITS technical training, the economies of 
scale allow the USDOT to more cost effectively develop training 
materials that are applicable to numerous agencies. Additionally, 
course materials will be made available through the Internet to promote 
the use of the information by universities and other educational 
institutions.
    The current budget projection for fiscal year 1998 include a total 
of $10 million for training. This request is similar to the request 
(though not the appropriation) made in fiscal year 1997. Both requests 
reflect the urgency for massive retraining that was reflected in the 
recent GAO report. Of that total, $8.75 million will support training 
for ITS travel management including traffic and transit management and 
traveler information and $1.25 million will support training in the 
commercial vehicle operation area. Much of the key technical training 
topics such as architecture, standards and telecommunication will be 
funded from the travel management portion of the funds even though 
those subject areas underpin the entire ITS deployment effort. The 
funds also support presentation of the courses, production of course 
materials, the services of a program manager, and logistical support 
for arrangement of course presentation.
    The Professional Capacity Building Program is key to the success of 
ITS deployment and is a significant role for the USDOT.
    Question. We understand that you are allocating Federal funds on 
scanning tours and on scholarships to ensure that State and local 
governmental leaders and traffic engineers and operators have a chance 
to visit exemplary ITS sites and to attend major ITS meetings and 
seminars. How much was allocated for these types of activities during 
fiscal year 1996 and fiscal year 1997? Please justify these expenses, 
explain their importance, and specify proposed funding levels for 
fiscal year 1998.
    Answer. In fiscal year 1996 the FHWA allocated $150,000 to provide 
scholarships to state and local transportation professionals to review 
intelligent transportation systems operating in seven locations along 
the eastern coast of North America and to participate in the 1996 ITS 
World Congress in Orlando, Florida in October, 1996. Ten public agency 
transportation professionals participated in both the field review of 
deployed intelligent transportation systems and World Congress 
meetings. This funding also supported an additional twenty-two state 
and local transportation professionals to participate in the ITS World 
Congress sessions. This scholarship program was administered jointly by 
the Institute of Transportation Engineers and Public Technologies, Inc.
    In fiscal year 1996, the FHWA provided $360,000 to support 
Executive ITS Scanning Reviews. The purpose of these reviews was to 
improve the awareness of the benefits and capabilities of integrated 
intelligent transportation systems by high level state and local 
officials, transportation decision makers and planning organization 
executives. More than 294 state and local executives participated in 
these scanning reviews representing highway and transit agencies, 
elected officials, and transportation planning professionals.
    In fiscal year 1997, two special scanning tours were held in 
Atlanta. In two, two-day events more than 160 top officials toured ITS 
facilities and operations in the state, city and transit authority. In 
fiscal year 1997, the FHWA has again allocated $150,000 for the 
Scholarship program and $360,000 for the Executive ITS Scanning Review 
program. The scholarship program funds will be used to conduct a review 
of integrated intelligent transportation systems in a number of cities 
in the south and southwestern portions of the United States, similar to 
the fiscal year 1996 East Coast Review, and to support a limited United 
States representation from state and local agencies at the 1997 ITS 
World Congress meeting in Berlin, Germany. The Executive ITS Scanning 
Review program is again being jointly administered by the FHWA and FTA 
Regional Offices and will be used, not only to enable state and local 
decision makers to experience firsthand the capabilities and benefits 
of ITS, but also to provide the opportunity for these participants to 
meet with their peers at these sites to discuss the actions and support 
required to fund, implement and operate ITS applications.
    The purpose of the ITS Scholarship program is to provide 
opportunities for some state and local government officials and 
transportation professionals to participate in an event that will give 
them maximum exposure to ITS technology, benefits, and issues in the 
least time and at least cost. Most of the work in developing and 
implementing ITS systems takes place at the state and local level. It 
is at this level that the needs for these systems are first identified 
and the projects to implement application of these advanced 
technologies take shape. Yet, state and local budgets do not support 
such travel. The USDOT believes that the use of these funds are 
essential to speeding the application and use of these ITS technologies 
through state and local ITS implementation programs.
    The Executive ITS Scanning Review program was developed in 1996 in 
response to a request by FHWA and FTA field forces as a means of 
exposing high level state and local decision makers and transportation 
executives to the capabilities and benefits of ITS technologies. Many 
of these officials have heard of ITS but have no way to visualize or 
appreciate what it can do for their transportation problems and needs. 
The staff in the Regional Offices of FHWA and FTA work together to 
develop a concept plan for each review. The reviews are designed to 
highlight ITS technologies that are applicable to the interests and 
needs of the individual review executives. The reviews are intended to 
bring together the appropriate officials from a full range of 
interested ITS partners, providing an opportunity for multi modal team 
building and awareness of ITS applications across all modes. These 
reviews also provide a forum for peer to peer discussions between 
officials interested in learning more about the ``what and how'' of ITS 
and their counterparts that have carried out the systems to address 
those issues. One example came as a result of the Atlanta scanning 
tours, where immediately following the tour, the top executive for a 
state DOT allocated much needed personnel resources to their local 
effort based on the demonstrated effectiveness and personnel needs 
illustrated in Atlanta.
    Scholarship recipients and Scanning Review participants have 
evaluated favorably the professional benefits from participating in 
these programs. USDOT field staff has also strongly recommended the 
continuation of the Scanning program. Based on these recommendations 
and the continuing need to raise awareness and demonstrate benefits, we 
propose to continue these programs in fiscal year 1998 at the same 
funding level as in fiscal years 1996 and 1997.
    Question. What is your strategic vision for the ITS Rural Program?
    Answer. The vision for the Rural ITS program is to improve the 
safety and security of the rural traveler, especially given the 
differences with the urban environment. Similarly, isolation is a 
factor that impacts both the transportation disadvantaged and the 
economic vitality of the communities in Rural America, therefore 
reducing isolation is important. Additionally, as resources continue to 
become more scarce, using advanced technologies to improve the 
efficiency and productivity of operating and maintaining transportation 
services is crucial, especially given the high costs associated with 
rural transportation operations and maintenance.
    Question. How are you planning to use the fiscal year 1998 funds 
that are requested for rural projects and related research?
    Answer. In fiscal year 1998, we have requested $2 million for 
research and $5 million for operational tests. The project descriptions 
follow:
    1. Development of Rural ITS Services--$1.9 million.--This will 
provide $1.9 million to continue the development of rural user services 
that will reduce traffic fatalities, reduce emergency medical response 
time, improve the efficiency and availability of rural transit services 
and improve the availability/quality of traveler information. This will 
be accomplished by resolving the technological and institutional issues 
through basic research and/or field trials targeted at the high 
priority needs in each of the seven critical program areas. The results 
of this effort will either lead to operational tests of specific user 
services or development of deployment guidance for rural transportation 
planners. This is a three year program initiated in fiscal year 1997 
and is projected to end in fiscal year 1999; total cost is estimated to 
be $4.5 million with funding by fiscal year estimated as follows: 
fiscal year 1998, $1.9 million, fiscal year 1999, $2 million, fiscal 
year 2000, $600,000.
    2. Analysis of Site Characteristics--$100,000.--This will provide 
$100 thousand to FTA to initiate an analysis of data previously 
collected to assess characteristics of rural transit systems and 
recommend appropriate APTS technologies based on site characteristics. 
The result of this project will be a guide for rural transit operators 
recommending specific ITS technologies will solve their site specific 
problems. This is a 1 year project with a total cost of $100,000.
    3. Field Operational Tests--$5.0 million.--This will fund up to 
four operational tests of rural ITS user service groups. The specific 
evaluation goals will be developed during fiscal year 1997 in the Rural 
ITS elements definition for concepts determined to be critical to rural 
ITS implementation but requiring operational testing prior to 
deployment. Examples of potential test categories include:
  --Traveler safety and security.--This project(s) will evaluate the 
        effectiveness of promising technologies for the reduction of 
        rural accidents and fatalities which were identified in the 
        Development of Rural ITS Services Project. Candidate 
        applications include roadway departure, animal vehicle 
        collision, low-cost in-vehicle hazard warning systems, Variable 
        Speed Limits using various algorithms (refine algorithms as 
        appropriate) Surrogate evaluation parameters will be developed 
        for crash reduction, cost effectiveness and deployability.
  --Rural infrastructure operations and maintenance.--In fiscal year 
        1998 a sample of rural highway departments, representing 
        different operating environments, will be analyzed to identify 
        the operations where improved technologies, procedures and 
        coordination of resources can reduce costs, and increase 
        effectiveness within budget constraints. These projects will 
        include a range of capital-intensiveness and suitability for 
        operations of different sizes and extent of roadway and may 
        include: Wireless Communication Requirements and Coordinated 
        Rural Traffic Management.
  --Rural fleet operations and maintenance.--This Operational Test will 
        expand the Integrated Regional Fleet Management System to 
        include other governmental services (e.g., police, fire, EMS 
        and utilities) within a rural environment. The fiscal year 1998 
        activity will permit two or more transit authorities within a 
        region to integrate their services (vis-a-vis systems) into a 
        regional transportation system that will be ``seamless'' to the 
        customer and will be more efficient since a single dispatch 
        center will be formed and operated, instead of multiple 
        centers. This expansion will integrate other governmental 
        services with the transit component so ITS infrastructure costs 
        can be shared among users so to avoid duplication. This project 
        will incorporate several high priority elements in developing 
        the integrated regional fleet management system (both for 
        transit initially and then for other governmental functions). 
        This project is focused on rural applications, but has 
        applicability to all areas with multiple fleets operating 
        within a geographic area.
    Question. How do you know that there is a balance between rural and 
urban ITS needs in your program?
    Answer. In the past there has been greater research and deployment 
attention given to metropolitan and commercial vehicle ITS research 
than to rural. There was however reasonable balance with operational 
tests with well over \1/3\ devoted to rural applications. Both the 
metropolitan ITS applications and commercial vehicle applications had 
the benefit of well over a decade of past research, making these 
technologies more ``ripe'' for deployment.
    Recognizing the potential for rural applications, U.S. DOT launched 
a rural research needs and ITS opportunities assessment in 1995, that 
and early results of several ITS operational tests formed the basis of 
the rural strategic plan published in early 1997. In developing that 
plan we recognized that there were several rural technologies that were 
similar or identical to those in the metropolitan infrastructure, 
albeit with different applications. For example, many of the travel 
management and traveler information systems used for tourist 
information rely on the same technology as that used in metropolitan 
areas, but the type of information delivered is different, and 
strategies used for management is different.
    We have proposed, both in the 1997 and 1998 budget a major increase 
in rural research and operational tests. These efforts will provide 
cost benefit information that will allow the department to more 
appropriately compare the potential payoff of rural vs. urban 
applications and perhaps adjust the balance between the two. In the 
meantime, several applications have proven themselves such as road 
weather information systems, travel information systems, and automated 
dispatch and tracking of rural para transit. Recognizing this we will 
encourage deployment of these applications thru the proposed deployment 
incentives program.
    Question. What could be accomplished with additional funds provided 
beyond the requested amount for rural projects?
    Answer. Additional funding would be used to conduct additional 
operational tests in the seven critical program areas: Traveler Safety 
and Security; Emergency Services; Tourism and Travel Information 
Services; Public Traveler Services/Public Mobility Services; 
Infrastructure Operating and Maintenance; Fleet Operating and 
Maintenance; and Commercial Vehicle Operations. This would allow us to 
evaluate systems at multiple environments. This is a critical 
evaluation factor because of the diverse climate and topography which 
characterizes rural America. The priorities are:
    Rural emergency services.--This project will evaluate an Advanced 
Mayday System which combines communications technologies, AVL and 
dispatching methods with improved institutional arrangements between 
ISP's, PSAP's and EMS, to reduce response times, decrease morbidity and 
fatality, and improve the efficiency of emergency services in remote 
and rugged rural areas. Traveler MAYDAY service, direct emergency calls 
and calls from patrol agencies will be included. This project will 
determine if further reduction in emergency response can be achieved 
beyond faster notification.
    Tourism and traveler information systems.--This project will 
evaluate the information collection and dissemination techniques (such 
as high speed AM subcarrier for broadcast messages in coordination with 
Herald Phase III) developed in fiscal year 1998 in the Development of 
Rural ITS Services Project. Testing will be conducted at 2 or more 
sites in order to evaluate the systems in different environments. 
Evaluation parameters will be developed to measure impact of traveler 
information on economic development, and the effectiveness of 
alternative dissemination techniques.
    Rural infrastructure operations and maintenance.--Additional 
projects for this critical program area would be funded which include:
  --Appropriate traffic signal and traffic management systems.--
        Evaluate the performance, architecture and cost effectiveness 
        of these systems for small urban areas potentially linked to 
        regional TMC's. Test and evaluate alternatives to extend 
        surveillance from an urban TMC out into rural areas (besides 
        CCTV); Test and evaluate alternatives to measure A ``short'' 
        link travel times (i.e., expand upon SDAS). Refine algorithms; 
        and Test and evaluate alternatives to linking small-scale TMC/
        TOC's, including their linkage to an urban TMC/TOC. [Would 
        first require defining the components of a small-scale TMC/
        TOC.]
  --Automated Management Systems.--Evaluate the ability to reduce costs 
        associated with operations and maintenance of bridge, pavement 
        and roadside hardware.
    Preliminary integrated systems.--The Rural Operational Test Program 
have been focused on the evaluation of single systems which address a 
critical program area need. Based on definition of integration measures 
associated with the ARTS infrastructure, field tests will be devised 
for one or more rural areas that will maximize the integration measures 
with substantially existing ARTS components, and will evaluate the 
increased operational and cost-effectiveness resulting from 
integration.
    Question. What are the estimated total number and types of ITS 
standards that must be agreed upon to ensure interoperability? What 
remains to be done to research agreement on each standard?
    Answer. The ITS National Architecture results indicated that to 
achieve national interoperability, there are 45 interfaces that need to 
be standardized. In addition, there are a number of interfaces 
requiring standardization to facilitate regional interoperability. As 
such, a rough estimate of the number of new standards required to 
ensure interoperability is somewhere between 50 to 100--the list is 
still evolving. Part of the problem in estimating the numbers is the 
level of granularity for which a particular standard is developed. Some 
groups combine activities and represent their results in a single 
standard, while others may prefer a greater partitioning, resulting in 
multiple standards. In some cases, additional standards are being 
identified as the interoperability requirements are better understood.
    There are a number of different types of standards currently under 
development by the SDO's. These take the form as described below, and 
are being developed to provide both national and regional 
interoperability:
  --Communications.--Standards relating to communications protocols in 
        most cases already exist as industry standards. In a few cases, 
        however, there are requirements to develop new or modify 
        communications standards to support ITS applications. Examples 
        are: Dedicated Short Range Communications (DSRC), Hi-Speed FM 
        Subcarrier, and National Transportation Communication ITS 
        Protocol (NTCIP).
  --Message sets.--The national architecture program's focus was on the 
        development of information flows among the various subsystems, 
        in support of ITS user services. These information flows 
        provide the foundation for the development of message set 
        standards. It is expected that the majority of the standards 
        development work will be in this area. Unlike communications 
        standards, very little, if any ITS message set standards exist. 
        Examples of the types of message set needing to be developed 
        are: Mayday, traveler information, real-time transit 
        information, etc.
  --Enabling.--There are a number of standard activities that are 
        supported by a common foundation. Enabling standards provide 
        this foundation and in many instances, provide uniformity 
        across application areas. Examples of such enabling standards 
        are: data dictionaries, common formatting standards, location 
        referencing, spatial database interchange, etc.
  --Other.--There are additional needs not neatly fitting into any of 
        the above categories. This would include such things as, safety 
        and human factors, etc.
    The activities involved in developing the standard and ensuring 
interoperability include: technical development (i.e., the committee 
process), consensus building (i.e., the balloting process), and in some 
cases operational testing. More specifically, the standards being 
developed will promote interoperability but not necessarily ensure it. 
Especially, in situations where multiple standards are expected to 
``play together'' (i.e., the integration of multiple system elements). 
To ensure interoperability for this broader perspective, system level 
field testing may be required, for particular implementations.
    What follows is a graphical depiction of the schedule for 
completion of each standard currently underway. The list is still 
incomplete in that additional standards are still being identified.
[GRAPHIC] [TIFF OMITTED] TFHA.000

[GRAPHIC] [TIFF OMITTED] TFHA.001

    Question. How is the Department effectively addressing the most 
critical technical and operational challenges affecting the innovation 
of ITS, including research, operational tests, and deployment 
components? How do you know these are the most critical?
    Answer. U.S. DOT is pursuing a broad strategy which involves key 
assumptions of ``sequencing''. The assumptions are that (1) Several of 
the private sector technologies and services cannot be deployed without 
a basic ITS infrastructure. (2) There is little value in extending the 
state of the art in ITS infrastructure if the level of the state of the 
practice remains at a pre-ITS level. Thus in the past two years and in 
the coming three to five years our emphasis will be on supporting 
deployment of ITS infrastructure and investing in research in safety 
related in-vehicle technology. This basic strategy has been discussed 
at numerous ITS America Board meetings and the philosophy ultimately 
adopted in the articulation of the National Deployment Goal.
    Within that broad strategy, we have developed road maps with the 
aid of support contractors skilled in systems management and subjected 
elements of the program to a variety of peer review exercises. These 
include a very formal review by the ITS America ATMS committee, a 
Professional Capacity Steering Committee, A National Academy Review of 
the AHS work this summer, intense review, and discussion of the CVISN 
roadmap by ATA, the ITS A CVO committee and by field implementers. We 
expect to subject our Intelligent Vehicle Initiative to similar 
industry and peer scrutiny.
    Question. Is the Department appropriately balancing Federal 
investment among the various components of the ITS program, including 
research, operational testing, pre-deployment, and deployment 
activities?
    Answer. Given the existing technical and operational challenges 
facing the program, we believe the current program balance is 
appropriate. We have proposed an approximate division of resources for 
fiscal year 1998 (including both contract authority and appropriated 
funds) of 25 percent for research and development activities; 13 
percent for operational tests; 14 percent for deployment support 
activities such as standards and training development; 8 percent for 
crosscutting activities, such as program assessment and program 
support; and 40 percent for deployment incentives. This represents 
nearly an even balance between program activities designed to explore 
ITS technologies and strategies and program activities designed to 
support and deploy technologies and strategies which we know to be 
effective.
    Question. Has the scope, diversity, and funding level of the ITS 
program surpassed DOT's capability to effectively manage this complex 
initiative? (Please take into account a variety of factors including 
personnel ceiling limitations, the progress made to date, scope and 
number of projects already underway, and the goals and objectives of 
the program.)
    Answer. No. Given the personnel ceilings and number of projects 
underway, we have turned to the use of support contractors who bring 
expertise and experience in managing complex programs in NASA and the 
Department of Defense. Without funding for that management support the 
complexity of the program would exceed the current staffs' ability to 
manage it. With continuing support that we receive from these 
contractors, we are confident in our ability to effectively manage the 
ITS program, particularly with the management controls that have been 
implemented in the last two years. Overall funding amounts received for 
the program over the last several years have actually been relatively 
stable. Further, much of the management of the proposed incentives 
awards will be delegated to the FTA and FHWA field offices.
    Question. The Department supports the expenditure of millions of 
dollars on outreach, public information, mainstreaming, training, and 
other activities aimed at promoting the innovation of ITS. Does the 
Federal Government's experience in innovation suggest that ``pushing'' 
technologies into marketplace works?
    Answer. ITS is a manifestation of the information and communication 
revolution that is affecting every aspect of American life and every 
aspect of business and government. We are increasingly finding that 
once the benefits of a particular ITS application are demonstrated, it 
is generally accepted. Our focus now is on communicating benefits, 
training an industry that has a civil engineering base in ITS 
specification, management and procurement skills, and developing the 
incentive and technical base for integrated deployment. We do not 
believe that we are aggressively ``pushing'' this technology.
    Question. Please specify the amount and purposes of all fiscal year 
1996 and fiscal year 1997 monies to be allocated on systems 
architecture.
    Answer. The details of allocated expenses for the Systems 
Architecture Program for fiscal year 1996 and fiscal year 1997 are as 
follows:
    Funds for both fiscal years are:

                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                  Fiscal years--        
                                         -------------------------------
                                               1996            1997     
------------------------------------------------------------------------
Architecture technical support..........             485  ..............
Architecture development................           2,075  ..............
Architecture deployment/implementation                                  
 support................................           1,000             900
Architecture maintenance................             525           2,500
                                         -------------------------------
      Total.............................           4,085           3,400
------------------------------------------------------------------------

    Architecture Technical Support (Engineering) was procured to 
technically review and support the development of the National 
Architecture products. This primarily consisted of an industry based 
Technical Review Team (TRT) composed of industry experts knowledgeable 
in the technical disciplines and technologies involved in the National 
ITS Architecture.
    Architecture Development was the work actually performed by the 
Lockheed Martin and Rockwell International architecture development 
teams producing the National ITS Architecture products.
    Architecture Deployment/Implementation Support is technical 
assistance from the architecture team to local officials which we will 
continue until we have provided sufficient training to the consultant 
community and state and local system integrators. As a top priority, 
the National ITS Architecture teams are currently working with the four 
metropolitan Model Deployment Initiative sites to facilitate the 
identification of common system interfaces where the sites may generate 
de facto standards. The CVO architecture team is conducting extensive 
architecture workshops with the 8 CVO model deployment sites to insure 
interoperability among the sites. The teams are scheduled to interface 
with other metropolitan planning organizations as their needs arise.
    Architecture Maintenance is maintaining the National ITS 
Architecture documentation and data base in a current and useable form. 
Until we are through a transition to a full main streaming of the 
architecture, it will be maintained by U.S. DOT by a small element of 
the National ITS Architecture team. They will be responsible for 
providing support to a dynamic standards setting process and modifying 
the architecture as a result of experience gained from operational 
tests, the standards setting process and ITS research and development. 
New user requirements stemming from research will be incorporated into 
the architecture and updated materials made available in hard copy, on 
the Web, and via CD.
    Question. Please breakout in detail the expected uses of the monies 
requested to advance the systems architecture during fiscal year 1998.
    Answer. Funds for the fiscal year are as follows:

                        [In thousands of dollars]

                                                        Fiscal year 1998
Architecture technical support....................................   300
Architecture maintenance.......................................... 2,500
                        -----------------------------------------------------------------
                        ________________________________________________
      Total....................................................... 2,800

    Architecture Technical Support (Engineering) is procured to 
technically review and to provide management support to the development 
of the National Architecture products. This primarily consisted of 
technical experts knowledgeable in the technical disciplines and 
technologies involved in the National ITS Architecture.
    Architecture Maintenance is maintaining the National ITS 
Architecture documentation and data base in a current and useable form. 
Until we are through a transition to a full mainstreaming of the 
architecture, it will be maintained by U.S. DOT by a small element of 
the National ITS Architecture team. They will be responsible for 
providing support to a dynamic standards setting process and modifying 
the architecture as a result of experience gained from operational 
tests, the standards setting process and ITS research and development. 
New user requirements stemming from research will be incorporated into 
the architecture and updated materials made available in hard copy, on 
the Web, and via CD. In addition this includes technical assistance 
from the architecture team to local officials which we will continue 
until we have provided sufficient training to the consultant community 
and state and local system integrators. As a top priority, the National 
ITS Architecture teams are currently working with the four metropolitan 
Model Deployment Initiative sites to facilitate the identification of 
common system interfaces where the sites may generate de facto 
standards. The CVO architecture team is conducting extensive 
architecture workshops with the 8 CVO model deployment sites to insure 
interoperability among the sites. The teams are scheduled to interface 
with other metropolitan planning organizations as their needs arise. In 
addition this includes technical support by the Architecture teams in 
the generation and issuance of architecture related guidance documents 
to facilitate the understanding and use of the National ITS 
Architecture by various stakeholders in need of having the architecture 
used as a tool in ITS system integration and design. These documents 
provide an understanding of the application of National ITS 
Architecture products to the development of regional architectures and 
the design of ITS deployments. In addition, the documents provide 
design options, tradeoffs, lessons learned, best practices, etc.
    Question. Please specify the amount and purposes of all fiscal year 
1996 and fiscal year 1997 monies spent on standards work.
    Answer. The following table and narrative describe the funding 
allocation for standards activities:

                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                  Fiscal years--        
                Activity                 -------------------------------
                                               1996            1997     
------------------------------------------------------------------------
Spatial data transfer standard..........           1,000           1,000
National transportation communications                                  
 for ITS protocol.......................             750           1,000
CVO standards...........................             500             500
Traffic management system support                                       
 standards..............................  ..............             800
Transit management standards support....  ..............             100
Standards development organizations                                     
 (National Architecture)................           2,000           3,700
Standards management support (JPL)......             300           1,600
Dedicated short range communications....  ..............             100
Core infrastructure standards...........             405  ..............
                                         -------------------------------
      Total.............................           5,455           8,800
------------------------------------------------------------------------

    Spatial Data Transfer Standard.--This activity provides support to 
develop a spatial data location referencing system and define a Spatial 
Data Transfer profile for ITS, simulate the profile in computer models 
and provide technical support for the use of SDTS prototypes in 
operational tests (the actual operational test activity is not covered 
under this activity). This project will also coordinate numerous 
ongoing national and international transportation spatial database 
efforts with the ITS efforts, ensuring inter-operability among modes of 
travel.
    NTCIP.--This activity supports, maintains, and refines the National 
Transportation Communications for ITS Protocol (NTCIP). This funding 
will cover four major areas: (1) continue the consensus building 
process required to establish NTCIP as a national ITS standard, (2) 
introduce additional traffic control devices into the standard, 
including environmental sensors (i.e., fog detectors, air quality 
sensors, etc.), malfunction management units, etc., (3) develop 
necessary interfaces to existing infrastructure therefore enabling the 
retrofit of already deployed equipment, and (4) establish and conduct 
an experimental plan to evaluate the NTCIP at various field sites.
    CVO Standards.--This activity supports national coordination for 
acceptance of the proposed ANSI ASC X12 and EDIFACT standards and work 
with the appropriate organizations to refine and complete a majority of 
the appropriate standards. This will include coordination with CVSA, 
AAMVA, ITSA, HELP, I-75, CDLIS, IFTA, IRP, CVIS, SAFER, States, private 
industry and many other organizations.
    Traffic Management System Support Standards.--This activity 
supports development and adoption of standards and guidelines directed 
towards traffic management systems. The deployment of ATMS encompasses 
the establishment of traffic control centers. The functionality within 
the control centers needs to allow for alternate computing 
architectures which can be configured based upon existing 
communications infrastructure and desired functionality. Standards that 
allow for the integration of vendor independent products, both hardware 
and software, will be required. These standards will create and sustain 
a broad-base market for manufacturers, facilitate the retrofitting of 
already deployed systems, and significantly increase the life of 
traffic control systems. In turn, these standards will also provide 
interoperability and interchange ability of traffic control products.
    Transit Management Standards Support.--This project supports 
activities to the International Standards Organization undertaken by 
the U.S. as the designated international lead country for public 
transit.
    Standards Development Organizations (National Architecture).--This 
activity supports the Standard Development Organizations' efforts to 
obtain dedicated technical and administrative committee support to 
accelerate the standards development process. The technical support 
will consist of research projects, technology assessment activities, 
and testing of developed protocols and standards. Administrative 
support will consist of producing draft standards, supporting 
information facilitation among and within committees, and liaisoning 
with other activities such as research and development efforts, 
operational tests, and deployment. The focus of the standards 
development effort will be on interface standards resulting from the 
national architecture activity.
    Technical Support.--This activity provides support for evaluating 
and monitoring projects generated from the standards cooperative 
agreements with SAE, IEEE, ASTM, ITE, and AASHTO. This includes 
participating in standards committee meetings, helping to identify 
critical standards activities, harmonizing the developing standards 
with the National Architecture, and harmonizing activities with 
international efforts.
    Dedicated Short Range Communication (DSRC).--This activity is to 
help resolve technical and institutional uncertainties that have 
contributed to the lack of movement in the DSRC arena. While the actual 
standard is being defined within the standard development organization 
some additional support work, such as the development of migration 
strategies, that fall outside of standards development, needs to be 
developed.
    Core Infrastructure Standards.--This activity originally was 
focussed on supporting traffic management related activities. A portion 
of this funding was used to initiate a traffic management data 
dictionary with the remainder supporting the general category of 
National Architecture interface standards.
    Question. Will you assure this Subcommittee that the JPO will 
``step up to the plate'' if the standards necessary for 
interoperability are not reached, soon?
    Answer. We assume this question refers to the Department's 
willingness to take a more prescriptive role in the standards 
development process, if the consensus efforts currently underway bog 
down or reach an impasse. We believe there is already evidence of the 
Department's willingness to assume a stronger position through the 
experience with the development of the standard for interoperability of 
dedicated short range communications (DSRC). Last Fall, after the 
consensus process in the development of this standard had reached an 
impasse, the Department called the major industry and public sector 
players in the process together to discuss the Department's intent to 
establish a standard through rulemaking if the impasse continued. This 
and subsequent meetings led to an agreement amongst the industry 
representatives to draft a mutually acceptable standard and establish a 
forum and process to resolve impasse issues. This process is working 
well. A draft DSRC standard ready for ballot is expected to be complete 
by November 1997.
    Question. After more than six year of controversy, does the ITS 
community have standards for dedicated short-range communications, 
which are critical to the program? Will it take this long to reach 
consensus on other critical standards?
    Answer. The previous six years of controversy and slow progress 
surrounding the DSRC standards activities was due primarily to a lack 
of rigor and focus on the technical and institutional efforts. As a 
result of the SDO funding support from FHWA, more progress has been 
made in the last six months than has been made in the last six years. 
Current projections are to have a draft standard by the end of the year 
with compliant product available in 1999. Other standards are not 
envisioned to have to go through as lengthy of a process to reach 
consensus for the same reason we have been able to expedite the current 
DSRC activities. Federal funding support for technical and 
administrative assistance and public agency participation will help us 
avoid the lengthy ``DSRC scenario'' again.
    Question. How much do you expect to spend on advancing the 
architecture and related standards work for each of the next three 
years?
    Answer. The expenditures for architecture and standards activities 
for fiscal year 1997, fiscal year 1998, and fiscal year 1999 are 
defined below.

                        [In millions of dollars]                        
------------------------------------------------------------------------
                                                  Fiscal years--        
                                        --------------------------------
                                            1997       1998       1999  
------------------------------------------------------------------------
Architecture...........................        5.0        2.8        5.4
Standards..............................       8.25       11.5       14.5
                                        --------------------------------
      Total............................      13.25       14.3       19.9
------------------------------------------------------------------------

    Since the completion of the ITS National Architecture in fiscal 
year 1996, there have been three major focuses of the Architecture 
effort. First, the Architecture technical team has been assisting the 
Standard Setting Organizations (SDO's) in the development of the 
standards requirements. Secondly, a major effort is under way to 
provide guidance documentation on the Architecture for use by State and 
local officials and transportation professionals. Finally, training 
materials on the Architecture have been developed to support the 
Professional Capacity Building program. The assistance to the SDO's 
will continue in fiscal years 1998 and 1999. Guidance materials will be 
completed in fiscal year 1998. In fiscal year 1999, there will be a new 
architecture effort to extend the architecture into vehicles in support 
of the Intelligent Vehicle Initiative currently being planned. There 
will also be a small initiative to extend the architecture to include 
the data collecting and planning functions of most transportation 
agencies.
    The standards program is growing in importance to the deployment of 
ITS and the development of products for the ITS market. In fiscal year 
1997, a number of the ITS standards will be available for use by the 
public and private sectors. By fiscal year 1998, we expect to have 42 
new standards available for use by the industry. As a result of this 
activity, which will continue in fiscal year 1999, two new efforts will 
be initiated late in fiscal year 1998 and into fiscal year 1999. User 
guides will be prepared to assist transportation professionals in the 
implementation of the new standards. For a select few of the new 
standards where national interoperability as an essential element, such 
as the communications standard for credentialing commercial vehicles 
across state lines, a testing effort will be initiated to insure the 
necessary interoperability.
    Question. Please submit for the record a copy of your latest ITS 
spending plan for both fiscal year 1997 and fiscal year 1998, showing 
the use of both GOE and other contract monies. Please be certain that 
comparable activities are presented in these tables.
    Answer. The following table reflects the latest ITS spending plans 
for fiscal years 1997 and 1998:

    FEDERAL HIGHWAY ADMINISTRATION INTELLIGENT TRANSPORTATION SYSTEMS--FISCAL YEAR 1997 AND FISCAL YEAR 1998    
                                                 SPENDING PLANS                                                 
                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                            Fiscal years--                      
                                                     -----------------------------------------------------------
                  Activity/project                                1997                        1998 \2\          
                                                     -----------------------------------------------------------
                                                       GOE \1\    ISTEA     Total      GOE      ISTEA     Total 
----------------------------------------------------------------------------------------------------------------
Research and development............................    28,455     4,600    33,055    33,000    12,500    45,500
    Traffic management and software tools...........     2,771  ........     2,771     7,500  ........     7,500
    Commercial vehicle operations...................     7,000  ........     7,000  ........     7,500     7,500
    Crash avoidance research........................     7,000  ........     7,000  ........    12,500    12,500
    Enabling research...............................     4,500  ........     4,500     7,500  ........     7,500
    Rural research..................................  ........  ........  ........     2,000  ........     2,000
    High risk research..............................  ........     4,300     4,300  ........  ........  ........
    Advanced fleet management research..............       300  ........       300     1,000  ........     1,000
    Other R&D.......................................     5,784  ........     5,784     4,000  ........     4,000
    Program assessment..............................     1,100       300     1,400  ........  ........  ........
    Highway rail intersection innovative development                                                            
     research.......................................  ........  ........  ........     3,500  ........     3,500
Automated highway system............................    22,000  ........    22,000  ........    26,000    26,000
Architecture and standards..........................     5,000     7,200    12,200  ........    13,000    13,000
    Architecture....................................  ........     3,400     3,400     2,800     2,800          
    Standards.......................................     5,000     3,800     8,800  ........    10,200    10,200
Operational tests...................................    55,042     5,050    60,092  ........    24,500    24,500
    ATMS/ATIS.......................................    10,000     1,700    11,700  ........  ........  ........
    Commercial vehicle operations (CVO).............    12,500     1,000    13,500  ........     2,000     2,000
    AVCSS...........................................     3,050  ........     3,050  ........    12,500    12,500
    APTS............................................  ........     1,350     1,350  ........     5,000     5,000
    Model deployment................................    26,492  ........    26,492  ........  ........  ........
    Training activities.............................     2,000  ........     2,000  ........  ........  ........
    Rural...........................................     1,000     1,000     2,000  ........     5,000     5,000
Evaluation/program assessment.......................     2,000       100     2,100     9,000  ........     9,000
Mainstreaming.......................................  ........    10,050    10,050     3,000    19,000    22,000
    Commercial vehicle operations (CVO).............  ........     1,000     1,000  ........  ........     (\3\)
    Advanced public transportation systems (APTS)...  ........       450       450  ........  ........     (\1\)
    Training (professional capacity building).......  ........     3,100     3,100  ........    10,000    10,000
    Planning/process guidance.......................  ........     1,000     1,000  ........     4,000     4,000
    Deployment technical assistance.................  ........     4,500     4,500  ........     5,000     5,000
    Awareness and advocacy \4\......................  ........  ........  ........     3,000  ........     3,000
Program support.....................................     7,861       300     8,161     9,000     1,000    10,000
Corridors program...................................  ........    71,700    71,700  ........  ........  ........
ITS deployment incentives program...................  ........  ........  ........  ........   100,000   100,000
National advanced driver simulator (NADS)...........  ........    14,000    14,000  ........  ........  ........
                                                     -----------------------------------------------------------
      Grand total...................................   120,358   113,000   233,358    54,000   196,000   250,000
----------------------------------------------------------------------------------------------------------------
\1\ Amounts reflect $1.642 million reduction associated with the ITS share of $3 million ``Accountwide          
  Adjustments'' shown on page 43 of Conference Report 104-785.                                                  
\2\ Fiscal year 1998 amounts are those included in the Congressional Budget; spending plan will not be          
  formulated until after fiscal year 1998 appropriations are enacted.                                           
\3\ Included in program categories below in fiscal year 1998.                                                   
\4\ In fiscal year 1998 consists of activities formerly funded under items VIA, VIB, and VIE.                   

    Question. How could the ITS program be improved to ensure that 
additional environmental and energy conservation benefits are realized? 
How could the measurement of these environmental benefits be improved?
    Answer. Current ITS traffic management programs attempt to reduce 
energy and emissions by reducing speed variability, excessive 
accelerations and the exposure of travelers to congestion. Advanced 
travel information seeks to provide the consumer with real time trip 
time information via alternate routes and alternate modes. Informed 
choice will generally lead travelers to choose the fastest means of 
travel which is generally the least polluting.
    We recognize that short-term success in reducing congestion will 
lead to more thruput capacity that will ultimately be consumed by 
growth in demand. While more vehicles will yield more pollution--the 
alternatives are worse. New capacity will consume precious land, and 
other environmental resources and lead to further sprawl which is less 
conducive to mass transit service. An ITS managed system--while 
congested will smooth flow, and permit denser development. Over the 
long term ITS infrastructure will enable the use of congestion pricing 
to further manage the use of scarce road space.
    Truly accurate predictions of the impact of surface transportation 
operations improvements are not possible on current transportation or 
air quality models. This was a key finding of a recent analysis done by 
the National Academy of Sciences. Both need substantial improvement.
    Using current tools, the measurement of environmental benefits 
could be improved through field measurements and the institution of a 
coordinated modeling approach. Field measurements can be conducted 
through a sample of instrumented vehicles using both ITS technologies 
such as on-board GPS systems and cellular data links and other 
equipment to collect both vehicle operations and related emissions and 
fuel consumption data. The modeling approach should be sufficiently 
detailed to capture the reduction in accelerations from implementing 
ITS, while concurrently capturing the travel demand impacts of ITS.
    The former impact on accelerations are to be calibrated using the 
measurements gathered from instrumented vehicles, while the travel 
demand impacts are to be captured using surveys.
    The above approach is being pursued for both the energy and 
emissions impacts of metropolitan model deployments.
    Question. Please estimate dollar amounts separately for fiscal year 
1996, fiscal year 1997, and fiscal year 1998 that were used or planned 
for the education of kindergarten to twelfth grade students on ITS. 
Please further justify why this funding is of critical importance.
    Answer. In 1996, $60,000 was provided to the TRAnsportation and 
Civil Engineering (TRAC) program for ITS education of middle and high 
school students. The TRAC program is a hands-on educational package 
that helps students use math and science to solve real-world problems 
in transportation and civil engineering. TRAC, a 6-year old program, is 
a joint AASHTO-FHWA effort consisting of a TRAC kit which stays in the 
classroom throughout the school year. This kit includes a DOS-based 
desktop computer, a set of analog-to-digital data collection probes, 
and printed lesson plans and student materials. Its goal is to 
encourage interest in careers in transportation engineering and related 
ITS disciplines. Special emphasis is given to those currently under 
represented in the field such as minorities and women. There are 
currently 400 participating schools in 23 States, Puerto Rico, and the 
Virgin Islands. In the current year, 83,000 students are making use of 
the TRAC program. As of July 1996, current demand for TRAC, as measured 
by teachers who have specifically requested the program in their 
classrooms, is in excess of 2,100.
    No funding for this activity will be provided in fiscal year 1997 
and no funds are included in the ITS budget for fiscal year 1998.
    At the present time, a Business Plan for the Professional Capacity 
Building program is being developed that will assess the needs and will 
prioritize the limited resource dollars to meet future budget needs. 
The TRAC program will be considered as the needs and resources dictate.
    Question. Is it correct that FHWA is not funding any work 
specifically to promote incident management coalitions during fiscal 
year 1997? In view of the cost effectiveness of this activity and the 
importance of building regional cooperation, what plans have you 
developed to advance this area? How much do you plan to spend during 
fiscal year 1998 on this topic?
    Answer. Because incident management is part of a much larger ITS 
Infrastructure serving the entire metropolitan area for the management 
of all forms of travel, FHWA did not fund this activity in fiscal year 
1997, per se. Instead the concept of coalition building for all players 
for the expanded ITS Infrastructure received a great deal of attention 
thru our training efforts, guidance, and our work with associations. 
Our concern with focusing exclusively on incident management, to the 
exclusion of a larger vision--is deployment of incident management 
programs in a stovepipe fashion.
    Nevertheless, work is continuing with the National Incident 
Management Coalition in fiscal year 1997 with fiscal year 1996 funds. 
In fiscal year 1998 we plan to provide funding for the National 
Incident Management Coalition to continue their work. The proposed 
budget for this work in fiscal year 1998 is $188,000.
    Question. What could be done during fiscal year 1998 to improve the 
state of technology of incident management? What amount do you plan to 
spend in this area during fiscal year 1998?
    Answer. The application of advanced technologies to speed the 
detection and initial assessment of incidents is an area that can 
produce significant results in providing lifesaving assistance and/or 
reducing the impact that incidents have on our transportation systems. 
A number of advanced technologies can be applied to incident detection, 
each with their own strengths, weaknesses, costs and benefits. In 
fiscal year 1998, we propose to examine both existing and proposed 
surveillance systems and to provide a trade off type analysis of these 
systems in the areas of cost effectiveness, flexibility of application, 
compatibility with existing technologies, as well as overall 
maintenance and operational considerations. The intent of this work is 
not to select which surveillance system is better, but rather, to 
generate methodologies for practitioners to use in evaluating 
applicable technologies and selecting the system(s) that best meets 
their needs and budget. The proposed budget for this work in fiscal 
year 1998 is $250,000.
    Question. What is the estimated annual level of expenditures on ITS 
by State and local governments? Please present any historical data that 
are available.
    Answer. Through the existing FHWA Fiscal Management Information 
System (FMIS), we are able to track Federal-aid expenditures on four 
ITS components--traffic signal control systems, freeway traffic 
surveillance and control systems, motorist-aid systems, and highway 
information systems. In fiscal year 1995 (the latest year for which we 
have summary information), Federal-aid expenditures on these four 
components amounted to approximately $1 billion. Historical trend data 
is listed in the attached table, which indicates that the investment in 
these components has been growing rapidly.
    When proposed changes to the FMIS system are implemented, and our 
ITS deployment tracking database is fully populated, we should be able 
to make more accurate estimates of State and local expenditures on ITS 
deployment.

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                     Fiscal years--                                     
                                                               -----------------------------------------------------------------------------------------
                                                                      1991              1992              1993              1994              1995      
--------------------------------------------------------------------------------------------------------------------------------------------------------
Traffic signal control systems (including computerized                                                                                                  
 systems).....................................................   $272,801,631.76   $317,244,058.92   $380,704,078.85   $452,151,298.78   $494,000,112.21
Freeway traffic surveillance and control systems..............     72,478,786.26    153,827,574.15    368,680,215.57    408,677,197.65    503,570,854.94
Motorist aid system...........................................     13,930,195.96      6,989,865.32     22,352,084.80     45,239,999.60     32,100,288.60
Highway information...........................................     13,078,923.29     15,997,416.38     16,513,740.64     20,738,932.13     25,432,206.01
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Question. Please submit for the record a detailed breakout of how 
the fiscal year 1997 funds for model deployment were allocated. Specify 
the amounts and purposes of any supporting contracts.
    Answer.
Travel management
    A total of $20,312,000 in fiscal year 1997 funding for the ITS 
model deployment projects was distributed as follows:
  --New York/New Jersey/Connecticut metropolitan area--$5,760,000.
  --Phoenix, Arizona--$2,920,000.
  --San Antonio, Texas--$2,544,000.
  --Seattle, Washington--$9,088,000.
    The funding was awarded to the model deployment projects through 
cooperative Partnership Agreements between the Federal Highway 
Administration and the appropriate State' Department of Transportation. 
The New York/New Jersey/Connecticut model deployment is a cooperative 
effort among the three participating States, with the New York 
Department of Transportation acting as the lead State for 
administration of the project funding. The Model Deployment Initiative 
is being managed jointly by FHWA and FTA.
    A total of $1,805,000 is being used in fiscal year 1997 to support 
the selected metropolitan area Model Deployment projects, and to 
encourage the non-selected Model Deployment partnerships to continue 
with their ITS deployment plans. This support includes regular 
workshops to facilitate information exchange among the selected Model 
Deployment sites and to provide a forum to address crosscutting issues. 
An additional workshop will be conducted for the non-selected Model 
Deployment sites to encourage their continued pursuit of their 
deployment goals. The funding also provides technical assistance on the 
national ITS architecture, systems engineering and other issues 
relevant to both the selected and non-selected Model Deployment 
partnerships. The funding is allocated as follows:
  --Model Deployment Quarterly Workshops--$105,000.
  --National Architecture ``Early Implementation'' Support--$800,000.
  --Deployment Assistance Workshops and Support--$200,000.
  --Technical/Systems Engineering Support--$500,000.
  --Program Management Software, Internet Site Support--$200,000.
    Evaluation of the Model Deployment effort is essential to obtaining 
the total national program value from the this initiative. To avoid 
conflict of interest created by having a participant evaluate its own 
projects, two ITS Program Assessment support contracts were awarded, in 
part, to evaluate the benefits of the metropolitan Model Deployment 
sites. fiscal year 1997 funds allocated for this evaluation effort 
totals $3,300,000.
Commercial vehicle operations
    For Commercial Vehicle Operations the plan for model deployment 
funding is to allocate approximately $500,000 to each of the nine pilot 
and prototype model deployment states. The model deployment states are 
Maryland, Virginia, California, Connecticut, Colorado, Kentucky, 
Michigan, Minnesota, Oregon/Washington. In addition, $5 million has 
been allocated to Technical Support for the CVISN pilot states to 
conduct CVISN program planning and coordination, CVISN system design 
refinement and extension, EDI standards development, CVISN 
interoperability testing, and architectural refinement and extension.
    Question. Why does the JPO believe it is critical to spend $3.5 
million on highway/rail grade crossings in the ITS program?
    Answer. The importance of funding highway/rail grade crossings in 
the ITS program is to demonstrate that the train control system and the 
highway traffic management system correctly communicate with each 
other, based upon the recently completed ITS National Architecture for 
Highway/Rail Intersections. The system is expected to interconnect 
crossing warning systems with highway signal systems, Positive Train 
Control (PTC), and advanced traffic management systems deployed in most 
major cities in the U.S. The intermodal dynamic traffic control system 
will focus on corridor segments of special traffic flow (school buses, 
hazmat vehicles) and provide advanced information to warn drivers 
approaching a HRI of a train blocking a crossing. The highway-traffic 
management system can then reroute the traffic around the occupied 
crossings to minimize delays to motor vehicles.
    There are two previous ITS investments involving highway/rail 
intersections. Both were earmarked projects. The first project involves 
the Vehicle Proximity Alert System (VPAS), which is designed to warn 
drivers of priority vehicles about the presence of approaching trains 
at rail crossings. The first phase of the project, which required 
several systems to be tested, has recently been completed. Phase two 
started in the Fall of 1996. A test plan has been completed by the 
Volpe Center. Both the states of Michigan and Washington have expressed 
an interest in becoming test sites. They are now developing proposals. 
Approximately $400,000 of the $1,000,060 allocated to the project has 
been spent to date. All of that is ISTEA funds.
    The second project includes the development of a prototype 
integrated warning system for use at railroad/highway grade crossings. 
The purpose is to perform a demonstration of an integrated uniform time 
warning/ITS system on an electrified railroad. The demonstration will 
employ an Intelligent Grade Crossing System (IGC), working in concert 
with an Intelligent Traffic System (ITS) and a modified radio 
communications-based Automatic Train Control (ATC) system. It is being 
conducted by the New York DOT under an earmark of $4,625,000, all ISTEA 
funds. The first phase is complete. The second phase, hardware 
development, is expected to be complete by September 30, 1998. The 
field testing and final evaluation of the system is expected to be 
complete by the first quarter in 2000.
    Question. What has been achieved with past ITS investments in this 
area?
    Answer. The importance of funding highway/rail grade crossings in 
the ITS program is to demonstrate that the train control system and the 
highway traffic management system correctly communicate with each 
other, based upon the recently completed ITS National Architecture for 
Highway/Rail Intersections. The system is expected to interconnect 
crossing warning systems with highway signal systems, Positive Train 
Control (PTC), and advanced traffic management systems deployed in most 
major cities in the U.S. The intermodal dynamic traffic control system 
will focus on corridor segments of special traffic flow (school buses, 
hazmat vehicles) and provide advanced information to warn drivers 
approaching a HRI of a train blocking a crossing. The highway-traffic 
management system can then reroute the traffic around the occupied 
crossings to minimize delays to motor vehicles.
    There are two previous ITS investments involving highway/rail 
intersections. Both were earmarked projects. The first project involves 
the Vehicle Proximity Alert System (VPAS), which is designed to warn 
drivers of priority vehicles about the presence of approaching trains 
at rail crossings. The first phase of the project, which required 
several systems to be tested, has recently been completed. Phase two 
started in the Fall of 1996. A test plan has been completed by the 
Volpe Center. Both the states of Michigan and Washington have expressed 
an interest in becoming test sites. They are now developing proposals. 
Approximately $400,000 of the $1,000,060 allocated to the project has 
been spent to date. All of that is ISTEA funds.
    The second project includes the development of a prototype 
integrated warning system for use at railroad/highway grade crossings. 
The purpose is to perform a demonstration of an integrated uniform time 
warning/ITS system on an electrified railroad. The demonstration will 
employ an Intelligent Grade Crossing System (IGC), working in concert 
with an Intelligent Traffic System (ITS) and a modified radio 
communications-based Automatic Train Control (ATC) system. It is being 
conducted by the New York DOT under an earmark of $4,625,000, all ISTEA 
funds. The first phase is complete. The second phase, hardware 
development, is expected to be complete by September 30, 1998. The 
field testing and final evaluation of the system is expected to be 
complete by the first quarter in 2000.
    Question. Do you have a strategic plan to guide your activities 
specifically in this area.
    Answer. An Action Plan on Rail-Highway Crossing Safety was 
developed by Federal Highway Administration, Federal Railroad 
Administration, Federal Transit Administration and the National Highway 
Traffic Safety Administration in June of 1994. The plan was developed 
to improve safety and prevent trespassing at highway-rail crossings 
throughout the nation. The plan was updated in March of 1996 by a Grade 
Crossing Safety Task Force appointed by Secretary Federico Pena The 
task force concentrated its attention on five problem areas, (1) 
Interconnected highway-rail signal and highway rail crossing warning 
devices, (2) Available storage space for motor vehicles between highway 
rail crossings and adjacent highway-highway intersections, (3) High 
profile crossings and low clearance vehicles, (4) Light rail transit 
crossings, (5) Special vehicle operating permits and information. In 
1996 and early 1997 the ITS Joint Program Office and the Federal Rail 
Administration undertook a project to develop an ITS architecture for 
Rail-Highway Intersections. The architecture is complete and an update 
to the task force's plan is expected to occur in fiscal year 1998.
    Question. Please compare your GOE expenditures for each of the last 
three years to the amounts appropriated for each ITS category of funds 
specified in the Conference report, as well as amounts earmarked by the 
House or Senate reports that were not objected to in either the Senate 
report or in the Conference report. Indicate the amount of carryover 
funds for each year by category and explain any deviations.
    Answer. The following table compares actual and/or planned GOE 
obligations for each of the last three fiscal years (1995, 1996 and 
1997) to the amounts for each ITS program area included in the annual 
conference reports. This table also reflects unobligated balances at 
the end of each of the aforementioned fiscal years by program category.
    Any deviations between the funds actually used and/or projected to 
be used by program category is minor. If not for the rescission in 
fiscal year 1995 and unspecified ``account wide reductions'' reductions 
in fiscal years 1996 and 1997, funds actually used for each ITS program 
within the General Operating Expenses account would always falls within 
the 10 percent plus or minus variance historically allowed by the 
Committee.

                   FEDERAL HIGHWAY ADMINISTRATION INTELLIGENT TRANSPORTATION SYSTEMS--ANALYSIS OF FUNDING, GENERAL OPERATING EXPENSES                   
                                                                [In thousands of dollars]                                                               
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                           Fiscal years--                                               
                                          --------------------------------------------------------------------------------------------------------------
                                                           1995                                 1996                                 1997               
             Program category             --------------------------------------------------------------------------------------------------------------
                                           Dollars in    Actual    Unobligated  Dollars in    Actual    Unobligated  Dollars in    Actual    Unobligated
                                             report       used       9-30-95      report     used \1\     9-30-96      report     used \2\     9-30-97  
--------------------------------------------------------------------------------------------------------------------------------------------------------
Research and development.................      35,000      35,512        2,529      37,479      36,166        2,237      29,000      28,605  ...........
Operational tests........................      22,500      19,982          657      32,500      31,052          587      56,000      54,992  ...........
Commercial vehicle operation.............      10,700      11,565  ...........      14,500      13,750          435  ..........  ..........  ...........
Automated highway system.................      10,000       8,990  ...........      14,000      14,000           23      22,000      22,000  ...........
Advanced technology application..........      15,000      14,466  ...........  ..........  ..........  ...........  ..........  ..........  ...........
Corridors program........................      10,000      11,000  ...........  ..........  ..........  ...........  ..........  ..........  ...........
Deployment support.......................  ..........  ..........  ...........  ..........  ..........  ...........  ..........  ..........  ...........
Program and system support...............      11,300      12,985        1,504      11,300     10,034,        1,096       8,000       7,761  ...........
System architecture......................  ..........  ..........  ...........  ..........  ..........  ...........       5,000       5,000  ...........
Congested corridors......................  ..........  ..........  ...........  ..........  ..........  ...........  ..........  ..........  ...........
Model deployment.........................  ..........  ..........  ...........  ..........  ..........  ...........  ..........  ..........  ...........
Evaluation...............................  ..........  ..........  ...........  ..........  ..........  ...........       2,000       2,000  ...........
Mainstreaming............................  ..........  ..........  ...........  ..........  ..........  ...........  ..........  ..........  ...........
National adv. driver sim. (NADS).........  ..........  ..........  ...........  ..........  ..........  ...........  ..........  ..........  ...........
                                          --------------------------------------------------------------------------------------------------------------
      Total..............................     114,500     114,500        4,690     109,779     105,002        4,378     122,000     120,358  ...........
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Fiscal year amounts exclude $4,777 in reductions associated with sec. 335 of Public Law 104-50.                                                     
\2\ Fiscal year 1997 amounts exclude $1.642 M in ``Accountwide Savings'' (page 43 conference report 104-785).                                           

    Question. Please breakout in detail the amount of DOT funds that 
was spent in conjunction with the 1996 Olympic in Atlanta. 
Approximately how much private sector money was spent on ITS 
investments in or around Atlanta?
    What were the lasting benefits of this investment? Will any fiscal 
year 1998 funds be spent in this area?
    Answer. The Olympic and Paralympic Games were the world' two 
largest sporting events in 1996 both in terms of athlete and spectator 
attendance. The Atlanta games were the largest Olympics in history with 
average daily ticket sales exceeding 500,000 for all 17 days of the 
Games. In addition to its massive size, the Atlanta games were also 
unique in terms of the location of event venues. Most of the major 
venues were located in a 1.5 mile radius Olympic Ring centered in 
downtown Atlanta. The combination of these factors compounded by other 
issues like security, presented a major challenge for transportation 
operators during the Games period. Consequently, investment in 
transportation infrastructure to support the Games was heavy. However, 
the roadway, bridge, and most ITS projects had been previously planned 
and were accelerated to meet an Olympic deadline.
    More than $800M was spent on 125 Olympic-related transportation 
projects throughout the State of Georgia, of which more than $660M was 
federally funded. More than $500M was spent on projects in the Atlanta 
metropolitan area. The generalized expenditures are as follows:

                        [In millions of dollars]

Total Federal Funds:
    Roadway and bridge............................................ 554.1
    Landscaping, pedestrian, bikeways.............................  40.2
    ITS related................................................... 182.8
    Other.........................................................  41.5
                        -----------------------------------------------------------------
                        ________________________________________________
        Total..................................................... 818.1
                        =================================================================
                        ________________________________________________
Total ITS-related projects:
    Advanced Transportation Management System (ATMS) ($58 earmark, 
      $79 federal-aid)............................................   137
    MARTA (the local transit authority)...........................    13
    Traveler information showcase.................................  14.6
    Atlanta driver advisory system operational test...............   9.1
    Kiosk project.................................................     5
    Commute connections...........................................   3.3
    ITS evaluation effort.........................................   0.8
                        -----------------------------------------------------------------
                        ________________________________________________
        Total..................................................... 182.8
                        =================================================================
                        ________________________________________________
Total ITS program funds:
    MARTA (plus $2 FTA funds).....................................    11
    Traveler information showcase (plus $10 technology application 
      funds)......................................................   4.6
    Atlanta driver advisory system operational test (plus $2.4 
      match)......................................................   6.7
    Kiosk project (Plus $1 match).................................     4
    ITS evaluation effort.........................................   0.8
                        -----------------------------------------------------------------
                        ________________________________________________
        Total Federal ITS program funds...........................  27.1

    Private sector investment in ITS projects is by its nature 
difficult to quantify. Those costs tend to be privately held by each 
private sector partner. For the Atlanta Driver Advisory System 
Operational Test, the Scientific Atlanta team contributed approximately 
$1.86M. The kiosk project was designed to be self sufficient through 
the use of advertising on the kiosks. The details of this arrangement 
are still under discussion and negotiation with the operators of the 
kiosks. The Traveler Information Showcase project made the most 
extensive use of private sector service providers. While we know that 
the private sector partners contributed work (particularly for software 
development) beyond that for which they were compensated, cost 
estimates have not been shared with US DOT.
    All of the projects in Atlanta were permanent deployments. The 
Traveler Information Showcase project which was intended as a short 
term showcase of traveler information services has been absorbed by the 
Georgia Department of Transportation and others. The only products 
which will not continue to be available are the hand-held computers and 
the in-vehicle devices. These services are wholly the prerogative of 
the private sector who have chosen not to continue them. We are 
optimistic that the lessons learned by the private sector partners will 
provide the impetus to redeploy products and services based on their 
experience in Atlanta.
    The lasting benefits to the Atlanta region and the State of Georgia 
are impressive and far reaching.
    Improved identification and clearance of incidents.--71 percent of 
the incidents during the Olympics were verified in two minutes. The 
only large incident during the Games, which normally would have taken 
most of the day to clear, was cleared in a little over two hours. 
Highway Emergency Response Operators (HERO's) responded to 2000 
incidents during the Games, and moved disabled vehicles and buses from 
freeway lanes until they could be towed. In the first year of 
operation, the HERO's handled 17,714 incidents. Additionally, it has 
been observed that the number of Atlanta police officers responding to 
a single incident has reduced since they no long have to handle traffic 
as that is now done by the HEROs. This allows better use of police 
resources throughout the city.
    Transit operations.--The Metropolitan Atlanta Regional Transit 
Authority (MARTA) Transportation Information Center (TIC) used the CCTV 
cameras for assignment of buses, management of spectator movements, 
transit surveillance in the congested Olympic Ring area, and incident 
response. This capability assisted MARTA in managing three times its 
normal load during the Games.
    Traveler information.--Real-time traffic information was available 
through cable TV in more than 700,000 homes. Public response was very 
positive, with the most useful information being the real-time speed 
map, incident details and live camera views. This service is being 
continued by the Georgia Department of Transportation. The Internet 
page was also popular. The route planning page was the most used with 
16,000 ``its'' in the peak week of the Games. 80 percent of the users 
of the real-time transportation information said that they changed 
their travel plans due to the information. The in-vehicle device 
received very high marks with the public users. In one case, a Showcase 
contractor picked up an associate who was sick; the in-vehicle device 
was used to find the nearest hospital and navigate there quickly with 
real-time information available to the driver. This technology was 
credited with getting quick treatment for a seriously ill person for 
whom time was of the essence.
    Surveillance cameras.--Two-thirds of the incidents during the Games 
were detected by CCTV, HERO's or DOT callers. Additionally, the cameras 
provided the most flexible and most used tool to the operating 
agencies. Since the cameras were fully accessible to the state, city, 
five counties, MARTA, police agencies and security personnel, the same 
piece of equipment could be used by each agency for their own unique 
purpose. For example, in dealing with recurring congestion at a 
downtown off ramp it was discovered that managers from different 
operating agencies were literally looking at the same camera view but 
acting on the situation per their unique responsibilities. Georgia 
Department of Transportation used the information to manage their 
response on the freeway, the City of Atlanta used the information to 
determine the effectiveness of their signal timing modifications, MARTA 
used it to determine the impact on the spectator fleet, Georgia State 
Patrol used it to manage the athlete fleet, and the Atlanta Committee 
for the Olympic Games (ACOG) used it to coordinate the many aspects of 
their transportation program. Clearly, this type of efficient response 
would not be possible without the capabilities provided by ITS 
technologies and an integrated approach.
    Interjurisdictional relationships.--One of the most significant, 
long-term benefits from the ITS program in Atlanta was the forging of 
institutional relationships across jurisdictional and agency 
boundaries. There is no way to neatly quantify this benefit, but it is 
real and it is significant. The City and the State traffic personnel 
have reached unprecedented levels of cooperation and coordination. The 
City enforcement community has a much stronger communication link to 
Georgia Department of Transportation and an appreciation of the need 
for coordination between traffic and enforcement has been developed. 
Coordination between traffic and transit agencies is at an all-time 
high. There is an open sharing of information between agencies, with 
shared control of some hardware such as traffic signals and cameras.
    No fiscal year 1998 ITS funds are planned to be obligated in 
Atlanta.
    Question. Are you planning ITS projects related to the future 
Olympics in Utah?
    Answer. FTA and FHWA are working with the State of Utah on how ITS 
technologies will play a role in meeting the transportation needs at 
the 2002 Olympics in Salt Lake City. In early March, a briefing was 
held including representatives of USDOT from FTA, FHWA and FAA as well 
as representatives from the Salt Lake Olympic Committee, the Utah 
Governors Office, the Utah Transit Authority, and congressional staff. 
Key points of discussion included: multi modal transportation 
infrastructure needs for the Salt Lake area; NEXTEA legislation 
pertaining to transportation for US Olympic venues; and an overview of 
Olympic Committee activities and near term directions for inter-agency 
coordination.
    Later in March, in a conference call FHWA and FTA Regional 
Administrators agreed to develop a proposal to address the resource and 
coordination needs related to the upcoming Olympics. The proposal will 
address the Division, Regional and Headquarters roles.
    At the current time FTA is providing technical assistance. It is 
possible that funding would be provided for ITS projects in Salt Lake 
as part of the Deployment Incentives program as the transportation 
needs to support this event are further defined.
    Question. Please prepare a list of all of the operational tests 
that have not yet been completed, indicate their starting date, 
expected date of completion, expected date of submittal of final 
evaluation, remaining unspent balances, and remaining balances that are 
obligated.
    Answer. Our partial answer to this question is provided in the 
table below. In order to provide answers regarding unspent balances, we 
will have to work with our financial administrators to search data 
bases and cross-reference accounting codes. We anticipate re-submitting 
a completed table by July 11, 1997. Please note that the ``expected 
date of completion'' and ``expected date of submittal of final 
evaluation'' are the same dates. Projects are not considered completed 
until the final, publicly available evaluation report is submitted and 
approved. Also, remaining unspent balances are the same as remaining 
balances that are obligated; therefore, only one column (i.e., the 
currently incomplete column) reflects our response to these requests.
    Extracting unspent balances by project from the agency's accounting 
system is a very time-consuming effort, this data is not included 
herein and will be submitted in the near future.

------------------------------------------------------------------------
                                                  Expected              
                                                completion/   Remaining 
             Project                Start date     final       unspent  
                                                report date    balance  
------------------------------------------------------------------------
   ADVANCED TRAFFIC MANAGEMENT                                          
          SYSTEMS (ATMS)                                                
                                                                        
Fast-trac........................         4/92         6/00  ...........
Integrated ramp metering/adaptive                                       
 signal control..................         9/93         7/98  ...........
ITS for voluntary emissions                                             
 reduction.......................         1/95        10/97  ...........
Mobile communications system.....         5/94        10/97  ...........
Montgomery County ATMS...........         7/94         9/97  ...........
North Seattle ATMS...............         3/94        12/97  ...........
San Antonio transguide...........         8/93         4/97  ...........
Satellite communications                                                
 feasibility.....................        10/92         6/98  ...........
SCOOT adaptive control system....         9/93         6/98  ...........
Spread spectrum radio traffic                                           
 interconnect....................         7/94         6/98  ...........
                                                                        
  ADVANCED TRAVELER INFORMATION                                         
          SYSTEMS (ATIS)                                                
                                                                        
Atlanta traveler information                                            
 systems kiosk project...........         1/94         5/97  ...........
Atlanta driver advisory system...         3/95         5/97  ...........
DIRECT...........................         5/91        12/97  ...........
Denver, CO, Hogback Multi-Modal                                         
 Transfer Center.................         5/93         9/98  ...........
Railroad crossing vehicle                                               
 proximity alert system, phase I.         6/95         8/97  ...........
Railroad crossing vehicle                                               
 proximity alert system, phase II        10/97        11/98  ...........
Railroad highway crossing--Long                                         
 Island..........................         7/95         9/98  ...........
Seattle wide-area information for                                       
 travelers/Bellevue..............         8/94        12/97  ...........
Travinfo.........................         4/93        12/98  ...........
Trilogy..........................         7/94         1/98  ...........
                                                                        
  ADVANCED PUBLIC TRANSPORTATION                                        
          SYSTEM (APTS)                                                 
                                                                        
LYNX passenger travel planning                                          
 system..........................         1/96     \1\ 4/97  ...........
Miami real-time passenger                                               
 information system..............         7/95         7/97             
Northern Virginia regional fare                                         
 system..........................         9/96         5/99  ...........
Blacksburg traveler information                                         
 system..........................         7/96         1/98  ...........
Suburban mobility authority for                                         
 regional trans (SMART)..........        12/93         6/98  ...........
Winston-Salem mobility                                                  
 management, phase II............         6/96        10/97  ...........
Houston smart commuter...........         2/93        10/99  ...........
Ann Arbor smart intermodal.......         7/91         9/97  ...........
CTA (Chicago) smart intermodal...         7/91         5/98  ...........
Dallas smart vehicle operational                                        
 test............................         4/94         1/98  ...........
Delaware County ridetracking.....         9/92         6/97  ...........
Smart flexroute integrated real-                                        
 time enhancement system.........         1/94         5/98  ...........
Santa Clara County smart vehicle.        11/93         2/96  ...........
Dallas area rapid transit                                               
 personalized public transit.....         9/94         8/98  ...........
Denver RTD passenger information                                        
 display system..................         9/93         9/97  ...........
Wilmington, Delaware smart DART..         7/94         5/99  ...........
New York City MTA travel                                                
 information system..............         9/94         9/98  ...........
                                                                        
  ADVANCED RURAL TRANSPORTATION                                         
          SYSTEMS (ARTS)                                                
                                                                        
Travel-aid.......................        11/92         7/98  ...........
Idaho storm warning system.......         6/93         1/98  ...........
Advanced rural transportation                                           
 information and coordination....         7/94         8/98  ...........
TransCal.........................         7/94        12/97             
Advanced transportation weather                                         
 information system..............         5/95         8/97  ...........
Herald en-route driver advisory                                         
 via AM subcarrier...............         1/95        10/97  ...........
------------------------------------------------------------------------
\1\ Concept development phase completed. Project completion date TBD.   


                   COMMERCIAL VEHICLE OPERATIONS (CVO)                  
------------------------------------------------------------------------
                                                  Expected    Remaining 
             Project                Start date   completion    unspent  
                                                    date       balance  
------------------------------------------------------------------------
Dynamic truck speed warning for                                         
 long downgrades.................         6/93         8/97  ...........
Advantage I-75...................         1/91        10/97  ...........
Out-of-service verification                                             
 operational tests...............         4/94  ...........  ...........
    Wisconsin/Minnesota..........  ...........         3/97  ...........
    Idaho........................  ...........        12/97  ...........
Electronic one-stop shopping for                                        
 credentials.....................         1/95  ...........  ...........
    HELP.........................  ...........         8/97  ...........
    Midwest......................  ...........        12/97  ...........
    Southwest....................  ...........         7/97  ...........
Electronic clearance for                                                
 international boarders..........         9/94  ...........  ...........
    MONY (Detroit, MI, Buffalo,                                         
     NY).........................  ...........         3/98  ...........
    IBEX (Otay Mesa, CA).........  ...........        10/98  ...........
    EPIC (Nogales, AZ)...........  ...........        12/97  ...........
ITS/CVO greenlight project.......         10/9         4/00  ...........
National Institute for                                                  
 Environmental Renewal (NIER)....         10/9  ...........  ...........
    Tranzit xpress...............  ...........         3/97  ...........
    Tranzit xpress II............  ...........         3/98  ...........
Operation Respond................         4/95         6/97  ...........
Roadside MCSAP computer system...         5/95         6/97  ...........
------------------------------------------------------------------------


           ADVANCED VEHICLE CONTROL AND SAFETY SYSTEMS (AVCSS)          
------------------------------------------------------------------------
                                                  Expected              
                                                completion/   Remaining 
             Project                Start date     final       unspent  
                                                report date    balance  
------------------------------------------------------------------------
Puget Sound help me (PuSHME)                                            
 mayday system...................         8/94         3/97  ...........
Colorado mayday system...........        10/94         6/97  ...........
Automated collision notification                                        
 system..........................         9/95        10/98  ...........
Intelligent cruise control.......         9/95         9/97  ...........
------------------------------------------------------------------------

    Question. Are additional model deployments necessary beyond the 
four now underway?
    Answer. We believe the four existing metropolitan area model 
deployment projects and the seven CVISN model deployments--will be 
sufficient to achieve the goals of this program, namely to evaluate and 
showcase the benefits of integrated, intermodal, interoperable 
deployment of ITS technologies and strategies in a metropolitan 
setting.
    Question. How many ``model deployments'' and ``incentive projects'' 
will it take to convince metro areas and States to use more of their 
Federal aid dollars to deploy ITS?
    Answer. Model deployment and deployment incentive projects are 
distinct types of projects, conducted for different reasons. The four 
existing metro area model deployment and the seven CVISN model 
deployment projects are being implemented to serve as showcases of 
integrated, intermodal ITS infrastructure, and to provide the 
opportunity for comprehensive evaluations of this level of deployment. 
We believe that projects, together with the Washington D. C. and 
Atlanta Showcases, will provide enough information and experience to 
draw the interest of other elected officials, and that the evaluation 
data will be sufficient to convince others that implementation is 
viable, practical, and cost-effective.
    The incentive program is intended as a transition from research and 
demonstration to mainstream. It is designed for only the life of 
NEXTEA. The metropolitan projects to be funded under the proposed ITS 
deployment incentives program will be in metropolitan areas which have 
already made a decision to deploy ITS infrastructure. The deployment 
incentive funding there will serve as a ``sweetener'' to jump-start the 
integration of that infrastructure. The incentives for states to deploy 
CVO ITS infrastructure will help extend the 7 state system to a 
national system. Funding incentives for deployment of rural 
applications has also been provided. It is expected that in all 
instances the availability of ITS deployment incentive funds will spur 
additional Federal-aid investment.
    Question. Please assess the progress made by the National ITS 
Program against each of the goals and objectives specified in Title 
VI(B) of the ISTEA.
    Answer. The benefits of the ITS program are well documented 
according to the goals specified in ISTEA. The ITS Joint Program Office 
has identified a key set of few good measures to capture such benefits. 
These include (1) crashes avoided; (2) lives saved; (3) improved 
throughput, or transportation system network efficiency; (4) decreased 
travel times; (5) improved customer satisfaction; and (6) reduced 
costs. Corollary benefits from ITS are hypothesized to include 
reductions in harmful emissions and fuel use. The current state of 
documented benefits is comprehensively reviewed in a report, ``Review 
of ITS Benefits: Emerging Successes,'' U.S. DOT, FHWA, 1996. The 
following paragraphs provide a brief assessment of progress made 
according to each goal area in ISTEA.
    Promote widespread implementation of ITS.--The ITS program has made 
an excellent start at laying the foundation for widespread 
implementation. This foundation consists of: (1) a comprehensive 
research, test, and model deployment program conducted by the surface 
transportation modal administrations under the leadership of the ITS 
Joint Program Office; (2) a comprehensive development and documentation 
of a National ITS Architecture that provides the framework by which ITS 
products and services can be marketed and sold nationwide while having 
utility by all Americans traveling anywhere in the United States; (3) a 
standards program that stimulates private industry to work together to 
ensure all ITS products and services will be compatible, interoperable, 
and affordable; (4) a Professional Capacity Building program to re-
shape the knowledge, skills, and abilities of our nation's 
transportation professionals, many of whose careers have been dedicated 
to the building of the Interstate System and now must turn to learning 
how to apply telecommunications, electrical engineering, information 
processing, and computer skills to operating and maintaining our 
existing physical infrastructure while supplementing it with an 
integrated ITS infrastructure; (5) a Main streaming Program dedicated 
to providing job aids and tools to transportation professionals to help 
them plan, develop, build, deploy, operate, and maintain an integrated, 
multimodal, surface transportation system; (6) a Program Assessment 
function that has afforded independent evaluations of field operational 
tests and model deployments and provided an extensive documentation of 
the benefits of ITS, as well as the documentation of non-technical, 
institutional issues leading to gradual changes in institutional 
infrastructures by modifying legislation, contracting procedures, and 
other standard practices to enable full realization of the benefits 
that ITS has to offer; and, (7) a strong partnership with industry 
through ITS America, and through increasingly large numbers of public-
private partnerships in field operational tests and model deployments, 
whereby industry has signed up to greater than 50 percent of the costs 
of many projects, and up to 50 percent in many more. The technical 
feasibility of ITS has been demonstrated. There are no show stoppers. 
It is now time to turn the nation's attention to NEXTEA whereby the job 
of national deployment of ITS can take place.
    Reduce costs of traffic congestion.--Significant strides have been 
made in showing the potential for ITS to save lives, reduce congestion-
caused delay, and save time and money. There is growing documentation 
of specific time savings resulting from advanced traffic management 
systems, advanced public transit systems, and from commercial vehicle 
operations. This documentation includes reports that freeway management 
systems are responsible for a 20 to 48 percent decrease in travel 
times, 15 to 50 percent reduction in accident rates, and up to a 41 
percent reduction in congestion-caused fuel use.
    Increased safety.--There are several major ways that the deployment 
of ITS is beginning to promote or could result in safety benefits. 
These include: crash avoidance technologies that warn drivers of 
impending rear-end collisions, countermeasure systems that prevent 
vehicles from inadvertently running off of the highway, and lane 
change/merge crash avoidance systems. Such systems, if implemented 
nationwide, could avoid 1.1 million crashes out of a total of 6.4 
million crashes each year, a savings of 17 percent. Other ITS 
technologies result in improved traffic flow and mitigated traffic 
congestion. Moreover, advances in commercial vehicle operations 
technologies can allow for increased targeting of unsafe motor carriers 
by means of electronic screening of registrations and safety records 
for each equipped vehicle.
    Improved air quality.--The linkage between ITS and improved air 
quality is based upon the hypothesis that ITS deployments can alleviate 
congestion, thereby decreasing stop-and-go traffic and resulting in 
less fuel consumed by rapid acceleration/deceleration oscillations of 
large numbers of vehicles. ITS intervention can be accomplished by 
real-time traveler information systems that inform travelers about 
weather and congestion and can cause them to delay their departures, 
select a different route or a different transportation mode. 
Coordinated traffic signal systems can accomplish similar smoothing of 
traffic flows with commensurate benefits in fuel savings. A few field 
operational tests have been conducted whereby data sampling has been 
made and modeling has been used to project benefits in fuel efficiency. 
In one instance that tested dynamic route guidance in a vehicle, 
general emissions benefits were projected to be modest, at around 5 
percent. Moreover, although some are concerned that because ITS 
alleviates congestion, such technologies will contribute to emissions 
because more people will be driving the less congested highways. At 
present, there are no data available to document the validity of this 
argument.
    Development of ITS technology and domestic ITS industry.--The ITS 
program has been successful in stimulating a rapidly growing industrial 
base. The Electronics Industry of America has just completed a market 
assessment of ITS and confirms that ITS is becoming a billion dollar 
industry. A similar study by ITS America is supportive of this same 
conclusion. Emerging benefit/cost data reflect a healthy 8/1 benefit/
cost ratio for investments in ITS infrastructure in the nations larger 
metropolitan areas. ITS is emerging as an extremely cost effective 
investment. Expanding roadway capacity by incorporating ITS into the 
planning process has recently been estimated to provide a 35 percent 
cost savings compared to traditional methods of expanding capacity by 
merely paving new lanes. The private sector is also catching on. High 
end vehicles now include in-vehicle collision and Mayday notification 
systems. Back-up collision warning systems concepts are getting 
commercial television advertisement spots from one domestic car 
manufacturer, and in-vehicle navigation systems are being advertised by 
a variety of domestic and foreign automobile manufacturers.
    Question. Please specify on a project-by-project basis how the 
fiscal year 1996 and the fiscal year 1997 program support monies were 
used. How much of these funds went to ITS AMERICA?
    Answer. A total of $10.299 million was obligated for Program 
Support in fiscal year 1996 and we expect to obligate $9.257 million in 
fiscal year 1997 and $10 million in fiscal year 1998 for Program 
Support as follows:

                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                                  Fiscal years--                
                                                                 -----------------------------------------------
                                                                       1996            1997            1998     
----------------------------------------------------------------------------------------------------------------
ITS America.....................................................           2,605           2,773           2,700
Mitre Corporation (management support)..........................           5,544           5,495           5,300
Volpe National Transportation Service Center....................             250             900             900
Other support services \1\......................................           1,900              89           1,100
----------------------------------------------------------------------------------------------------------------
\1\ Includes computer network support, technical and Report to Congress writers/editors, management information 
  support/project tracking system support, special visual aid and publication services, etc.                    

    Question. If program support monies are held constant, what are the 
implications?
    Answer. We have indicated in our answer to question 14 that we are 
critically dependent on management support contractors to manage the 
program. Access to data bases, information networks, etc that they have 
created for us would be difficult. The clearinghouse function and all 
dissemination of research information is entirely dependent on contract 
support. Further, we are relying on these contractors for support in 
assisting us in reviewing applications for deployment incentive funds. 
A reduction in our request will reduce our ability to effectively 
manage the program. Much of the increase requested in fiscal year 1998 
is attributable to program support activities required for the portion 
of the program managed by the Federal Transit Administration (FTA), 
which is proposed to grow from $4 million in fiscal year 1997 to $15.5 
million in fiscal year 1998. These funds are critical to their ability 
to effectively manage their program.
    Question. When will it be a requirement for the States to use the 
National Systems Architecture and to comply with consensus standards 
needed for interoperability in any ITS project funded with Federal Aid 
monies? How will you establish this requirement?
    Answer. We are currently requiring all operational tests and model 
deployments using ITS funds to be consistent with the Architecture and 
applicable industry standards as they are adopted. A similar 
requirement for the use of Federal-aid funds is included in the 
Department's ISTEA reauthorization proposal recently delivered to 
Congress. Assuming that this provision is signed into law, we 
anticipate the need for an annual determination by the Secretary 
regarding which ITS standards are required to be used as a prerequisite 
for using Federal-aid funds to deploy ITS projects.
    FHWA is currently developing a policy that will implement this 
provision and is also developing guidance material on what constitutes 
conformance with the Architecture.
    Question. Please delineate all contract and GOE expenditures 
(active and planned) for fiscal year 1997 and fiscal year 1998 related 
to ``outreach'' and ``mainstreaming'' activities. Please specify fiscal 
year 1997 amounts by project or activity and do the same for fiscal 
year 1996 expenditures.
    Answer. The ITS spending plan for fiscal year 1997 includes $9.95 
million for Mainstreaming activities all of which is funded from 
contract authority funds provided via contract authority through the 
Federal-aid Highways account. Of this total for mainstreaming, 
approximately $100 thousand is expected to be obligated for CVO 
outreach, and $1 million for ITI outreach.
    The ITS Budget for fiscal year 1998 includes $22 million for 
Mainstreaming activities; $3 million are requested in FHWA's General 
Operating Expenses account and $19 million are included within the $96 
million in contract authority requested in fiscal year 1998 for the ITS 
Research and Development program in the reauthorization (NEXTEA) 
package now under consideration by the Congress. Of the $22 million for 
mainstreaming, approximately $1 million will be used for an ITI 
Awareness Campaign which could loosely be interpreted as outreach.
    Question. Are you planning or conducting any research or 
operational tests to use ITS as a means of helping to notify police of 
possible impaired or aggressive drivers? Is this an avenue worth 
pursuing during fiscal year 1998? Do you plan on spending any fiscal 
year 1998 funds on this technological path?
    Answer. The technologies used to detect drowsy drivers are likely 
to also have applicability to impaired or aggressive drivers. We will 
be conducting an on-road evaluation of a heavy vehicle drowsy driver 
detection system in fiscal year 1998, but have no immediate plans to 
extend this research to include impaired or aggressive drivers.
    Question. Given the numerous alternative uses for Federal aid 
dollars, do you anticipate that most metropolitan areas would be able 
and willing to invest in an integrated Intelligent Transportation 
Infrastructure? How many areas have integrated ITS? To which extent?
    Answer. Yes, evidence suggests that most metropolitan areas are 
willing to deploy components of ITS infrastructure because it fulfills 
a basic need--the effective operation and management of the 
transportation system. In fact, most States and many metropolitan areas 
are already using Federal-aid and State and local funds to purchase ITS 
infrastructure components (e.g. traffic signal systems, freeway 
management systems, transit management systems, incident management 
systems, electronic fare payment and toll collection systems, traveler 
information centers, railway-highway grade crossing systems, and 
emergency management systems) to help satisfy this need.
    In many instances ITS infrastructure components are not new budget 
items to State and local jurisdictions. Instead they are upgrades of 
existing infrastructure.
    The challenge now is to convince the remaining State and local 
jurisdictions that ITS technologies and services can provide 
substantial benefits to their customers, and that ITS infrastructure 
must be deployed in an integrated, intermodal, interoperable fashion. 
On the latter issue, our evidence suggests that without some incentive 
to cause agencies to go to the extra effort of integration, it is not 
likely to happen. That is the reason that we have proposed the 
deployment incentive program to provide incentives for integration, not 
the deployment of hardware.
    Question. FHWA has developed several reports which delineate the 
benefits and costs of deploying ITS. Please summarize the results of 
each of the studies.
    Answer. Several DOT reports have shown how ITS technologies can 
favorably impact transportation efficiency, productivity, safety, user 
satisfaction, and the environment. The following tables document the 
findings of eleven of the most recent major studies sponsored or 
performed by DOT. Research on the public benefits of ITS establish 
compelling national interest in deploying ITS technologies and 
infrastructure. Below are highlights of ITS benefits documented by DOT:
ITS provides better traffic management
    (1) Abilene, Texas replaced outdated signals with a computer-based 
traffic signal system and realized $8-$11 in benefits for each dollar 
invested.
    (2) The Automated Traffic Surveillance and Control (ATSAC) program 
controls traffic flow between freeway and parallel arterial streets in 
Los Angeles, California and surrounding areas. The program has reduced 
fuel usage by 12.5 percent, hydrocarbon emissions by 10 percent, and 
carbon monoxide emissions by 10 percent.
ITS benefits transit agencies
    (1) Four hundred New Jersey Transit buses are able to alter their 
routes and stay on schedule using real-time information they receive 
about traffic conditions.
    (2) Baltimore, Maryland and Portland, Oregon cut travel time by 10-
18 percent, using vehicle locating technology to re-route buses and 
dispatch additional vehicle buses to keep their services on schedule.
    (3) Kansas City, Missouri was able to eliminate 7 buses from its 
fleet of 280 by implementing advanced transit fleet management systems.
ITS reduces the costs of toll collecting
    (1) The Oklahoma Turnpike Authority saves about $160,000 annually 
by switching from a manual to electronic toll lane. The Authority 
incurred an annual cost of $176,000 to operate an attended toll lane 
vs. $15,800 to operate an automated electronic toll lane.
ITS can improve safety
    (1) Just three crash avoidance systems alone could eliminate more 
than 17,500 fatalities, prevent 1.2 million accidents, and save $26 
billion each year. (By comparison, seatbelts and airbags save 10,500 
lives per year.)
    (2) Incident management programs could prevent 50 to 60 percent of 
the accidents precipitated by traffic delays and congestion.
ITS increases traveler convenience
    (1) As part of the Los Angeles Smart Traveler project, information 
kiosks were located in office lobbies and shopping plazas. Between 20 
and 100 users accessed these kiosks daily, with more than half 
requesting freeway maps and bus and train information.
    (2) Given traveler information, almost 50 percent of those surveyed 
in Seattle and Boston indicated that they changed their travel route 
and time of travel. Five to 10 percent indicated that they changed 
travel mode. Even if only 30 percent of travelers change travel plans 
daily, harmful emissions of carbon monoxide, volatile organic 
compounds, and nitrogen oxides would be reduced by 33, 25, and 1.5 
percent, respectively.

                                                              DOCUMENTATION OF ITS BENEFITS                                                             
--------------------------------------------------------------------------------------------------------------------------------------------------------
             Document                      Date              ITS technology                 Description                            Findings             
--------------------------------------------------------------------------------------------------------------------------------------------------------
ITS National Investment & Market   January 1997 draft    Metropolitan           This study, prepared by Apogee       The deployment of the nine elements
 Analysis.                          unpublished.          intelligent            Research for ITS America and DOT:    of the metropolitan intelligent   
                                                          transportation         (1) Estimates public sector          transportation infrastructure in  
                                                          infrastructure.        investment requirements to deploy    the largest 297 metropolitan areas
                                                         Rural ITS               basic ITS infrastructure             in the United States would have an
                                                          infrastructure.        nationwide by year 2005; (2)         overall benefit-cost ratio of     
                                                         ITS/CVO targeting       Quantifies direct benefits; (3)      5.7:1.                            
                                                          administrative         Estimates size of private sector    The deployment of these same       
                                                          processes.             market; and (4) Identifies and       elements in the 75 Operation Time 
                                                                                 evaluates national economic          Saver metropolitan areas would    
                                                                                 impacts.                             have a benefit-cost ratio of      
                                                                                The study is an analytical            8.8:1. More than 80 percent of the
                                                                                 framework based on analyses          benefits are from increased safety
                                                                                 conducted as part of the National    and reduced congestion.           
                                                                                 ITS Architecture efforts. The                                          
                                                                                 framework employs best publicly                                        
                                                                                 available information on the costs                                     
                                                                                 and benefits of deploying ITS.                                         
An Estimate of Transportation      February 1997 latest  Metropolitan           This study, prepared by Mitretek     This study estimates that buying   
 Cost Savings by Using              version               intelligent            for the ITS Joint Program Office,    smarter by deploying ITS reduces  
 Intelligent Transportation         (unpublished).        transportation         estimates the cost savings of        the need for new roads, while     
 System (ITS) Infrastructure.                             infrastructure.        metropolitan ITS infrastructure      saving taxpayers 35 percent of    
                                                                                 for 50 major urban areas to keep     required investment in urban      
                                                                                 up with expected new travel demand   highways. 44,000 new lane-miles   
                                                                                 over the next ten years.             would be needed to keep up with   
                                                                                The study employs a life-cycle        travel demand over the next ten   
                                                                                 analysis (10 years of investment,    years in 50 major urban areas. The
                                                                                 out to 20 years of operations) to    deployment of ITS would reduce    
                                                                                 compare two alternatives: (1) New    required new lane-miles to 15,000.
                                                                                 highway construction (build-only)                                      
                                                                                 and (2) ITS plus limited road-                                         
                                                                                 building. The results are                                              
                                                                                 discounted to 1996 using a seven                                       
                                                                                 percent annual rate.                                                   
Preliminary Assessment of Crash    October 1996........  Single vehicle         The study, performed by NHTSA,       The study predicts that three types
 Avoidance Systems Benefits.                              roadway departure      estimates the benefits of three      of collision avoidance systems--  
                                                          systems (including     types of advanced collision          rear-end collision avoidance, lane
                                                          excessive speed for    avoidance systems in terms of        change/merge crash avoidance, and 
                                                          curve-ahead warning    number of crashes avoided.           road departure warning systems--  
                                                          and imminent road     The study employs probability         could eliminate 1.18 million      
                                                          departure warning).    analyses based on information from   vehicular collisions each year--17
                                                         Rear-end collision      NHTSA's traffic accident database    percent of all vehicular crashes. 
                                                          avoidance driver       and preliminary experimental data    This estimate presumes that all   
                                                          warning systems.       from NHTSA's advanced collision      vehicles in the U.S. would be     
                                                         Lane change collision   avoidance program.                   equipped with these collision     
                                                          avoidance systems.                                          avoidance systems.                
                                                                                                                     These predictions must be          
                                                                                                                      considered preliminary pending    
                                                                                                                      further research, refinement of   
                                                                                                                      potential countermeasure          
                                                                                                                      effectiveness estimates, and field
                                                                                                                      experience.                       
Review of ITS Benefits: Emerging   Sept. 1996..........  Advanced traffic       The document, prepared by Mitretek   Highlights of the 75 studies       
 Successes.                                               management systems.    for the ITS Joint Program Office,    reviewed in this report are shown 
                                                         Advanced traveler       presents the findings of             in the attached table.            
                                                          information systems.   approximately 75 studies related                                       
                                                         Advanced public         to ITS impacts on time savings,                                        
                                                          transportation         number of crashes, fatalities,                                         
                                                          systems.               throughput, cost reductions, and                                       
                                                         Advanced rural          energy and environment. The review                                     
                                                          transportation         distinguishes measured, predicted,                                     
                                                          systems.               and anecdotal results from                                             
                                                         ITS/CVO..............   evaluations of field operational                                       
                                                         Advanced collision      tests and early deployments, and                                       
                                                          avoidance systems.     academic studies.                                                      
                                                         Integrated systems...                                                                          
Benefits Assessment of Advanced    July 1996...........  Transit management     The study, prepared by Volpe         The analysis projects that total   
 Public Transportation Systems.                           systems.               National Transportation Systems      benefits over ten years for 265   
                                                         Automated traveler      Center for FTA, considers the        APTS system deployments would     
                                                          information systems.   deployment of APTS technologies      range from $3.8 billion to $7.4   
                                                         Electronic fare         for a total of 200 motorbus, 212     billion. On an annualized basis,  
                                                          payment systems.       demand-responsive transit, 16        the annual APTS benefits, over the
                                                         Transportation demand   light-rail and 14 heavy-rail         next ten years, from these        
                                                          management.            transit systems. For each of these   deployments are projected to range
                                                                                 systems, data representing the       from $546.6 million to as high as 
                                                                                 1993 financial, operating, and       $1.1 billion. Approximately 44    
                                                                                 performance characteristics (as      percent of the total benefits are 
                                                                                 reported by these transit systems    accrued from fleet management     
                                                                                 under Section 15) was used to        system deployments, 34 percent    
                                                                                 predict the benefits of APTS         from electronic fare payment      
                                                                                 deployments for a ten-year period    system applications, 21 percent   
                                                                                 (1996-2005).                         from traveler information system  
                                                                                                                      deployments, with the remaining 1 
                                                                                                                      percent from demand responsive    
                                                                                                                      transit systems.                  
Assessment of Intelligent          June 1996...........  Commercial vehicle     The study, performed by the          The study estimates the following  
 Transportation Systems/                                  administrative         American Trucking Associations       benefit-cost ratios for three     
 Commercial Vehicle Operations                            processes.             Foundation for FHWA, evaluates the   sizes of carriers:                
 User Services: ITS/CVO                                  Electronic clearance.   potential benefits and costs of     --Commercial vehicle administrative
 Qualitative Benefit/Cost                                Automated roadside      ITS/CVO technologies for small (1-   processes: small (1.0:1); medium  
 Analysis.                                                safety inspections.    10 units), medium (11-99 units),     (4.2:1); and large (19.8:1).      
                                                         On-board safety         and large (> 99 units) motor        --Electronic clearance for motor   
                                                          monitoring.            carriers. The calculated benefits    carriers who pay drivers based on 
                                                         Hazardous materials     are restricted to reduced labor      hours worked: small (3.3:1 to 6.5 
                                                          incident response.     expenses associated with             to 6.5:1); medium (3.7:1 to       
                                                         Freight mobility.....   regulatory compliance based on       7.4:1); and large (1.9:1 to 3.8 to
                                                                                 survey results from 700 motor        1).                               
                                                                                 carriers.                           --Automated roadside safety        
                                                                                The costs are based on actual 1995    inspections for motor carriers who
                                                                                 product prices obtained from 170     pay drivers based on hours worked:
                                                                                 vendors.                             small (1.3:1); medium (1.4:1); and
                                                                                                                      large (1.4:1).                    
                                                                                                                     --On-board safety monitoring: small
                                                                                                                      (0.18:1 to 0.49:1); medium (0.06:1
                                                                                                                      to 0.16:1); and large (0.02:1 to  
                                                                                                                      0.05:1).                          
                                                                                                                     --Hazardous materials incident     
                                                                                                                      response: small (0.3:1); medium   
                                                                                                                      (1.1:1); and large (2.5:1).       
                                                                                                                     --Freight mobility: Mobile         
                                                                                                                      communications can yield benefit/ 
                                                                                                                      cost ratios ranging from 1.5:1 to 
                                                                                                                      5.0:1.                            
Assessment of ITS Benefits:        April 1996..........  ATMS.................  The study, performed by Mitretek     Highlights of the studies reviewed 
 Results from the Field.                                 ATIS.................   for the ITS Joint Program Office,    in this report are shown in the   
                                                         APTS.................   is a precursor to Review of ITS      attached table.                   
                                                         ITS/CVO..............   Benefits: Emerging Successes and                                       
                                                                                 presents the findings of estimated                                     
                                                                                 and measured impacts of ITS field                                      
                                                                                 operational tests and early                                            
                                                                                 deployments.                                                           
Intelligent Transportation         Jan. 1996...........  Traffic signal         This document, prepared by Mitretek  The study predicts the following   
 Infrastructure Benefits:                                 control systems.       for FHWA, presents benefits of 7     benefits:                         
 Expected and Experienced.                               Freeway management      of the 9 components of              --Traffic signal control systems:  
                                                          systems.               metropolitan intelligent             travel time (decrease 8-15        
                                                         Transit management      transportation infrastructure. For   percent); travel speed (14-22     
                                                          systems.               each of these components, the        percent); vehicle stops (decrease 
                                                         Incident management     document presents the range of       0-35 percent); delay (decrease 17-
                                                          pro-  grams.           reported impacts on travel time,     37 percent); fuel consumption     
                                                         Electronic fare         travel speed, freeway capacity,      (decrease 6-12 percent); emissions
                                                          payment sys-  tems.    accident rate, fuel consumption,     (decrease CO by 5-13 percent and  
                                                         Electronic toll         and vehicular emissions. The         decrease HC by 4-10 percent)      
                                                          collection sys-        benefits results are based on a     --Freeway management systems:      
                                                          tems.                  review of approximately 50 studies   travel time (decrease 20-48       
                                                         Multimodal traveler     of the actual and predicted          percent); travel speed (increase  
                                                          information systems.   impacts of ITS operational tests     16-62 percent); freeway capacity  
                                                                                 and field deployments.               (increase 17-25 percent); accident
                                                                                                                      rate (decrease 15-50 percent);    
                                                                                                                      fuel consumption (decrease fuel   
                                                                                                                      used in congestion by 41 percent);
                                                                                                                      emissions (decreases in CO, HC,   
                                                                                                                      and NOX)                          
                                                                                                                     --Transit management: travel time  
                                                                                                                      (decrease 15-18 percent); service 
                                                                                                                      reliability (increase 12-23       
                                                                                                                      percent in on-time performance;   
                                                                                                                      security (decrease incident       
                                                                                                                      response time to as little as one 
                                                                                                                      minute); cost effectiveness (45   
                                                                                                                      percent annual return on          
                                                                                                                      investment).                      
                                                                                                                     --Incident management: incident    
                                                                                                                      clearance time (decrease 8 minutes
                                                                                                                      for stalls and decrease wrecker   
                                                                                                                      response time by 5-7 minutes);    
                                                                                                                      travel time (decrease 10-42       
                                                                                                                      percent); and fatalities (decrease
                                                                                                                      10 percent in urban areas).       
                                                                                                                     --Electronic fare payment: patron  
                                                                                                                      popularity (up to 90 percent usage
                                                                                                                      where available); fare collection 
                                                                                                                      (increase 3-30 percent); and data 
                                                                                                                      collection costs (decreased $1.5  
                                                                                                                      to $5 million).                   
                                                                                                                     --Electronic toll collection:      
                                                                                                                      operating expenses (decrease up to
                                                                                                                      90 percent); effective capacity   
                                                                                                                      (increase 250 percent); fuel      
                                                                                                                      consumption (decrease 6-12        
                                                                                                                      percent); emissions (decrease CO  
                                                                                                                      by 72 percent, decrease HC by 83  
                                                                                                                      percent, and decrease NOX by 45   
                                                                                                                      percent per affected mile).       
                                                                                                                     --Multimodal traveler information: 
                                                                                                                      travel time (decrease 20 percent  
                                                                                                                      in incident conditions and        
                                                                                                                      decrease 8-20 percent for vehicles
                                                                                                                      equipped with in-vehicle          
                                                                                                                      navigation systems); fuel         
                                                                                                                      consumption (decrease 6-12        
                                                                                                                      percent); and emissions (decrease 
                                                                                                                      HC by 33 percent from affected    
                                                                                                                      vehicles and decrease NOX by 1.5  
                                                                                                                      percent from affected vehicles).  
Assessment of ITS Benefits: Early  January 1996........  ATMS.................  This study, performed by Mitretek,   Highlights of the studies reviewed 
 Results.                                                ATIS.................   is a precursor to Review of ITS      in this report are shown in the   
                                                         APTS.................   Benefits: Emerging Successes and     attached table.                   
                                                         ITS/CVO..............   presents the findings of                                               
                                                         Collision avoidance     approximately 50 benefits studies.                                     
                                                          systems.                                                                                      
                                                         AHS..................                                                                          
Intelligent Transportation         1996................  Traffic signal         The document, prepared by ITS        Highlights of the studies reviewed 
 Systems Action Guide.                                    control systems.       America, summarizes nine ``success   in this report are shown in the   
                                                         Freeway management      stories'' illustrating how ITS       attached table.                   
                                                          systems.               solutions eased congestion,                                            
                                                         ITS/CVO electronic      increased efficiency, improved                                         
                                                          clearance.             safety, improved air quality,                                          
                                                         Hazardous materials     assisted elderly and disabled                                          
                                                          response systems.      travelers, enhanced emergency                                          
                                                         Transit management      response, and improved                                                 
                                                          systems.               productivity. The beneficiaries                                        
                                                         In-vehicle navigation   include Abilene, Texas; Houston;                                       
                                                          systems.               Kansas City, Missouri; Montgomery                                      
                                                         Electronic toll         County, Maryland; Oakland County ,                                     
                                                          collection systems.    Michigan; the Oklahoma Turnpike                                        
                                                         Electronic fare         Authority; Phoenix; Winston-Salem,                                     
                                                          payment.               North Carolina; and the trucking                                       
                                                                                 corridor from Florida to Ontario                                       
                                                                                 Canada.                                                                
Traveling With Success: How Local  1995................  Traffic signal         This document, prepared for Public   Highlights of the studies reviewed 
 Governments Use Intelligent                              control systems.       Technology, Inc. for FHWA,           in this report are shown in the   
 Transportation Systems.                                 Freeway management      presents the stories of 31           attached table.                   
                                                          systems.               successful local government ITS                                        
                                                         Transit management      initiatives. These studies                                             
                                                          systems.               illustrate how ITS technologies                                        
                                                         Incident management     have helped ease problems in seven                                     
                                                          systems.               categories of local transportation                                     
                                                         Electronic fare         concerns: traffic management;                                          
                                                          payment systems.       parking solutions; mass transit;                                       
                                                         Electronic toll         incident management; traveler                                          
                                                          collection systems.    information; traffic safety; toll                                      
                                                         Multimodal traveler     collection; and public safety. The                                     
                                                          information systems.   document also provides anecdotal                                       
                                                         Integrated systems...   benefits of integrated systems in                                      
                                                                                 Atlanta, Houston, and Oakland                                          
                                                                                 County, Michigan.                                                      
--------------------------------------------------------------------------------------------------------------------------------------------------------


                    BENEFITS OF SELECTED ITS PROJECTS                   
------------------------------------------------------------------------
          ITS Technology                          Findings              
------------------------------------------------------------------------
Advanced traffic management         Traffic signal control: In          
 systems.                            Lexington, Kentucky, coordinated   
                                     computerized traffic signals       
                                     reduced ``stop and go'' traffic    
                                     delay by 40 percent and reduced    
                                     accidents by 31 percent between    
                                     1985 and 1994; The Abilene, Texas  
                                     computerized traffic light system  
                                     decreased travel time by 14        
                                     percent, increased travel speed by 
                                     22 percent, and decreased delay by 
                                     37 percent; In the Detroit area,   
                                     the SCATS adaptive signal system   
                                     decreased left turn accidents by 89
                                     percent and decreased delay by up  
                                     to 30 percent.                     
                                    Freeway management: Minnesota's     
                                     freeway management system increased
                                     speeds by 35 percent and reduced   
                                     accidents by 15 to 50 percent      
                                     although demand increased by 32    
                                     percent; In Seattle, ramp metering 
                                     along Interstate 5 kept traffic    
                                     moving and cut accident rates by   
                                     more than 38 percent over a six-   
                                     year period despite a 10 to 100    
                                     percent increase in traffic.       
                                    Incident management: Initial        
                                     operation of Maryland's incident   
                                     management system had a benefit/   
                                     cost ratio of 5.6:1; Minnesota's   
                                     Highway Helper reduces the duration
                                     of a stall by 8 minutes.           
                                    Electronic toll collection: On the  
                                     Tappan Zee Bridge toll plaza,      
                                     electronic tolls handle 1000       
                                     vehicles per hour compared with 350-
                                     400 vehicles per hour handled by   
                                     manual tolls; New York's E-Z Pass  
                                     electronic toll system nearly      
                                     tripled traffic speeds compared to 
                                     stop-and-pay tolls.                
Advanced traveler information       In-vehicle navigation: TravTek's in-
 systems.                            vehicle navigation systems in      
                                     Orlando decreased wrong turns by 33
                                     percent and decreased travel times 
                                     by 20 percent for unfamiliar       
                                     drivers.                           
                                    Multimodal traveler information: In 
                                     Boston, 30-40 percent of travelers 
                                     adjusted travel behavior after     
                                     receiving real-time traveler       
                                     information from Smart Traveler; In
                                     Montgomery County, Maryland, the   
                                     local cable station reaches 180,000
                                     homes to show traffic conditions on
                                     major highways--giving commuters   
                                     mode of travel options.            
Advanced public transportation      Fleet management: In Kansas City,   
 systems.                            with the Transit Management System 
                                     implementation, transit officials  
                                     cut operating costs by $400,000,   
                                     avoided $1.5 million in new bus    
                                     purchases, and reduced response    
                                     time to emergencies from 3-10      
                                     minutes to 1 minute; The computer  
                                     dispatching system in Sweetwater   
                                     County, Wyoming has helped increase
                                     monthly transit ridership from     
                                     5,000 to 9,000 passengers while    
                                     reducing mileage-related operating 
                                     costs by 50 percent over a five-   
                                     year period.                       
                                    Electronic fare payment: New York   
                                     estimates $49 million in increased 
                                     ridership from smart cards; Atlanta
                                     estimates annual cost savings of $2
                                     million in cash handling; Ventura  
                                     County, California estimates annual
                                     cost savings of $9.5 million in    
                                     reduced fare evasion, $5 million in
                                     reduced data collection costs, and 
                                     $990,000 by eliminating transfer   
                                     slips.                             
                                    Multimodal traveler information: An 
                                     automated transit information      
                                     system implemented by the Rochester-
                                     Genesee Regional Transportation    
                                     Authority spurred an increase in   
                                     calling volume by 80 percent; A    
                                     system installed by New Jersey     
                                     Transit reduced caller wait time   
                                     from 85 seconds to 27 seconds and  
                                     reduced the caller hang-up rate    
                                     from 10 percent to 3 percent while 
                                     accommodating more calls.          
Advanced rural transportation       Mayday systems: Mayday devices, if  
 systems.                            effectively deployed in 60 percent 
                                     of rural crashes, could eliminate  
                                     1,727 fatalities each year through 
                                     speedier incident notification.    
ITS/commercial vehicle opera-       Fleet management: Best Line of      
 tions.                              Minneapolis estimates a $10,000 per
                                     month savings from its computer-   
                                     aided dispatching system; Schneider
                                     of Green Bay, Wisconsin reported a 
                                     20 percent increase in loaded miles
                                     from its advanced vehicle          
                                     monitoring and communications      
                                     systems.                           
                                    Electronic safety inspections: An   
                                     early information network in Oregon
                                     increased the number of truck      
                                     weighings and safety inspections by
                                     90 percent and 428 percent,        
                                     respectively, between 1980 and 1989
                                     although staff increased by only 23
                                     percent; On-board safety monitoring
                                     systems, along with electronic     
                                     clearance and automated roadside   
                                     safety inspections, could reduce   
                                     fatalities by 14 to 23 percent.    
                                    Electronic pre-clearance: A 1994    
                                     study estimates a benefit/cost     
                                     ratio to the government of 7.2 for 
                                     electronic clearance, 7.9 for one- 
                                     stop/no-stop shopping, and 5.4 for 
                                     automated inspections.             
Advanced vehicle control and        In-vehicle collision avoidance      
 safety systems.                     systems: Lane change/merge, rear   
                                     end, and single-vehicle roadway    
                                     departure collision avoidance      
                                     systems could eliminate 1.2 million
                                     crashes annually.                  
                                    Rear-end collision warning systems: 
                                     The use of the Eaton-Vorad         
                                     collision warning device by        
                                     Greyhound reduced accidents by 20  
                                     percent.                           
------------------------------------------------------------------------

    Question. How much are you planning to spend on evaluations of the 
program during fiscal year 1997 and fiscal year 1998? Please be certain 
to delineate LGOE and contract monies. Why is an increase in funds for 
evaluation sought at this time in the program?
    Answer. We plan to spend $6.092 million in fiscal year 1997 on 
Evaluations of which $5.992 million is LGOE funding and $100 thousand 
is from Federal-aid Highways contract authority. It is noted that 
$3.992 of fiscal year 1997 funds expected to be utilized for 
Evaluations is included under the Operational Tests program category 
(only $2.1 million is shown under the Evaluation program line). Our 
fiscal year 1998 budget includes $7.25 million for Evaluations all of 
which is from LGOE funding. The primary reason for the increase in 
Evaluations is related directly to the comprehensive work we will be 
doing for the four Metropolitan Model Deployment Sites and the seven 
CVO Model Deployment sites. It is not unreasonable for evaluations of 
this scale to consume 15 to 25 percent of the original cost of the 
projects. Previous operational tests primarily focused on whether the 
technology worked; these demonstrations are being comprehensively 
evaluated for costs and benefits--from the individual technology and 
the integration of it.
    Question. Which fiscal year 1996 or fiscal year 1997 ITS projects 
required additional Federal monies added to the amounts specified in 
their original cooperative agreements? Why were these funds added?
    Answer. The Mobile, Alabama Fog Detection System (Mobile, AL)--A 
fiscal year 1996 start up has received additional funding in fiscal 
year 1997 through a Congressional earmark.
    Question. Please prepare a detailed table showing any unspent funds 
by year for any ITS project specified in previous Conference Reports. 
What is the status of each of these projects? Have all of these monies 
been obligated?
    Answer. The following table displays all ITS projects specified in 
annual conference reports from fiscal year 1992 through fiscal year 
1997. We do not have detailed records regarding unobligated balances 
for each of these projects prior to fiscal year 1995; however, 
generally, earmarked projects are historically obligated in the fiscal 
year for which the Congressional earmark was made. At the end of fiscal 
year 1995 Johnson City, Tennessee was the only earmarked project with 
an unobligated balance ($3.75 million); and at the end of fiscal year 
1996, Johnson City was again the only earmarked project with an 
unobligated balance ($3.75 million). We are currently working with the 
parties involved with this project and expect to arrive at a viable ITS 
project in the very near future and anticipate these funds being 
obligated by the end of fiscal year 1997.

                          FEDERAL HIGHWAY ADMINISTRATION INTELLIGENT TRANSPORTATION SYSTEMS--CONGRESSIONALLY EARMARKED PROJECTS                         
                                                                 [Dollars in thousands]                                                                 
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                    Fiscal years--                            Fiscal years--            
                   Project                              State          ---------------------------------------- Rescission --------------------   Total 
                                                                          1992      1993      1994      1995                  1996      1997            
--------------------------------------------------------------------------------------------------------------------------------------------------------
ADVANTAGE I-75...............................  .......................    $1,000    $1,400  ........  ........  ..........  ........  ........    $2,400
Smart corridor...............................  CA.....................     1,000  ........  ........  ........  ..........  ........  ........     1,000
ADVANCE (Chicago)............................  IL.....................     7,500     4,550    $6,000  ........  ..........  ........  ........    18,050
HELP/Crescent................................  .......................     2,000       525  ........  ........  ..........  ........  ........     2,525
DIRECT (Detroit).............................  MI.....................       500  ........  ........  ........  ..........  ........  ........       500
Smart Commuter (Houston).....................  TX.....................     2,000  ........  ........  ........  ..........  ........  ........     2,000
Philadelphia.................................  PA.....................     2,000  ........  ........  ........  ..........  ........  ........     2,000
Miami........................................  FL.....................     5,000  ........  ........  ........  ..........  ........  ........     5,000
Guidestar....................................  MN.....................    10,000     8,750     6,000    $6,825  ..........    $2,000    $3,600    37,175
Electric vehicle.............................  CA.....................     1,500  ........  ........  ........  ..........  ........  ........     1,500
FAST-TRAC (Oakland County)...................  MI.....................    10,000    10,500    20,000    15,000  ..........  ........  ........    55,500
TRANSCOM.....................................  NJ/NY..................     3,000     2,400     2,200     2,625  ..........     1,500     2,250    13,975
MAGIC........................................  NJ/NY..................     4,000     6,280  ........  ........  ..........  ........  ........    10,280
Toll road ETTM...............................  NJ.....................    25,000     7,000     3,000  ........  ..........  ........  ........    35,000
Integrated Corridor Management...............  NJ/PA..................     6,000  ........  ........  ........  ..........  ........  ........     6,000
Signal computerization.......................  NJ.....................     6,000     7,000  ........  ........  ..........  ........  ........    13,000
Southern State Parkway.......................  NY.....................    20,000    14,000  ........  ........    -$13,600  ........    20,400          
Spellman Parkway.............................  MD.....................       300  ........  ........  ........  ..........  ........  ........       300
Maryland Arterials...........................  MD.....................     2,200  ........  ........  ........  ..........  ........  ........     2,200
Northeast Corridor...........................  Various................  ........    10,500     1,000     7,500  ..........     3,500  ........    22,500
Gary Corridor................................  Various................  ........     1,400     2,500  ........  ..........  ........  ........     3,900
Houston Corridor.............................  TX.....................  ........     3,105     2,000     2,250  ..........     2,200     2,000    11,555
Anaheim Corridor.............................  CA.....................  ........     4,200  ........  ........  ..........  ........  ........     4,200
Smart Corridor (Los Angeles).................  CA.....................  ........     4,900  ........  ........  ..........  ........  ........     4,900
Chicaao Corridor.............................  IL.....................  ........       500  ........  ........  ..........  ........  ........       500
Milwaukee Corridor...........................  WI.....................  ........       500  ........  ........  ..........  ........  ........       500
San Diego....................................  CA.....................  ........     2,100     5,000  ........  ..........  ........  ........     7,100
Miami/Ft. Lauderdale.........................  FL.....................  ........     2,240  ........  ........  ..........  ........  ........     2,240
Seattle......................................  WA.....................  ........     3,500     1,500  ........  ..........  ........  ........    5,000 
Detroit......................................  MI.....................  ........       700  ........  ........  ..........  ........  ........       700
TravTek (Orlando)............................  FL.....................  ........       500  ........  ........  ..........  ........  ........       500
I-80 (CVO)...................................  .......................  ........       700  ........  ........  ..........  ........  ........       700
Sutter County................................  CA.....................  ........     1,750  ........  ........  ..........  ........  ........     1,750
Fairx County.................................  VA.....................  ........     5,250  ........  ........  ..........  ........  ........     5,250
Police Communications Center.................  NJ.....................  ........     3,500  ........  ........  ..........  ........  ........     3,500
New York State Thruway.......................  NY.....................  ........     5,250     6,400  ........  ..........     1,500     3,000    16,150
George Mason University (GOE funding)........  VA.....................  ........     1,600  ........  ........  ..........  ........  ........     1,600
Humphrey Institute (GOE funding).............  MN.....................  ........       760  ........  ........  ..........  ........  ........       760
Sandia Labs..................................  NM.....................  ........  ........     2,000  ........  ..........  ........  ........     2,000
Bronx/Northern Manhattan ATMS................  NY.....................  ........  ........     2,400     2,250  ..........  ........  ........     4,650
Buffalo/Niagara Falls ATMS...................  NY.....................  ........  ........     2,000  ........  ..........  ........  ........     2,000
CARAT (Charlotte)............................  NC.....................  ........  ........     6,000     4,500  ..........  ........  ........    10,500
George Mason University......................  VA.....................  ........  ........     2,000  ........  ..........  ........  ........     2,000
Johnson City.................................  TN.....................  ........  ........     2,500     3,750  ..........     1,500  ........     7,750
Montgomery County............................  MD.....................  ........  ........     1,000  ........  ..........  ........  ........     1,000
Southeast Michigan (SMART)...................  MI.....................  ........  ........     4,500     7,500  ..........  ........  ........    12,000
Smart Bus--State Rt. 9.......................  NJ.....................  ........  ........     1,500  ........  ..........  ........  ........     1,500
Iowa CVO (GOE funding).......................  IA.....................  ........  ........     2,000  ........  ..........  ........  ........     2,000
Humphrey Institute (GOE funding).............  MN.....................  ........  ........       950  ........  ..........  ........  ........       950
Lower Hudson Valley..........................  NY.....................  ........  ........  ........     1,500  ..........  ........  ........     1,500
Advisory Transportation Weather Information    ND.....................  ........  ........  ........       750  ..........     1,000     1,000     2,750
 System (U of ND).                                                                                                                                      
Hazardous Materials Transportation Safety      N/A....................  ........  ........  ........     1,500  ..........     2,500     2,000     6,000
 (NIER).                                                                                                                                                
Santa Teresa Border Crossing.................  NM.....................  ........  ........  ........     1,680  ..........       900  ........     2,580
Syracuse Congestion Management...............  NY.....................  ........  ........  ........     1,500  ..........     1,500  ........     3,000
Brooklyn/Bronx/Queens Signalization..........  NY.....................  ........  ........  ........     3,750  ..........  ........  ........     3,750
National Transportation Center (Oakdale)       NY.....................  ........  ........  ........     1,870  ..........     2,000     2,500     6,370
 (Dowling Collage).                                                                                                                                     
Advisory Railroad/Highway Crossings..........  NY?....................  ........  ........  ........     2,625  ..........     1,250     2,000     5,875
New Jersey Turnpike..........................  NJ.....................  ........  ........  ........     2,625  ..........  ........  ........     2,625
Green Light CVO Project......................  OR.....................  ........  ........  ........     6,000  ..........     7,000     7,000    20,000
Paralympad...................................  GA.....................  ........  ........  ........  ........  ..........     1,000  ........     1,000
I-10 (Mobile) (Fog Detection System).........  AL.....................  ........  ........  ........  ........  ..........     3,000     2,000     5,000
Capitol Beltway..............................  MD/VA..................  ........  ........  ........  ........  ..........     4,000  ........     4,000
Texas Transportation Institute (Texas A&M)...  TX.....................  ........  ........  ........  ........  ..........       600       600     1,200
Western Transportation Institute (Montana      MT.....................  ........  ........  ........  ........  ..........     1,000  ........     1,000
 State Univ.).                                                                                                                                          
I-675/SR844/Col. Glenn (Fairborn)............  OH.....................  ........  ........  ........  ........  ..........     1,000  ........     1,000
Salt Lake City...............................  UT.....................  ........  ........  ........  ........  ..........     2,000     5,000     7,000
Inglewood....................................  CA.....................  ........  ........  ........  ........  ..........  ........     1,000     1,000
Mobile Advisory Traffic Management System      AL.....................  ........  ........  ........  ........  ..........  ........     1,000     1,000
 (Montgomery).                                                                                                                                          
Traffic Guidance System (Nashville)..........  TN.....................  ........  ........  ........  ........  ..........  ........     1,000     1,000
Operation Respond............................  MD.....................  ........  ........  ........  ........  ..........  ........     1,000     1,000
Pennsylvania Turnpike........................  PA.....................  ........  ........  ........  ........  ..........  ........     3,000     3,000
National Capitol Region Congestion Mitigation  Various................  ........  ........  ........  ........  ..........  ........     3,500     3,500
National Advanced Driver Simulator (NADS)....  IA.....................  ........  ........  ........  ........  ..........  ........    14,000    14,000
Kansas City Region...........................  KS/MO..................  ........  ........  ........  ........  ..........  ........     2,500     2,500
United States/Canada CVO.....................  MI/NY?.................  ........  ........  ........  ........  ..........  ........     1,500     1,500
Rochester Congestion Management..............  NY.....................  ........  ........  ........  ........  ..........  ........     1,500     1,500
Urban Transportation Safety System Center      PA.....................  ........  ........  ........  ........  ..........  ........       500       500
 (Philadelphia).                                                                                                                                        
                                              ----------------------------------------------------------------------------------------------------------
      Totals.................................  .......................   109,000   115,360    82,450    76,000     -13,300    40,950    63,450   473,610
--------------------------------------------------------------------------------------------------------------------------------------------------------

     Question. Are any ITS projects not progressing at an acceptable 
rate? If so, please specify the scope and nature of the challenge and 
your current plans regarding these projects.
    Answer. The answer is as follows:
    WILMINGTON, DELAWARE SMART DART has encountered significant 
schedule problems resulting from the dynamics in the smart card 
industry. MasterCard divested itself of ``Smart Cash,'' the stored 
value card used in the project. MasterCard subsequently acquired 
MONDEX, an electronic purse system. This turbulence in the operation 
and evaluation of a stored value smart card has extended previously 
reported delays in resolving banking law issues. The project manager 
whose proactive leadership was key to maintaining momentum on the 
project has departed. MasterCard appears to be exercising cautious risk 
management during this period of flux in the smart card industry. The 
Federal Transit Administration is intensively monitoring the project, 
and has established deadlines for getting on track or suspending 
activity.
    ADVANCED RURAL TRANSPORTATION INFORMATION AND COORDINATION (MN). 
This project has encountered a series of contracting-related delays 
resulting in restructuring the procurement approach from a single 
vendor/system integrator to multiple procurements. While this revised 
approach added time to the project schedule, managers anticipate 
bringing all components on-line by mid-1997 with a mix of systems 
better suited to project needs.
    DENVER, COLORADO, HOGBACK MULTI-MODAL TRANSFER CENTER. This project 
encountered resistance by residents of the area west of Metropolitan 
Denver where the proposed site was to be located. The controversy 
placed the project in a ``HOLD'' status pending a review of regional 
traveler information initiatives. Recent information indicates that 
progress to resolution is being made, but the original schedule will 
require significant adjustment.
    Question. The JPO is in the process of conducting numerous 
evaluations of the Operational Test Program. What benefits and cost 
savings have been documented? What problems or shortcomings in these 
tests have you documented?
    Answer. Each question is answered in respective sections:
Documented benefits and cost savings
    The following is a selection of evaluation results from a number of 
ITS operational tests. The evaluation report for each test is 
footnoted. A single test may be mentioned in more than one place to 
describe different study results. These data are drawn primarily from a 
recent FHWA report titled, Review of ITS Benefits: Emerging Successes, 
September 1996.
    The Information for Motorists (INFORM) program is an integrated 
corridor management system on Long Island, New York providing 
information via variable message signs (VMS's) and control using ramp 
meters serving parallel expressways and some signal coordination on 
arterial. The program stretches back to concept studies in the early 
1970's and a major feasibility study performed from 1975 to 1977. The 
implementation progressed in phases starting with VMS's, followed by 
ramp meters in 1986 and 1987 and completed implementation by early 
1990. Estimates of delay savings due to motorist information \1\ reach 
as high as 1,900 vehicle-hours for a peak period incident and 300,000 
vehicle-hours in incident related delay annually.
    In-vehicle navigation devices can benefit users of such devices in 
terms of travel time and route finding. Field Operational Test 
experience is producing data that suggest system benefits when wider 
deployment appears. The TravTek test in Orlando found that for 
unfamiliar drivers, wrong turn probability decreased by about 33 
percent and travel time decreased by 20 percent relative to using paper 
maps, while travel planning time decreased by 80 percent.\2\ The 
ADVANCE project in the Northwest suburbs of Chicago tested the time 
effects of dynamic route guidance using a yoked vehicle study on an 
arterial network with limited probe data. The aggregate data set showed 
no significant time savings offered by dynamic route guidance; however, 
there was a small sample size and relatively high standard 
deviation.\3\ It did appear that the dynamic route guidance concept, as 
implemented in ADVANCE, can detect some larger delays and help drivers 
avoid them. The Pathfinder project implemented an in-vehicle navigation 
and motorist information system including access to real-time traffic 
information. The project was implemented in the Los Angeles area. The 
evaluation \4\ stated that the Pathfinder navigation system delivered 
meaningful user benefits including fewer travelers failing to follow 
their desired route. Since in-vehicle systems operate in a complex 
environment, specific results vary with conditions and options 
selected.
    Studies also indicate that travelers are interested in receiving 
traffic information and are willing to react to avoid congestion and 
delay. In focus groups for the Atlanta, Georgia, Advanced Traveler 
Information Kiosk Project,\5\ 92-98 percent of participants found the 
current information on accidents, alternate routes, road closures, and 
traffic congestion to be useful and desirable. A survey in Marin 
County, California, showed that if regular commuters had been presented 
with alternate routes including travel time estimates, 69 percent would 
have diverted and would have saved an average of 17 minutes.\6\ A pilot 
project in the Netherlands found a 40 percent increase in route 
diversions based on traffic information provided to the 300 vehicles 
equipped with FM sideband data receivers.\7\
    According to studies related to INFORM, drivers will divert from 5 
percent to 10 percent of the time when passive (no recommended action) 
messages are displayed and twice that when messages include 
recommendations to divert. Convenient alternate routes also have a 
major impact on diversion. Drivers will start to divert several ramps 
prior to an incident, with typically 3 percent to 4 percent of drivers 
using an individual exit ramp. This represents an increase in ramp 
usage of 40-70 percent. Surveys performed in the Seattle, Washington, 
and the Boston, Massachusetts, areas indicate that 30-40 percent \8\ of 
travelers frequently adjust travel patterns based on travel 
information. Of those who change travel patterns, about 45 percent 
change route of travel and another 45 percent change time of travel; an 
additional 5-10 percent change travel mode.
    Incident management programs show concrete promise of reducing the 
50-60 percent of delay associated with traffic congestion attributable 
to incidents. The Maryland CHART program is in the process of expanding 
to more automated surveillance with lane sensors and video cameras. The 
evaluation of the initial operation of the program shows a benefit/cost 
ratio of 5.6:1, with most of the benefits resulting from a 5 percent (2 
million vehicle-hours per year) decrease in delay associated with non-
recurrent congestion.\9\ Freeway service patrols, which began prior to 
the emergence of ITS technologies, but are being incorporated into 
traffic management centers, significantly reduce the time to clear 
incidents, especially minor incidents. The Minnesota Highway Helper 
Program \10\ reduces the duration of a stall (the most frequent type of 
incident representing 84 percent of service calls) by 8 minutes. Based 
upon representative numbers, annual benefits through reduced delay 
total $1.4 million for a program that costs $600,000 to operate.
    Freeway management systems and ramp meters show good results in 
reducing travel times on congested roadway segments. According to a 
longitudinal study of the ramp metering/freeway management system in 
the Seattle, Washington area over a six year period,\11\ freeways in 
the area show a growth in traffic volume of 10 percent to 100 percent 
along various segments of I-5 while speeds have remained steady or 
increased up to 20 percent. The improvements have occurred while 
average delays caused by ramp meters have remained at or below 3 
minutes. According to the Minnesota DOT Freeway Operations Meeting 
Minutes, average peak period speeds have risen from 34 mph to 46 mph 
while peak period demand increased by 32 percent. In studies comparing 
1987 to 1990 flows in the area of the INFORM system measuring benefits 
from ramp metering in combination with motorist information, freeway 
speeds increased 13 percent despite an increase of 5 percent in VMT for 
the PM peak.\12\ The relative merits of ramp metering and motorist 
information can not be discerned from the available data. The number of 
detectors showing speeds of less than 30 MPH decreased 50 percent for 
the AM peak. Average queue lengths at ramp meters ranged from 1.2 to 
3.4 vehicles, representing 0.1 percent of vehicle hours traveled. A 
survey of traffic management centers using ramp metering \13\ reported 
similar findings of speed increases of 16-62 percent and travel time 
improvements of up to 48 percent while demand increased 17-25 percent.
    Traffic signal system improvements are frequently implemented with 
reduction of travel time as a primary goal. The Automated Traffic 
Surveillance and Control (ATSAC) program in Los Angeles, California, 
largely a computerized signal control system, reported an 18 percent 
reduction in travel time, a 16 percent increase in average speed, and a 
44 percent decrease in delay.\14\ The City of Abilene, Texas, installed 
a closed-loop computerized signal system. Their report \15\ indicates 
an overall decrease in travel time of 14 percent, a decrease in delay 
of 37 percent, and an increase in travel speed of 22 percent. Phase I 
of a Texas state program called Traffic Light Synchronization (TLS) 
involving 44 cities, has installed arterial and network signal system 
projects affecting 2,243 of the approximately 13,000 traffic signals in 
the state. An additional 73 systems were installed in phase II. TLS 
analysis shows a benefit/cost ratio of 62:1,\16\ with a majority of the 
benefits being travel time reduction.
    Portland, Oregon \17\ has integrated a bus priority system with the 
traffic signal system on a major arterial. By allowing buses to either 
extend green time or shorten red time by only a few seconds, the bus 
travel time was reduced by between 5 percent and 8 percent. In addition 
to the travel time savings, this approach allows the use of fewer 
vehicles to serve that route.
    The City of Richardson, Texas, tied the operator of the city's 
towing concession into the roadway surveillance network with an 
investment of roughly $200. Using the information provided by the 
camera, the tow truck dispatcher can position appropriate equipment 
near the collision site prior to the request for service from the 
police department. This reduces the response time for incident 
clearance by 5-7 minutes on average and greatly improves the ability to 
send appropriate equipment that can handle the active incident (Pamela 
Hadnot, City of Richardson internal memorandum, December 1995).
    Fifteen authorities are currently using electronic toll collection 
(ETC), with more planning for implementations (Maureen Gallagher, 
IBTTA, telephone interview, February 1996). ETC can greatly improve 
throughput on a per-lane basis compared with manual toll collection 
techniques. On the Tappan Zee Bridge toll plaza, a manual toll lane can 
accommodate 350-400 vehicles per hour while an electronic lane peaks at 
1,000 vehicles per hour.
    By replacing eight manual collection stations with five electronic 
lanes using the multi jurisdictional E-ZPass electronic toll collection 
system, and implementing a movable barrier procedure to allow an extra 
peak direction lane, traffic speeds have increased from a crawling 8-12 
mph to a flowing 25 mph (Mike Zimmerman, New York State Thruway 
Authority, telephone interview, December 1995). The nature of the data 
reported does not allow allocation of speed benefits between the 
electronic toll collection and moveable barrier solutions.
    For nearly a decade, transit properties have been installing and 
using automatic vehicle location (AVL) systems based on signpost, 
triangulation, LORAN, and more recently GPS technologies.\18\ The most 
direct improvement enabled by transit management systems relates to 
schedule adherence. The Mass Transit Administration in Baltimore, 
Maryland, reported a 23 percent improvement in on-time performance by 
AVL-equipped buses. The Kansas City Area Transportation Authority in 
and around Kansas City, Missouri, improved on-time performance by 12 
percent in the first year of operation using AVL, compared to a 7 
percent improvement as the result of a coordinated effort between 1986 
and 1989. Preliminary results from Milwaukee, Wisconsin, indicate a 28 
percent decrease in the number of buses more than one minute behind 
schedule.\19\
    AVL systems continue to be deployed rapidly. A recent study found 
22 U.S. transit systems operating more than 7,000 vehicles under AVL 
supervision and another 47 in various stages of procurement. The new 
procurements represent a tripling of the number of deployed systems, 
with most new systems using a GPS-based location process.\20\ Fleet 
management systems with vehicle location capability are producing 
benefits in productivity, security and travel time. In addition, 
several operators have reported incidents where AVL information 
assisted in resolving disputes with employees and patrons.
    The Commercial Vehicle Operations (CVO) area continues to be viewed 
as a potential early winner for the ITS program. Use of advanced 
vehicle monitoring and communications technologies by motor carriers 
has demonstrated considerable time savings.\21\ Schneider of Green Bay, 
Wisconsin, reported a 20 percent increase in loaded miles and that the 
elimination of driver check-in telephone calls saves approximately two 
hours per day resulting in a driver salary increase of $50 per week 
with a primary benefit of improved customer service. Trans-Western Ltd. 
of Lerner, Colorado, credits their fleet management system for improved 
driver relations, noting that drivers are able to drive 50 to 100 
additional miles per day. Frederick Transport of Dundas, Ontario, 
Canada, estimates an increase of 20 percent in loaded miles, a 
reduction of $30 from $150 per month in telephone charges, a 0.7 
percent greater load factor and a 9 percent increase in total miles. 
Best Line of Minneapolis, Minnesota, estimates a $10,000 per month 
savings since 300 drivers previously lost about 15 minutes each day 
waiting to talk with dispatchers.
    The safety potential for an advanced traffic information system 
that warns commercial vehicles and other heavy vehicles of a 
potentially dangerous highway situation is being tested. The Dynamic 
Truck Speed Warning System for Long Downgrades has been installed on I-
70 west of the Eisenhower Tunnel west of Denver. This system warns 
drivers of safe truck speed at the start of the downgrade for normal 
operations based on the truck's measured weight. The Colorado Motor 
Carrier Association is excited about the potential for improved safety 
represented by this system. Prior to the project, the state studied 
accident characteristics and hypothesized that since 88 percent of the 
runaway trucks were out-of-state, many truck drivers were unfamiliar 
with the terrain. The fact that runaway truck drivers entered ramps at 
speeds of up to 110 mph supports this hypothesis (Greg Fulton, Colorado 
DOT, telephone interview, January 1995). The system began operating 
during 1995. While evaluation results are not yet available, observers 
report that trucks being instructed to slow frequently apply their 
brakes immediately.
    The TravTek project examined the safety aspects of an in-vehicle 
navigation device that used a moving map display as well as voice 
directions. While data on accidents and near accidents are not 
statistically significant, driver workload studies yielded encouraging 
results. Compared to control conditions of paper maps and road signs, 
use of both visual and voice displays yielded lower driver workloads in 
each category of stress including time stress, visual effort, and 
psychological stress.\22\ TravTek users also perceived that they were 
safer.
    The TravTek project used a simulation approach to estimate safety 
impact. Using the INTEGRATION simulation model, a representation of the 
Orlando roadway network, and performance parameters obtained during the 
live field studies, analyses were performed to estimate crash risk of 
motorists using navigation devices compared to motorists without them. 
In addition, the safety impacts on the entire traffic network (both 
equipped and unequipped vehicles) were analyzed. Results indicated an 
overall reduction in crash risk of up to 4 percent for motorists using 
navigation devices, due to improved wrong turn performance and the 
tendency of the navigation system to route travelers to higher class 
(normally safer) facilities. Other indications from the TravTek field 
studies were that the ability of the navigation system to receive real-
time traffic and congestion information provided an advance warning to 
motorists of potentially unsafe conditions on the route they were 
traveling, further improving the safety benefits of the system. The 
simulations showed a potential for increased safety risk for 
navigation-system-equipped vehicles when real-time information caused 
them to divert from a higher class facility to a lower class road 
(e.g., from a freeway to an arterial). Increased safety risks of up to 
10 percent were estimated for the equipped vehicles, while the overall 
network showed a safety neutral to a slight safety improvement when 
diversion occurred. The network safety improvements were experienced 
when diversion from congested roadways reduced the level of congestion 
for the remaining equipped and non-equipped vehicles and helped to 
smooth traffic flows on those roads.
    The first ramp meter was installed on the Eisenhower Expressway in 
Chicago in 1963. Other early adopters of freeway ramp meters include 
Detroit, Michigan, Minneapolis, Minnesota, and Los Angeles, California. 
By 1989, the Federal Highway Administration (FHWA) had enough data to 
put together a summary of ramp metering practices with quantitative 
results. As places such as Minneapolis upgrade their ramp metering 
systems into true Freeway Management Systems, results continue to 
improve along with coverage, capability, and coordination. While ramp 
metering systems are designed to improve operation at the merge point 
to improve mainline speed and capacity, field experience has 
demonstrated a significant reduction in accident rate. According to 
Minnesota DOT Freeway Operations Meeting Minutes from January of 1994, 
accident rates on I-35W in Minneapolis before management were 421 per 
year and are now 308 per year (a 27 percent reduction). Annual accident 
experience on the same freeway after management is 2.11 collisions per 
million vehicle miles traveled (VMT) compared to 3.40 collisions per 
million VMT before management was instituted (a 38 percent reduction). 
A longitudinal study of the ramp metering/freeway management system in 
the Seattle, Washington, area over a six year period \23\ shows that 
accident rates have fallen consistently to a current level of 62 
percent compared to the base period. A survey of traffic management 
centers using ramp metering \24\ reported similar findings. Accidents 
on freeway systems under freeway management were reduced between 15 
percent and 50 percent. While some other freeway improvements were 
implemented during the study periods, the combination of geometric, 
vehicle, and operational procedures showed significant reductions in 
accident rate. After implementation of the San Antonio TransGuide 
system, which is a freeway management system that does not use ramp 
meters, total collisions decreased by 35 percent and the collision rate 
decreased by 41 percent to 1.80 crashes per million vehicle miles.\25\
    The reduction in secondary collisions attributable to the incident 
management program, which may be quite significant, is difficult to 
estimate due to the coordinated freeway management program in the area. 
The CHART evaluation estimates that the traffic management center, 
including freeway service patrols, was responsible for a 5 percent 
reduction in the number of accidents during non-recurrent congestion. 
Evaluation of the San Antonio TransGuide system found a 20 percent 
decrease in average response time to incidents and a 30 percent 
reduction in secondary collisions, representing a 2.5 percent reduction 
in the total number of collisions.\26\
    Highway-railroad grade crossing systems were recently added to the 
ITS program. The need for improvement is indicated by the fact that in 
1992, 577 fatalities and 1963 injuries occurred at grade crossings.\27\ 
Additionally, the occasional spectacular accident including school 
children or hazardous materials attract national attention. Several 
technologies are currently being tested including photo enforcement and 
adaptation of collision warning systems. Initial tests of photo 
enforcement in Los Angeles have yielded positive results, with a 92 
percent decrease in violation rate. Since the deployment is limited and 
grade crossing accidents are relatively rare, the fact that no 
accidents occurred during the test is not statistically significant 
(Dana King, U.S. Public Technologies Inc., personal interview, January 
1996).
    Collision warning devices and blind spot detectors are becoming 
available as commercial products. Transport Besner Trucking Co. has 
installed an Eaton-Vorad collision warning device on 100 percent of its 
185 truck fleet. Internal studies found that the combination of the 
device with a safety training program has reduced accidents by 38 
percent (Daniel Lareau, Transport Besner Trucking Company, telephone 
interview, February 1996 verifying information in ``Freightliner to 
Offer Collision Warning on New Truck Line,'' Inside ITS, Vol. 5, No. 
23, November 20, 1995). The Greyhound accident experience using an 
earlier model product yielded a reduction of 20 percent in a deployment 
equipping half of the fleet, which could extrapolate to a 40 percent 
reduction in accidents for full equipage.\28\
    In addition to the quantitative results from the collision warning 
systems, other installations and pilot projects are taking place. 
Landstar Systems is installing the Eaton-Vorad system on 40 percent of 
its owned fleet and giving the contract fleet incentive to equip. 
Positive evaluation of the device by experienced drivers in a pilot 
test and the potential to decrease self insurance losses lead to the 
decision to equip. While Landstar does not have reliable statistics, no 
equipped power units have been involved in a rear-end collision since 
the installation began in January of 1995 (Brian Kinsey, Landstar 
Systems, telephone interview, February 1996).
    An early information network in Oregon enabled an increase of 90 
percent in number of weighings and 428 percent in number of safety 
inspections between 1980 and 1989 while staff increased by only 23 
percent.\29\ While these measures are not directly of desired outcomes, 
the link between inspections and reductions in crashes is intuitive.
    ITS implementation is expected to improve the safety record of 
motor carriers. Electronic screening and improved inspection procedures 
will help to eliminate major causes of accidents through better use of 
communications and information technology. Evidence of future success 
is indicated by ongoing motor carrier safety programs including the 
Motor Carrier Safety Assistance Program (MCSAP) and federal safety 
audits. The benefit/cost ratio of these programs has been estimated as 
2.5 while yielding a reduction of 2,500-3,500 accidents annually.\30\
    A collision avoidance product, which has been in use since 1993, is 
the Forewarn system applied to school buses. In 1992-1994, of the 25-40 
school-age children killed by buses, over two-thirds were as 
pedestrians at the time.\31\ \32\ \33\ Many of these children had 
either just exited the bus or were waiting to board it. Although 
quantitative benefits are not yet available, pilot programs in states 
considering deployment of such a device have gone exceptionally well, 
with many drivers having stories of situations in which the system told 
them of the presence of children who were in harm's way (Jeff Himelick, 
Delco Electronics, telephone interview, March 1995). As of late 1995, 
about 500 of the devices were in active use (Ed Kinnaird, Delco 
Electronics, telephone interview, December 1995).
    AVL/CAD and navigation systems are being installed in fire, police, 
and emergency vehicles. While quantitative evaluations are rare, a 
collection of anecdotal evidence is becoming available. A crash in 
Muskogee County, Oklahoma, involving a car and a school bus, resulted 
in the need for medical attention. The fog that contributed to the 
collision would have also delayed an ambulance and made location of the 
collision difficult from a helicopter. However, the helicopter, 
equipped with a GPS receiver, located the crash scene using location 
information provided by a Highway Patrol officer on the scene using a 
hand held GPS. The helicopter was then able to complete the rescue.\34\ 
The AVL system installed by the Schaumburg, Illinois police department 
has been reported to enable dispatch of backup to officers who failed 
to report location information and dispatch of assistance to an 
incapacitated officer.\35\
    The San Antonio TransGuide facility opened in the summer of 1995. 
The value of an integrated facility was demonstrated in the week before 
the center opened when an industrial plant fire erupted within view of 
freeway video surveillance. Based on the visibility afforded at 
TransGuide, the fire was accessed and fought more effectively, possibly 
saving the lives of several firefighters. Both local police and fire 
were convinced of the wisdom of their investment in collocation.
    Simulation using data collected during the TravTek test predicted a 
benefit in throughput. Using constant average trip duration as a 
surrogate for maintaining level of service, a market penetration of 30 
percent for dynamic route guidance results in the ability to handle 10 
percent additional demand.\36\
    Freeway management systems including both ramp meters and incident 
management programs are designed to improve the operating performance 
of freeways. Maximum throughput is reported in the freeway operations 
meeting minutes as 2200 vplph compared with 1800 prior to the use of 
the ramp meters while average speeds have risen from 34 MPH to 46 MPH 
according to the Minnesota DOT meeting notes. The Seattle, Washington 
study \37\ showed a growth in traffic of 10 to 100 percent along 
various segments of I-5 while speeds have remained steady or increased 
up to 20 percent. Other ramp metering installations have reported 
increases in peak throughput of 8-22 percent with steady or increased 
travel speeds.\38\
    Deployment of ETC is occurring at a rapid pace and is being driven 
by cost savings to the operator. The Oklahoma Turnpike has been 
operating ETC in the Pike Pass program for over five years with 
excellent results. Statistics from the Turnpike in a flyer entitled 
Pike Pass Facts indicate a 91 percent savings:
  --Annual cost to operate automated lane--$15,800.
  --Annual cost to operate an attended lane--$176,000.
    The use of AVL/CAD systems has demonstrated significant 
productivity improvements to transit operators. In Kansas City, 
Missouri, the analysis of actual run times on all routes over an 
extended period of time allowed a reduction in equipment requirement in 
several routes of up to 10 percent, allowing fewer buses to serve those 
routes with no reduction in service to the customer. The result was a 
savings in both operating expense and capital expense by actually 
removing these buses from service and not replacing them. The 
productivity gain of eliminating seven buses out of a 200 bus system 
allowed Kansas City to amortize their investment in AVL in two years. 
Other transit systems have reported reductions in fleet size of 4 to 9 
percent due to efficiencies of bus utilization.\39\
    The Winston-Salem Transit Authority in Winston-Salem, North 
Carolina, evaluated effects of a computer-aided dispatch and scheduling 
(CADS) system \40\ in operation of a 17 bus fleet. While the client 
list grew from 1,000 to 2,000 over a 6-month period and vehicle miles 
per passenger trip grew 5 percent, operating expenses dropped 2 percent 
per passenger trip and 9 percent per vehicle mile. These productivity 
improvements occurred at the same time as service improvements 
including institution of same day reservations, which grew to account 
for 10 percent of trips, and a decrease in passenger wait time of over 
50 percent.
    While much of the literature regarding electronic fare payment 
discusses technical capability and patron convenience, some early 
indications of benefits to the transit property are accumulating.\41\ 
Reduced fare evasion has increased revenue from 3 to 30 percent. 
Reductions in data collection cost range from an estimated $1.5 million 
in Manchester, UK to a predicted $5 million in Ventura, California, in 
addition to improved data accuracy. New York estimates the increase in 
ridership due to electronic fare payment to be worth $49 million. New 
Jersey Transit estimates annual cost reduction of $2.7 million in cash 
handling while Atlanta estimates $2 million in savings.\42\
    Public transportation providers in rural areas can produce cost 
efficiencies by increasing ridership. The computer-assisted dispatching 
system in Sweetwater County, Wyoming, which allows same-day ride 
requests to be accepted, has contributed to an increase in ridership 
from 5,000 passengers monthly to 9,000 monthly without increasing the 
dispatch staff and a reduction of operational expense of 50 percent 
over a 5-year period on a per passenger mile basis.\43\
    Results are provided in an ATA Foundation 1992 survey \44\ of 69 
trucking companies operating in an urban area. More than half of the 69 
companies surveyed use CAD systems. Productivity gains resulted from an 
increase in the number of pickups and deliveries per truck per day, 
ranging from 5 percent to more than 25 percent, with most gains being 
clustered in the 10-20 percent range. The use of two-way text 
communication systems yielded driver time savings of 30 minutes per day 
because of the reduced time spent locating and using telephones.
    Further anecdotal evidence of benefits fleet management systems to 
carriers is accumulating. The recently completed Automated Mileage and 
Stateline Crossing Operational Test (AMASCOT) has generated significant 
interest from carriers, manufacturers, and regulators, with carriers 
awaiting delivery of orders for commercial products (Estel Cooper, Ruan 
Transportation, personal interview, April 1996). Although the 
evaluation did not calculate cost savings from the operational phase, 
carriers involved in the test estimated a potential for similar devices 
to reduce costs for International Fuel Tax Agreement (IFTA) and 
International Registration Plan (IRP) reporting by 33 to 50 percent. 
State processing and audit staffs were also receptive to potential 
changes in processing requirements and optimistic about the ability of 
such a system to improve accuracy, productivity, and compliance for 
both carriers and states.\45\
    Commercial Vehicle Regulators will also experience financial 
benefits due to implementation of ITS. Improvements in administrative 
efficiency, avoidance of infrastructure investment, and improvements in 
highway data collection will reduce costs while increased compliance 
will increase revenues and reduce damage to highways in addition to 
improving safety. The HELP/Crescent Project on the West Coast and 
Southern border states represented the final stage of the HELP program 
that evaluated the applicability of four technologies to services 
including roadside dimension and weight compliance screening, pre-
screening of vehicles with proper documents, government audit of 
carrier records, government processing of commercial vehicle operator 
documents, government planning, and industry administration of vehicles 
and drivers. The technologies included automatic vehicle 
identification, weigh-in-motion, automatic vehicle classification, and 
integrated communications systems and database. The benefits data are 
developed as a projection of experience from the project and from other 
databases rather than direct measurement by the project.\46\ Impact of 
hazardous material incidents could be reduced $1.7 million annually per 
state. Estimates of reductions in tax evasion range from $0.5 to $1.8 
million annually per state. Overweight loads could be reduced by 5 
percent leading to a savings of $5.6 million annually. Operating costs 
of a weigh station could be reduced up to $160,000, with credentials 
checking adding $4.3-$8.6 million and automated safety inspection 
adding $156,000-$781,000 in savings due to avoided accidents annually 
per state. A full implementation of services examined in the Crescent 
project would yield a benefit/cost ratio of 4.8 for state government 
over a 20-year period. Less complete implementations range in benefit/
cost ratio from up to 12:1 for the government. The COVE Study \47\ 
estimates a benefit/cost ratio to the government of 7.2 for electronic 
clearance, 7.9 for one-stop/no-stop shopping, and 5.4 for automated 
roadside inspections. Another study finds that administrative 
compliance costs for Massachusetts carriers could be reduced by $2.4 
million annually using ITS techniques.\48\
    One indication of reduced travel stress is the availability of 
information. Of rental users of TravTek, 38 percent found the device 
helpful in finding specific destinations in unfamiliar territory as did 
63 percent of local drivers.\49\ In the Pathfinder project users 
perceived that their trips were less stressful and that they were 
saving time, even in situations where the time savings were 
insignificant. Drivers were also more comfortable in diverting with 
Pathfinder, as indicated by a 40 percent increase in diversion.\50\ The 
Avis fleet of navigation equipped cars is expanding and frequently 
fully rented.\51\
    Pre-trip traveler information is also popular, although measures of 
reduced stress are difficult to obtain. The Los Angeles Smart Traveler 
project has deployed a small number of information kiosks in locations 
such as office lobbies and shopping plazas.\52\ The number of daily 
accesses range from 20 to 100 in a 20-hour day, with the lowest volume 
in offices and the greatest in busy pedestrian areas. The most frequent 
request was for a freeway map with 83 percent of users requesting this 
information. Over half of the accesses included requests for MTA bus 
and train information. Users, primarily upper middle class in the test 
area, were overwhelmingly positive in response to a survey.
    The Travlink test in the Minneapolis area distributed PC and 
videotext terminals to 315 users and made available transit route and 
schedule information, including schedule adherence information, as well 
as traffic incidents and construction information.\53\ For the month of 
July 1995, users logged on to the system a total of 1660 times, an 
average of slightly more than one access per participant per week. One 
third of the accesses to the system requested bus schedule adherence; 
another 31 percent examined bus schedules. Additionally, three downtown 
kiosks offering similar information averaged a total of 71 accesses per 
weekday between January and July of 1995; real-time traffic data were 
more frequently requested than bus schedule adherence.
    The Genesis project, also in Minneapolis, delivered incident 
information via alphanumeric pagers. A majority of Genesis users (65 
percent) reported using the service daily and 88 percent reported using 
the service once or more per week. Of users who participated in the 
test, only 2 percent dropped out of the project during operation due to 
dissatisfaction with the service. An additional indication that users 
found the service valuable is that users discovered over half of the 
incidents affecting their travel via Genesis compared to discovering 15 
percent of incidents via radio and TV. When users became aware of 
incidents via Genesis, they chose alternate routes for travel in 83 
percent of the situations.\54\
    An automated transit information system implemented by the 
Rochester-Genesee Regional Transportation Authority resulted in an 
increase in calling volume of 80 percent,\55\ while a system installed 
by New Jersey Transit reduced caller wait time from an average of 85 
seconds to 27 seconds and reduced caller hang-up rate from 10 to 3 
percent while increasing the total number of callers.\56\ The Boston 
SmarTraveler has experienced 138 percent increase in usage from October 
1994 to October 1995 to a total of 244,182 calls monthly, partly due to 
a partnership with a local cellular telephone service provider, 
according to a SmartRoute Systems memorandum entitled SmarTraveler 
Update dated November 6, 1995.
    TravTek users perceived that their driving was safer. Based on 
survey data, users felt less nervous and confused and more confident, 
attentive, and safe, with local users being significantly more positive 
than renters. Users also felt that the use of TravTek did not interfere 
with their driving task. While users who were interacting with TravTek 
immediately before a near accident were more likely to feel that they 
had contributed to the close call, users were no more likely to be 
involved in close calls than were nonusers.\57\
    Traffic signal system improvements are able to reduce the number of 
vehicle stops. Quoting studies mentioned earlier, ATSAC reported 41 
percent reduction in vehicle stops.\58\ SCOOT in Toronto resulted in a 
22 percent decrease in stops \59\ compared to a best effort fixed 
timing plan. The Abilene report indicates no change in the number of 
stops.\60\
    For the transit riding public, security is a crucial issue. 
Everyday there are numerous emergency situations in every major city 
involving passenger and operator safety. The deployment of automatic 
vehicle location (AVL) systems coupled with modern computer-aided 
dispatch (CAD) as part of transit management systems has had a dramatic 
affect on the response to emergencies. The AVL/CAD systems now being 
deployed have two key features which contribute to passenger safety. 
First, these systems have a silent alarm capability where the driver 
can alert the dispatch center of a problem. When this alarm is 
activated, the vehicle in trouble is highlighted on the dispatcher's 
console for immediate response. The dispatcher can activate a covert 
microphone on the bus and listen to the nature of the problem without 
alerting the perpetrators or passengers. The dispatcher can then alert 
the appropriate emergency service. A number of transit agencies have 
reported a dramatic reduction in response time. The fact that the 
dispatcher can pinpoint the vehicle at all times, and is able to advise 
the police of the nature of the problem has produced a reduction in 
response time from over ten minutes to less than two minutes.\61\ At 
least one dispatcher in Denver believes that this capability has 
literally saved the lives of some passengers.
    Electronic fare payment tests are ongoing in both bus and rail 
systems which address customer convenience and security. In California, 
tests comparing various card technologies have found RF proximity cards 
to be high in reliability. A test in the Marseilles, France, 
metropolitan area is comparing RF and IR technologies that would allow 
each patron to use a card of his or her choice (credit card, debit 
card, monthly pass, etc.) for transportation payment, while processing 
a transaction in less than a second.\62\ An experiment involving 2,400 
rail travelers in the Washington system using RF stored-value cards has 
been operating since February of 1995. System-wide deployment of the 
cards is planned based on the reliability of the technology and 
potential improvements in convenience and security (Ramon Abramovitch, 
Washington METRO, telephone interview, November 1995).
    The Phoenix transit operators have used electronic fare payment 
techniques since 1991.\63\ The Arizona state legislature passed an air 
quality bill in the late 1980's. Maricopa County, the county 
encompassing Phoenix, in turn passed a travel reduction ordinance that 
required each employer in the Phoenix area with over 100 employees to 
reduce single-occupancy commuting trips by 5 percent in two years. To 
assist in data collection needed in this program as well as to reduce 
operational problems, the City of Phoenix Public Transport System led 
development of the Bus Card Plus system to read magnetically encoded 
plastic passes. Employers were then billed monthly for transit use by 
their employees.
    The first public use of the Phoenix system was in April 1991 by 
employees of Valley National Bank. Currently, 190 companies participate 
with a total of 35,000 cards in use. Express routes report 90 percent 
of fares are paid by bus pass cards. Since employers are billed only 
for transit usage rather than purchasing monthly passes, costs to them 
are decreasing by up to one third. Starting in May of 1995, VISA and 
MasterCard have also been accepted. While this project has not been in 
operation long enough for firm results to be claimed, patronage has 
been growing over the four months from May-September, with processing 
fees totaling under 7 percent of revenue generated and without major 
problems.
    One case where direct measurement of environmental impact is 
practical is a highly localized measure such as air quality surrounding 
a particularly snarled intersection or other point of interest. An 
example of local air quality benefit is the reduction of emissions 
using signal system optimization in the ``Five Points'' area of Las 
Vegas.\64\
    The Pike Pass ETC program on the Oklahoma Turnpike started 
operation on 1 January 1991. As of June 1994, 250,000 passes had been 
issued, of which over 90 percent (226,000) were still active, 
accounting for 35 percent of the turnpike association's revenue. Using 
a protocol prepared from the Northeast States for Coordinated Air Use 
Management (NESCAUM), the Clean Air Action Corp. \65\ estimated toll 
booth emissions based on dynamometer tests and toll road observation at 
Muskogee Turnpike in Oklahoma, Asbury Plaza on the Garden State Parkway 
in New Jersey, and Western Plaza on the Massachusetts Turnpike. This 
report takes the experiences gained with the Pike Pass project and 
applies them to the other two freeways. The report projects significant 
reduction in tons of pollutants for the 260 day commuter case. The 
overall percent change is dependent upon frequency of toll plazas. Per 
mile of impacted operation, the average emissions reductions are 72 
percent for carbon monoxide, 83 percent for hydrocarbons, and 45 
percent for oxides of nitrogen. The report uses 0.55 miles as the 
distance involved in the average barrier toll transaction.
    Traffic signal systems continue to be upgraded for a number of 
reasons, primarily for traffic flow and system maintenance reasons. The 
improved flow and reduced delays also have a generally positive impact 
on emissions and energy consumption at current traffic levels. Several 
system retimings and equipment upgrades have included emission 
evaluations. Among documented results are systems in Abilene, Texas, 
Southern California, and Toronto, Ontario. The ATSAC program in Los 
Angeles, California reported 13 percent decrease in fuel consumption, 
14 percent decrease in emissions.\66\ The City of Abilene report \67\ 
indicates overall impacts on emissions of 6 percent decrease in fuel 
consumption, 10 percent decrease in HC, and 13 percent decrease in CO, 
while nitrous oxide increased by 4 percent. The SCOOT implementation in 
Toronto showed a decrease in fuel consumption of 6 percent, a decrease 
in carbon monoxide emission of 5 percent, and a decrease in hydrocarbon 
emissions of 4 percent compared to a ``best effort'' fixed timing 
plan.\68\
                         problems/shortcomings
    The primary motivation behind the field operational test program 
was to get promising technologies fielded and to evaluate the 
feasibility of such technologies for real-world applications. We are 
accomplishing this goal and are learning a lot. In addition to the 
benefits and savings learned and portrayed above, problems and 
shortcomings dealing with institutional capacities and procedures for 
implementing ITS deployments have been identified in the field 
operational test program. These have been extensively documented and 
are recounted in summary fashion here. Many findings, such as the lack 
of a technical architecture to help ensure interoperability, have 
already been addressed in our completion of the ITS National 
Architecture. We continue to address other shortcomings in our 
initiatives to promote standards and protocols, professional capacity 
building, updating of procurement practices, and integration across ITS 
components within and between transportation regions.
    Although several field operational tests have looked into savings 
associated with fielding ITS technologies, the costs of deployment were 
not required to be documented. Many field tests deployed one-of-a-kind 
systems for prototype testing. Any costing of such more expensive 
systems would have been premature and not cost effective itself. As we 
turn now to model deployments of the integrated ITS infrastructure in 
four metropolitan areas, and CVISN in eight states, we are also 
emphasizing the need for cost/benefit studies of these deployments.
    Two reports document problems and shortcomings based upon an 
analysis of 12 operational tests and one privately sponsored test. 
``IVHS Institutional Issues and Case Studies: Analysis and Lessons 
Learned'' (Report Number DOT-VNTSC-FHWA-94-15, April 1994) is based 
upon ADVANCE; Advantage I-75; HELP/Crescent; TRANSCOM/TRANSMIT; 
Travtek, and the private deployment of Westchester County Commuter 
Central. The following are categories of issues and issues identified 
across these tests:
    Category 1.--Organization and Management Issues.--Of the four 
categories of institutional issues defined, this contained the largest 
number of institutional issues. The following are the issue types 
identified and discussed under this category in the referenced report:
Cultural differences in public-private partnerships
    Issues: A fundamental impediment to the smooth accomplishment of a 
partnership agreement for many of the projects was the stark difference 
in the ways the partners, particularly between those in the private 
sector versus those in the public sector, did business.
Lack of inter-partner communications
    Issue: The following factors contributed to this problem:
  --Negative stereotypes of cultural differences
  --Lack of trust
  --Unclear/Changing definition of goals, roles and responsibilities
  --Imprecise definition of evaluation
  --Lack of communication protocols
Lack of intra-partner communications
    Issues: Communications problems are greatest in the CVO arena 
whereby a single state representative is required to represent multiple 
state agencies.
Management challenges
    Issues: The following are some of the factors that contributed to 
the problem:
  --Evaluation planning problems
  --Over dependence on unproven technology
  --Contract and contractor problems
  --Aggressive project schedule
  --Size of the policy committee
    Category 2.--Regulatory and Legal Issues.--Of the four major 
categories of issue types, this category contains issue types that had 
obvious near and far term implications for the ITS products and 
services proposed for testing. Regulatory and legal issue types found 
to be of more immediate concern to partners of operational field tests 
were those in the critical path of beginning the implementation and 
test and evaluation phases of the projects.
Unclear government accounting requirements
    Issue: Work performed with Federal funding requires the accounting 
of direct, overhead, and fee expenses incurred by private sector 
vendors. The private partner insisted on total confidentiality 
regarding product costs.
Burdensome administrative requirements
    Issue: The issue of how to administer funding from multiple sources 
was often a problem.
Concerns regarding liability and insurance
    Issue: Who will insure vehicles for collision and liability and for 
such things as wrong way directions, etc.?
Concerns over legality of new technologies in moving vehicles
    Issue: How much and what types of information should a driver be 
allowed to receive without causing a safety hazard due to divided 
attention taking the driver's eyes off of the road? The issue of 
multifunction displays in automobiles and the functions that are 
allowable during driving (e.g., moving map displays and reception of 
television entertainment programs), will be a growing issue nationwide.
Concerns regarding intellectual property and proprietary rights
    Issue: This issue stems from the stereotypical view that the 
results of any endeavor that uses Federal funding will fall in the 
public domain.
Concerns over differing state regulations governing CVO operations
    Issue: Partnering states had difficulty reaching agreement on an 
acceptable regulatory and enforcement protocol for CVO. Differences in 
scale tolerances, weight limits, and acceptable evidence of truck 
safety inspections contributed to the problem.
Lack of IVHS technology standards
    Issue: The lack of technical standards has the potential to become 
the biggest institutional impediment to the successful commercial 
deployment of the majority of IVHS projects.
Concerns regarding potential negative public reaction
    Issue: Concerns regarding public reaction to potential 
redistribution of congestion-causing traffic to local arterial.
    Issue: Concerns regarding public perceptions that IVHS technologies 
can compromise individual privacy.
    Issue: Concerns regarding a lack of data on environmental impacts.
    Category 3.--Human and Facilities Resources Issues.--This category 
focuses primarily upon people-related issues in response to two simple 
questions: (1) Do you have enough people?, and (2) Are the people 
qualified to do the work?
Quality and sufficiency of partner leadership
    Issue: Two issues were identified in this area: (1) criticality of 
the program manager role, and (2) lack of partner leadership, authority 
and continuity.
Quality and sufficiency of support resources
    Issue: Lack of quality and sufficiency of Federal/state DOT staff 
resources.
    Issue: Lack of quality and sufficiency of program staff resources.
    Issue: Lack of quality and sufficiency of contractor support 
resources.
    Category 4.--Financial and Market Uncertainty Issues.--Of the four 
categories of institutional issues, this category contains issues which 
present the greatest diversity in definition as well as risk to 
deployment of ITS products and services. The following issues are 
discussed under this category of the report:
Cost sharing goals and how they will be measured
    Issue: How the non-Federal partners apportion the expenses of an 
operational test is left to the ingenuity of individual partnerships.
Projecting project funding through deployment
    Issue: Program cost and uncertainty about continued Federal support 
of IVHS programs was seen as a significant impediment to deployment. 
There is a concern that the Federal Highway Administration (FHWA), 
after providing funding to initiate the test, will require the states 
to absorb all future maintenance costs of elements critical to the 
program.
Market uncertainty and user willingness to pay
    Issue: The uncertainty issue is driven by two factors: (1) A 
realization that in the beginning, IVHS products and services will be 
expensive, and (2) Lack of information on the value of products and 
services from the perspective of the market place.
    In addition to identifying the above issues, the report also 
identifies lessons learned and recommendations for improving the 
performance of other operational field tests and deployments of ITS 
products and services.
    The second report, ``Analysis of ITS Operational Tests Findings and 
Recommendations'' (Report Number DOT-VNTSC-FHWA-95-5, September 1995) 
summarizes the institutional issues and lessons learned from six case 
studies spanning seven operational tests: the Guidestar Program, which 
includes the Genesis and Travlink operational tests, and the FAST-TRAC, 
Houston Smart Commuter, SaFIRES, SmarTraveler, and TravelAid 
operational tests. The issues in this report are similar to those 
listed above.
    Like the first report, this report also makes recommendations for 
improving the performance of future operational tests and deployments 
of ITS products and services--the majority of which we are now 
incorporating in our selection and contracting processes for future 
operational test and into our mainstreaming process.
    Question. Why can't the $500,000 study requested on page 166 be 
completed by a visiting scholar or by FHWA personnel?
    Answer. The nature of the data to be obtained under the 
Supplemental Data Collection study is such that it must be at a level 
of detail that will facilitate validation and calibration of traffic 
flow theory and analysis tools and our computer simulation programs. 
Typical types of data to be obtained are individual vehicle speeds, 
vehicle trajectories, lane changes, and vehicle dispersion patterns 
from stop bars. This type of data and the nature of its use is more 
detailed and complex than typical traffic data collection efforts. An 
underlying strategy for this study will be to seek out existing sites 
such as ITS operational tests, ITS Model Deployment cities, and 
regional traffic control centers where some such traffic data 
collection is already occurring and to reduce costs by capitalize on 
those data sharing opportunities. The volume, complexity, and 
geographic distribution of the data to be obtained makes it infeasible 
for a single person to collect, reduce and process the data into a 
useable format. Although a visiting scholar or FHWA personnel will be 
involved in the requirements analysis for this study, the majority of 
the funding is needed for supplementing data already available through 
physical data collection.
    Question. How critical is the modeling work proposed on pages 166 
and 167? Why can't you incorporate this work with TRANSIMS? Why can't 
you use existing models? Who is requesting this work? Do you have a 
specific request from a MPO?
    Answer. Our analysis of current planning and operational models has 
revealed that they have various deficiencies that inhibit accurate 
estimation of ITS benefits in a regional transportation planning 
analysis. Planning models analyze traffic characteristics over a 
region. However due to the current planning analysis methods used to 
model a region, details necessary for the analysis of ITS operational 
benefits are not present. Conversely, current operational models have 
the detail required, but, lack the ability to simulate a regional area 
and provide for the estimation of benefits over a 20 year planning 
horizon. However, by carefully and selectively using the power of the 
two model types, we believe that we can minimize the development of new 
models.
    The ITS Deployment Analysis System (IDAS) will support analysis in 
the near-term time frame of the benefits of applying technology to 
various regional transportation deficiencies. Identifying the level of 
benefit associated with various alternatives of current, traditional 
capabilities and available ITS technologies is critical to the 
decision-making process of the States and Metropolitan Planning 
Organizations in development of Long Range Plans and Transportation 
Improvement Programs.
    The development of IDAS is being thoroughly coordinated with the 
TRANSIMS effort to support estimation of ITS benefits. This will 
produce a two track approach. The first track, IDAS, supports analysis 
of ITS benefits in the near-term time frame. IDAS will supplement 
current analysis procedures to enable ITS analysis at a sketch planning 
level. Track two, TRANSIMS/ITS, is an effort to incorporate various 
capabilities into TRANSIMS that will support the detailed analysis of 
ITS alternatives. Thus, TRANSIMS will support more detailed ITS 
analysis needs in the longer-term time frame.
    Due to the emphasis on ITS deployment, the transportation planning 
community (e.g. State DOT's, MPO's) has voiced strong concerns 
pertaining to the lack of ITS analytical capabilities needed to support 
the planning process and that they can use to justify and defend the 
selection of ITS alternatives. To assure that we are responsive to 
their concerns and needs, we have received commitments from twelves 
planning organizations to have representatives who will participate on 
a Steering Committee to work interactively with us in the development 
of IDAS. The Steering Committee has endorsed the IDAS conceptional 
framework and Scope of Work. We anticipate a competitive award to begin 
a phase one IDAS this fiscal year.
    Question. Please complete each of the tables presented on page 169 
for fiscal year 1996 and fiscal year 1997 funding levels.
    Answer. Information provided in the following tables.

    PROGRAM: RESEARCH AND DEVELOPMENT--TRAFFIC MANAGEMENT AND CONTROL   
------------------------------------------------------------------------
                                                     Program schedule   
                                                 -----------------------
             Products and activities                  Fiscal years--    
                                                 -----------------------
                                                  1997  1998  1999  2000
------------------------------------------------------------------------
Advanced traffic management research:                                   
    Advanced traffic management.................  100
Laboratory Staff and Grad Research Fellow Study at Turner-Fairbank 
    Research Center...............................................   <50

    In response to matching funds and university/industry partners in 
the composite research area, please be advised that there has been, and 
continues to be, significant participation. Universities involved 
include: Universities of California at San Diego, at Long Beach and at 
Berkeley, University of Maryland, Wyoming University, Penn State 
University, Catholic University, University of Delaware, West Virginia 
University, Georgia Tech, with several more universities active in 
related work where FHWA provides technical support. Major industry 
partners include: DuPont, XXSys, Hercules/Alliant, AMOCO, JMI, 
Mitsubishi, Toren, Hexcel-Fyfe, DuPont-Hardcore, Brunswick 
Technologies, and Strongwell Inc. Other Federal governmental agencies 
involved include: Advanced Research Projects Agency within the DOD, the 
National Institute of Standards and Technology's Advanced Technology 
Program, NASA's Marshall Space Flight Center and the U.S. Air Force at 
Wright-Patterson Air Force Base. Furthermore, several State Departments 
of Transportation (DOT) and associated research centers are 
coordinating with FHWA including: Texas Research Institute, Virginia 
Transportation Research Center, Cal Trans, DEL DOT, VDOT, SCDOT, WVDOT, 
GADOT, Ohio DOT, FDOT, SDDOT and KDOT. Cooperative funding includes the 
$10.5M from ARPA and similar matching from the private/public ACTT 
Consortium as well in kind materials and engineering services amounting 
to hundreds of thousands of dollars. Our current fiscal year 1997 
procurement actions include private section participation.
    Question. FHWA is requesting funds to upgrade the HYSIM driving 
simulator located at the Turner-Fairbanks Laboratory. Please describe 
in detail the nature of these upgrades and how these will improve the 
fidelity and overall operational and research capability of HYSIM. 
Please breakout the use of these monies.
    Answer. Upgrades to the HYSIM focus primarily on two critical 
systems; the visual system and the motion base/car cab. The complete 
visual system, which includes the image generator and the sign system 
centers on improving the realism and complexity of the simulated 
environment and increasing the field of view. By enhancing this system, 
more sophisticated images can be produced, including the ability to 
depict more realistic urban scenes and interactive traffic. These 
capabilities are critical to FHWA research in order to assess driver's 
performance in a number of scenarios and especially to gauge how 
drivers interact with other traffic.
    The motion base is a new subsystem and will enhance the realism of 
the simulator and allow for greater fidelity for investigations that 
require specific driver maneuvers on various geometric configurations. 
In addition, the motion base will help reduce the risk of simulator 
sickness that is associated with an expanded field of view in fixed 
base systems. A new car cab will allow researchers to change the 
dashboard configuration via software; a more efficient method than 
developing and implementing various hardware configurations. This 
capability will allow for investigations of integrated ITS systems and 
multiple displays.
    Question. What research for fiscal year 1998 does the FHWA expect 
to conduct on the upgraded HYSIM that cannot be conducted with the 
existing facility? Could this research be conducted on the NADS when it 
becomes available?
    Answer. The HYSIM upgrade is proceeding in an incremental fashion 
to ensure the FHWA human factors research will continue (i.e., the new 
operating system and visual system will be installed, followed by the 
car cab and the motion base). A comprehensive research program to 
investigate highway safety and ITS issues has been developed for the 
HYSIM. Emphasis will be placed on investigations that address the new 
Intelligent-Vehicle Initiative (IVI), including the assessment of 
different in-vehicle displays, their location, and especially the 
integration of different types of driver information and modalities and 
driver maneuvers on various geometric configurations. These studies 
cannot be conducted on the current HYSIM due to the need for the 
reconfigurable dashboard for display experiments and the need for a 
motion base to fully test driver performance on different types of 
roadways and intersections. When testing driver information issues, 
comparisons between in-vehicle and roadway elements is important. The 
HYSIM includes the DYNASIGN system, which is unique to the HYSIM and 
offers the most realistic resolution of simulated signs in the country. 
It consists of a series of 35mm random-access slide projectors and zoom 
lenses with affiliated yaw mirrors that move both laterally and 
vertically to realistically depict signs in the simulator scenarios.
    Due to the nature of the FHWA research with its emphasis on the 
integration of ITS systems and subsystems, multiple display locations, 
and especially signing issues, these studies are not suited for being 
conducted on the NADS.
    Question. Please outline the total annual operating costs of the 
HYSIM for the last three fiscal years. Based on the number of hours 
that the facility was used to conduct research in the past year, what 
is its average hourly operating cost?
    Answer. The annual costs for operating the HYSIM the past three 
fiscal years has been approximately $300,000 per year. The HYSIM was 
used virtually full time for conducting research, and typical tasks 
include programming and scenario set up, data collection, and data 
reduction. Based on these activities, the average hourly operating cost 
of the HYSIM has been $150.
    Question. The Committee understands that the National Advanced 
Driving Simulator (NADS) which NHTSA is developing will have a fixed-
base simulator module to supplement the main motion-based simulator. 
How do the technical capabilities of this fixed-base simulator compare 
with those of the upgraded HYSIM?
    Answer. The NADS fixed based module's technical capabilities will 
be inferior to the upgraded HYSIM. Without motion capabilities, the 
NADS fixed base simulator will not provide the degree of fidelity 
needed to adequate simulate the cues drivers utilize, especially when 
performing turning, accelerating, and braking maneuvers on a variety of 
highway configurations. Therefore, the number and type of experiments 
and driving situations that can be conducted on the NADS fixed base 
simulator will be limited, when compared to the upgraded HYSIM. The 
lack of a motion base will also have the potential to increase the 
occurrence of simulator sickness, when compared to the motion based 
HYSIM. Furthermore, the NADS fixed base simulator (and the entire NADS) 
does not contain the DYNASIGN system.
    Question. Would utilization of the NADS fixed-based simulator in 
lieu of HYSIM place any limitation on the type or quality of research 
that FHWA could conduct? Please describe the nature of these 
limitations.
    Answer. Using a fixed base simulator in lieu of the upgraded, 
motion based HYSIM would severely limit both the type and the quality 
of research FHWA could conduct. The addition of the motion base to the 
HYSIM is being implemented to address a number of the weaknesses 
associated with fixed base simulation. One specific function being 
added to the HYSIM, with the inclusion of the three degree of freedom 
motion base, is the capability to conduct experiments on highway design 
induced motion, a critical and unique element of the FHWA research 
program. This emphasis on highway design issues is one of the major 
strengths of the upgraded HYSIM's capabilities, when compared to NADS. 
Finally, as mentioned above, the HYSIM's reconfigurable dashboard is 
essential for conducting ATIS research and the DYNASIGN system is an 
integral component of the simulator and FHWA's research.
    Question. The NADS is expected to become operational in the spring 
of 1999. How does the FHWA plan to utilize the NADS facility, and does 
it plan to continue the HYSIM operation after the NADS is available?
    Answer. The FHWA is planning on conducting research at NADS through 
its Office of Motor Carriers (OMC). The specific nature of OMC's 
research issues requires the use of NADS as a laboratory, not the 
HYSIM. The sophisticated vehicle dynamics of NADS will enable OMC 
researchers to address questions specific to the trucking community and 
truck driver population. The NADS motion base will provide 6 degrees of 
freedom and will be capable of simulating forces and angular rates 
associated with motions for the full range of truck driving maneuvers. 
FHWA plans to fully utilize the HYSIM in its research program. The 
HYSIM will include a software reconfigurable dashboard to optimize its 
utility to perform specific types of ITS research. There is sufficient 
need for motion based simulation in FHWA's research programs to keep 
the HYSIM and the NADS active.
    Question. Please provide quantitative data to estimate the amount 
of cash and in-kind contributions received to assist the OTA program 
for each of the last three years.
    Answer. The Office of Technology Applications has integrated 
partnerships into its programs to expand its capabilities and to 
leverage its resources. Overall, for the last three years the funds in 
the programs within the Technology Applications Program average 40 
percent from those programs and 60 percent from other sources, either 
in funding or in-kind services; this translate to approximately $30 
million leveraged by $45 million from other sources over the last 3 
years.
    OTA is active throughout it program to stimulate partnerships in 
the makeup of project media and in conducting the projects. The FHWA's 
National Priority Technologies Program (PTP) is an organized effort to 
encourage partnering. In the first year of the PTP, 1995, the 32 
projects included 26 percent non-PTP funds; in 1996, the 52 projects 
included 52 percent non-PTP funds; and in 1997 of the projects approved 
so far, the percentage of non-PTP funds has jumped similarly, showing a 
clear trend toward increasing non-PTP funding for these projects.
    In the Local Technical Assistance Program, the amount of leveraged 
resources varies from State to State, but integral to the program is 
the States' equal contribution to the Federal share up to $110,000 per 
center--the Native American tribal government regional centers are on 
100 percent funding equally shared by FHWA and the Bureau of Indian 
Affairs. Many States, recognizing the value of the Centers to their 
rural and small urban roadway programs contribute additional funding 
from State funds or from the universities; resources are in both the 
form of funds and in-kind services. Overall, the leveraged amount has 
been approximately 44 percent FHWA and 56 percent non-Federal.
    There are many examples of continuing FHWA collaborations to 
improve relevant technology, a goal central to the FHWA's work toward 
achieving the highest quality surface transportation system for the 
Nation. Specifically, the timely development and dissemination of 
improved technology to a well-trained highway community are essential 
to the fulfillment of such a system. FHWA is continuing to identify and 
enter into partnerships to significantly expand the effectiveness of 
the Technology Applications Program.
    Question. The Priority Technologies Program is now in its third 
year. What types of projects are being conducted with this Federal 
investment? How has the program leveraged its costs to increase its 
effectiveness? How are the products being showcased?
    Answer. The Priority Technologies Program (PTP) was initiated in 
fiscal year 1995 designed expressly to accelerate the deployment of new 
or innovative transportation technology by the successful testing and 
evaluation of technologies which have high potential for bringing real 
benefits to transportation users. The program is unique in that the 
FHWA field offices have had the lead in establishing and operating the 
program. A team comprised entirely of field personnel developed the 
guidelines under which the program has operated.
    Priority Technologies Program projects are focused on getting new 
technology ``on the ground''--on closing the gap between the state-of-
the-art and the state-of-practice. Through this program, State and 
local governments find support for implementing innovative 
technologies, construction materials, and procedures, in order to 
achieve results from application of the technologies and deliver 
expected user benefits.
    Many different types of projects have resulted from the program. 
Examples include:
  --Pilot testing use of composite materials for replacing 
        deteriorating concrete and corroding steel in our aging 
        bridges.--Composite materials promise lower-cost, quicker, 
        longer-lasting, more corrosion-resistant and safer bridge 
        repairs. (West Virginia, Utah, Idaho)
  --Installation of global positioning system (GPS) receivers in police 
        cars for more accurate location of accident sites.--GPS 
        technology enables police to record more accurate accident 
        data, more quickly, and assists in clearing the road 
        expeditiously. (Delaware)
  --Centralized calibration of road roughness and ride quality.--Ride 
        data is an essential foundation for pavement management systems 
        that help highway agencies manage maintenance activities more 
        efficiently. (Massachusetts)
  --Application and performance testing of thin whitetop (Portland 
        cement concrete) overlays.--Whitetopping overlays can be a 
        relatively inexpensive and quick method for restoring a smooth 
        surface to rutted asphalt pavement. (Pennsylvania)
  --Video documentation of cathodic protection systems.--Cathodic 
        protection prevents bridge deterioration from chloride-based 
        deicing chemicals. (Texas)
  --Assessing the environmental impacts of using industrial wastes in 
        highway construction.--Many industries could benefit by use of 
        industrial wastes in road construction. It would reduce their 
        disposal costs and provide an environmentally attractive 
        alternative to landfill. (Indiana)
  --Development of an electronic miniature cone penotrometer for 
        assessing pavement condition.--Nondestructive pavement 
        assessment technologies enable highway agencies to manage their 
        pavement maintenance more efficiently. (Louisiana)
  --Evaluating a mechanical gang vibration system for bridge deck 
        construction.--Mechanical vibration is expected to produce 
        higher quality and better-performing concrete than the hand-
        held vibrators traditionally used for consolidation of concrete 
        in bridge decks. (Arkansas and Illinois)
  --Developing a Safety and Traveler Information System for rural 
        Interstate highways.--Information systems will provide 
        travelers with up-to-the-minute information on road repair 
        activities, weather, and traffic conditions, and warn them when 
        they are driving too fast for current conditions. Studies have 
        shown that providing accurate information can reduce driver 
        frustration and aggressive behavior. (Iowa)
  --Retrofitting bridge columns with composite jackets to increase 
        seismic safety.--This rehabilitation technique promises to be a 
        cost-effective and more efficient method for enhancing 
        earthquake resistance. (California)
    As with any new activity, there are always challenges and 
difficulties associated with PTP. Communication and making those in the 
field aware of the program and the opportunity for participation is of 
prime concern. The guidelines for the fiscal year 1997 program were 
officially distributed on November 14, 1996, to our field offices. This 
has been followed up by E-mails, personal contacts, and the program 
will be showcased at the upcoming field Research and Technology 
Conference in April.
    The overall objective of showcasing activities will be to provide 
technical support to future implementers by sharing implementation 
experiences and results.
    Marketing Plan.--A Marketing Plan is being prepared for each 
product of the PTP program as it comes on line, tailored to the primary 
customers for that product and the rest of the target audience. Every 
effort is made to reach primary customers through:
  --Professional associations, meetings, and publications at the local, 
        state, and national level; and/or
  --Specially developed workshops or training courses.
    Project Briefs.--Project briefs are prepared as each product comes 
on line. These briefs are used for outreach to trade and professional 
audiences through publications and at meetings and trade shows, and are 
made available on line.
    Videotapes.--Many of the projects involving construction projects 
have been videotaped. Dissemination of videotapes, either directly or 
through training programs, will enable other highway professionals to 
become familiar with the material technology, construction activities, 
and early performance data.
  --The South Dakota Department of Transportation, in partnership with 
        3M Corporation and the South Dakota School of Mines and 
        Technology has produced a video describing their use of 
        polyolefin fiber-reinforced concrete in a bridge deck 
        replacement.
  --The Iowa Department of Transportation has developed a video 
        documenting their use of European snow maintenance technology.
  --The Utah Department of Transportation developed a video on its 
        composite wrappings project, and has hosted a technical 
        workshop.
    Web Pages.--Web pages are another popular way to publicize project 
results.
  --Iowa State University has developed a web page for the low-cost 
        travel demand modeling software that it developed for use by 
        small city planning agencies. Users may record their comments 
        on the software on the web page. The PTP Program as a whole 
        also has a Web Page, which has been linked to the FHWA's Office 
        of Technology Applications Web Page.
  --The University of West Virginia has developed a web page on their 
        composite bridge project.
    CD/ROM.--CD/ROMS provide a useful format for interactive computer 
training.
  --Purdue University has developed an interactive CD/ROM to showcase 
        their project on evaluation of waste reuse using bioassay 
        characterization.
    Question. How does your fiscal year 1998 budget request related to 
this initiative? Will it be continued?
    Answer. The Priority Technologies Program (PTP) is a model for the 
National Technology Deployment Initiatives that are a part of the 
Research and Technology Program in the administration's proposed 
National Economic Crossroads Transportation Efficiency Act (NEXTEA). As 
part of the emphasis on the Research and Technology Program, the 
Department is developing a program of National Technology Deployment 
Initiatives (NTDI). This will build upon the successes of several 
innovative Research and Technology initiatives conducted under the 
Intermodal Surface Transportation Efficiency Act (ISTEA) of 1991, 
including the Applied Research and Technology Program Sec. 6005). The 
NEXTEA proposals will carry forward the central theme of increased 
implementation of innovative technologies through customer-driven focus 
areas, which was initiated under ISTEA. The program will focus on 
accelerating the implementation of technologies that will address a set 
of specific ``customer-driven'' technology goals.
    This program will implement a range of tools to achieve the goals, 
especially including authorized funding and program incentives. NTDI 
program incentives being considered includes provisions to help 
overcome the barriers to implementation of new technology in the 
regular Federal-aid program (e.g., allowing the broader use of 
proprietary products.) The Department would develop strategies to 
address these goals, working closely with key public and private 
technology partners.
    An underlying object of the program will be to ``get projects on 
the ground.'' Funds from the NTDI are expected to be used by States and 
other implementation agencies to expand ``real'' world deployment. The 
Priority Technologies Program, funded with Section 6005 funds, has been 
extremely successful in this approach and we will build upon many of 
the lessons learned in PTP.
    Question. Continuing implementation of the Superpave system for 
asphalt pavements appears to be one of the key areas in which FHWA is 
working directly with State DOT's and others to significantly improve 
performance. How is your implementation plan progressing, and what are 
some of the key issues for the future? How does your fiscal year 1998 
budget request related to this initiative?
    Answer. Based on a current survey conducted by the State DOT's 85 
percent of the States plan to construct Superpave projects for 1997. 
Fifty Percent of the States will adopt Superpave Binder Specifications 
for 1997.
    There are still many concerns in the highway community about to 
Superpave system. In some cases there is fundamental resistance to 
change. In other cases, there are technical concerns about an 
acceptable pavement performance test, or the cost to the highway 
construction industry--including the aggregate and asphalt industry--of 
complying with Superpave specifications, participating in materials 
testing, and designing and constructing Superpave projects.
    Over the past few years, FHWA has taken the lead in refining and 
implementing the Superpave system including:
  --Developing equipment specifications.
  --Enabling States to use Federal-aid highway funds to buy Superpave 
        equipment to use on projects.
  --Refining binder specifications.
  --Presenting hands-on training course around the country for State 
        and industry personnel.
  --Providing technical assistance to States using mobile labs.
  --Establishing five SUPERPAVE regional centers for the testing and 
        promotion of new pavement technology.
    As the States use the specification and build pavements with the 
Superpave system new questions and concerns develop. It is anticipated 
that the DOT's will complete implemented the Superpave binder and 
mixture specification by 2005. The final System which includes 
prediction models for determining how a pavement will perform will be 
completed by 2007 with implementation by 2010. Until the full system is 
completed there will be many questions to answer on how Superpave will 
perform and with that much more work to do in implementation.
    Representatives of States, industry, and academia continue to 
worked with FHWA in the refinement of Superpave. States and industry 
continue to participate actively with FHWA on the asphalt technical 
working group and other implementation teams. FHWA will continue to 
provide technical assistance to States and industry on how to best 
tailor implementation plans to fit local conditions and help respond to 
feedback on implementation.
    Question. Please prepare a table comparing current contract funding 
for all R, D, and T functions with that proposed in the reauthorization 
bill.
    Answer. The information is provided in the following table.

 DEPARTMENT OF TRANSPORTATION FEDERAL HIGHWAY ADMINISTRATION RESEARCH AND TECHNOLOGY PROGRAM--CONTRACT AUTHORITY
                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                       Fiscal years--                           
            Contract authority             ---------------------------------------------------------------------
                                              1997      1998      1999      2000      2001      2002      2003  
----------------------------------------------------------------------------------------------------------------
Applied Research..........................    41,000  ........  ........  ........  ........  ........  ........
National Technology Deployment Initiatives  ........    56,000    56,000    56,090    84,000    84,000    84,000
                                           =====================================================================
Technology Implementation and Professional                                                                      
 Capacity Building:                                                                                             
    National Highway Institute............  \1\ [4,2                                                            
                                                 69]     8,000     8,000     8,000    14,000    14.000    14.000
    University Transportation Centers.....     6,000     6,000     6,000     6,000     6,000     6,000     6,000
    University Research Institutes........     6,250     6,000     6,000     6,000     6,000     6,000     6,000
    Eisenhower Fellowship Program.........     2,000     2,000     2,000     2,000     2,000     2,000     2,000
    Locol Technical Assistance Program:...                                                                      
        Contract Authority................     6,000    12,000    12,000    12,000    12,000    12,000    12,000
        Limitation on General Operating                                                                         
         Expenses.........................  \2\ [2,8                                                            
                                                 27]  ........  ........  ........  ........  ........  ........
    Technology Implementation Partnerships    14,000    11,000    11,000    11,000    11,000    11,000    11,000
                                           ---------------------------------------------------------------------
        Subtotal..........................    34,250    45,000    45,000    45,000    51,000    51,000    51,000
                                           =====================================================================
Long Term and Advanced Research:..........                                                                      
    Long-Term Pavement and Performance....     6,000    15,000    15,000    15,000    15,000    15,000    15,090
    Advanced Research.....................  ........    10,000    10,000    10,000    20,000    20,000    20,000
                                           ---------------------------------------------------------------------
      Subtotal............................     6,000    25,000    25,000    25,000    35,000    35,000    35,000
                                           =====================================================================
Intelligent Transportation Systems:                                                                             
    ITS Contract Authority................   113,000  ........  ........  ........  ........  ........  ........
    ITS Research and Technology transfer..  ........    96,000    96,000    96,000   130,000   130,000   130,000
                                           ---------------------------------------------------------------------
      Total Contract Authority............   194,250   222,000   222,000   222,000   300,000   300,000   300,000
                                           =====================================================================
Intelligent Transportation Systems: ITS                                                                         
 Deployment Incentives....................  ........   100,000   100,000   100,000   100,000   100,000   100,000
----------------------------------------------------------------------------------------------------------------
\1\ NHI is included in LGOE in fiscal year 1997.                                                                
\2\ LTAP is included in LGOE in fiscal year 1997.                                                               

    Question. The Local Technical Assistance Program (LTAP) is 
basically an outreach program to the highway community serving local 
governments. How have you responded to the Committee's directive to 
improve the LTAP centers? How are these centers contributing to the 
dissemination of increase information on highway and traffic safety? 
How did you convince the LTAP centers to undertake this mission? How 
has NHTSA assisted FHWA in this effort? How will efforts be continued 
during fiscal year 1998?
    Answer. Considerable efforts and funding have been directed at 
improvements for the LTAP centers. Many new LTAP products are currently 
underdevelopment which will improve the centers' ability to train local 
agency personnel through better training materials and techniques. Some 
of the new products which are being completed this year include: A 
training package on improved training techniques and methods; Training 
packages on pavements including: Asphalt Rehabilitation, Asphalt 
Construction Inspection, Chip Seals, Gravel Roads, and Utility Cuts; 
Training packages on management systems including: Road Surface, Sign 
Inventory, Equipment Maintenance, Sidewalks, Curb, Gutter and Storm 
Drains, and Culvert and Drainage Systems; Training on tort liability, 
risk management, accident investigation, and giving depositions; 
Individualized training on motor grader operations; Training package on 
sign maintenance and installation; Training to develop new trainers on 
inspection of work zones; Individualized training on improved 
supervision; Training on handling transportation related hazardous 
materials by local agencies and recycling of waste products by local 
transportation agencies; Training course on wetlands requirements for 
local agencies; Development of a pedestrian road show package with 
NHTSA including a video; Training on the use of a motor grader with 
wings to plow snow.
    In addition to the above packages, we have initiated efforts this 
year to develop new packages in the following subject areas: Traffic 
calming techniques; Road drainage systems; Traffic control for short-
term and moving maintenance and construction work zones; Heavy 
equipment operator training programs; Highway incident and 
transportation emergency management; Air quality transportation 
planning; Traffic generation, access review and parking lot layout 
review; Models for in-class training in nine technical subject areas; 
Benefits of technology transfer.
    We have also increased our funding of the LTAP Technology Transfer 
Clearinghouse and they have added a second person to improve their 
responsiveness to Center requests. The Clearinghouse video library and 
publication library continue to expand to provide additional resources 
for the LTAP centers' use.
    We completed a consultant contract this past year which evaluated 
the SHRP products to identify and further promote those which were 
considered most applicable to local agency use. The sixteen products 
identified by the advisory board for this study were promoted to the 
LTAP centers through presentations, written articles for publication in 
LTAP Newsletters, demonstration projects and loan and purchase of new 
SHRP equipment. This effort was highly successful and many 
implementation opportunities were identified by local and LTAP 
participants.
    Evidence of the gap between the state of the practice and the state 
of the art being narrowed for local agencies through the LTAP and the 
technology transfer centers is visible in the products being developed 
for the centers. In the past, efforts for LTAP products were directed 
at the more basic needs of local transportation agencies--such as how 
to patch a pothole or basic traffic engineering concepts. These more 
basic needs are still reflected somewhat in the above list of products 
being completed this year. The new list of products being initiated 
this year, however, suggests some very new and innovative activities 
and interests by the LTAP centers for their local constituents. Current 
transportation areas of interest such as traffic calming techniques, 
incident management, and air quality transportation planning 
demonstrate the LTAP centers have brought many of their customers 
through the basics and prepared them for consideration of more advanced 
transportation subjects. Other evidence of the closing gap could be 
inferred from the every increasing number of agencies listed on the 
LTAP centers mailing list and the increased attendance at training 
sessions conducted by the centers, both of which suggest a broadening 
of the LTAP audience. A broadened audience and updated training topics 
should lead to further closing of the gap between the state of the 
practice and state of the art for local agencies.
    The LTAP centers have historically provided highway and traffic 
safety information to their constituencies through training, 
publications, videotapes and other means. In recent years, the centers 
have increased this effort, particularly as it relates to the programs 
of the National Highway Traffic Safety Administration (NHTSA). To 
encourage this relationships, centers have published articles in their 
newsletters detailing the Committee's interest in this relationship and 
reporting on some of these activities. In addition, representatives 
from NHTSA spoke about their programs at the annual LTAP meeting 
(August 1996), which included representatives from virtually all of the 
LTAP centers.
    The FHWA further promoted the relationship with NHTSA in its 
recently published Local Technical Assistance Program Field Manual. 
This publication is designed to provide a framework for technology 
transfer center operations within the broader context of the overall 
program. Its purpose is to present information and suggestions for 
designing efficient and comprehensive programs and activities.
    Through its program to promote products from the Strategic Highway 
Research Program, FHWA has considerable success in LTAP centers using 
the highway and traffic safety products as well as support products to 
promote the use of the products. Products such as the stop/slow paddle, 
opposing traffic lane dividers, multi-directional barricade, all-
terrain sign, and others were reported to have been used by a high 
number of centers. Similarly, the centers reported high use of the 
supporting products, such as publications, training packages, and 
promotion articles published in the centers' newsletters.
    There are a number of ways through which the LTAP centers 
contribute to the dissemination of information on highway and traffic 
safety:
  --They have expanded their existing customer base by adding on those 
        identified by NHTSA's local Governors' Highway Safety 
        Representatives (GHSR) and other contacts identified by the 
        FHWA Office of Highway Safety.
  --Their quarterly newsletters have provided feature articles on 
        initiatives being undertaken by NHTSA and the FHWA Office of 
        Highway Safety. The centers have included flyers and public 
        service announcements on new safety information in their 
        newsletters or, in some cases, distributed them separately.
  --The centers have provided jointly sponsored workshops and circuit-
        rider on-site training for these initiatives particularly 
        targeting, for example, the Safe Communities program. They 
        included new workshops on highway safety information in their 
        generalist ``Roads Scholar'' programs or created within this 
        program a transportation safety specialist curriculum for those 
        local communities that can dedicate an individual to become 
        such a specialist.
  --They have provided clearinghouse support both as depositories and 
        sources for increased information on highway safety to local 
        transportation agencies. Through their own networking, the 
        centers have identified safety activities and initiatives being 
        conducted by other centers for feedback and information on what 
        programs and activities are proving successful.
  --The centers have included as members of their advisory committees, 
        participants from NHTSA's local GHSR's, FHWA Region and 
        Division offices, as well as State DOT safety program 
        specialists; members that can provide an assessment of needs 
        for such information from the ground up and guide the centers 
        on how best and in what form to provide the needed information 
        to the locals.
    The centers have historically provided training on highway safety 
issues, such as safety through work zones, as resources were available, 
in addition to national educational packages delivered by the centers. 
Local advisory committees help identify needs for training provided and 
center personnel make the advisory committee members aware of the 
availability and importance of highway safety information and training. 
Working jointly, they establish a program of training for the coming 
year and develop the content of their ``Roads Scholar'' programs. There 
has been no need to convince the LTAP centers to undertake the mission 
of safety training and promotion as they are well aware of the benefits 
of such efforts and needs of their customers in this area.
    Question. Please discuss the relative allocation of ITS activities 
compared to non-ITS activities (or the more traditional FHWA R, D, and 
T program).
    Answer. For fiscal year 1998, the budget requests $71.5 million for 
ITS R&D and Advanced Vehicle Control and Information Systems, $178.5 
million for other ITS activities and $241.053 million for non-ITS 
activities. This allocation reflects the relative priority of the ITS 
program.
    Question. FHWA is requesting roughly a $1 million increase for 
technology assessment and deployment. Why is this increase judged 
critical at this time in view of the substantial increases requested 
for related contract funds?
    Answer. The vision of the FHWA is to ``create the best 
transportation system in the world for the American people through 
proactive leadership, innovation and excellence in service.'' This 
vision has been advanced through a distinguished history of 
development, adaptation, and delivery of innovative technologies for 
the transportation community. The FHWA has operated the Technology 
Assessment and Deployment (TAD) Program as part of a complementary 
array of technology transfer programs in parallel with the growth of 
the overall FHWA Research and Development Program. To help fulfill the 
FHWA's vision its programs have evolved with a strong technology focus 
that will lead to ``the best transportation system in the world.'' But 
there is a recognized gap that must be closed in the technology 
available and accessible to the transportation community and in the 
professional knowledge within that community. The overall R&T program, 
including TAD and related programs, is designed to close the technology 
gap which exists between new technologies and the current state of the 
practice by introducing innovations and new technologies on the road, 
while at the same time pushing the state of the art to higher levels.
    Each of the programs addresses closing the gap in a different way, 
for different technologies and different audiences. In the case of TAD, 
various approaches are taken to reach a largely State and industry 
audience--such as demonstration project mobile laboratories, technical 
assistance, videotapes, interactive programs, exhibits, and other 
media--covering the array of topics among highway technologies. The TAD 
program identifies and assesses innovative research results, 
technology, and products and promotes the application of those that are 
determined to be of potential benefit to the highway community through 
increased productivity, safety, and operational efficiency. The program 
includes efforts in the areas of roadway applications, structures and 
soils, safety and design, traffic and motor carrier, technology 
marketing, and technology operations. Related programs focus on select 
priority areas (such as in the National Technology Deployment 
Initiatives), use training as its primary medium (such as in the 
National Highway Institute), or focus on a precise audience that other 
programs don't fully reach (such as the Local Technical Assistance 
Program).
    These programs are designed to complement each other in an effort 
to accelerate the adoption of innovations and new technologies and to 
close the knowledge gap in what is increasingly a technology driven 
transportation industry
    Question. Please compare your actual GOE expenditures for each R&D 
and technology transfer activity against the amount actually 
appropriated for fiscal year 1995 and fiscal year 1996. Please indicate 
on a year-by-year basis the amount of carryover funds for each year by 
category.
    Answer. The information is provided in the following table.

DEPARTMENT OF TRANSPORTATION FEDERAL HIGHWAY ADMINISTRATION FISCAL YEAR 1995 CONTRACT PROGRAMS--FISCAL YEAR 1995
                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                        Fiscal year                             
  Research, development, and technology  -----------------------------------------------------------------------
                transfer                      1995          1995          1995           1995           1995    
                                             enacted     recissions    enacted \1\    obligations     carryover 
----------------------------------------------------------------------------------------------------------------
Highway Research Development and                                                                                
 Technology.............................    53,552,000   (8,030,000)    45,522,000    (44,842,727)       679,273
Intelligent Transportation Systems......   114,500,000  (26,700,000)    87,800,000    (85,425,730)     2,374,270
Long-Term Pavement Performance..........     8,739,000     (220,000)     8,519,000     (8,519,000)  ............
Technical Assessment and Deployment.....    12,622,000   (1,000,000)    11,622,000    (10,526,007)     1,095,993
Local Technical Assistance Program......     3,015,000  ............     3,015,000     (2,819,512)       195,488
National Highway Institute..............     4,369,000  ............     4,369,000     (4,325,239)        43,761
Rehabilitation of Turner Fairbanks......     3,000,000  ............     3,000,000       (649,363)     2,350,637
                                         -----------------------------------------------------------------------
      Grand total.......................   199,797,000  (35,950,000)   163,847,000   (157,107,578)     6,739,422
----------------------------------------------------------------------------------------------------------------
\1\ Reflects fiscal year 1995 recessions.                                                                       
Note.--Enacted funds are available for 3 fiscal years.                                                          


DEPARTMENT OF TRANSPORTATION FEDERAL HIGHWAY ADMINISTRATION FISCAL YEAR 1995 CONTRACT PROGRAMS--FISCAL YEAR 1996
                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                                   Fiscal year--                
                                                                 -----------------------------------------------
    Research, Development, and Technology Transfer activities          1995            1996            1996     
                                                                     carryover      obligations      carryover  
----------------------------------------------------------------------------------------------------------------
Highway Research, Development and Technology....................         679,273       (652,973)          26,300
Intelligent Transportation Systems..............................       2,374,270     (2,374,270)  ..............
Long-Term Pavement Performance..................................  ..............        123,188          123,188
Technical Assessment and Deployment.............................       1,095,993     (1,076,198)          19,795
Local Technical Assistance Program..............................         195,488       (192,155)           3,332
National Highway Institute......................................          43,761        (43,761)  ..............
Rehabilitation of Turner Fairbanks..............................       2,350,637     (2,350,637)  ..............
                                                                 -----------------------------------------------
      Total.....................................................       6,739,427     (6,566,806)         172,616
Other...........................................................       1,187,469     (1,091,259)          96,210
                                                                 -----------------------------------------------
      Grand total...............................................       7,926,891     (7,658,065)         268,826
----------------------------------------------------------------------------------------------------------------
Note.--Carryover funds are available until fiscal year 1997.                                                    


DEPARTMENT OF TRANSPORTATION FEDERAL HIGHWAY ADMINISTRATION FISCAL YEAR 1996 CONTRACT PROGRAMS--FISCAL YEAR 1996
                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                    Fiscal year                                 
   Research, development, and    -------------------------------------------------------------------------------
 technology transfer activities    1996  enacted       1996        1996  enacted       1996            1996     
                                        \1\         recissions          \1\         obligations     unobligated 
----------------------------------------------------------------------------------------------------------------
Highway Research Development and                                                                                
 Technology.....................      56,772,000     (1,303,000)      55,469,000    (52,851,387)       2,617,613
Intelligent Transportation                                                                                      
 Systems........................     109,779,000     (4,777,000)     105,002,000   (102,471,016)       2,530,984
Long-Tenm Pavement Performance..       8,739,000       (431,000)       8,308,000     (8,090,190)       (217,810)
Technical Assessment and                                                                                        
 Deployment.....................      12,622,000       (123,000)      12,499,000       2,498,410             590
Local Technical Assistance                                                                                      
 Program........................       3,015,000       (149,000)       2,866,000       2,865,886             114
National Highway Institute......       4,369,000        (42,000)       4,327,000     (4,012,203)         314,797
                                 -------------------------------------------------------------------------------
      Total.....................     195,296,000     (6,825,000)     188,471,000   (182,789,092)       5,681,908
Other...........................  ..............  ..............      12,975,000    (12,836,938)         138,062
                                 -------------------------------------------------------------------------------
      Grand total...............  ..............  ..............     201,446,000   (195,626,030)       5,819,970
----------------------------------------------------------------------------------------------------------------
\1\ Reflects fiscal year 1996 recessions.                                                                       
                                                                                                                
Note.--Enacted funds are available for 3 fiscal years.                                                          

    Question. Please discuss why such a large increase in funds for the 
National Highway Institute is requested.
    Answer. Many reasons have contributed to the increased budget 
request. Listed are four of the main reasons:
    1. Although the appropriated budget for NHI has traditionally been 
consistent at about $4 million per year, additional internal funds have 
been allocated to supplement the development and offering of training 
courses. In fiscal years 1995 and 1996, these additional funds amounted 
to $2 million and $3.8 million respectively. The funding source for the 
additional funds was the 6005 program which will lapse at the end of 
this fiscal year.
    2. NHI's customer base, which mostly consists of public sector 
employees at all levels of government, is quickly and drastically 
changing. These agencies are downsizing and shifting their roles. As 
such, there is an increased demand for NHI courses to provide 
retraining of personnel and to augment their technical competence in 
other technical areas. In 1996, NHI trained 1,400 more students than in 
1995, reaching a total audience of about 16,500 professionals.
    3. Rapid changes in technology are now allowing for the training 
and education of personnel that would otherwise not attend NHI courses. 
Computer-based training, training through the Internet, satellite-based 
transmission, etc., are providing (just in time) training to people 
that cannot afford to travel or people that have extensive 
responsibilities that hamper their ability to be away from their 
offices for several days. NHI is actively pursuing the packaging of its 
training and education programs in a way that would not only maximize 
the targeted audience, but would also gain access to the audience by 
using the most appropriate media. Also, what traditionally used to be a 
three-day course, say on Superpave technology, is now being offered as 
three separate training options: (1) a seminar for managers and 
decision makers that need to become conversant with the subject matter 
(to the extent that it influences budgets and policy); (2) engineers 
that will bring the technology to implementation; and (3) technicians 
who will have the overall responsibility for supporting and maintaining 
the technology once implemented.
    4. Because of technological advances, research and development are 
yielding advanced technologies in a shorter time frame. For example, 
Intelligent Transportation Systems and Superpave have yielded new 
products and technologies in just a few years. As such, the cycle of 
training and education programs is much shorter and the quantity much 
larger, which requires NHI to invest accordingly. Training and 
education is an integral and critical component of facilitating and 
accelerating the field implementation of state-of-the-art technology.
    Question. If fees for industry attendance at NHI were increased, 
could federal outlays be reduced?
    Answer. Not in the foreseeable future. Over the last three years, 
attendance at NHI courses from the private sector has averaged 8 
percent of the total, or approximately 1,250 participants per year. 
Most of the private sector attendees are instructed to attend by their 
public sector customers who find NHI fees very reasonable. If we were 
to raise the fee, we would expect a drop in attendance and minimal gain 
in net dollars.
    Question. Please breakout in detail the fiscal year 1997 pavement 
research spending plan on a project-by-project basis and justify the 
fiscal year 1998 request considering the LTPP contract request. Also 
please specify how much is allocated towards exploratory research for 
fiscal year 1997.
    Answer.

       Projects included in fiscal year 1997 pavements R&D program

                                                                  Amount
Laboratory Support at TFHRC...................................$2,294,000
WesTrack...................................................... 2,000,000
Waste Materials Study......................................... 2,000,000
LTPP Technical Assistance..................................... 1,986,000
TFHRC Management and Coordination............................. 1,582,000
LTPP Regional Office (North Central).......................... 1,566,000
LTPP Regional Office (North Atlantic)......................... 1,500,000
LTPP Regional Office (Southern)............................... 1,500,000
LTPP Regional Office (Western)................................ 1,500,000
LTPP Pavement Distress Identification......................... 1,500,000
LTPP Data Analysis............................................ 1,000,000
Superpave Support and Performance Models Management........... 1,000,000
Transportation Research Board Cooperative Agreement...........   910,000
LTPP Information Management System Technical Assistance.......   700,000
LTPP Incentive Funding........................................   670,000
ADP Support Services for TFHRC................................   559,000
LTPP Laboratory Testing.......................................   555,000
Bragg Grating Fiber Optics....................................   475,000
Support for the Pavement Testing Facility.....................   400,000
LTPP Materials Reference Library..............................   358,000
Support for the Asphalt Research and Technology Program.......   332,000
Validation of Performance Models for PCCP.....................   315,000
Support of AASHTO Materials Reference Laboratory..............   305,000
Laboratory Support at TFHRC...................................   283,000
Highway Concrete Technology...................................   200,000
PCC Rheology and Workability..................................   200,000
Concrete Protection, Rehabilitation, and Testing..............   200,000
Model of Combined Pavement Damage.............................   200,000
Advanced Materials Model of Concrete Frost Resistance.........   165,000
Materials-Related Distress in PCCP............................   151,000
Innovative Pavement Repair....................................   113,000
Support for Heavy Vehicle Research............................   111,000
Fast Track Paving.............................................   101,000
Agreement for CCMO Personnel..................................   100,000
Concrete Mixture Optimization.................................    94,000
LTPP Traffic Technical Assistance.............................    80,000
Lab/Field Investigation of Performance-Related PCCP...........    72,000
Study of Film Distress Surveys................................    65,000
Use of Waste Materials in Pavement Construction...............    63,000
Damage Due to Microcracking...................................    63,000
Microwave Thermoreflectometry.................................    60,000
Scanning Acoustic Microscope Study............................    57,000
Pavement Performance Data Collection and Processing...........    51,000
Distress Identification Calibration Workshop..................    50,000
Plasticity Model Testing and Support..........................    47,000
Prediction of Asphalt Temperatures............................    40,000
Pavement Maintenance Effectiveness............................    38,000
Validation of Superpave Tests.................................    28,000
Ultrasonic Investigation of Cement Rheology...................    28,000
Study to Investigate Pavement Roughness.......................    27,000
Health-Related Aspects of CRM Asphalt.........................    24,000
Graduate Research Fellow (Craig Miller).......................    21,000
LTPP Load Tests...............................................    18,000
Analysis of Acoustic Emission Moment Tensor...................    13,000
Conference on Nondestructive Characterization.................    10,000
Development and Compilation of Aggregate Database.............    10,000
Sponsor Fiber Optics Symposium................................    10,000
Temporary Assignment for Seishi Meiareshi.....................     7,000
International Personnel Exchange (Dr. M. El-Gindy)............     7,000
Sponsor Symposium on Hardened Cement Paste....................     5,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Total...................................................27,819,000

Note.--Projects totaling $1,000,000 from the above list are in the 
Exploratory (Advanced) Research area.
These projects are: Part of 1 (>$200,000), Part of 16 (>$50,000), 18, 
Part of 31 (>$20,000), 43, 44, 45, 48, 57, 58, 60, 63.

Funds available for pavements R&D program in fiscal year 
    1997:
    GOE Activity 13.....................................     $19,731,000
    ISTEA 6001..........................................       6,088,000
    ISTEA 6005..........................................       2,000,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Total.............................................      27,819,000

Funding request for fiscal year 1998:
    Pavements R&D.......................................     $11,150,000
    LTPP................................................      15,000,000
    Advanced research...................................       2,000,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Total.............................................      28,150,000

Notes.--1. The original request for Pavements R&D was $12,775,000. This 
was later reduced to $11,150,000.
2. The line item for Advanced Research is currently $10,000,000. It is 
assumed that approximately $2,000,000 of this amount will be made 
available for pavement-related activities.
There will be no significant change in pavement-related needs from 
fiscal year 1997 to fiscal year 1998. As a result, the total available 
funding level proposed for fiscal year 1998 pavement activities is 
consistent with the overall funding level that was available in fiscal 
year 1997.

    Question. Please breakout in detail the fiscal year 1997 structures 
research spending plan on a project-by-project basis and explain why a 
substantial increase is requested for fiscal year 1998.
    Answer. In the following information.

                        [In thousands of dollars]

Non-Destructive Evaluations (NDE)--Structures (8 
    studies)............................................           1,580
Advanced Composite Materials--Bonded Structural Repair..           1,500
                    ========================================================
                    ____________________________________________________
Geotechnical:
    Foundations (10 projects)...........................             730
    National Geotech Data...............................             149
    Projects/Studies....................................             562
                    --------------------------------------------------------
                    ____________________________________________________
        Subtotal........................................           1,441
                    ========================================================
                    ____________________________________________________
Structures Lab Tech Support (4 contracts)...............           1,227
Composite Materials--Piles..............................             800
Exploratory Research--12 studies including fractography 
    and digital waveform for acoustic emissions, pattern 
    recognition, neutron scattering techniques, and 
    materials characterization..........................             775
Alternative Bridge Paint/Coating Systems................             600
Computer Support for R&D program........................             548
High Performance Steels for Bridge Construction and 
    Bridge Design.......................................             500
Corrosion Inhibitors in Concrete........................             400
Hydraulics Lab Tech Support.............................             350
Prediction Chloride Penetration in Concrete (BAA).......             350
Williamsburg Bridge--Orthotopic Deck Study..............             300
Machine Shop--Materials/Equipment/Support...............             282
Scour Model Development and Studies (4 projects)........             281
Interagency Agreements--Seismic, Tunnels, NDE, Fatigue, 
    others..............................................             280
Graduate Research Fellows...............................             263
Electrochemical Chloride Extraction.....................             200
Research on I-15 Bridges in Utah........................             200
Develop Training Course on Bridge Paint Systems.........             200
Behavior of Thin Wall Concrete Box Sections.............             150
Aerodynamics Laboratory Tech Support....................             150
Development of an Embeddable Micro-Instrument...........             100
Knowledge Based Bridge Coatings System..................             100
Enhanced Technologies for Coating Durability Testing....             100
Anti-Icing Study in Chicago.............................             100
Other Studies, Cooperative Agreements, Small Purchases..             434
                    --------------------------------------------------------------
                    ____________________________________________________

      Total.............................................          13,211
                    ==============================================================
                    ____________________________________________________
The budget for fiscal year 1997 is......................      13,211,000
The fiscal year 1998 requested budget is................      15,256,000

    In order to make the transportation infrastructure perform at a 
higher level, new and better technologies must be developed and 
implemented. Making Bridges Better using higher performing materials 
and methods offers an opportunity to significantly improve the life of 
our nation's bridges which will have economic advantages to both 
individuals (in terms of less delay, better safety, and convenience) 
and business (lower transportation costs, higher safety, faster 
delivery, etc.) Our fiscal year 1998 budget offers a prudent increase 
in Structures R&D aimed at accelerating some of this very high payoff 
research. Additionally, our engineers, scientists, and laboratories 
have served the country (and the world) in times of natural disasters--
earthquakes, floods, wind storms, etc., with the highest level of 
analysis so as to assure the safety of bridges, structures, and highway 
pavements, slopes and embankments. Our scour detection work saved lives 
in the recent North Dakota flood. Funding for this on-demand service 
has in the past been ad hoc and taken from other projects which were 
then delayed. Some funds for this work are included in our fiscal year 
1998 budget.
    Question. Please quantify for each of the last two years the extent 
of cost sharing that FHWA obtained for the structures research program. 
What could you do to increase cost sharing? Which part of your research 
program received cost shared funds or in-kind services?
    Answer. Cost sharing with other Federal agencies, State DOT, 
universities, and the private sector is a way we leverage our scarce 
research dollars. The cost sharing is in terms of pooled fund studies, 
donated materials, in-kind services, loaned equipment and facilities, 
use of State and other forces for items like traffic control, testing, 
collecting samples, etc., as well as joint funding.
    In more recent years we have included within appropriate proposals 
and agreements opportunities for commercially available products with 
corresponding cost sharing. Our work in high performance steels, 
aluminum, composite materials and concrete; coatings; cost effective 
foundations; non-destructive evaluation; inspection systems; seismic; 
aerodynamic and hydraulic programs all benefitted from some form of 
cost sharing.
    It is estimated that for fiscal year 1996 cost sharing in the range 
of 30-35 percent of our budget ($3.5 to $4.5M) was accomplished. For 
fiscal year 1997 the range is estimated to be 25-30 percent ($3 to 
$4M). Funding of several pooled fund projects may boost this figure in 
the remainder of fiscal year 1997.
    The year to year budget and program changes make it difficult to 
develop longer term relationships that could more easily accommodate 
joint funding and cooperation. The start and stop nature of the yearly 
process discourages potential investors.
    Question. Please quantify for each of the last two years the extent 
of cost sharing that FHWA obtained for the pavement research program. 
What could you do to increase cost sharing? Which part of your research 
program received cost shared funds or in-kind services?
    Answer. In the following information.

------------------------------------------------------------------------
                                             1996 cost       1997 cost  
      Program area/type of service            shared          shared    
------------------------------------------------------------------------
LTPP Program As part of LTPP data                                       
 collection activities the State DOT's                                  
 provided FHWA with traffic control                                     
 (personal, materials, and equipment)...      $1,208,000      $1,340,000
LTPP Program State DOT's provided FHWA                                  
 with material and traffic data, traffic                                
 equipment and maintenance of LTPP sites         600,000         600,000
Crumb Rubber Study EPA and other                                        
 organizations are sharing the cost of                                  
 the Crumb rubber study.................         500,000         500,000
WesTrack Program Truck Manufacturers                                    
 have provided vehicles (trucks), parts,                                
 and supplies either free or at                                         
 significantly reduced costs............         400,000         400,000
WesTrack Program The companies and                                      
 organizations which make up the                                        
 research team at WesTrack are sharing                                  
 the public information costs for the                                   
 track..................................         100,000         100,000
State highway agency, university, and                                   
 private laboratories are using their                                   
 own equipment and personnel in a joint                                 
 operation with FHWA to evaluate how                                    
 well various laboratory tests can                                      
 predict the rutting performance........          50,000          50,000
Pool Fund Study SPR-2(193) Traffic                                      
 Monitoring State participation.........  ..............         124,000
Pool Fund Study SPR-2(182) Traffic data                                 
 editing................................  ..............         365,000
Pool Fund Study MinRoad.................         200,000         150,000
Pool Fund Study SPR-2(176) Validation of                                
 SHRP Mix Specifications Mix                                            
 Specifications.........................         200,000         200,000
------------------------------------------------------------------------

    Several other fiscal year 1997 cost shared projects from the 
exploratory (advanced) research area are:
    Joint funding with NSF:
    a. Impact Echo Technique (Cornell U.) FHWA = $63K NSF = $50K.
    b. Fiber Optic Bridge Monitoring: (New Mexico State) FHWA = $52K 
NSF = $50K (New Mexico State DOT is also funding this).
    State Pooled Fund Study on Aerial Robot FHWA = $214K States = 
$186K.
    Scanning Acoustic Microscope (U. Hawaii) FHWA = $57K Hawaii = $38K.
    Delayed Ettringite with T x DOT FHWA = $40K T x DOT = $100K.
    FHWA will continue to aggressively seek outside participation 
wherever appropriate.
   office of highway safety (ohs) and safety r&d/technology transfer 
                               activities
    Question. Please describe how the OHS activities help rural 
America.
    Answer. OHS activities benefit Rural America in many ways. Among 
them:
    Speed management.--Speed is a contributing factor in more than one-
third of all fatal crashes. Rural roadways by their design are often 
less forgiving of driver error than urban roadways, and speeding 
compounds this problem. The OHS Speed Team has prepared a 5-year plan 
for the Department outlining research, engineering studies, enforcement 
initiatives, and other programs to reduce speeding.
    Work Zone Safety.--More than half of all work zone fatalities occur 
in rural areas. The OHS Work Zone Team has a variety of safety 
initiatives to increase worker and traveler safety.
    Improved roadway markings.--OHS has initiated rulemaking to 
encourage expanded and more effective use of pavement markings. Center 
lane and edge line markings are of proven safety benefit, especially on 
rural roads which tend to have narrower lane widths. Pavement edge 
markings in particular are useful when there is no ambient light, soft 
shoulders, or steep drop-offs; features often found on rural roads. The 
Federal Register Notice suggests making standard: center line markings 
on all rural arterials and collectors with a travel way of 18 feet or 
more in width with an average daily traffic of 1,000 or greater and 
edge line markings on rural collectors with a travel way 20 feet or 
more in width and where the edge of the travel way is not otherwise 
delineated.
    Improved visibility.--OHS is developing, as part of the Manual for 
Uniform Traffic Control Devices (MUTCD) revision, guidelines for a 
minimum level of retroreflectivity for all pavement markings and signs 
on public roads. Such guidance will be of benefit to rural travelers 
who travel at night on unlit or poorly lit roads.
    New signs.--Also as part of the MUTCD revision, a ``Share the 
Road'' sign has been developed to warn motorists to watch for slower 
forms of transportation such as farm machinery traveling along the 
highway. Local jurisdictions may now install this sign on their 
highways.
    Intelligent Transportation Systems (ITS).--To ensure that rural 
safety issues are addressed, OHS staff serve on the Department's 
intermodal team on Advanced Rural Transportation Systems (ARTS), and 
staff has served as the DOT Secretary of the ITS America Rural 
Committee. ITS holds great promise to increase the safety of the rural 
traveler, through application of advanced hazard warning systems, 
weather advisories, lane tracking and other technologies designed to 
prevent run-off-the-road accidents, traveler information systems, and 
Mayday systems. The latter system is of special safety importance to 
rural travelers since a rural motorist can expect to wait twice as long 
for emergency medical assistance than an urban motorist.
    Run-off-the-road accidents.--In 1998, OHS will begin a new emphasis 
area: single vehicle run-off -the-road accidents. This accident 
configuration is quite common in rural areas, and the countermeasures 
developed will benefit rural travelers.
    Question. Please update us on the implementation of the OHS five-
year strategic plan. What operational changes and new perspectives have 
resulted from implementing the strategic plan? When will you prepare 
your next plan? Which aspects of the plan are behind schedule or need 
to be modified based on your progress and experience?
    Answer. The 5-Year Strategic Plan for the Office of Highway Safety 
(OHS) was submitted to the Congress in May 1995. Since the submittal of 
the plan, OHS has continued to address the goal and objectives stated 
in the plan. The OHS has focused on the implementation of safety 
management systems in each State, improved and expanded public outreach 
efforts to address various safety problems/issues, improved pedestrian 
safety and pedestrian access, improved understanding of speed and speed 
management issues, and a reduction of single vehicle crashes. A current 
major emphasis in OHS is the revision and update of the Manual on 
Uniform Traffic Control Devices which is due to be published in the 
year 2000. In addition, OHS is actively working with outside partners 
to implement our safety mission and with our DOT partners, NHTSA, FTA, 
and FRA to address common areas of interest.
    Following the submittal of the strategic plan, OHS undertook a 
review of all ongoing safety initiatives (both team and non-team) and 
the level of effort involved in each of these initiatives. After the 
review, there were some modifications to the number of persons assigned 
to each of the teams, and discussions were initiated regarding 
continuation of some of the non-team activities and the level of effort 
devoted to these activities. The responsibilities for hazardous 
materials routing, formerly in OHS, were transferred to the Office of 
Motor Carriers. In recognition of the importance of data, and the 
criticality of data to all current team activities and future planning 
and evaluations, a new team was added to address safety data and 
information needs.
    The Federal-aid part of FHWA has Safety as a strategic goal. OHS is 
leading the effort in developing performance and assessment plans in 
response to the Department's fiscal year 1999 Budget in accordance with 
the Government Performance and Results Act of 1993. The current 
Strategic Plan will be revised in that initiative. The performance 
plan, now under development, includes outcome goals, output goals, and 
performance indicators.
    The 5-Year Strategic Plan did not contain a rigid time schedule, 
and several efforts mentioned in the plan have not yet been initiated. 
The establishment of a university-based safety training program for 
highway safety professionals to improve the quality of highway safety 
programs has not been initiated; but we have created a four-week 
training program on Safety Management Systems. Special safety programs 
for the elderly and special needs drivers has not yet been initiated, 
however guidelines to design highways with the elderly have been 
developed. Rotational assignments between FHWA and NHTSA have occurred 
mainly in the field. A Senior Management Safety Team has been 
established in headquarters and staff from each agency serve on the 
other agency's project teams.
    Question. How much money are you spending in fiscal year 1997 and 
planned for fiscal year 1998 on work zone safety? Please provide 
exhaustive detail on current projects and their funding amounts and 
sources.
    Answer. We expect to spend $445,762 in fiscal year 1997 and a 
planned $390,000 in fiscal year 1998. The dollar amounts shown above 
are for the completion of the following two projects: the establishment 
of a national work zone safety information clearing house and the 
production of public outreach/education material for use in work zone 
safety media campaigns. The outreach pooled fund project was let in 
July of 1996 with in initial obligation of $250,000 of fiscal year 1996 
Office Of Technology Applications (OTA) General Operating Expenses 
(GOE) funds. The project is scheduled for completion at the end of 
August 1997, with the delivery of contract items. An additional 
$145,762 of fiscal year 1997 OTA (GOE) funds were recently obligated to 
complete the contract work. It is estimated that another $50,000 of 
fiscal year 1998 OTA funds will be used for kicking off the campaign 
and making a distribution of the contract products (video and audio 
tapes of the PSA's and other hard copy products) per the individual 
state needs. Part of these costs will be covered by the contributions 
from the pooled fund participating states ($100,000).
    The clearing house project has been advertized as a cooperative 
agreement with cost sharing. Applications have been received and an 
award is expected in July. The project is for three years with 
declining Federal support. The clearing house is to be self sustaining 
at that point. Initial funding of $300,000 will be obligated using 
fiscal year 1997 OTA funds. About $340,000 of fiscal year 1998 OTA 
funds will be obligated to cover next year's operating expenses. 
Approximately $150,000 of fiscal year 1999 funds may be needed to 
complete the project depending on the final negotiated cooperative 
agreement price.
    The cost and source of providing the various work zone safety 
training courses for fiscal year 1998 are unknown at this time, 
although the presentations are usually funded through the National 
Highway Institute and off set by received fees.
    Question. Please specify the progress made in implementing each of 
the items listed in the DOT Rail-Highway Grade Crossing Action Plan 
that were assigned to FHWA.
    Answer. The FHWA is responsible for implementing 22 of the 55 
individual elements of the 1994 DOT Rail-Highway Grade Crossing Action 
Plan. The FHWA has developed plans to implement each of the 22 assigned 
elements. Activities to date are as follows:
      dot rail-highway crossing safety action plan status of fhwa 
                   implementation plan--june 11, 1997
1. Action element--commercial drivers license
    The FHWA will work with the American Association of Motor Vehicle 
Administrators (AAMVA) to examine the need for rulemaking to make a 
grade crossing violation a ``serious traffic violation'' on a 
Commercial Drivers License (CDL).
    Action to date.--The FHWA has discussed this issue with the AAMVA 
and is considering a possible rulemaking action later this year.
2. Action element--national highway system (NHS)
    The FHWA will encourage that statewide and metropolitan 
organizations and safety management systems (SMS) address the upgrading 
or elimination of at-grade crossings on the NHS and give priority to 
the long-term goal of eliminating (through closure or grade separation) 
NHS intersections with Principal Rail Lines (PRL).
    Action to date.--The FHWA will explore grade crossing design 
standards/performance criteria that may be developed for the NHS. In 
the interim, our division offices have been working closely with States 
and metropolitan planning organizations to ensure that grade crossing 
issues are considered in the planning process. They are encouraging the 
States to focus on eliminating crossings or installing active warning 
devices at NHS grade crossings, particularly at intersections with the 
PRL's. They are encouraging the States to incorporate the upgrading and 
elimination of NHS grade crossings under the umbrella of their Safety 
Management Systems; and several States have agreed to revise their 
prioritization procedures to give additional weight to crossing closure 
proposals. Additional guidance, ``Safety Management Systems: Good 
Practices for Development and Implementation,'' was issued in a further 
effort to assist the States.
3. Action element--upgrade signing and marking
    The FHWA will encourage States to increase the Conspicuity of signs 
and markings at grade crossings by promoting greater use of longer 
lasting, high-grade reflective materials.
    Action to date.--A number of States are using Federal funds to 
upgrade rail-highway crossing warning signs by installing improved 
retroreflective materials. In many cases, the highly reflective 
material is being installed on both sides of the crossbuck sign and the 
sign's support post. This increases dramatically the conspicuity of 
these traffic control devices.
4. Action element--consider installation of STOP signs where warranted
    The FHWA will encourage States to consider the installation of STOP 
signs at grade crossings where they are warranted. Guidance on STOP 
sign installation was issued in a July 8, 1993, joint memorandum from 
FHWA and FRA to their respective field offices.
    Action to date.--Our division offices have discussed the use of 
STOP signs with the States, but many are reluctant to place them on 
State routes--especially on those that carry significant volumes of 
traffic. They are considering STOP signs where they are warranted and 
where they can be deployed without creating other safety problems. Most 
States have endorsed placing STOP signs at crossings on low-volume 
local roads.
5. Action element--incentives for crossing consolidation (bonuses)
    Legislation will be proposed to allow Federal funds to be eligible 
for paying a bonus to a local community that would close a grade 
crossing.
    Action to date.--Section 353 of the Department of Transportation 
Appropriation Bill of 1997 provided incentive payment to local 
governments for the permanent closure of grade crossings.
6. Action element--incentives for crossing consolidation (100 percent 
        funding)
    Legislation will be proposed that will allow 100 percent Federal 
funding for projects to close grade crossings.
    Action to date.--Section 353 of the Department of Transportation 
Appropriation Bill of 1997 provided incentive payment to local 
governments for the permanent closure of grade crossings.
7. Action element--check list for corridor reviews
    The FHWA, in coordination with FRA, will develop a ``check list'' 
of items to be considered in a corridor analysis of crossings.
    Action to date.--The ``check list'' (now called the ``Corridor 
Analysis Guide'') was developed in coordination with FRA and 
distributed to our field offices in May 1995. Some States have 
incorporated the guide in their Safety Management Systems. The corridor 
concept has been generally well received by the States.
8. Action element--railroad-highway grade crossing handbook
    The FHWA, in cooperation with other DOT agencies, will revise and 
update the 1986 issuance of the Railroad-Highway Grade Crossing 
Handbook.
    Action to date.--A contract was awarded for revising the Handbook. 
The FHWA plans to complete distributing the updated Handbook by 
September 1998.
9. Action element--vegetation clearance
    The FHWA will encourage States to incorporate in their Safety 
Management Systems guidelines to ensure that vegetation is continually 
cleared on highway rights-of-way at grade crossings.
    Action to date.--FHWA field offices have discussed with State 
maintenance and operations personnel the need to establish maintenance 
practices to ensure that any obstructing vegetation is cleared from 
highway rights-of-way at crossings. All States have maintenance 
programs to keep vegetation under control. Clearance, however, is 
generally limited to the State's right-of-way, as most have no 
jurisdiction to enter private or railroad property for this purpose. 
Most States have included this item in diagnostic reviews as well as in 
Safety Management Systems.
10. Action element--corridor review participation
    Legislation will be proposed to allow Federal funds to be used as 
an incentive to States that review crossings for improvement on a 
corridor basis rather than individually.
    Action to date.--Section 353 of the Department of Transportation 
Appropriation Bill of 1997 provided incentive payment to local 
governments for the permanent closure of grade crossings. This should 
encourage jurisdictions to review crossings on a corridor basis.
11. Action element--distribution of funds
    The FHWA, in cooperation with FRA, will initiate a study of the 
formulas used to apportion funds to the States for grade crossing 
improvements to determine if there may be a more equitable distribution 
formula, possibly including the number of crossings and accidents in 
each State.
    Action to date.--The DOT reauthorization proposal included changes 
in the distribution of rail-highway crossing funds to the States. The 
proposed distribution would be based on the number of crashes at public 
grade crossings (25 percent), the number of fatalities at public grade 
crossings (25 percent), the number of public grade crossings (25 
percent), and on the number of public crossings with passive warning 
devices (25 percent).
12. Action element--on-guard notice
    Publish and distribute to all 270,000 interstate motor carriers an 
On-Guard notice to alert the truck and bus industry to the danger at 
crossings.
    Action to date.--This was completed in February 1996.
13. Action element--advisory bulletin
    Send an advisory bulletin to the trade press about the danger of 
accidents at crossings.
    Action to date.--This was done in February 1996.
14. Action element--public service print advertisements
    Prepare public service print advertisements for the trade journals 
on truck and bus accidents at highway-rail crossings.
    Action to date.--Print ads have been developed and distributed.
15. Action element--``Trucker-on-the-Train'' program
    Work with Amtrak, the American Trucking Associations (ATA), 
Brotherhood of Locomotive Engineers (BLE), OLI and FRA to create a 
``Trucker on the Train'' program where motor carrier executives and 
drivers accompany train engineers on the engine of a train to view 
first hand dangerous highway-rail crossings.
    Action to date.--A press conference was held in September 1996, at 
Washington's Union Station. The ``kickoff'' train ride was held on 
November 17, 1996, between Cleveland and Toledo. Other such events are 
being considered.
16. Action element--operation lifesaver (OLI)
    Encourage OLI staff to meet with trucking companies and 
associations regarding the dangers at crossings.
    Action to date.--Representatives from FHWA, FRA, OLI, Amtrak, 
railroads, etc. are meeting on a continuing basis with trucking 
companies and associations.
17. Action element--national safety organizations
    Address the issue at meetings of national safety organizations such 
as the International Association of Chiefs of Police.
    Action to date.--This issue is being included and will continue to 
be included in speeches to appropriate organizations. We supplied major 
amounts of editorial material to the National Safety Council (NSC) for 
inclusion in a widely distributed booklet, ``Don't Gamble at the 
Tracks,'' aimed at professional drivers. The booklet was distributed by 
NSC in March 1995. In 1996, FHWA provided additional funds to Operation 
Lifesaver, which developed and distributed the training video for 
school bus drivers titled ``The Responsibility Is Ours.'' A total of 
600 videos was distributed, at no charge, to key education and pupil 
transportation groups in each State and the regional offices of each of 
the modal administrations.
18. Action element--on-site compliance reviews
    Ensure that at on-site compliance reviews conducted by the Office 
of Motor Carriers (OMC) field staff and State personnel, the motor 
carrier is informed of the risks at highway-rail crossings.
    Action to date.--A December 14, 1994, memorandum was issued to OMC 
Regional Directors instructing them to discuss this matter when 
carriers are contacted. Printed material outlining the risks at grade 
crossings is being provided to carriers during on-site visits.
19. Action element--operation lifesaver (OL) matching funds
    Legislation will be proposed to provide additional Federal funding 
for Operation Lifesaver.
    Action to date.--In June 1994, DOT submitted legislation to 
Congress relating to this issue but it was not enacted. Operation 
Lifesaver received an additional $100,000 in fiscal years 1995 and 
1996. In the DOT reauthorization legislation, $300,000 is proposed 
annually.
20. Action element--signs and signals
    The FHWA, in cooperation with FRA, will initiate conceptual studies 
of new highway rail crossing warning devices with the goal of providing 
additional information to motorists about whether there is an active or 
passive warning system at the crossing and information about the 
direction from which a train is approaching the crossing.
    Action to date.--A contract has been awarded to develop signing 
that provides motorists cleaner and better information at grade 
crossings and to examine the use of regular highway traffic signals at 
grade crossings.
21. Action element--MUTCD
    The FHWA will propose changes to the MUTCD pertaining to high-speed 
rail crossings, work zones, STOP signs, DOT/AAR Inventory numbers, and 
light rail.
    Action to date.--A final rule that contains amendments to the MUTCD 
was published in the Federal Register in January 1997. A notice of 
proposed rulemaking addressing the issue of light rail will be 
published in July 1998.
22. Action element--national inventory
    The FHWA will encourage States to incorporate in their Safety 
Management Systems means of ensuring that the DOT/AAR Inventory is 
updated on a systematic basis.
    Action to date.--The FHWA field offices are encouraging States to 
incorporate in their Safety Management Systems means of a process for 
systematic updating of the highway data in the national grade crossing 
inventory. There have been problems getting update information from 
some highway agencies and railroads because of staffing shortages and 
competing priorities.
    Question. Which action items have not yet been completed and what 
is the time schedule and approach for doing so?
    Answer. Of the 22 action items assigned to FHWA from the 1994 DOT 
Rail-Highway Grade Crossing Action Plan, eight are still ongoing. A 
number of these action items are long term and are designed to reduce 
the number of fatalities at rail-highway grade crossings by 50 percent 
by the year 2004. The FHWA will continue to work with the other 
involved DOT agencies, the States, the railroad industry, Operation 
Lifesaver, and the enforcement community on all items in the Action 
Plan.
    Question. How has FHWA responded to the results of its 
comprehensive national review of highway-rail crossing design and 
construction?
    Answer. The results of the review of highway-rail crossing design 
and construction can be found in the March 1, 1996, report to the 
Secretary, ``Accidents That Shouldn't Happen.'' It included a number of 
short-term and long-term recommendations.
    Shortly after the report was issued, the FHWA Executive Director 
issued implementation guidance to FHWA field offices that addressed the 
short-term recommendations pertaining to interconnected signals and 
storage.
    One of the long-term recommendations in the report called for the 
FHWA and FRA to convene a Technical Working Group (TWG) to review 
existing standards and guidelines and develop new ones, if appropriate, 
on several grade crossing safety issues. The TWG was established, 
consisting of representatives of agencies, professional organizations, 
and other groups that had knowledge and interest in assisting the 
U.S.DOT in improving railroad-highway grade crossing safety. The TWG 
held three formal meetings and addressed the following issues: 
terminology; interconnected signals and vehicle storage; high profile 
crossings; joint inspections; and training. The TWG made 35 
recommendations in the June 1, 1997 report to the Secretary, 
``Implementation Report of the U.S.DOT Grade Crossing Safety Task 
Force''.
    The FHWA, in conjunction with the FRA where appropriate, continues 
to implement the recommendations from both reports.
    Question. What were the major challenges that your grade crossing 
team dealt with during the last 12 months? What were the major 
accomplishments of this team?
    Answer. The primary challenge addressed by the Rail-Highway 
Crossing Safety Team during the past year was to implement the 
recommendations contain in the Grade Crossing Safety Task Force's 
report to the Secretary in March 1996. This Task Force was established 
following the rail-highway crossing accident at Fox River Grove, 
Illinois, which involved a school bus and a commuter train and resulted 
in the deaths of seven students.
    Among the noteworthy accomplishments of the U.S.DOT Task Force are: 
the convening of a Technical Working Group (TWG) that made 35 
recommendations for standards, guidelines and other grade crossing 
safety issues; the identification of focal points to coordinate 
railroad safety issues in each State; the initiation of regional State/
railroad conferences; and the creation of an advance warning sign for 
motorists approaching high-profile crossings. The TWG's accomplishments 
are: development of a common glossary for railroad and traffic 
engineers; development of an interconnected warning placard on 
controller cabinets; recommendations in the areas of interconnected 
signals, vehicles storage, joint-inspections, and high profile 
crossings; and the submission of the Task Force Report to the Secretary 
of Transportation on May 28, 1997.
    Question. How does each of the program areas proposed in your 
fiscal year 1998 program relate to the R&D needs identified by the TRB? 
Be certain to address how your fiscal year 1998 program addresses 
pedestrian and bicycle safety.
    Answer. It is not certain what TRB identified R&D needs are being 
referred to TRB participated in the recent AASHTO effort to update 
their strategic highway safety plan/implementation plan. The Offices of 
Highway Safety (OHS) and Research and Development (HRD) were actively 
involved in this effort. The combined plan has just been drafted and 
will be circulated for comment to the responsible AASHTO committee and 
the individual participants involved in the effort. Therefore, the R&T 
needs are not yet finalized. TRB also funded an NCHRP study to develop 
a strategic plan for improving roadside safety. OHS and HRD are also 
involved in this effort. This study is also in final stages of drafting 
and will need to be circulated for comment and subsequent revision. 
Therefore, the R&T needs are again not finalized. From our involvement 
in both these efforts, thus being acquainted with what is being 
proposed, we feel that our currently planned fiscal year 1998 R&T 
program is relative to many of the AASHTO and TRB strategic plans' 
objectives.
    The fiscal year 1998 R&D program includes a new High Priority Area 
(HPA) entitled, ``Engineering Improvements for Enhanced Safety and 
Operations''. This area includes four planned research projects for 
fiscal year 1998 that relate to pedestrian and bicycle safety. 
Additional ped/bike safety related projects are planned for future 
years. It should be noted that due to a lower level of fiscal year 1998 
budget approval for Safety R&D than available in previous years, and 
the uncertainty of any supplemental funds until there is a 
Transportation Reauthorization Act, new starts in this new HPA may have 
to be delayed until fiscal year 1999.
    As a result of the previous R&D HPA on ``Pedestrian and Bicycle 
Safety'', there are completed or soon to be completed research results 
that will be available for use in technology transfer and training 
activities starting in fiscal year 1998 and continuing into subsequent 
fiscal years.
    Question. What are you doing to develop educational and outreach 
efforts to combat the problem of drivers running off the road? Please 
estimate fiscal year 1996, fiscal year 1997 and fiscal year 1998 funds 
allocated for this purpose and provide the funding sources of these 
monies.
    Answer. Educational and outreach programs include training and 
technical assistance provided to both State and local officials. The 
Office of Highway Safety coordinated with the National Highway 
Institute (NHI) and the Office of Engineering in the development and 
implementation of several courses that address highway, roadway and 
operational design. These areas are three of the primary areas related 
to safety and can be used to reduce the number of run-off-the road 
crashes, or when these crashes do occur, significantly reduce the 
severity of the crash. The following training courses have, or are 
being, developed:
  --``Design, Construction, and Maintenance of Highway Safety 
        Features.'' This course was developed and is partially 
        supported with FHWA funds from the NHI budget, and additional 
        funds come from States requesting this training. The estimated 
        cost of course development for fiscal year 1996 and fiscal year 
        1997 is approximately $150,000. The estimated cost for training 
        activities for fiscal year 1997 is $25,000, and for fiscal year 
        1998 is $35,000.
  --A new ``Design and Operation of Safer Highways'' course currently 
        is in development. The course will be based on the new AASHTO 
        guide on the same subject and will be available for training in 
        late fiscal year 1998. The development and partial training 
        funds will come from NHI and are approximately $20,000 for 
        fiscal year 1997 and $100,000 for fiscal year 1998.
    The Office of Highway Safety in coordination with the Offices of 
Engineering and Safety and Traffic Operations Research and Development 
has begun the process of recertification of safety appurtenances, such 
as guardrail, used on the roadside. These systems are being recertified 
or modified as safer hardware. They are required for use on new 
National Highway System projects after August 1998. It is anticipated 
that the safety appurtenances recertified under the new criteria 
(National Cooperative Highway Research Program Report 350) will reduce 
the severity of run-off-the-road crashes. The process of 
recertification and providing State and local agencies plans and 
details for this safety hardware cost approximately $80,000 in fiscal 
year 1996, $100,000 in fiscal year 1997 and will cost approximately 
$50,000 in fiscal year 1998. The funds being used to crash test 
existing and modified safety hardware are primary those allocated to 
Research and Development for testing and development.
    The Office of Highway Safety has, and is continuing, to prepare 
technical guides and informational packages for local agencies that 
relate to safety improvements. These guides are designed to bring to 
the attention of local agencies design, and operational conditions that 
can result in run-off-the-road type accidents. The cost of preparation 
and distribution of these guides comes out of the budgets of the 
Offices of Highway Safety and Technology Applications. The estimated 
cost of providing this technical information to local officials using 
the Office of Technology Applications General Operating Expense funds 
was approximately $5,000 in fiscal year 1996 and will be approximately 
$15,000 and $25,000, respectively for fiscal year 1997 and fiscal year 
1998.
    Signs and markings are extremely important in keeping drivers on 
the roadway. They often convey important warnings about appropriate 
driving speed or warn of situations where a driver could have trouble 
maintaining their path on the highway. Currently, the Office of Highway 
Safety is involved with developing sign and pavement marking 
retroreflectivity guidelines. A Federal Register Notice will be 
published this fall for signs and in the fall of 1998 for pavement 
markings. This will improve nighttime visibility in adverse weather, on 
curves, and better delineate fixed objects. The estimated cost of 
providing this information to state and local officials as well as the 
public using the General Operating Expense funds was approximately 
$10,000 in fiscal year 1996 and will be approximately $10,000 and 
$10,000, respectively for fiscal year 1997 and fiscal year 1998.
    In accordance with the 1993 DOT Appropriations Act, the FHWA is in 
the process of developing changes to the Manual on Uniform Traffic 
Control Devices for new centerline and edge line requirements for all 
roads and highways open to public travel. These new guidelines should 
provide better nighttime guidance on more highways and therefore 
improve safety. A Federal Register Notice was published August 2, 1996, 
for public comments and a final rule is scheduled to be published in 
the Federal Register Notice in the fall of 1997. The estimated cost of 
providing this information to state and local officials as well as the 
public using the General Operating Expense funds was approximately 
$10,000 in fiscal year 1996 and will be approximately $10,000 and 
$10,000, respectively for fiscal year 1997 and fiscal year 1998.
    FHWA has made several presentations to national and local highways 
agencies concerning this rulemaking and the need for better nighttime 
visibility. In addition there is an Internet web page site for the 
public to make inquiries about traffic control device questions. In the 
near future, the OHS will have a website with the most frequently asked 
questions and the appropriate answers.
    As a part of the 1991 Intermodal Surface Transportation Efficiency 
Act Section 6005, we are conducting an evaluation of all-weather 
pavement marking to determine the visibility, durability and safety 
impacts of several new pavement marking materials in various States in 
the country. There are presently 23 States participating in this 
program where testing and evaluation of over twelve different types of 
innovative pavement marking materials are being conducted. In addition, 
the FHWA has developed new technology--a mobile pavement marking 
retroreflectometer van (Laserlux) that effectively measures levels of 
retroreflectivity of pavement markings. This technology allows for the 
safe, fast, accurate and efficient measurement of pavement markings at 
highway speeds up to 55 miles per hour. We have also developed a 
Pavement Marking System (PMS) to reflect the status of pavement 
markings throughout a jurisdiction's roadway system. This new equipment 
and PMS system will assist highway agencies in managing their pavement 
markings on their roadways in a safer and more cost effective manner. 
Additional vans that were developed and equipped with this technology 
were demonstrated 64 times in several States nationwide to their 
traffic and pavement marking specialists. The estimated cost of 
conducting this technical information and evaluation program in various 
States using the Office of Technology Applications 6005 funds was $3.15 
million in fiscal year 1994, $3.16 million in fiscal year 1995, $1.55 
million in fiscal year 1996, and approximately $2.30 million in fiscal 
year 1997.
    Question. What quantitative analysis has been conducted to 
determine the scope and nature of the problem of drivers failing to 
comply with yield right-of-way signs?
    Answer. The existing data on the scope and nature of failure to 
yield right of way is outdated and inconclusive. An 1989, FHWA-
sponsored research study--Motorist Compliance with Standard Traffic 
Control Devices (FHWA-RD-89-103), investigated the general area of 
traffic control compliance, including yield right-of-way. This study 
indicates that compliance with several traffic control devices--
especially traffic signals, STOP signs, and speed limits--is considered 
to be a problem by law enforcement agencies, but did not rank 
compliance with yield signs as significant. It is difficult to 
determine the true extent of this problem through the Fatal Accident 
Reporting System (FARS) because FARS has two separate data reporting 
elements related to failure to yield. The first combines failure to 
comply with the actual Yield Right of Way sign along with all other 
traffic control devices; none of these are discrete elements that can 
be extracted for further analysis. The second data element refers to a 
driver failing to yield right of way, implying that this would include 
both signed and not signed instances of failing to yield. However, 
anecdotal information implies that failure to yield is a more serious 
traffic safety problem that has not been specifically identified and 
addressed.
    Question. What is the scope and nature of your activities to 
address this highway problem?
    Answer. The FHWA recognizes that the public's perception of the 
seriousness of traffic control devices has been diminishing, which led 
to the development and implementation of the successful national 
campaign against Red Light Running. Anecdotal information--coupled with 
the emerging phenomenon of aggressive driving--indicate that failure to 
yield right-of-way is also a cause of concern. As a preliminary step, 
this issue has been incorporated within the Read Your Road highway 
users manual and FHWA's interactive Highway Safety Kiosks. These kiosks 
engage users via a highway safety quiz, which includes sections 
relating to proper and safe driving behavior when merging in traffic 
and yielding right of way.
    Question. Please specify funding amounts allocated or planned for 
this effort for each of the last two fiscal years and planned for 
fiscal year 1998.
    Answer. Since other safety issues are addressed in both the Read 
Your Road partnership program and the interactive Highway Safety 
Kiosks, it is difficult to extract the amount of funding dedicated 
specifically to yield right of way and would be an extrapolation at 
best. However, the FHWA plans to budget $100,000 in fiscal year 1998 to 
include funds for focus group research targeted to yield right of way.
    Question. In Conference Report 104-286, the conference agreement 
provides $8,768,000 for safety related R&D. The conferees directed that 
the total R&D safety activity be funded at a level of at least 
$12,768,000, including both ISTEA and appropriations authority. Please 
show the allocation of any ISTEA, Section 6005, and GOE funds used to 
implement this directive. Please show the amounts allocated to key 
safety projects.
    Answer. The breakdown of R&D GOE funds and 6005 funds by safety 
High Priority Areas are as follows:

------------------------------------------------------------------------
                                                 Fiscal year 1996       
       HPA's/Administration costs        -------------------------------
                                                GOE            6005     
------------------------------------------------------------------------
Advance traffic control devices.........        $300,000        $550,000
Highway safety information management...         700,000         900,000
Interactive highway safety..............       1,600,000         250,000
Roadside safety hardware................       1,200,000         300,000
Pedestrian and bicycle safety...........       1,900,000  ..............
Human factors research..................       1,100,000       1,175,000
Supportive services:                                                    
    Safety design information...........         400,000  ..............
    Behavorial systems..................         700,000         825,000
Management and coordination.............         825,000  ..............
                                         -------------------------------
      Total.............................       8,750,000       4,000,000
------------------------------------------------------------------------

    The total funds obligated for safety R&D equaled $12,750,000.
    Question. In Conference Report 104-286, $1,000,000 was allocated to 
the Office of Highway Safety to support the Red Light Running Campaign 
and to increase compliance with yield right-of-way or grade crossings 
signs. What is the status of these efforts?
    Answer. The Red Light Running (RLR) effort has been extremely 
successful, as evidenced by the tremendous amount of media interest in 
red light running in general and this program in particular. Despite 
the fact the RLR campaign is nearly two years old, there continue to be 
numerous print articles in major national journals, newspapers and 
magazines praising the program, as well as national television and 
radio features on red light running. The actual campaign is nearing 
completion with over 30 communities across the country implementing RLR 
programs. Thus far, summary reports indicate that public recognition of 
the seriousness of RLR is at 48 percent, RLR crashes have been reduced 
by 24 percent, and RLR citations have doubled in the communities 
participating in the campaign. In addition, RLR communities have more 
than doubled the amount of funds dedicated to the RLR campaign, by 
securing over $2 million in private and local contributions--
effectively leveraging the Federal funds dedicated to this serious 
traffic safety issue. We expect a final report on the national RLR 
campaign in Spring, 1998.
    While there is anecdotal evidence that the RLR campaign has had a 
``spill over'' effect on compliance with other traffic control devices 
(ie railroad grade crossings and yield right of way), in response to 
Conference Report 104-286, the FHWA developed additional safety 
outreach items that address both these issues. Among these is the 
development and planned distribution of Read Your Road (RYR), a 
comprehensive highway users manual filled with important roadway 
information which is designed for drivers of all ages. RYR includes 
information what to do at a rail-highway grade crossing, the meaning of 
yield right of way signs, and how to safely merge into traffic. Another 
is the development of the interactive Highway Safety Kiosks. These 
kiosks engage users via a highway safety quiz which includes sections 
relating to proper and safe driving behavior when approaching grade 
crossings, merging and yielding right of way. Currently, the FHWA has 
produced three kiosks, which have literally toured the country and been 
featured at national conferences, State Fairs and expositions.
    Question. What new safety outreach campaigns are planned for fiscal 
year 1997 and fiscal year 1998? Please indicate funding amounts for 
each project.
    Answer. The FHWA will continue to spend over $1,000,000 each year 
on highway safety outreach activities. In fiscal year 1997, OHS is 
focussing on the Read Your Road Partnership Program, in an effort to 
print and distribute RYR manuals to motorists across the country. In 
fiscal year 1998, FHWA intends to expand safety outreach to address 
run-off-the-road crashes and will develop a public information campaign 
directed at storage space at rail-highway grade crossings. 
Additionally, FHWA will continue its activity in work zone safety, with 
the development of public service announcements in late fiscal year 
1997 and distribution in fiscal year 1998, subject to funding 
availability.
    In response to the Committee's direction that the Office of Highway 
Safety (OHS) utilize advanced technology to expand safety outreach to 
the motoring public, pedestrians and bicyclists, the OHS has developed 
an Internet Home Page, with a comprehensive array of highway safety 
information that encompasses all OHS team activities, as well as 
special projects, programs and special initiatives. Planning for fiscal 
year 1998 includes enhancing existing home page information and 
converting information from the Highway Safety Kiosks to a CD-ROM 
format to allow for greater penetration and a reduction in shipping and 
handling costs associated with the large kiosks.

------------------------------------------------------------------------
                                                     Fiscal years--     
                                               -------------------------
                   Activity                         1997         1998   
                                                 estimated    estimated 
                                                  funding      funding  
------------------------------------------------------------------------
Read your road................................     $200,000      $50,000
Red light running.............................       20,000  ...........
Grade crossings...............................   \2\ 75,000      100,000
Work zones....................................  \3\ 270,000  \1\ 285,000
Yield sign....................................  ...........      100,000
Single vehicle run-off-the-road...............  \1\ 150,000  \1\ 150,000
Pedestrian/bike...............................      150,000      150,000
CD-Rom kiosk information......................       25,000       75,000
Training \4\..................................  ...........      250,000
------------------------------------------------------------------------
\1\ Includes funds for Training Activities.                             
\2\ $75,000 was spent on grade crossing outreach activities in fiscal   
  year 1996.                                                            
\3\ $250,000 was spent on work zone safety outreach activities in fiscal
  year 1996.                                                            
\4\ To be determined.                                                   

    Question. When and how will you reorient the activities and 
projects funded by the safety R&D and OTA budget, to those which will 
have the greatest impact on reducing fatalities?
    Answer. As part of the government-wide effort to comply with the 
Government Performance and Results Act (GPRA), the Office of Highway 
Safety has expended considerable effort to develop performance goals 
and strategies in conformance with the FHWA strategic plan. This effort 
has included identifying the safety needs of our partners and 
stakeholders through the use of focus groups. It also included direct 
involvement in the two efforts for developing safety strategic plans--
one by AASHTO and one by a TRB study for roadside safety. Although both 
are in the final stages of initial drafting they are not ready for 
publication yet. However, the process used in both cases made extensive 
use of using national experts in the various areas of highway safety to 
identify major problems and strategies that could impact the problems. 
Subsequently, the Safety Research and Technology Coordinating Group is 
using this valuable information to help direct future research and 
technology needs.
    A recent review of a wide range of needs indicates that our R&T 
program has and is generally on target for meeting national R&T needs. 
Several R&D safety High Priority Areas (HPA) are in their final stages 
and outputs from this research will be the basis for technology 
transfer and training activities. A new planned HPA (engineering 
improvements for enhanced safety and operations) will contribute 
information for improving pedestrian and bicycle safety which is an 
area that has a significant percent of the total highway fatalities 
that occur yearly in the U.S. Other ongoing HPA areas (enhanced driver 
visibility, roadside safety hardware, interactive design model, and 
human factors) are and will provide information that will help reduce 
the number of single vehicle runoff-the-road accidents and also reduce 
the severity of the roadside crash when it does occur. This area is 
also a very significant part of the annual fatalities occurring on 
highways. There are a number of technology application and training 
courses that have been identified that will carry a greater focus on 
mitigating the run-off-the-road problem.
    It should be noted that safety R&D funds may also be needed to fund 
needed research in the more traditional traffic operations area where 
their is usually a secondary impact of safety. This has been assigned 
to the Safety RTCG for consideration of funding. The bottom line is 
that safety R&D needs of about $14 million has been identified for the 
next several years if we are to meet identified national needs. 
Currently we are budget approved for $9.0 million which means a several 
year delay in advancing some projects.
    Question. Is it correct that this is the second year in a row that 
FHWA has not requested funds for pedestrian R&D safety? Last year did 
you indicate that you would be proposing a major new initiative in this 
area in the fiscal year 1998 budget request?
    Answer. It is true that no R&D funds for pedestrian/bicycle safety 
new starts were included in the budget request for fiscal year 1997. 
Due to the availability of fiscal year 1996 R&D funds and the 
importance assigned to the Ped/Bike Safety High Priority Area (HPA), 
not only were the planned fiscal year 1996 projects advanced, but the 
preplanned fiscal year 1997 projects were also advanced. Those 
essentially were the last projects planned under this HPA. Therefore, 
no additional pedestrian research projects were funded in fiscal year 
1997. As noted in your second part of this question, a new HPA is 
scheduled to fully start in fiscal year 1998 with at least four of the 
projects directly impacting pedestrian safety problems and maybe two 
others having an indirect impact. The full implementation as planned 
for this HPA is subject to availability of sufficient fiscal year 1998 
funds to start this HPA. On the Technology Applications side, several 
activities are planned for fiscal year 1998 and beyond to implement and 
use the information coming from the R&D projects.
    Question. What are the performance measures or goals of your safety 
R&D and Technology Transfer Programs?
    Answer. Since research and technology programs are primarily 
support for the program offices' functions, the safety R&D and 
Technology Transfer programs are being linked to the FHWA federal-aid 
safety measures and goals as developed by the OHS. Two of the Outcome 
goals for the FHWA federal-aid safety program are: improve safety 
management processes, including data collection and analysis and 
professional competencies, to better identify and resolve highway 
safety problems: and improvements in priority safety areas (run-off-
road and pedestrian/bicycle). Although the present R&T programs are 
focusing on these goals and will continue to do so in even a more 
focused manner starting in fiscal year 1998, the fiscal year 1999 R&T 
programs will begin the formal integration of safety R&T and safety 
program goals/strategies and performance measures. The Safety RTCG will 
be working over the next several months to develop the ``roadmap'' for 
this full integration process.
                                planning
    Question. What are you doing to encourage the States to include the 
costs of highway operations and management in the planning process?
    Answer. ISTEA emphasizes the management of the existing system and 
non-capital alternatives to maintaining system performance. We are 
encouraging through our policies, certification reviews, technical 
assistance, and training: (1) consideration of operations and 
management strategies in the decision-process at the regional level; 
(2) improved coordination of operations and management activities at 
the regional level. We are also supporting those States and MPO's who 
are continuing their management system efforts and encouraging those 
who are considering implementing them. State programs and MPO plans and 
programs include prioritized financial plans, which address management 
and operations costs. Together, these activities support better 
operations and management of the existing highway system.
    We currently have an emphasis in our reauthorization language on 
strengthening the current operations and management focus of enabling 
legislation. If adopted in NEXTEA, one of the goals of the 
transportation planning processes will be operations and management of 
the transportation system including strategic ITS services and sub-
systems. This will support the building and operation of regional 
infrastructures (including ITS) over time within the context and forum 
of the traditional transportation planning process. In addition, fiscal 
constraint requirements that include operations and management elements 
will be incorporated into the State and MPO planning processes.
    Question. What are you doing to increase the use of Geographical 
Information Systems in planning? Please delineate fiscal year 1996, 
fiscal year 1997, and planned fiscal year 1998 funding and activities 
in this area.
    Answer. The FHWA supports and promotes Geographic Information 
Systems (GIS) as an essential analytical and presentation tool to 
support transportation planning and project development activities. In 
the current environment of shrinking staffs and funding resources, GIS 
is an efficient and effective means of integrating large amounts of 
data and information to support effective decision making in 
transportation planning as well as in other areas such as integrated 
information systems, sustainable development and early consideration of 
the environment in the planning process.
    FHWA has a number of staff and research activities designed to 
promote the increased application of GIS at all levels of government 
(metropolitan, state and federal). The program consists of staff, 
applications research, and training and technical assistance 
activities.
    Staff.--FHWA GIS Coordination.--FHWA has designated a national 
expert in GIS as the FHWA GIS Coordinator, who is responsible for 
maintaining a comprehensive knowledge of GIS activities at all levels 
of government and using this knowledge to promote GIS usage. FHWA 
participates in a large number of activities such as national and state 
conferences and committees, technical seminars and on-site technical 
assistance. The FHWA serves on the Federal Geographic Data Committee 
(FGDC), Ground Transportation Subcommittee, Transportation Research 
Board (TRB) Committee on State Transportation Data and Information 
Systems, TRB Task Force on GIS, TRB Committee on Computer Technology, 
and the AASHTO Task Force on GIS.
    National Highway System (NHS) Activities.--GIS was used to develop 
the maps to support NHS legislation activities. The National Highway 
Planning Network (NHPN) was established and used to document the NHS. 
NHS promotion efforts, map production of the NHS, and use of this 
material in technical assistance activities increased the awareness and 
use of GIS in transportation.
    Development of National GIS.--The FHWA is building upon the NHPN to 
develop a national GIS database by integrating data from the Highway 
Performance Monitoring System (HPMS) and the National Bridge Inventory 
(NBI). This effort has done a great deal to promote the use of GIS in 
planning by advancing scheduled individual state GIS implementation 
efforts.
    R&T.--Applications.--FHWA promotes the use of GIS in transportation 
planning and project development activities by developing applications 
and case studies highlighting exemplary usage of the technology. 
Applications development and documentation is being pursued in areas 
such as NHS database development, freight flow analysis, traffic flow 
analysis, environmental impact assessment, application and testing of 
travel and land use models, sustainable development applications, 
intermodal decision support, facility management, and major investment 
studies. Funding for research to support these applications is:

Fiscal year:
    1996......................................................  $475,000
    1997......................................................   610,000
    1998.....................................................\1\ 800,000

\1\ Proposed.

    T \2\--Training and Technical Assistance.--FHWA staff GIS expertise 
and the FHWA National GIS activity are utilized to provide training and 
technical assistance to customers and thus advance the state of the 
practice in both statewide and metropolitan GIS applications. FHWA 
supports the use of GIS through training courses, such as the 
``Application of GIS for Statewide Transportation'' (NHI 15129) course. 
Current and future efforts focus on the integration of training modules 
into other courses (travel demand forecasting, freight planning) and 
further on-site technical assistance. FHWA also takes a very active 
leadership and participation role in the GIS-T Symposium, an annual GIS 
---------------------------------------------------------------------------
technology transfer forum. Funding for these activities is as follows:

Fiscal year:
    1996......................................................  $100,000
    1997......................................................    85,000
    1998.....................................................\1\ 210,000

\1\ Proposed.

    Question. Please prepare a table showing the expected sums required 
for each of the next few years to bring TRANSIMS to completion, 
breaking out both FHWA and other funds. When will the FHWA support for 
TRANSIMS be substantially diminished?
    Answer. FHWA anticipates completing the basic TRANSIMS core 
development by the year 2000. After completion FHWA will continue 
support for packaging and deploying TRANSIMS. There will also be a 
separate effort to include ITS capabilities within TRANSIMS. The cost 
of that effort is above the $25,200,000 core development cost. The 
expected remaining costs to complete the core TRANSIMS effort are 
outlined in the table below:

----------------------------------------------------------------------------------------------------------------
                                                             TRANSIMS core development                  ITS     
                   Fiscal year                   ------------------------------------------------   enhancement 
                                                     GOE funds    Contract funds     EPA funds     ITS funds \2\
----------------------------------------------------------------------------------------------------------------
1998............................................  \1\ $5,000,000         ( \1\ )        $250,000      $2,000,000
1999............................................  ..............      $3,000,000         250,000       2,000,000
2000............................................  ..............       2,000,000  ..............       2,000,000
2001............................................  ..............       2,000,000  ..............                
----------------------------------------------------------------------------------------------------------------
\1\ A total of $5,000,000 will be allocated to TRANSIMS. This will be a combination of GOE and contract funds.  
  The exact distribution depends upon final budget allocation and ISTEA reauthorization.                        
\2\ Funding for ITS development is a separate effort and is not included in the $25,200,000 for TRANSIMS core   
  development.                                                                                                  

    We have not included contributions from FTA. We anticipate FTA will 
provide direct financial support to MPO's implementing TRANSIMS. In 
addition FHWA expects approximately $250,000 in funds from EPA each 
year. However, the decisions for this are made on a year by year basis 
by EPA depending upon funding availability; EPA may designate these 
funds for research other than TRANSIMS core development.
    FHWA anticipates completion of the TRANSIMS core development by the 
year 2000. Additional funds will be required to package TRANSIMS in a 
user friendly format, provide technical assistance to users, and to 
provide seed money to support early applications. $2,000,000 in 
contract funds in fiscal year 2000 and fiscal year 2001 have been 
allocated to this activity. We anticipate that FHWA's support will 
decline after the year 2000 and will become part of FHWA's ongoing 
support for travel modeling after the year 2003.
    Question. How much money was allocated to TRANSIMS during fiscal 
year 1995, fiscal year 1996, and fiscal year 1997, and planned for 
fiscal year 1998? Please breakout all FHWA monies, including GOE 
(including ITS), ISTEA, and Section 6005 monies spent on this activity, 
indicate the amounts of cost sharing received from other Federal 
agencies for this project. Please breakout in detail the specific 
activities funded with these monies.
    Answer. The table below lists funds provided for the TRANSIMS core 
development, the basis for TRANSIMS operations. In fiscal year 1998, 
additional funds will be required to develop the ITS component of 
TRANSIMS.
    The activities funded to date include identification of TRANSIMS 
design requirements to address Federal Legislative initiatives; 
interviews with MPO's to determine specific analytic needs; development 
of the cellular automata traffic microsimulator; development of the 
TRANSIMS core data handling capabilities including representation of 
networks, households, individuals and automobiles; identification of 
approaches to air quality models, data sources to support air quality 
modeling, and contractor support for air quality modeling; and 
specification of activity analysis requirements and contracting with 
the National Institute of Statistical Sciences to support activity 
analysis.
    In addition to the technical activities identified above, a field 
test on the traffic microsimulator was conducted in Dallas Texas. This 
field test included modification of existing highway networks to 
conform to TRANSIMS data structures, changing existing forecasting 
procedures to ``emulate'' portions of TRANSIMS not yet developed, and 
testing the procedures using available data.
    The field test resulted in the successful development of the 
microsimulator and testing of alternative transportation policies which 
can not be evaluated by current methods. A video has been produced to 
document the results of the test.

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                             TRANSIMS core development                          ITS                     
                       Fiscal year                       ----------------------------------------------------------------   enhancement        Total    
                                                             GOE funds    Contract funds     FTA funds       EPA funds     ITS funds \1\                
--------------------------------------------------------------------------------------------------------------------------------------------------------
1995....................................................      $1,673,832      $1,400,000        $500,000        $250,000  ..............      $3,823,832
1996....................................................       1,500,000       2,000,000         500,000         525,000  ..............       4,525,000
1997....................................................       2,000,000       2,000,000         ( \2\ )     \3\ 375,000        $500,000       4,875,000
1998....................................................   \4\ 5,000,000         ( \4\ )  ..............         250,000       2,000,000       7,250,000
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Funding for ITS development in TRANSIMS is a separate effort and is not included in the $25,200,000 for TRANSIMS core development.                  
\2\ FTA has allocated $600,000 to Portland, Oregon to support the innovative transit planning aspects of TRANSIMS. A portion of this will be used by    
  Portland and a portion contracted to the Los Alamos Laboratories, the TRANSIMS developers.                                                            
\3\ These funds have been committed by EPA but have not yet been transferred.                                                                           
\4\ A total of $5,000,000 will be allocated to TRANSIMS. This will be a combination of GOE and contract funds. The exact distribution depends upon final
  budget allocation and ISTEA reauthorization.                                                                                                          

    Question. What are the remaining technological challenges and pilot 
testing needs to be addressed in the TRANSIMS?
    Answer. The remaining technical challenges include selecting an 
activity based forecasting method and integrating it into the TRANSIMS 
architecture; specification of transit operations within the micro-
simulator including fixed guideway, exclusive guideway and scheduled 
vehicles; including transit in trip planning and path finding; freight 
planning; and final specification and testing of the air quality 
module. In addition, extensive testing of these modules will be 
required to determine their sensitivity to changes in input data.
    We are currently beginning the second pilot test in Portland, 
Oregon. This test will address the above technical challenges. We are 
also exploring the possibility of allowing universities to use early 
versions of TRANSIMS for testing and educational purposes. This will be 
at no cost to DOT, will provide additional field testing, and will 
train students who will then be able participate in the application of 
TRANSIMS when it becomes available on a broader basis.
    Question. What did you do to seek additional non-DOT funds for the 
TRANSIMS? How successful were you? Please show all contributions for 
each of the last three years.
    Answer. We have continued to seek additional funding from EPA. We 
have provided ongoing briefings and involved EPA staff in the 
management of the TRANSIMS development process. EPA has provided direct 
financial support to TRANSIMS. FTA provided funds to support the 
innovative transit planning aspects of TRANSIMS in the Portland, Oregon 
MPO.
    In addition to direct financial support, TRANSIMS will draw on 
research currently funded by the National Institute of Statistical 
Sciences and the National Academy of Sciences. This research will 
greatly improve the activity forecasting and air quality components of 
TRANSIMS.

------------------------------------------------------------------------
                  Fiscal year                       EPA          FTA    
------------------------------------------------------------------------
1995..........................................     $250,000     $500,000
1996..........................................      525,000      500,000
1997..........................................      375,000      ( \1\ )
------------------------------------------------------------------------
\1\ FTA has allocated $600,000 to Portland, Oregon to support the       
  innovative transit planning aspects of TRANSIMS. A portion of this    
  will be used by Portland and a portion contracted to the Los Alamos   
  Lab.                                                                  

    Question. What was the origin of the $4.25 million initiative 
requested on page 118? Which agency or entity proposed this concept?
    Answer. The sustainability initiative was proposed by the 
Department of Transportation in recognition of the need to plan, design 
and operate transportation facilities and services in the context of 
the linkages among transportation and the other factors defining the 
quality of life. These other factors include site-design and regional 
scale land use, all aspects of the environment and economic 
development.
    Though originally conceived of by the Department of Transportation, 
the Environmental Protection Agency (EPA) and the Department of Housing 
and Urban Development (HUD) are being asked to participate as partners.
    Question. Please break down the intended use of these funds and 
specify research versus pilot project amounts and likely request 
groups.
    Answer. The Department's intent is to use the majority of funds for 
this initiative to benchmark current practices and develop case studies 
of best practices encompassing comprehensive planning of 
transportation, land-use, the environment, economic and community 
development, etc. The goal of this effort would be the identification 
and deployment of analytical and decision support tools for use by 
state, Metropolitan Planning Organization (MPO) and local officials in 
their respective planning processes. Primary among these tools would be 
methods to asses the impact on land-use of the full variety of 
transportation investment, management and operations strategies, and 
the impact of site and transportation design features (e.g., street 
widths and topology, on-street parking, building set-backs, pedestrian 
amenities, etc.) on travel demand. A small portion of these funds would 
be used for consensus building activities such as conferences, 
workshops and other types of outreach activities.
    Question. Did the Research and Technology Coordinating Council 
(RTCC) or the Research and Technology Executive Board (RTEB) critically 
review the proposal?
    Answer. As is the case for all major FHWA R&T activities, the 
Sustainability Initiative was presented to the RTEB for their critical 
review.
    Question. Why is FHWA proposing this? Will this work also be partly 
conducted by EPA? Why isn't this being partly funded by HUD?
    Answer. The Department in general and FHWA in particular are 
interested in this subject because we believe that comprehensive 
planning is the only way to get the maximum benefit from increasingly 
precious transportation investment and operating funds. For example, we 
can no longer afford to make investments in new highway facilities that 
cannot be safely and effectively used to their full people and goods 
moving design capacity because of poor site planning along adjacent 
rights-of-way. Similarly, we can no longer afford to invest in new 
transit guideway facilities with patronage significantly below that 
used to justify them because land surrounding stations and elsewhere 
was not developed as originally conceived.
    We have coordinated our plans for the initiative with both EPA and 
HUD, and fully expect them to contribute personnel and financial 
resources to the initiative during the NEXTEA authorization period.
    Question. How long do you anticipate this initiative to run? How 
much will it cost during the next few years?
    Answer. We expect the initiative for six years at annual funding 
levels of 4.25 million beginning in fiscal year 1998.
    Question. Please compare this initiative in terms of relative 
priority to other components of your planning budget.
    Answer. The highest priority for the planning research program is 
to continue existing initiatives such as development of the 
Transportation Analysis and Simulation System (TRANSIMS) through to 
completion. The sustainability initiative is our highest priority new 
planning effort.
    Question. Please discuss the purposes and possible benefits of the 
pilot test components of this initiative.
    Answer. The purposes of the case study component of the initiative 
is to demonstrate how transportation planning can be effectively 
accomplished as part of a comprehensive, holistic process where 
sustainability from environmental, ecological, financial, community, 
and economic perspectives is a key objective. Different institutional 
arrangements for effecting the necessary coordination will be 
demonstrated along with application of analytical and decision support 
tools developed as part of the initiative.
    The results of the case studies will be documented, evaluated and 
synthesized for use by state, metropolitan planning organization and 
local officials.
    Question. Are any States or urban areas requesting these funds? Or 
was this initiative formulated by EPA? How does this initiative effect 
other components of the budget request.
    Answer. The general experience with planning under ISTEA suggests 
that if we are to achieve maximum benefit from existing and future 
transportation resources, they must be planned, designed and operated 
as part of an integrated development package for the communities and 
regions they serve. From Washington's Maryland suburbs to Portland, 
Oregon, transportation planners have learned the importance of working 
with their partners in land use, economic development and environmental 
planning. The Department had discussions with EPA, HUD, other 
interested Federal Government parties and state and local officials 
which led up to the initiative, but it is very much motivated by the 
Department's desire to use transportation resources more cost-
effectively. Though no specific agreements for case studies have been 
reached with any State, Metropolitan Planning Organization or local 
partner at this time, significant interest has already been expressed.
    As for the impact of the initiative on other components of the 
planning research and development program, our first priority is to 
complete ongoing work such as the development of ``TRANSIMS'' as part 
of the Travel Model Improvement Program. No net increase is anticipated 
in the overall R&T budget for this initiative. The annual $4.25 million 
initiative will be funded off the top; thus each office will be 
contributing to the activity.
    Question. What are the major challenges that the planning research 
program seeks to address during the fiscal year 1998 and how is this 
emphasis different than the fiscal year 1997 approach?
    Answer. The major new challenges for the fiscal year 1998 program 
with respect to the fiscal year 1997 program are: (1) the need to 
quantitatively benchmark, measure, and report program success; and (2) 
the need to address the strategic concerns of sustainable development.
    The fiscal year 1998 program will begin to examine and implement 
methods to track mobility changes at the national level. In addition, 
ways of measuring program outcomes and impacts will be examined. These 
new challenges will afford another significant opportunity to work with 
our partners at all levels within the transportation sector.
    As discussed in response to earlier questions, there are 
significant environmental, public investment, and community concerns 
that have gained substantial national attention with resulting 
pressures to examine and address them at the Federal level. In response 
to these pressures, the Sustainable Development Initiative has been 
proposed to deal with these concerns in objective detail. This new 
program will identify and deploy tools to decision makers in support of 
their comprehensive planning efforts.
    Question. Please prepare a description of your major fiscal year 
1997 research topics or activities and associated fiscal year 1997 
funding allocations.
    Answer. Travel Demand Forecasting Improvements--$3,200K.--The 
objectives of the program are: (1) To make existing travel forecasting 
procedures responsive to emerging issues, including environmental 
concerns, growth management, and lifestyle, along with traditional 
transportation issues; (2) To make travel forecasting processes 
responsive to changing travel behavior, greater information needs, and 
changes in data collection technology; and (3) To make travel 
forecasting model results more useful for decision makers. This 
research area includes developing metropolitan and statewide 
applications and manuals of practice. It also includes TRANSIMS.
    The planning tools developed in this program will provide improved 
forecasts of the effects of transportation improvements on congestion, 
energy, air quality, and land development. The Clean Air Act Amendments 
(CAAA) of 1990 provided major motivation for travel model improvements. 
The act mandates details and accuracy not currently available from 
travel models.
    Ensuring Efficiency of Future Transportation Systems--$600K.--
Current legislation encourages consideration of full costs of 
transportation in planning evaluation, including both direct and 
indirect costs, and assessments of the impacts of transportation 
investments on regional economies. Transportation decision-makers are 
seeking ways to evaluate alternative land use, pricing, demand 
management, congestion relief strategies, capacity expansion, ITS, etc. 
in the planning process. Increased emphasis is also being placed on 
using innovative ways of financing federal-aid highway project. It is 
essential that these innovative financing mechanisms are considered 
within the financial segment of the transportation planning process. 
Special emphasis will be placed on monitoring the effectiveness of 
financial planning efforts. This research area includes improving 
benefit cost accounting procedures, innovative financing, data 
collection, and freight planning.
    Training, Education, and Technical Assistance--$690K.--A 
comprehensive planning research program is being established to close 
the gap between state-of-the-art and state-of-the-practice in the next 
five to 10 years. The resulting information, data and technical 
procedures will be integrated with advanced technologies such as GIS, 
geographic positioning systems, and multimedia presentations and will 
be packaged into courses, seminars, conferences and technical 
assistance efforts to promote better multi-modal planning. A major 
effort will also be devoted to transferring technical information to 
our clients. This is a continuing effort to maintain state-of-the-art 
capabilities in these areas. Finally, we will improve our understanding 
of advancing technologies and promote the use of these technologies to 
enhance intermodal data collection, communications, analyses, and 
information display and exchange. This activity area includes training 
development, information materials, and conference support.
    Intermodal Statewide Transportation Planning--$1,000K.--The 
objective of this research is to support the States as they improve 
their statewide planning efforts and to maximize the effective and 
efficient use of limited financial resources as called for in ISTEA. 
Research efforts provide the basis for statewide transportation 
planning training, education and improved technologies. A significant 
multi year effort is devoted to developing a FHWA Geographic 
Information System to provide a planning tool to support statewide 
planning, analysis of the NHS, and environmental activities. This GIS 
serves as a planning tool for the complete transportation community. 
This research area includes data collection, manuals of practice, and 
applications development.
                              environment
    Question. What recent proposals for changes in EPA requirements 
have stimulated the need for additional research by FHWA? Please relate 
this need to the requested increase in the fiscal year 1998 budget.
    Answer. Air Quality.--EPA's November 1996 proposals to tighten the 
National Ambient Air Quality Standards (NAAQS) for ozone and 
particulate matter (PM) have generated considerable need for more 
research into transportation-air quality relationships. Tighter air 
quality standards are likely to produce more areas around the country 
that will fall under some level of transportation-emissions regulation. 
Previous studies of the linkages between transportation and air 
pollution have yielded incomplete results and frequently have posed as 
many questions as provided answers. FHWA is just beginning a mid- to 
long-term effort to fine-tune many of the less understood linkages 
between transportation and air pollution. The agency is considering 
efforts on better understanding the nature of and mitigation strategies 
for fine particulate matter and to meet the new ozone standard. We also 
anticipate research on the emission characteristics of heavy duty 
engines. A more detailed research plan will not be possible until the 
final form of these standards is decided upon. These efforts in 
addition to many other research efforts will seek a better knowledge 
base of the impacts that transportation sources and programs may exert 
on regional and national air quality planning.
    Water Quality.--Changes to the Clean Water Act in 1987 established 
a two-phased approach to addressing storm water discharges under the 
National Pollution Discharge Elimination System (NODES). Phase I is 
currently regulating storm water sources of large and medium-sized 
municipalities (100,000 or greater in population) and industrial sites, 
including construction sites of at least 5 acres in size. Under Phase 
II, dischargers to be covered include communities of less than 100,000 
inhabitants and construction sites under 5 acres. EPA is currently 
under a court order to propose supplemental rules for the Phase II 
storm water sources by September 1, 1997. The NODES Phase II program 
will include, at a minimum, requirements for Water quality Best 
Management Practices (BMP's) at construction sites, BMP's for existing 
storm water sources, and monitoring/enforcement requirements for local 
communities. Our current and projected water quality research program 
includes BMP development and assessment, as well as, monitoring 
techniques and analysis of data. Our program will emphasize the cost 
and effectiveness of BMP's, particularly those appropriate for limited-
space applications in urban areas. Another emphasis area of our 
research which has been stimulated by EPA requirements is the 
determination of possible water quality impacts from highway storm 
water runoff. Our understanding of the chemical constituents in runoff 
is well documented. However, very little is known regarding the impacts 
to water bodies that these constituents may pose. The effects of 
dilution, bio-availability, exposure time, and other factors must be 
determined before any conclusions about impacts are possible.
    Question. The validity of several air quality models is being 
criticized by several groups. Please discuss how your fiscal year 1997 
and fiscal year 1998 research program addresses these criticisms. 
Please specify funding amounts on a project level for both fiscal year 
1997 and fiscal year 1998.
    Answer. The Federal Highway Administration has research underway to 
attempt to improve the accuracy of both transportation and air quality 
models and analysis methodology. Result are just beginning to emerge. 
Our approach will be to build on the current work to refine new 
understanding and design new research efforts to fill in gaps that 
remain. Until result from current efforts are in and the form of the 
new standards are established it is difficult to determine exact 
additional amounts needed in each area. Current work underway and 
amounts dedicated are: Travel Model Improvement--$10 million; Regional 
Simulation Modeling--$26 million; Hot Spot Modeling--$2.5 million; 
Motor Vehicle Emission Estimation--$2 million; Long Range Emission 
Estimating Model--$5 million;and PM-10 Emissions Estimation--$0.5 
million. It is unclear at this point if improved analysis accuracy to 
the level required in each area will be possible. The form of the 
National Air Quality Standards is currently focused on extreme events 
(i.e. second worse hour of the year) and for long periods into the 
future (typically 20 years). Developing models that can perform well 
under these expectations is at best extremely difficult and may never 
achieve the level of accuracy needed to eliminate all the criticisms.
    Question. Is FHWA requesting additional funds for environmental 
research regarding wetlands? What are the consequences of not funding 
this work? Please specify funding amounts on a project level for both 
fiscal year 1997 and fiscal year 1998.
    Answer. FHWA has requested $620,000 in fiscal year 1997 and 
$500,000 in fiscal year 1998 as additional funding for wetland 
research. A total of $400,000 in each year are to be used to assist in 
completion of the Hydrogeomorphic Approach to wetlands functional 
assessment, an on-going effort being undertaken primarily by the Corps 
of Engineers, with technical and funding support from the USDA, EPA, 
USFWS, and FHWA. The Hydrogeomorphic Approach, when development is 
sufficient for implementation, will be the primary approach to 
functional evaluation of wetlands for Section 404 purposes, and will be 
important to assessment of impacts and determination of mitigation 
needs. The objective of the Hydrogeomorphic Approach is to more 
accurately identify and define the natural functions of wetlands in 
ecosystems and watersheds on a regional basis. The data being collected 
will enable more accurate modeling and evaluation of wetlands impacts 
on water quality, wildlife and habitat integrity, and water supply and 
storage. Completion of this phase of program development will allow 
resource agencies to make more flexible decisions regarding allowable 
impacts and mitigation needs, and could result in reduced construction 
costs and help eliminate delays in environmental reviews concerning 
wetlands. Over the two years, $280,000 is planned for work to develop 
methods for wetland assessment, mitigation, and preservation planning 
in a watershed-based context. Theses efforts will tie into the overall 
transportation / watershed planning and development efforts being 
pursued by FHWA. Part of these efforts will be to develop training 
materials and resources to educate highway planners and designers in 
use of this approach to wetlands assessment and mitigation planning. 
This includes an additional $40,000 to develop and implement needed 
reference and training materials. Failure to fund this work will result 
in a failure to realize these benefits to the State construction 
programs. In addition, the objective of no-net-loss of wetlands 
functions and values will not be realized, and wetlands resources 
values and benefits will continue to be lost due to highway and 
transportation project construction and development.

------------------------------------------------------------------------
                                                     Fiscal years--     
                                               -------------------------
                                                    1997         1998   
------------------------------------------------------------------------
Functional Evaluation of Wetlands (EPA).......     $250,000     $250,000
Functional Evaluation of Wetlands (COE).......      150,000      150,000
Ecosystem/Watershed Planning..................       50,000      100,000
Wetland Restoration and Watershed Planning....       80,000  ...........
Alternatives for Wetland Mitigation...........       50,000  ...........
Wetland Plant Database (NRCS).................       25,000  ...........
Wetland Workshops.............................       15,000  ...........
------------------------------------------------------------------------

    Question. Please breakout in detail your fiscal year 1997 spending 
plan for the environmental research program, explaining the purpose of 
each major project and the associated amount.
    Answer. The goals of the fiscal year 1997 research program are to 
develop (1) improved tools for assessing highway impacts on air 
quality, wetlands, hazardous waste sites, water quality, etc.; (2) more 
effective and innovative avoidance, detection, mitigation, and 
enhancement techniques; and (3) environmental expertise within FHWA and 
State and local transportation agencies that will significantly 
contribute to a more efficient environmental and project development 
program and to an enhanced environment in accordance with the 
Department of Transportation's Strategic Plan and the Federal Highway 
Administration's Environmental Policy Statement.
Air Quality
    Passage of the Clean Air Act Amendments of 1990 significantly 
altered the relationship between the development of transportation 
improvements and the air quality within the area. The emphasis on 
modeling and analytic compliance was significantly increased. This 
increase in analysis requires travel, emission, and dispersion modeling 
techniques that are considerably more sophisticated than current 
methods. There is therefore considerable pressure to develop new models 
to better meet the need. Experience with transportation programs, 
projects, and activities which have emission reduction benefits is also 
limited and in need of clarification. Finally, there is the need to 
provide information and technical guidance to Federal, State, and local 
officials as well as the public at large on the new requirements and 
methods for compliance. Because these changes represent a fundamental 
shift in transportation goals and objectives, research in these areas 
will be a continuing emphasis.
    Expected fiscal year 1997 Products and Milestones.--Publish 
evaluation of emission control potential of transportation Control 
Strategies.
    Fiscal year 1997 Program Request.--$2,250,000.
    New Initiatives for fiscal year 1997.--Examine the emission impacts 
of alternative fuels. Examine the impacts on the transportation 
program, and the additional controls needed to comply with the revised 
standards for ozone and particulate matter. Examine mitigation for 
reducing emissions from heavy duty diesel engines.
Wetland Resources
    The U.S. Fish and Wildlife Service National Wetlands Inventory, 
responding to government and public concerns that the Nation's wetlands 
resources, essential to important wildlife and fisheries resources, 
were being irretrievably lost, determined that between the initial 
European settlement of North America and the early 1970's, up to 50 
percent of existing wetlands were filled, lost, or converted to other 
uses by agriculture, housing, industry, and highway construction. The 
Federal Government, responding to a need to conserve wetlands critical 
to both water quality, fisheries, and wildlife, enacted legislation 
which established the framework within which wetlands protection and 
management have developed. Section 404 of the Clean Water Act regulates 
discharge of dredge and fill materials into waters of the United 
States, including wetlands. The Fish and Wildlife Coordination Act 
requires Federal agencies to coordinate with the Fish and Wildlife 
Service on projects which will impact aquatic resources. Many of the 
species listed as protected under the Endangered Species Act depend on 
wetlands. Many States have passed legislation to manage and protect 
important wetlands resources.
    The construction, use, and maintenance of highway systems have 
potential primary and secondary impacts on wetlands resources and other 
ecosystems. Due to the linear nature of highway projects, many cross 
watercourses or wetlands. The tendency of planners to locate highways 
in river valleys and on drainage boundaries increases the potential for 
interaction between highway facilities and wetlands resources. The land 
use changes that often provide the impetus for highway construction or 
that follow highway construction as a secondary development generate 
impacts to wetlands resources in addition to those directly 
attributable to the highway itself. Known potential impacts of highways 
and associated development on wetlands and aquatic resources include 
destruction of the wetland by fill, removal or alteration of wetland 
vegetation, changes in hydrology, both surface and ground water, 
vehicle-caused wildlife mortality, fragmentation of wildlife habitat, 
and pollution of waters by highway runoff.
    This research plan contributes to a more effective environmental 
management program in the project development process by emphasizing 
critical aspects of wetland management in highway environments. Major 
emphasis is placed on (1) the development and implementation of 
improved methods, tools, and techniques to identify and delineate 
wetlands, assess wetland impacts and evaluate wetland functions; (2) 
improve the effectiveness of compensatory mitigation through better 
techniques of wetland restoration, enhancement, and creation; (3) 
improve and enhance the use of mitigation banking as a viable, 
effective, tool of choice in situations where compensatory mitigation 
is necessary; (4) refine FHWA policies and regulations to accomplish 
the Administration objective of No Net Loss of Wetlands; (5) to improve 
training and educational tools available to the State Highway Agencies 
for wetlands impact management; and (6) improve coordination with other 
wetland resource mange agencies.
    Expected fiscal year 1997 Products and Milestones.--Methodology for 
Functional Assessment of Wetlands under Sec. 404 (Regionalized HGM 
approach, in part; in cooperation with COE). Improving Strategies for 
No-Net-Loss of Wetlands in Highway Development. Wetland Habitat 
Requirements of New England Birds: Assessing Impacts and Mitigation 
Needs. Mitigation Manual for Estuarine Wetlands.
    Fiscal year 1997 Program Request.--$640,000.
    New Initiatives.--Improving Runoff Water Quality Through Design of 
Highway Wetland Mitigation. Evaluating the Effectiveness and Success of 
Wetland Mitigation in the Federal Aid Highway Program: On-Site 
Mitigation versus Banking. Integrating Watershed Management Planning 
with Highway Project Development.
Highways And Water Resources
    In the early 1970's a growing awareness of the potential threat to 
water resources by highway construction and operation emphasized a need 
to identify and quantify water quality impacts. With the passage of the 
National Environmental Policy Act and the Clean Water Act of 1972, as 
amended, Federal decision makers were to be accountable for activities 
having the potential to impact features of the natural environment, in 
particular water quality.
    The planning for and implementation of highway systems can interact 
with the Nation's water resources in numerous ways. Since most highway 
sections lie within or cross a watershed, all phases of project 
development have the potential for impacting both surface and 
underground water resources. Highway project planning, location, and 
design activities can greatly influence future uses of water resources 
in localities by determining patterns of growth, secondary development, 
and water supply distribution. Construction and maintenance activities 
can have direct impacts to both supply and water quality 
characteristics of the project area. A variety of impacts are possible, 
ranging from the erosion of disturbed soils to the chemical pollutants 
associated with highway maintenance practices. Finally, the operation 
of highways open to traffic cause numerous other potential pollution 
sources created by the chemical and biological contaminants present in 
roadway storm water runoff.
    Previous research sponsored by the FHWA has provided tools to State 
and local transportation for assessing potential water quality impacts 
of transportation improvements and has developed mitigation techniques 
to lessen the pollution effects of storm water runoff. Ongoing studies 
and those planned for the future address the continuing concern over 
non-point water pollution from highway facilities and the ever present 
need to meet statutory and regulatory requirements. The eventual re- 
authorization of the Clean Water will undoubtedly affect transportation 
development activities. Also, as EPA's Phase II of the National Storm 
water Program is fully implemented over the next 5 years, State and 
local transportation agencies will continue to rely on FHWA's water 
quality research products in order to reduce pollution concerns and 
comply with regulatory requirements.
    This research plan will contribute to a more efficient 
environmental process and project development program, and will enhance 
the environment by supporting: (1) the development of improved methods, 
techniques, tools, models, and procedures to evaluate the water quality 
impacts of highway development and operation activities, particularly 
storm water runoff and changes in hydrology; (2) the identification and 
development of innovative best management practices, devices, and other 
mitigation measures; (3) the development of expertise within FHWA and 
State transportation agencies which integrates highway water quality 
and storm water issues with all water resource problems associated with 
highways, including hydraulic and hydrological concerns; (4) the 
coordination with other agencies to ensure that Federal storm water and 
non-point source pollution policies are incorporated into FHWA and 
State policies and procedures; and (5) the participation in national 
and international research on transportation-related water resource, 
water quality, and storm water issues.
    Expected fiscal year 1997 Products and Milestones.--Publish 
evaluation of best management practices for controlling storm water 
runoff from highways. Complete updating existing baseline data on storm 
water characteristics.
    Fiscal year 1997 Program Request.--$900,000.
    New Initiatives.--Determine the Potential for Impacts to Receiving 
Waters Caused by Highway Storm water Runoff--This study will identify 
short and long term water quality effects on surface and groundwater 
receiving storm water runoff from roadway surfaces. Develop an 
Assessment Methodology and Management Guidelines for Cumulative Water 
Quality Impacts of Highway Storm water Runoff. This research will 
examine long term and additive effects of highway storm water runoff on 
an area-wide or watershed basis. Comprehensive Integrated Water Quality 
and Water Resource Management This research will determine how to 
integrate highway planning, design, right-of- way, construction, 
operation, and maintenance issues with water resource protection in a 
watershed context.
Environmental Process
    In order to comply with the requirements and the intent of the 
National Environmental Policy Act, we are (1) evaluating procedural, 
technical, and legal issues to reduce project impacts, costs, and 
controversy, while ensuring consistency and implementation of land use 
and transportation plans; and (2) investigating and documenting the 
various techniques and procedures, as well as innovative mitigation, 
design, and construction techniques, used on projects that have been 
developed with mutually fruitful results benefiting both transportation 
and environmental protection purposes. The goal is to integrate 
environmental considerations into the project planning and development 
process.
    Expected fiscal year 1997 Products and Milestones.--Computerized 
``Catalog of Excellence in Highway Design Photographs and Data'' will 
be distributed on CD/ROM.
    Fiscal year 1997 Program Request.--$600,000.
    New Initiatives.--Develop methods and techniques to conduct 
economic analyses of alternative corridors, examine broad land use 
controls, and integrate corridor preservation concepts with the urban 
transportation planning process. Determine remote sensing signatures of 
surface and subsurface resources for environmental analysis.
Community Impacts And Public Involvement
    In order to comply with the requirements and the intent of the 
National Environmental Policy Act, we need to evaluate (1) policy, 
procedural, technical, and legal issues associated with community 
impact analysis and abatement; and (2) data needs and assessment 
techniques and methodologies to allow for efficient determination of 
community impacts of proposed highway projects. We need also to 
document the application of new public involvement techniques to 
highway projects and investigate the effective management of the public 
involvement function as an integral part of the project development 
process. Such techniques include the open forum hearing format, the use 
of marketing techniques, and graphic techniques based on video cameras 
and personal computers.
    Expected fiscal year 1997 Products and Milestones.--Develop case 
studies on community impact analysis and abatement.
    Fiscal year 1997 Program Request.--$395,000.
    New Initiatives.--Improve social and economic projection 
techniques. Analyze and incorporate secondary impacts into social and 
economic impacts. Evaluate highway department organizational structure 
and effective public involvement techniques.
Historic And Archeological Preservation And Aesthetics
    Historic and archeological preservation research addresses the 
procedural, technical, and legal issues associated with resource 
identification, evaluation and rehabilitation in the highway and 
transportation context. Historic and archeological preservation policy 
and procedures are changing due to current regulatory revisions and the 
recognition of Native American religious and cultural values. Research 
results will provide the tools necessary to meet these technical and 
procedural requirements.
    Highway esthetics research includes the different visual impact 
evaluation methods and their associated assessment techniques. 
Information will be developed to identify the viability and the manner 
in which the various methods can be used to effectively determine the 
visual impact of highway project proposals. Also, this program includes 
the various cultural practices of roadside maintenance which can 
benefit visual quality such as the use of wildflowers and other native 
plant species.
    Expected fiscal year 1997 Products and Milestones.--Design 
standards for the rehabilitation and preservation of historic highway 
bridges.
    Fiscal year 1997 Program Request.--$475,000.
    New Initiatives.--Develop standards and guidelines for historic 
highways which provide identification and evaluation criteria for use 
by transportation and historic preservation planners. Synthesize 
information on local efforts to preserve and relocate historic 
structures, including highway bridges. Summarize innovative solutions 
and techniques to fund and maintain these structures for continued 
public use and benefit. Identify naturally occurring plant communities 
and plant species which, if used in a comprehensive revegetation 
management strategy, would render roadside maintenance practices 
environmentally sensitive, safe, and less costly.
    Question. What are the major challenges that the environmental 
research program needs to address during fiscal year 1998, and how is 
this emphasis different from the fiscal year 1997 approach?
    Answer. Most of the challenges will remain the same; however, we 
have the following new challenges and additional research:
    Air Quality standards.--Changes to the national ambient air quality 
standards for ozone and fine particles are currently under 
consideration by the Environmental Protection Agency. Final Action is 
expected in mid 1997. Since highway travel contributes to both of these 
air pollution concerns, significant research will be needed to 
reestablish understanding of transportation contributions to the new 
standards along with methods of control.
    Watersheds.--There is a need to incorporate watershed-based water 
resource protection and management into various highway planning, 
project development, and operation/maintenance processes. Proposed 
research will integrate environmental and transportation planning and 
assessment (particularly in the watershed management and land-use 
planning arenas) and explore innovative ways to bring about a merger of 
the environment/planning and permit processes, etc.
    Communities, Neighborhoods, and People.--The President's Report on 
Sustainable Development emphasizes the importance of sustainable 
transportation projects that contribute to sustainable communities; and 
the DOT and FHWA Strategic Plan highlights the importance of putting 
people first in transportation decision making. Research will focus on 
the role of transportation systems and projects in contributing to 
sustainable communities, reflecting community values in design and 
placement of facilities in communities, and protecting and enhancing 
the social infrastructure. It will be even more critical now to 
research ways to improve the link between transportation and 
sustainable development within communities.
    Reinventing NEPA.--The National Performance Review, findings of the 
NEPA 25th Anniversary workshop jointly sponsored by DOT and CEQ, U.S. 
Senate NEPA roundtables, and Congressional concerns highlighted growing 
customer dissatisfaction with lead agencies implementation of NEPA, 
interagency coordination and conflicts, and the time and cost 
associated with project decision making. As a result, FHWA must 
continue to research ways to improve the FHWA NEPA decision making 
process. Research will focus on ways to streamline the manner in which 
environmental considerations are integrated into transportation 
decision making at the planning and project levels; build the capacity 
of State DOT's to effectively implement NEPA through training and 
technical assistance; and apply emerging and current advanced 
technologies.
    Environmental Justice.--Since Title VI of the 1964 Civil Rights 
Act, the transportation and highway program has been involved in 
implementing nondiscrimination programs, and addressing associated 
impacts, complaints and concerns. The Executive Order on Environmental 
Justice reemphasizes the need to address adverse human health or 
environmental effects, including social and economic effects of its 
programs, policies, and activities on minority and low income 
populations. FHWA will research methods and demonstrate exemplary 
practices of effective transportation decision making which evaluates 
and mitigate impacts to disproportionately high and adverse human 
health or environmental effects of transportation projects.
Additional research
    National Environmental Research Needs Conference.--An Environmental 
Research Needs Conference, jointly sponsored by the Transportation 
Research Board (TRB), the Center for Transportation and the Environment 
(CTE) at North Carolina State University, the Federal Highway 
Administration (FHWA), and the Federal Transit Authority (FTA) was 
conducted November 14-16, 1996, in Washington, D.C. The conference was 
attended by approximately 140 participants from State DOT's and 
environmental agencies, regional and local governmental agencies, 
university and research institutes, private non-profit environmental 
organizations, the American Association of State Highway and 
Transportation Officials (AASHTO), and four Federal agencies in 
addition to FHWA and FTA. The participants generated approximately 95 
detailed problem statements totaling over $28 million.
                                 policy
    Question. Now that most of the policy studies related to 
reauthorization have been completed, why can't we reduce the FHWA 
request for policy research?
    Answer. The Comprehensive Truck Size and Weight Study and Highway 
Cost Allocation Study represent only a portion of the Policy research 
program. Other high priority policy research activities including data 
management and dissemination, innovative finance, further development 
of the Highway Economic Requirements System, and analysis of 
interrelationships between highways and economic productivity, have 
continuing research needs. In fact, projects in several of these areas 
have been deferred to allow essential truck size and weight and cost 
allocation projects to be completed. Furthermore, even though reports 
on these two major policy studies will have been submitted, continuing 
work in both areas is needed. Documentation of data and analytical 
tools used for the two studies was deferred to allow work essential for 
the study reports to be completed; this documentation should be 
completed as quickly as possible to assure that details of the data 
collection, analysis, and model development processes are not forgotten 
or do not have to be recreated by the consultants. Also, both studies 
analyzed only a small set of policy scenarios. It is anticipated that 
further policy analysis in these two controversial areas will be 
required even after the reports have been submitted, and further 
validation and update will be required for models used in both studies. 
For the Truck Size and Weight Study, in particular, substantial work 
remains to incorporate results of the Commodity Flow Survey into the 
freight diversion model which is the basis for estimates of changes in 
travel by different vehicle classes and different modes in truck size 
and weight scenario analyses and to make tools developed for the 
national level study available to States for use in analyzing impacts 
of truck size and weight proposals at the State level. Performance 
measurement is a new research area that requires additional funding. 
The Government Performance and Results Act places many requirements on 
Federal agencies to measure results of their programs and to establish 
target outcomes that will be achieved through program funding. Research 
is required to conduct baseline analyses that relate investment in 
various programs with outcomes. These causal relationships are needed 
in order for future budget requests to estimate quantitatively changes 
in relevant performance measures that can be anticipated for a given 
program level. Finally, once surface transportation reauthorization 
legislation has been passed, significant policy research is anticipated 
in connection with implementing that legislation.
    Question. What is the most pressing policy research problem that 
needs additional attention during fiscal year 1998? How much do you 
plan to spend on this research during fiscal year 1998, and how much is 
being spent during fiscal year 1997 on this topic?
    Answer. In a time of limited resources we must strive more 
diligently than ever to use those resources most efficiently. New ways 
must be found to stretch limited public funds through innovative 
financing strategies, public private partnerships, and other means. 
Technical assistance must be provided to State and local agencies to 
help them minimize institutional and other impediments to use of these 
innovative financing mechanisms. Tools must be developed that allow 
Federal, State, and local transportation agencies to evaluate 
alternative investment strategies, including intelligent transportation 
systems and other new technologies, to determine the mix of investments 
that will provide the greatest return from limited resources. 
Infrastructure and demand management strategies must also be evaluated 
to assess their potential for reducing investment requirements for new 
capacity and to provide State and local partners with information on 
lessons learned by others that have been in the forefront of 
implementing such strategies. Data to support analyses of these various 
investment and systems management options must also be collected. A 
total of approximately $2.95 million is planned to be spent on research 
and technology transfer activities related to this key policy research 
problem in fiscal year 1998. About $2.4 million is anticipated to be 
spent on these activities in fiscal year 1997. These monies reflect 
research in four areas--innovative finance, market-based pricing and 
demand management, highway investment analysis, and related data 
collection activities. Many other elements of policy research relate to 
this overall issue, but not as directly as these four specific research 
areas.
    Question. Please breakout in detail your fiscal year 1997 spending 
plan, explaining the purpose of each major project and the associated 
amount.
    Answer. The following table.

----------------------------------------------------------------------------------------------------------------
                                      Fiscal year 1997                                                          
           Project area                 expenditures                              Purpose                       
----------------------------------------------------------------------------------------------------------------
Comprehensive Truck Size and       $830,000 GOE.........  To provide data and analysis in support of the        
 Weight Study.                                             Department's Comprehensive Truck Size and Weight     
                                                           Study. Fiscal year 1997 funds were expended primarily
                                                           on refinement of the freight diversion model, surveys
                                                           of shippers, research on stability and control       
                                                           characteristics of different vehicle configurations, 
                                                           review of size and weight enforcement issues, and    
                                                           analysis of bridge and other infrastructure impacts  
                                                           of size and weight scenarios.                        
Highway Cost Allocation..........  180,000 GOE..........  To develop data and methods based upon the Federal    
                                   300,000 line item       cost allocation study for use by States in conducting
                                                           their own cost allocation studies, and for follow-on 
                                                           activities to the Federal study including conference 
                                                           support and pooled fund study with several States to 
                                                           refine relationships between registered weights and  
                                                           operating weights of vehicles.                       
Relationship Between Highway       200,000 GOE..........  To extend and refine analyses demonstrating           
 Investment and Economic                                   relationships between highway investment and economic
 Productivity.                                             productivity. This research examines changes in      
                                                           productivity at the firm level as highway services   
                                                           change and develops adjustment factors to account for
                                                           changes in the quality of highway services over time.
Congestion Pricing...............  50,000 GOE...........  To provide technical support to State and local       
                                   200,000 6005            congestion pricing initiatives including evaluation  
                                                           of equity and other implementation issues.           
Innovative Finance/Public Private  75,000 GOE...........  Purposes include: (1) to evaluate and synthesize      
 Partnerships.                     850,000 6005            experiences and lessons learned from innovative      
                                                           finance test and evaluation projects, State          
                                                           Infrastructure Bank pilot projects; (2) to provide   
                                                           technical assistance to State and local partners in  
                                                           deploying innovative finance projects; (3) to        
                                                           identify gaps in our knowledge of innovative finance 
                                                           issues by examining financial practices and needs;   
                                                           (4) to provide training, conference support,         
                                                           newsletter, and other outreach activities; (5) to    
                                                           provide assistance for new innovative finance        
                                                           initiatives; and (6) to evaluate public/private      
                                                           partnership activities.                              
Highway Investment Analysis......  675,000 GOE..........  To develop enhancements to the Highway Economic       
                                                           Requirements System highway investment/performance   
                                                           analytic capabilities. The major enhancements are (a)
                                                           consideration of the costs of vehicle emissions in   
                                                           the selection of highway improvements and (b)        
                                                           implementation of travel demand elasticity in        
                                                           calculating the travel that would occur on a         
                                                           particular section of highway under analysis.        
                                                           Development of BIAS, a bridge investment analysis    
                                                           system designed to bring an economic dimension to    
                                                           estimates of bridge investment requirements has      
                                                           entered the second phase.                            
Performance Measurement..........  225,000 GOE..........  The purposes of this project are to (a) develop       
                                                           customer outreach activities to obtain customer input
                                                           for the selected performance measures, (b) to track  
                                                           and monitor strategic planning indicators, and (c) to
                                                           develop a handbook on strategic performance and      
                                                           planning.                                            
Reauthorization Issues...........  250,000 GOE..........  Purposes include: (a) to analyze specific             
                                                           reauthorization issues that arise, either during     
                                                           Congressional debate or as a result of stakeholder   
                                                           inquiries; (b) to synthesize information on          
                                                           reauthorization proposals and issues; (c) to convene 
                                                           and conduct forums to discuss ISTEA reauthorization  
                                                           issues; and (d) to disseminate ISTEA reauthorization 
                                                           information to transportation, environmental, and    
                                                           other interest groups, as well as the public. If     
                                                           funds are available they will be used to summarize,  
                                                           synthesize, and communicate the enacted              
                                                           reauthorization legislation to all ISTEA             
                                                           stakeholders.                                        
National Freight Partnership.....  150,000 GOE..........  The National Freight Partnership work in fiscal year  
                                                           1997 supported a series of national public/private   
                                                           meetings on issues of national and regional freight  
                                                           and international trade significance. These included 
                                                           (a) the Second National Freight Symposium, held in   
                                                           October, 1996 at the Port of Los Angeles on the      
                                                           subject of international trade corridors and (b) a   
                                                           series of four regional meetings on the impact of    
                                                           changes in maritime vessel design on U.S. ports, port
                                                           operations, and intermodal connections.              
Fuels and Finance Data             343,000 GOE..........  To collect and analyze information on highway fuel use
 Collection, Analysis, and                                 and highway finance necessary for transportation     
 Dissemination.                                            decisionmakers. Key research products include the    
                                                           improvement of data for local highway bond finance,  
                                                           collection of information for the publication        
                                                           ``Highways Taxes and Fees,'' and the publication of  
                                                           the ``Highway Funding Bulletin.''                    
Systems Performance Data           303,000 GOE..........  To develop user friendly, PC based, HPMS software for 
 Collection, Analysis, and         300,000 6005            use in a file server environment. The software       
 Dissemination.                                            extends the capabilities beyond the data submittal   
                                                           phase and into a phase that will enable staff to     
                                                           perform more comprehensive and less labor intensive  
                                                           data reviews , develop a server- based data base     
                                                           query capability, and to enable the production of    
                                                           reports for Highway Statistics and other             
                                                           dissemination venues off of the file server. Another 
                                                           focus of fiscal year 1997 research is to support the 
                                                           ongoing Strategic Reassessment of the HPMS.          
Traffic Monitoring Data            496,000 GOE..........  To collect, analyze, summarize, and disseminate       
 Collection, Analysis, and         450,000 6005            traffic data to support program needs at the Federal,
 Dissemination.                                            State, and local levels. These data include traffic  
                                                           volumes, vehicle classification, truck weights and   
                                                           related traffic characteristics. Within these areas, 
                                                           the primary focus is to develop guidelines for cost- 
                                                           effective data collection, evaluate and assess       
                                                           equipment deployment, including non-intrusive        
                                                           technologies, and develop enhanced procedures for    
                                                           efficient data management, handling and analysis to  
                                                           ensure the availability of quality data for          
                                                           decisionmaking.                                      
Transportation Surveys and Cen-    665,000 GOE..........  This activity includes efforts directed to the        
 suses.                                                    collection and application of household travel data  
                                                           of the Nationwide Personal Transportation Survey, and
                                                           the application of data from related surveys such as 
                                                           those of the U.S. Census to national transportation  
                                                           issues. Activities include data analysis,            
                                                           interpretation and distribution. In addition to these
                                                           basic data support activities, efforts also encompass
                                                           cutting-edge efforts such as on-the-fly analysis over
                                                           the Internet, development of procedures to apply     
                                                           national level data to metropolitan zones based on   
                                                           demographics, and evaluation of automated data       
                                                           collection techniques.                               
International Border Crossing      500,000 6005.........  To support land transportation planning process in the
 Analy-  sis.                                              U.S./Mexico border region, the North American        
                                                           Technology Exchange Program, and binational planning 
                                                           and identification of trade corridors along the U.S./
                                                           Canadian border.                                     
----------------------------------------------------------------------------------------------------------------

    Question. What were the major findings or tentative conclusions of 
the truck size and weight study? Are any fiscal year 1998 monies 
requested for this study. If so, please justify in detail.
    Answer. The Department has underway a Comprehensive Truck Size and 
Weight Study. This fall, the Study will be transmitted to Congress in 
four volumes: Volume I--Executive Summary, Volume II--Issues and 
Background, Volume III--Scenario Analysis and Volume IV--Guide to 
Documentation. A draft version of Volume II was provided, for review 
and comment, to Congress and other interested parties on June 11. It is 
premature at this time to delineate the major findings or even 
tentative conclusions as the material has not yet been adequately 
reviewed.
    As the Study will be complete by the end of the fiscal year, we are 
not requesting fiscal year 1988 monies to produce the report. However, 
we intend to continue work in this area on an ongoing basis, building 
upon the significant analytical tools now in place.
    Question. What does your study conclude regarding the safety 
impacts of increasing current truck size and weight limits?
    Answer. An array of alternative truck size and weight policies will 
be evaluated under the umbrella of the Comprehensive Truck Size and 
Weight (CTS&W) Study. While the analytical tools required to assess the 
impact of the alternative scenarios on factors such as safety, 
productivity, and infrastructure are now in place, the evaluation 
process (to include internal Departmental review) is not yet complete. 
The final CTS&W Study will be transmitted to Congress this fall.
    Question. What were the major findings or tentative conclusions of 
the cost allocation study. Are any fiscal year 1998 funds requested for 
cost allocation work? If so, please justify in detail.
    Answer. Preliminary conclusions of the highway cost allocation 
study, which is still in the review process within the Department and 
OMB, are that inequities remain in the Federal highway user fee 
structure, but that those inequities are smaller than inequities found 
in the last Federal highway cost allocation study completed in 1982. 
Several factors account for the improved equity of Federal user fees 
including (1) changes in the composition of the highway program with a 
greater portion of the funds being used for transportation systems 
management, safety, environmental purposes, and system enhancements for 
which trucks have a lower cost responsibility than they do for added 
lanes or improvements to the condition of existing pavements and 
bridges; (2) changes in the Federal user fee structure; and (3) the 
dedication of Federal user fees beginning in 1982 for mass transit 
purposes which are largely attributable to personal transportation.
    Some fiscal year 1998 funds are requested for highway cost 
allocation to support essential follow-up work to document data and 
analytical tools developed in connection with the cost allocation study 
while those items are still fresh in the minds of consultants who 
worked on them, to improve the integration of software developed for 
the current study in preparation for future studies which we are 
committed to doing on a regular basis, to further explore implications 
of greater use of life cycle cost analysis principles in infrastructure 
investment decisions, to evaluate specific highway user fee proposals 
that may come from others during and following the reauthorization 
debate, and to pursue recommendations by the Transportation Research 
Board Peer Review Committee that we validate and extend the new 
pavement distress models developed for the study and evaluate 
implications of highway user fee options on economic efficiency.
    Question. Please specify total expenditures by year and by funding 
source for all activities related to the truck size and weight studies 
and the cost allocation study for each of the last three fiscal years. 
How much will be spent on continuing these activities during fiscal 
year 1998?
    Answer. The following table shows expenditures for the truck size 
and weight and highway cost allocation studies by fiscal year and 
source of funds for the last three fiscal years.

------------------------------------------------------------------------
                                                           Highway cost 
     Fiscal year and source of funds      Truck size and    allocation  
                                           weight study        study    
------------------------------------------------------------------------
1995:                                                                   
    GOE.................................        $630,000        $694,000
    6005................................         325,000         175,000
1996:                                                                   
    GOE.................................         300,000         266,666
    6005................................         300,000         300,000
    HCAS Line Item......................       1,000,000         991,000
1997:                                                                   
    GOE.................................         825,000         180,000
    HCAS Line Item......................  ..............         300,000
------------------------------------------------------------------------

    In fiscal year 1998, $500,000 is estimated to be required for truck 
size and weight-related research including amounts to develop tools for 
use by States as is being done for the cost allocation study, 
refinement and integration of analytical tools used in evaluating 
impacts of truck size and weight scenarios, and incorporation of 
Commodity Flow Survey data into the freight diversion model. 
Approximately $350,000 is estimated to be required to for cost 
allocation-related research. As noted in the response to a previous 
question, these funds would support essential follow-up work to 
document data and analytical tools developed in connection with the 
cost allocation study while those items are still fresh in the minds of 
consultants who worked on them, to improve the integration of software 
developed for the current study in preparation for future studies which 
we are committed to doing on a regular basis, to further explore 
implications of greater use of life cycle cost analysis principles in 
infrastructure investment decisions, to evaluate specific highway user 
fee proposals that may come from others during and following the 
reauthorization debate, and to pursue recommendations by the 
Transportation Research Board Peer Review Committee that we validate 
and extend the new pavement distress models developed for the study and 
evaluate implications of highway user fee options on economic 
efficiency.
    Question. Please show the number of FTE and FTP assigned to the 
Office of Policy for the last four fiscal years.
    Answer. The answer follows.

        Fiscal year                                              FTE/FTP
1997..............................................................    90
1996..............................................................    94
1995..............................................................    94
1994..............................................................    94
1993..............................................................    96
                        international activities
    Question. Please breakout in detail your fiscal year 1997 spending 
plan, explaining the purpose of each major project and the associated 
amount. Please provide sufficient detail so that we can gain a better 
understanding of the scope and nature of the international program and 
the benefits to FHWA, industry, and State and local governments of this 
investment.
    Answer. The answer follows:

                                 FISCAL YEAR 1997 INTERNATIONAL OUTREACH PROGRAM                                
----------------------------------------------------------------------------------------------------------------
          Program element            Funding                          Program description                       
----------------------------------------------------------------------------------------------------------------
International Marketing...........   $200,000  Initiated study entitled ``Improving Flow of Trade-Related       
                                                Information for Highway and Transportation Specific Companies'' 
                                                which examines current trade promotion initiatives underway by  
                                                other U.S. Government agencies as well as covers needs of       
                                                highway and transportation specific companies                   
                                               Develop instructional materials and meetings with private sector 
                                                to assess findings of the study.                                
                                               Participated in the International Road Federation World Congress,
                                                including promotion of U.S. highway transportation expertise    
                                                with the U.S. private sector. This includes an FHWA exhibit at  
                                                the Congress.                                                   
                                               Provided guidance to Russian Federal Highway Service (RFHS)      
                                                during the development of bid packages for a $1.5 billion       
                                                project in Siberia and the Russian Far East. As a result of the 
                                                FHWA's cooperation with the RFHS, U.S. firms are being given    
                                                preference in undertaking this project.                         
                                               Promote a proposal to implement an electronic road pricing system
                                                for truck transportation in Russia using U.S. equipment and     
                                                services.                                                       
                                               Continued facilitation of U.S. firms' efforts to export highway  
                                                construction equipment to Russia and other countries.           
Technical Exchange................    200,000  Continue support for the FHWA's World Road Association           
                                                participation and their work programs                           
                                               Provided logistical support for U.S./Japanese technology exchange
                                                activities which included a technical exchange workshop in the  
                                                U.S.                                                            
                                               Continued support for the FHWA's participation in the World      
                                                Interchange Network, a network which improves the flow of road- 
                                                related technology world-wide.                                  
                                               Concluded FHWA's work with the APEC Congestion Points Study.     
                                               Continued work with the Finnish Road Administration and the      
                                                cooperative program for promoting technology in the Baltic      
                                                countries.                                                      
Foreign Visitor Program...........     75,000  Continued contract for the Foreign Visitor Program Coordinator   
                                               Facilitated Visitor Exchanges, including site visits to area     
                                                transportation research and demonstration facilitates to        
                                                demonstrate U.S. highway technology.                            
                                   -----------                                                                  
      Total funding...............    475,000                                                                   
----------------------------------------------------------------------------------------------------------------


                              FISCAL YEAR 1997 RUSSIAN TECHNICAL ASSISTANCE PROGRAM                             
----------------------------------------------------------------------------------------------------------------
          Program element            Funding                          Program description                       
----------------------------------------------------------------------------------------------------------------
Technical assistance..............   $200,000  Continue support of the FHWA's contractor in Moscow, Russia with 
                                                the following work objectives:                                  
                                                 --Providing information on U.S. legal basis for toll road      
                                                  authorities.                                                  
                                                 --U.S. study tour, advice, and support on establishing a       
                                                  national network of centers to provide training and technology
                                                  transfer.                                                     
                                                 --Support for twinning State highway agencies in Maryland and  
                                                  Alaska with counterparts in Russia.                           
                                                 --Advice and data processing support for establishing a bid    
                                                  estimating system for the Russian Federal Highway Service.    
                                                 --Appraisal of further institutional development needs in the  
                                                  highway sector.                                               
----------------------------------------------------------------------------------------------------------------

    Question. Please breakout in detail your fiscal year 1998 spending 
plan, explaining the purpose of each major project and the associated 
amount. Please provide sufficient detail so that we can gain a better 
understanding of the scope and nature of the international program and 
the benefits to FHWA, industry, and State and local governments of this 
investment.
    Answer. See chart below.

                                 FISCAL YEAR 1998 INTERNATIONAL OUTREACH PROGRAM                                
----------------------------------------------------------------------------------------------------------------
          Program element            Funding                          Program description                       
----------------------------------------------------------------------------------------------------------------
International Marketing...........   $225,000  Launch part II of study on ``Flow of Trade-Related Information'' 
                                                which includes regional seminars for U.S. industry on           
                                                opportunities and assistance available in U.S.                  
                                               Manage FHWA participation in 4th World Congress on ITS in Berlin,
                                                Germany, including sponsoring U.S. technology promotional       
                                                support and activities.                                         
                                               Development of marketing and promotional materials for ITS Latin 
                                                America Conference focusing on U.S. technology.                 
                                               Develop promotional materials for FHWA and coordinate materials  
                                                on U.S. technology to be developed by privates sector.          
                                               Undertake technical exchange mission to Korea with objective of  
                                                promoting private sector.                                       
                                               Continue promotion and support of U.S. firms for Russian         
                                                continental highway project.                                    
                                               Continue promotion and development support to advance electronic 
                                                road pricing system for charging trucks using U.S. technology   
                                                and equipment.                                                  
                                               Development of other projects in the NIS region that would       
                                                promote U.S. exports of highway-related goods and services.     
Technical Exchange................    300,000  Continue support for the FHWA's World Road Association           
                                                participation and their work programs.                          
                                               Continued support for the FHWA's participation in the World      
                                                Interchange Network, a network which improves the flow of road- 
                                                related technology world-wide.                                  
                                               Continue cooperative program with the Finnish Road Administration
                                                and technical cooperation with the Baltics.                     
                                               Provide logistical support for the U.S./Korean technology        
                                                exchange activities which include a technology exchange workshop
                                                in the U.S.                                                     
                                               Initiate technology exchange program with the New Zealand        
                                                Department of Transport.                                        
                                               Continue FHWA support for OECD cooperative activities.           
                                               Initiate phase II of study of international transportation       
                                                information resources which focuses on a specific technological 
                                                area.                                                           
Foreign Visitor Program...........     75,000  Continued contract for the Foreign Visitor Program.              
                                               Facilitate site visits for foreign visitors, including site      
                                                visits to U.S. technology demonstration and research location.  
South Africa Program..............    300,000  Continue working with republic of South Africa Department of     
                                                Transport (RSADOT) to improve the transfer of technology/       
                                                information in order to strengthen the transition to a post-    
                                                apartheid, democratic governing system. To transfer appropriate 
                                                technology to RSADOT and promote U.S. technology and industry   
                                                through: (A) Holding joint U.S./South Africa pavement workshop; 
                                                (B) Construction of two sections of pavement in the U.S. using  
                                                South African technology; (C) Continue support of training in   
                                                RSADOT and Technology Transfer Centers as appropriate; (D) Link 
                                                U.S. and South African private sectors to promote partnering on 
                                                African projects.                                               
                                               Begin transition of this program into a Sub-Saharan Africa       
                                                Program: (A) In cooperation with the World Bank and RSADOT,     
                                                coordinate the development of Technology Transfer Centers in    
                                                Tanzania and Mozambique. (B) In cooperation with the World Bank 
                                                and other international organizations, identify other sub-      
                                                Saharan countries which would be possible candidates for        
                                                establishing Technology Transfer Centers. (C) Develop strategy  
                                                for including U.S. private sector in these activities.          
                                   -----------                                                                  
      Total funding...............    900,000                                                                   
----------------------------------------------------------------------------------------------------------------


                              FISCAL YEAR 1998 RUSSIAN TECHNICAL ASSISTANCE PROGRAM                             
----------------------------------------------------------------------------------------------------------------
          Program element            Funding                          Program description                       
----------------------------------------------------------------------------------------------------------------
Technical Assistance..............   $400,000  Continue support of FHWA contractor in Moscow, Russia, with the  
                                                following work objectives:                                      
                                                 --Continue institution building in the Russian highway sector  
                                                  aimed at improving processes and organizations within the     
                                                  Russian Federal Highway Service (RFHS).                       
                                                 --Provide guidance to the RFHS during the development of       
                                                  international control procedures for managing and             
                                                  administering its programs.                                   
                                                 --Support U.S. States twinning with counterparts in Russian    
                                                  provinces.                                                    
                                                 --Continued support for Russian technology transfer centers and
                                                  networks.                                                     
                                                 --Establish two new Technology Transfer Centers in NIS states. 
----------------------------------------------------------------------------------------------------------------

    Question. FHWA is requesting almost a doubling in funds for the 
international program. Why is such an increase necessary at this time?
    Answer. The FHWA's request of $900,000 for fiscal year 1998 
represents only a $125,000 increase over the FHWA's fiscal year 1997 
funding level for international activities. For fiscal year 1998, it 
includes funding for the FHWA's South Africa Program which is presently 
being funded through other program areas with GOE funds. The FHWA's 
planned spending for each program is as follows:

------------------------------------------------------------------------
                                                  Fiscal years--        
                                         -------------------------------
                 Program                   1997 funding    1998 funding 
                                              amount          request   
------------------------------------------------------------------------
International Outreach Program..........    $475,000 GOE    $600,000 GOE
South Africa Program....................     \1\ 300,000    300,000 GOE 
------------------------------------------------------------------------
\1\ Technology Assessment and Deployment GOE funds.                     

    Question. Please specify the number of planned and completed 
international scanning trips taken during fiscal year 1996, fiscal year 
1997 and planned for fiscal year 1998. Please specify the total costs 
of these trips for each year and specify which portion of the GOE or 
ISTEA funds supported these trips.
    Answer. See chart below:

----------------------------------------------------------------------------------------------------------------
          Source of funding               Budget                      Names of scanning missions                
----------------------------------------------------------------------------------------------------------------
Fiscal year 1996: Section 6005 ISTEA        $400,000  Bridge Maintenance Coating.                               
 funds.                                               Traffic Management and Traveler Information Systems.      
                                                      South African Pavement and Other Highway Technology and   
                                                       Practices.                                               
                                                      European Traffic Monitoring Programs and Technologies     
                                                       Scanning Review.                                         
Fiscal year 1997: Section 6005 ISTEA         451,000  Advanced Composite Materials in Bridges in Europe and     
 funds.                                                Japan.                                                   
                                                      Study Tour for Road Safety Audits.                        
                                                      Transportation Agency Organization and Management Scanning
                                                       Review.                                                  
                                                      Bridge Structures Scanning Review.                        
Fiscal year 1998: NEXTEA Technology          462,000  Railroad-Highway Grade Crossing Protection Technology and 
 Assessment and Deployment Funds.                      Closing Programs Review.                                 
                                                      Improved Roadway Safety through Application of Intelligent
                                                       Traffic Control Devices, Practices, and System Review.   
                                                      Highway Performance Management System Scanning Review.    
                                                      International Scanning Tour for Geotechnology--Canadian   
                                                       and European Review.                                     
----------------------------------------------------------------------------------------------------------------

    Question. Why can't the State Department fund the technology 
transfer program for the Republic of South Africa?
    Answer. The FHWA did initially hold discussions with Department of 
State officials concerning the availability of funding for the South 
Africa Program. While these officials, as well as officials at the U.S. 
Embassy in South Africa, did agree that the FHWA's program had 
considerable merit, the Department of State indicated that it was 
unable to provide the FHWA with any funding at this time due to 
existing resource constraints. In light of these constraints, and 
because this program has provided a valuable, two-way exchange of 
advanced highway engineering technology and practices for both 
countries, the FHWA is funding this program through its own GOE funds.
    Question. For fiscal year 1996, fiscal year 1997, and planned for 
fiscal year 1998, please specify current or planned funding amounts for 
activities to promote or conduct technology transfer or educational 
activities associated with the Republic of South Africa? What are the 
sources of these monies?
    Answer. The funding amounts are as follows:

        Fiscal year                                                  GOE
1996..........................................................  $800,000
1997..........................................................   300,000
1998.........................................................\1\ 300,000

\1\ Planned estimate.

    Question. Why can't the monies to support the Pan American 
Institute of Highways be funded out of the contract program for the 
National Highway Institute?
    Answer. While the Pan American Institute of Highways (PIH) is 
currently funded through funds from the National Highway Institute 
(NHI), the PIH is in the process of being transferred to the Office of 
International Programs (HPI). The FHWA believes it is preferable to use 
NHI's funding to address the large number of domestic training needs, 
and that PIH's mission can be better realized if it is as a part of the 
Office of International Programs.
    Question. What are the major challenges and opportunities facing 
the international program during fiscal year 1997 and expected for 
fiscal year 1998? How will the reauthorization affect this program?
    Answer. In fiscal year 1997, the Office of International Program's 
primary international challenge has been to make the most of the FHWA's 
existing international commitments while developing a strategy for 
fiscal year 1998 which supports the needs of its customers and partners 
in the domestic highway community and compliments the Administration's 
foreign policy objectives. A part of this strategy includes more 
sharply focusing the FHWA's international cooperative activities to 
gain additional benefits at the present program funding levels. The 
Office of International Programs has identified three primary areas of 
focus for fiscal year 1998 which represent the interests of the FHWA's 
constituents and build on present strengths and investments: (1) 
international scanning and information management, (2) private sector 
support, and (3) support of administration commercial and foreign 
policy initiatives.
International scanning and information management
    The FHWA's international information initiative focuses on meeting 
the growing demands of its partners at the Federal, State, and local 
levels for access to information on state-of-the-art technology and the 
best practices used world wide. While the FHWA is a world leader in the 
area of highway transportation, the domestic highway community is very 
interested in the advanced technologies being developed by other 
countries as well as innovative organizational and financing techniques 
used by the FHWA's international counterparts. This growing interest is 
best demonstrated by the recent creation of the Special Committee on 
International Activity Coordination as a regular part of the American 
Association of State Highway and Transportation Officials (AASHTO). 
This committee was established to better coordinate the international 
activities of AASHTO, including the various members' participation in 
international highway-related organizations.
    To help meet this demand for information on foreign innovations, 
the FHWA has an established International Technology Scanning Program. 
This program serves as a vehicle for assessing and importing foreign 
technologies which could significantly benefit the U.S. highway 
community. This approach is similar to the bench marking process that 
is widely used by major private firms. It allows for advanced 
technology to be adapted and put into practice much more efficiently 
without spending scarce research funds to recreate technology already 
developed by other countries. To date, the FHWA has undertaken over 20 
of these reviews. For fiscal year 1998, the FHWA will continue to 
stress the successful implementation of technology identified through 
the scanning program and work to improve the dissemination of this 
information to the State and local levels.
    The second component of the FHWA's information management strategy 
is improving U.S. transportation officials' access to the large body of 
highway transportation-related information available internationally. 
The FHWA has already sponsored one scanning mission which identified 
these international information resources with the end product being a 
directory for use by U.S. transportation professionals. In cooperation 
with the Transportation Research Board and AASHTO, the FHWA is planning 
a second, more specific study of one technological area in order to 
focus on improving the flow of information into the U.S. and any 
barriers or gaps in information access training which may need to be 
addressed. The results identified through these efforts will be tied 
with the FHWA's on-going efforts to improve the dissemination of 
information collected through its scanning program and the development 
of an overall communications strategy for its international activities.
Private sector support
    The FHWA has developed a marketing strategy for U.S. technology and 
industry to assist the U.S. private sector in meeting stiffer 
competition in the global market place from foreign firms receiving 
support from their own governments. One component of this strategy is 
to ensure that every technical assistance activity in which the FHWA 
participates showcases U.S. technology and U.S. firms. By supporting 
government-to-government relationships, the FHWA is helping to 
establish a U.S. presence and reputation in foreign markets. This can, 
and has, resulted in sales of U.S. technology and services.
    The second component of this strategy more directly supports U.S. 
firms and their international commercial activities. The Intelligent 
Transportation Systems arena in Latin America and South East Asia are 
the first areas where the FHWA is concentrating its efforts. The FHWA 
can directly assist these firms by monitoring regional market 
conditions and identifying suitable local partners for U.S. firms. The 
FHWA also coordinates the participation of U.S. companies in trade 
exhibitions and conferences and ensures U.S. interests are represented 
on international committees and organizations engaged in setting 
standards.
Support of administration commercial and foreign policy objectives
    The FHWA is seeking better ways of supporting the Administration's 
efforts to pool the resources of U.S. Government agencies in pursuing 
U.S. international objectives. The FHWA is conducting a study to better 
understand what other agencies are doing with regard to the export of 
U.S. goods and services. The objective of this study is to identify 
FHWA's appropriate role in the trade promotion process and improve 
coordination with the efforts of the Department of Commerce and other 
agencies which are members of the Trade Promotion Coordination Council. 
The FHWA's technical expertise and leadership in the field of highway 
transportation allows it to fill a special niche role in the U.S.'s 
trade promotion activities.
    The FHWA Office of International Programs also coordinates with the 
DOT Office of International Transportation and Trade and the Department 
of State to respond to specific U.S. foreign policy objectives. Many 
initiatives undertaken by U.S. foreign affairs agencies have 
significant transportation-related implications. The agency also 
supports the Administrations's involvement in the NAFTA, the Free Trade 
Agreement of the Americas, and elsewhere, which complements the U.S. 
government's other assistance efforts in these countries. The DOT will 
be expected to continue numerous interagency initiatives abroad and 
associated technology exchanges.
Reauthorization
    The Administration's reauthorization proposal will not seek a 
change in the current enabling statutes or line item authority for 
particular program elements or country specific projects. Instead, it 
suggests that State DOTs and local entities should become effective 
partners in the FHWA International Outreach Program, by permitting the 
discretionary use of Federal highway research and planning funds for 
certain international activities. State DOT and local officials are 
increasingly involved in FHWA-sponsored technology ``scanning'' 
reviews, as well as the ITS, SHRP and other research and development 
programs which have engendered great international interests and led to 
numerous bilateral cooperation activities.
    Question. Please provide estimates for fiscal year 1996, fiscal 
year 1997, and fiscal year 1998 of the amount of funds used or planned 
to promote the marketing of highway-related technologies abroad. Why is 
this an FHWA function?
    Answer. The market development function on behalf of the private 
sector is one of the principal objectives included in the broad 
enabling statues establishing the FHWA International Outreach Program 
in Title 23, U.S.C., Section 325. In addition, the DOT/FHWA is a 
constituent member of the Interagency Trade Promotion Coordinating 
Council (established by statute), which is continuously refining the 
National Export Strategy, to be developed cooperatively and implemented 
by all 19 participating agencies. This is part of the Administration's 
efforts to maximize resources by engaging all Executive agencies with 
international initiatives in the promotion of U.S. foreign policy 
goals. The FHWA is a world leader in highway technology and the only 
Executive agency with the necessary technical expertise, experience, 
and partnerships with the domestic highway community to fulfill this 
role.
    Estimated funding for promoting the private sector is difficult to 
separate out as a specific amount since these activities are usually 
incorporated as a part of a larger technical exchange or assistance 
program. The estimates are:

Fiscal year:
    1996......................................................  $125,000
    1997......................................................   200,000
    1998......................................................   200,000

    Question. What are the benefits to the United States for this 
allocation?
    Answer. The primary objective of the FHWA's marketing activities is 
to increase the export and sales of U.S. highway-related goods and 
services, thereby benefitting the U.S. economy.
    The FHWA's marketing activities specifically benefit the U.S. in 
three ways: The FHWA supplies much needed information on markets, trade 
shows, and other such events in countries with high export potential. 
This information is particularly helpful to small and medium sized 
companies in the U.S. highway industry that are looking for 
opportunities to become export-ready, but lack the experience or 
resources to seeking out appropriate commercial opportunities for their 
products and services.
    The FHWA provides countries information and training concerning 
U.S. transportation technology and practices. This information and 
training is provided through technology transfer networks and centers, 
bilateral technical assistance programs in selected countries, and the 
international visitor program. Recipient countries are able to more 
effectively use U.S. exports to construct and manage their 
transportation systems.
    The FHWA strengthens and enhances the U.S. participation in the 
development of selected international technical standards to help 
ensure these standards are inclusive of U.S. products. This support is 
important to U.S. companies who are now facing strong competition, 
particularly in Latin America and Southeast Asia, from Asian and 
European companies who have the support of their respective 
governments.
    Examples of benefits are: The FHWA supported Hoffman International 
in its efforts to develop an equipment leasing joint venture in Russia. 
The venture has resulted in shipping over $15 million in U.S. equipment 
to Russia and training in U.S. pavement construction techniques for 
over 80 Russian highway officials and contractors.
    The FHWA's support of the Russian Federal Highway Service's (RFHS) 
efforts to model its highway program after the U.S. highway program 
have resulted in commercial opportunities and design contracts for 
several U.S. firms. The RFHS has set aside exclusively for U.S. firms a 
large design and construction project that would complete the last 
section of the trans-Siberian highway. The estimated export potential 
of this project for U.S. firms is $250 million.
          general administration and oversight regarding lgoe
    Question. Please present a detailed, side-by-side table showing all 
fiscal year 1997 ISTEA contract funds, contract funds requested in your 
reauthorization proposal, fiscal year 1997 GOE funds (with and without 
research and technology support costs--formerly referred to as 
management and coordination costs or M&C costs), and proposed fiscal 
year 1998 LGOE funds related to each category of research, development, 
technology transfer and training (with and without apportioned support 
costs).
    Answer. The information is provided in the following tables.

   RESEARCH AND TECHNOLOGY PROGRAMS, FEDERAL HIGHWAY ADMINISTRATION--   
                MANAGEMENT COORDINATION COST DISTRIBUTED                
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                       Fiscal years--   
                                                   ---------------------
                                                       1997       1998  
                                                     enacted    request 
------------------------------------------------------------------------
Highway Research, Development and Technology \4\..     61,972     73,903
    LGOE:                                                               
        Safety....................................      7,958      9,000
        Materials.................................  .........  .........
        Pavements.................................  \1\ 18,14           
                                                            9     11,150
        Structures................................     13,211     15,256
        Environment...............................      5,061      5,566
        Right-of-Way..............................        300        365
        Policy....................................      4,954      8,000
        Planning..................................      5,477     16,025
        Motor Carrier.............................      6,862      8,541
Intelligent Transportation Systems (ITS) \4\......    229,326    250,000
    LGOE..........................................    116,326     54,000
        Research and Development..................     24,573     33,000
        AHS/Advance Crash Avoidance...............     22,000  .........
        Architecture and Standards................      5,000  .........
        Operational Test..........................     54,992  .........
        Evaluation................................      2,000      9,000
        Mainstreaming.............................  .........      3,000
        ITS Deployment Incentives Program.........  .........  .........
        Commercial Vehicle Operations.............  .........  .........
        ITS Program and System Support............      7,761      9,000
        Advanced Technology Applications..........  .........  .........
    Contract Authority............................    113,000    196,000
        Research and Development..................      4,300     12,500
        AHS/Advance Crash Avoidance...............  .........     26,000
        Architecture and Standards................      7,300     13,000
        Operational Test..........................      5,400     24,500
        Evaluation................................        300  .........
        Mainstreaming.............................     10,000     19,000
        Commercial Vehicle Operations.............  .........  .........
        Priority Corridors........................     71,700      1,000
        National Advanced Driver Simulator........     14,000  .........
        ITS Deployment Incentives Program.........  .........    100,000
Long-Term Pavement Performance (LGOE).............    ( \1\ )    ( \1\ )
Technical Assessment and Deployment (LGOE) \1\....     12,802  \3\ 14,80
                                                                       0
National Advanced Driver Simulator................  .........     12,250
Local Technical Assistance Programs \4\...........      8,764     12,000
    LGOE..........................................      2,764  .........
    Contract Authority............................      6,000     12,000
Rehabilitation of Turner Fairbanks................        500      2,000
Truck Dynamic Test Facility.......................  .........  .........
National Highway Institutes \4\...................      4,167      8,000
    LGOE..........................................      4,167  .........
    Contract Authority............................  .........      8,000
University Transportation Centers.................      6,000      6,000
University Research Institutes....................      6,250      6,000
State Planning and Research.......................     80,367     90,307
Strategic Highway Research Program Implementation.     20,000  .........
    SHRP Implementation (LTPP)....................      6,000  .........
    SHRP Implementation...........................     14,000  .........
Technology Partnership Support....................  .........     11,000
Long-Term and Advanced Research...................  .........     25,000
    LTPP..........................................  .........     15,000
    Advanced Research.............................  .........     10,000
Eisenhower Transportation Fellowship Program......      2,000      2,000
Applied Research and Technology...................     41,000  .........
National Technology Deployment Initiatives........  .........     56,000
Seismic Research and Development Program..........      2,000  .........
Fundamental Properties of Asphalts................  .........  .........
Timber Bridge Research Program....................      1,000  .........
GPS Support.......................................  .........      2,100
R&T Technical Support.............................     10,358  \2\ 10,00
                                                                       0
                                                   ---------------------
      Grand total.................................    486,506    581,360
------------------------------------------------------------------------
\1\ The LTPP program is now incorporated under Highway Research,        
  Development, and Technology.                                          
\2\ R&T Technical Support will be included as a separate line item      
  begining in fiscal year 1998.                                         
\3\ The International Scanning program is now incorporated within       
  Technology Assessment and Deployment.                                 
\4\ R&T Technical Support were distributed among these programs.        


   RESEARCH AND TECHNOLOGY PROGRAMS, FEDERAL HIGHWAY ADMINISTRATION--   
              MANAGEMENT COORDINATION COST NOT DISTRIBUTED              
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                       Fiscal years--   
                                                   ---------------------
                                                       1997       1998  
                                                     enacted    enacted 
------------------------------------------------------------------------
Highway Research, Development and Technology......     67,124     73,903
    LGOE:                                                               
        Safety....................................      8,650      9,000
        Materials.................................  .........  .........
        Pavements.................................  \1\ 19,73           
                                                            1     11,150
        Structures................................     14,362     15,256
        Environment...............................      5,443      5,566
        Right-of-Way..............................        322        365
        Policy....................................      5,328      8,000
        Planning..................................      5,889     16,025
        Motor Carrier.............................      7,399      8,541
Intelligent Transportation Systems (ITS)..........    233,358    250,000
    LGOE..........................................    120,358     54,000
        Research and Development..................     28,605     33,000
        AHS/Advance Crash Avoidance...............     22,000  .........
        Architecture and Standards................      5,000  .........
        Operational Test..........................     54,992  .........
        Evaluation................................      2,000      9,000
        Mainstreaming.............................  .........      3,000
        ITS Deployment Incentives Program.........  .........  .........
        Commercial Vehicle Operations.............  .........  .........
        ITS Program and System Support............      7,761      9,000
        Advanced Technology Applications..........  .........  .........
    Contract Authority............................    113,000    196,000
        Research and Development..................      4,300     12,500
        AHS/Advance Crash Avoidance...............  .........     26,000
        Architecture and Standards................      7,300     13,000
        Operational Test..........................      5,400     24,500
        Evaluation................................        300  .........
        Mainstreaming.............................     10,000     19,000
        Commercial Vehicle Operations.............  .........  .........
        Priority Corridors........................     71,700      1,000
        National Advanced Driver Simulator........     14,000  .........
        ITS Deployment Incentives Program.........  .........    100,000
Long-Term Pavement Performance (LGOE).............    ( \1\ )    ( \1\ )
Technical Assessment and Deployment (LGOE)........     13,811  \2\ 14,80
                                                                       0
National Advanced Driver Simulator................  .........     12,250
Local Technical Assistance Program................      8,827     12,000
    LGOE..........................................      2,827  .........
    Contract Authority............................      6,000     12,000
Rehabilitation of Turner Fairbanks................        500      2,000
Truck Dynamic Test Facility.......................  .........  .........
National Highway Institute........................      4,269      8,000
    LGOE..........................................      4,269  .........
    Contract Authority............................  .........      8,000
University Transportation Centers.................      6,000      6,000
University Research Institutes....................      6,250      6,000
State Planning and Research.......................     80,367     90,307
Strategic Highway Research Program Implementation.     20,000  .........
    SHRP Implementation (LTPP)....................      6,000  .........
    SHRP Implementation...........................     14,000  .........
Technology Partnership Support....................  .........     11,000
Long-Term and Advanced Research...................  .........     25,000
    LTPP..........................................  .........     15,000
    Advanced Research.............................  .........     10,000
Eisenhower Transportation Fellowship Program......      2,000      2,000
Applied Research and Technology...................     41,000  .........
National Technology Deployment Initiatives........  .........     56,000
Seismic Research & Development Program............      2,000  .........
Fundamental Properties of Asphalts................  .........  .........
Timber Bridge Research Program....................      1,000  .........
DGPS Support......................................  .........      2,100
R&T Technical Support.............................   [10,358]  \2\ 10,00
                                                                       0
                                                   ---------------------
      Grand total.................................    486,506    581,360
------------------------------------------------------------------------
\1\ The LTPP program is now incorporated under Highway Research,        
  Development, and Technology.                                          
\2\ The International Scanning program is now incorporated within       
  Technology Assessment and Deployment.                                 

    Question. During the last two years, the Appropriations Committees 
placed a limitation on M&C costs. How did this limitation affect the R, 
D, and T program?
    Answer. There has been no significant or adverse impact on the 
vitality of the R, D, and T program. We have had to shift some program 
funding responsibilities, but this has been done without detriment to 
the program.
    Question. What expenses were reduced as a result of this 
limitation?
    Answer. None of the expenses were reduced; the costs were 
reassigned. Management and coordination has been used as a mechanism to 
ensure that all R, D, and T programs contribute a share of the funding 
to those activities where there is a mutual need or responsibility. To 
stay within the limits which were imposed on the FHWA, we had to shift 
program funding responsibilities. Consequently, there has not been a 
reduction in expenses. There has been a reduction in the cost of the 
management and coordination activity; however, there has been a 
corresponding increase in the cost to certain R, D, and T programs.
    Question. How could the technical support costs be further reduced?
    Answer. It would be extremely difficult to reduce the costs for 
technical support. The contribution to the Small Business Innovation 
Research Program, which is the largest costs under M&C, is fixed by 
law. The increases in our work with the Transportation Research Board 
have been primarily a result of inflation. Our recent increases in the 
editorial and publication support reflect the additional work from 
significant R&D funding increases brought about by ISTEA. We will 
continue to look for ways to reduce the costs of technical support.
    Question. Why is it of critical importance to support the TRB 
visits to States?
    Answer. Each year, the TRB staff members visit every State highway 
and transportation department, many transit agencies, other modal 
agencies and universities, and private industry. During these visits, 
the TRB learns about the problems facing the organizations and passes 
on information pertinent to the solution of these problems; learns of 
research activities in progress or planned, and informs the visited 
organization of ongoing similar activities to avoid duplication; and 
identifies new methods or procedures that might have application 
elsewhere. Although other information sharing exists, such as 
publications and electronic services, one-on-one discussions during 
these field visits explore areas of mutual interest and identify 
innovative or experimental work that will not be published for wide 
dissemination, yet are worth bringing to the attention of others. The 
TRB summarizes and distributes the results of its field visit program 
to the States, FHWA, and other interested parties.
    Question. Please breakout in detail each of the current fiscal year 
1997 contract and associated amounts that FHWA has with TRB. Please 
specify the purposes of these contracts and estimate fiscal year 1998 
continued funding levels.
    Answer.

Fiscal year 1997: Cooperative Agreement.................      $2,611,000
Fiscal year 1998: DTFH61-97-X-00001.....................       2,665,740

    This agreement is FHWA's contribution to TRB and is used to help 
support the following activities:
  --TRB Technical Committees and Publications.--The TRB maintains 
        standing committees in subject areas of interest to the FHWA. 
        The committees promote the exchange of technical research 
        information, advance the state-of-the-art in their respective 
        specialized field, and identify research needs. The Committees 
        also sponsor technical workshops and conferences.
  --TRB Annual Meeting.--The TRB conducts an annual meeting in 
        Washington, D.C., as a forum to review and discuss the results 
        of highway transportation research. Approximately 7,200 people 
        from the United States and around the world participate in the 
        5-day conference, involving over 700 technical sessions and 
        committee meetings. About 75 percent of the sessions and 
        meetings are highway related. In conjunction with the meeting, 
        the TRB provides FHWA with display areas and meeting 
        facilities. The TRB also registers all FHWA employees attending 
        the meeting and provides copies of all highway related papers.
  --TRB's Field Visit Program.--Each year, the TRB staff members visit 
        every State highway and transportation department, many transit 
        agencies, other modal agencies and universities, and private 
        industry. During these visits the TRB learns about the problems 
        facing the organizations and passes on information pertinent to 
        the solution of these problems; learns of research activities 
        in progress or planned and informs the visited organization of 
        ongoing similar activities to avoid duplication; and identifies 
        new methods or procedures that might have application 
        elsewhere. Although other information sharing exists, such as 
        publications and electronic services, one-on-one discussions 
        during these field visits explore areas of mutual interest and 
        identify innovative or experimental work that will not be 
        published for wide dissemination, yet are worth bringing to the 
        attention of others. The TRB summarizes and distributes the 
        results of its field visit program to the States, FHWA, and 
        other interested parties.
  --TRIS.--The TRB maintains a bibliographic database that contains 
        citations and abstracts for research literature published in 
        the transportation field and related disciplines. 
        Transportation Research Information Service (TRIS) personnel 
        also process summaries of research projects in progress being 
        conducted by organizations throughout the U.S. TRIS has been 
        upgraded to integrate document management with the TRIS system 
        by providing each State DOT's with (1) a compatible data entry 
        and text retrieval system to enable uploading of research 
        summaries, and (2) text retrieval capabilities for downloading 
        research summaries.
  --RTCC.--The Research and Technology Coordinating Committee (RTCC) is 
        composed of 15-20 members selected from among researchers, 
        administrators, research users and practitioners from the 
        public, private and academic sectors. The RTCC assists the FHWA 
        by identifying gaps in research, exploring ways to increase 
        State, local and private sector participation in highway 
        research, addressing issues related to the implementation of 
        research results, identifying areas of duplication, and 
        providing a mechanism for gathering research needs.
  --NCHRP-IDEA Program.--The Innovations Deserving Exploratory Analysis 
        (IDEA) program solicits projects with the potential to produce 
        significant technological improvements in the highway community 
        from individuals, public and private institutions, and small 
        and large businesses. Proposals are evaluated by a technical 
        committee and contracts in the amount of $50,000-100,000 are 
        awarded, about 10 projects annually. The FHWA has contributed 
        75 percent of the expenses for the IDEA program, and the States 
        contributed 25 percent. For the fiscal year 1998 program the 
        FHWA share will be 67 percent as the States' contribution will 
        increase.
    Question. Which FHWA sponsored projects or activities does TRB 
manage or help manage? What amount is required to pay for this TRB 
support annually?
    Answer. The Research and Technology Coordinating Committee (RTCC) 
is an FHWA activity that is managed by TRB. The TRB also conducts 
special studies, conferences and reviews when requested by the FHWA. 
The fiscal year 1997 budget for the RTCC is $388,500. The amount for 
special studies, conferences, etc., varies from year to year depending 
on need, but averages about $200,000.
    Question. For each of the major research areas, please prepare a 
chart showing separately LGOE, contract, and other funds provided for 
each of the last five years.
    Answer. The information is provided in the following table.

                         FEDERAL HIGHWAY ADMINISTRATION RESEARCH AND TECHNOLOGY PROGRAMS                        
                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                    Fiscal years--                              
                                    ----------------------------------------------------------------------------
              Programs                  1992       1993       1994       1995       1996       1997       1998  
                                      enacted    enacted    enacted    enacted    enacted    enacted   President
----------------------------------------------------------------------------------------------------------------
Funded by a takedown:                                                                                           
    Highway Research and                                                                                        
     Development...................     28,500     43,860     42,525     55,153     56,772     67,124     73,903
    Intelligent Transportation                                                                                  
     System........................    139,800     30,000     90,300     14,450    109,779    120,358     54,000
    Technology Deployment..........  .........  .........  .........     13,000     12,622  .........  .........
    Long-Term Pavement and                                                                                      
     Performance...................     10,000      6,000      7,000      9,000      8,739  .........  .........
    Advance Research...............  .........  .........  .........  .........  .........  .........  .........
    Technical Assessment and                                                                                    
     Deployment....................      8,000      8,000     12,000  .........  .........     13,811     14,800
    National Advanced Driver                                                                                    
     Simulator.....................  .........  .........  .........  .........  .........  .........     12,250
    Local Technical Assistance                                                                                  
     Program.......................      3,750      4,000        500      3,105      3,015      2,827  .........
    Rehabilitation of Turner                                                                                    
     Fairbanks.....................  .........      1,940      1,250      3,000  .........        500      2,000
    National Highway Institute.....      3,000      4,500      4,500      4,500      4,369      4,269  .........
    University Transportation                                                                                   
     Centers.......................  .........  .........  .........  .........  .........  .........  .........
    University Research Institute..  .........  .........  .........  .........  .........  .........  .........
    State Planning and Research....  .........  .........  .........  .........  .........  .........  .........
    Strategic Highway Research                                                                                  
     Program Implementation (SHRP).  .........  .........  .........  .........  .........  .........  .........
    Technology Partnership                                                                                      
     Fellowship Program (Formerly                                                                               
     SHRP).........................  .........  .........  .........  .........  .........  .........  .........
    Eisenhower Tranportation                                                                                    
     Fellowship Program............  .........  .........  .........  .........  .........  .........  .........
    Applied Research and Technology  .........  .........  .........  .........  .........  .........  .........
    National Technology Deployment                                                                              
     Initiatives (Formerly Applied                                                                              
     R&T)..........................  .........  .........  .........  .........  .........  .........  .........
    Seismic Research and                                                                                        
     Development Program...........  .........  .........  .........  .........  .........  .........  .........
    Fundamental Properties of                                                                                   
     Asphalts......................  .........  .........  .........  .........  .........  .........  .........
    Timber Bridge Research.........  .........  .........  .........  .........  .........  .........  .........
    GPS Oversight..................  .........  .........  .........  .........  .........  .........      2,100
    R&D Technical Support..........  .........  .........  .........  .........  .........  .........     10,000
                                    ----------------------------------------------------------------------------
      Subtotal.....................    193,050     98,300    158,075    102,208    195,296    208,889    169,053
                                    ============================================================================
Direct contract authority:                                                                                      
    Highway Research and                                                                                        
     Development...................  .........  .........  .........  .........  .........  .........  .........
    Intelligent Transportation                                                                                  
     System........................     94,000    113,000    113,000    113,000     97,910    113,000     96,000
    Technology Deployment..........  .........  .........  .........  .........  .........  .........  .........
    Long-Term Pavement and                                                                                      
     Performance...................  .........  .........  .........  .........  .........  .........     15,000
    Advance Research...............  .........  .........  .........  .........  .........  .........     10,000
    Technical Assessment and                                                                                    
     Deployment....................  .........  .........  .........  .........  .........  .........  .........
    National Advanced Driver                                                                                    
     Simulator.....................  .........  .........  .........  .........  .........  .........  .........
    Local Technical Assistance                                                                                  
     Program.......................      6,000      6,000      6,000      6,000      6,000      6,000     12,000
    Rehabilitation of Turner                                                                                    
     Fairbanks.....................  .........  .........  .........  .........  .........  .........  .........
    National Highway Institute.....  .........  .........  .........  .........  .........  .........      8,000
    University Transportation                                                                                   
     Centers.......................      5,000      6,000      6,000      6,000      6,000      6,000      6,000
    University Research Institute..      6,250      6,250      6,250      6,250      6,250      6,250      6,000
    State Planning and Research....  .........  .........  .........  .........  .........  .........  .........
    Strategic Highway Research                                                                                  
     Program Implementation (SHRP).     12,000     16,000     20,000     20,000     20,000     20,000  .........
    Technology Partnership                                                                                      
     Fellowship Program (Formerly                                                                               
     SHRP).........................  .........  .........  .........  .........  .........  .........     11,000
    Eisenhower Tranportation                                                                                    
     Fellowship Program............      2,000      2,000      2,000      2,000      2,000      2,000      2,000
    Applied Research and Technology     35,000     41,000     41,000     41,000     41,000     41,000     56,000
    National Technology Deployment                                                                              
     Initiatives (Formerly Applied                                                                              
     R&T)..........................  .........  .........  .........  .........  .........  .........  .........
    Seismic Research and                                                                                        
     Development Program...........      2,000      2,000      2,000      2,000      2,000      2,000  .........
    Fundamental Properties of                                                                                   
     Asphalts......................      3,000      3,000      3,000      3,000      3,000  .........  .........
    Timber Bridge Research.........  .........  .........  .........  .........  .........  .........  .........
    GPS Oversight..................  .........  .........  .........  .........  .........  .........  .........
    R&D Technical Support..........  .........  .........  .........  .........  .........  .........  .........
                                    ----------------------------------------------------------------------------
      Subtotal.....................    165,250    195,250    199,250    199,250    184,160    196,250    222,000
                                    ----------------------------------------------------------------------------
    ITS Incentive Programs.........  .........  .........  .........  .........  .........  .........    100,000
                                    ----------------------------------------------------------------------------
      Total........................    165,250    195,250    199,250    199,250    184,160    196,250    322,000
                                    ============================================================================
Funded by direct contract authority                                                                             
 and administration takedown:                                                                                   
    Highway Research and                                                                                        
     Development...................     28,500     43,860     42,525     55,153     56,772     67,124     73,903
    Intelligent Transportation                                                                                  
     System........................    233,800    143,000    203,300    127,450    207,689    233,358    150,000
    Technology Deployment..........  .........  .........  .........     13,000     12,622  .........  .........
    Long-Term Pavement and                                                                                      
     Performance...................     10,000      6,000      7,000      9,000      8,739  .........     15,000
    Advance Research...............  .........  .........  .........  .........  .........  .........     10,000
    Technical Assessment and                                                                                    
     Deployment....................      8,000      8,000     12,000  .........  .........     13,811     14,800
    National Advanced Driver                                                                                    
     Simulator.....................  .........  .........  .........  .........  .........  .........     12,250
    Local Technical Assistance                                                                                  
     Program.......................      9,750     10,000      6,500      9,105      9,015      8,827     12,000
    Rehabilitation of Turner                                                                                    
     Fairbanks.....................  .........      1,940      1,250      3,000  .........        500      2,000
    National Highway Institute.....      3,000      4,500      4,500      4,500      4,369      4,269      8,000
    University Transportation                                                                                   
     Centers.......................      5,000      6,000      6,000      6,000      6,000      6,000      6,000
    University Research Institute..      6,250      6,250      6,250      6,250      6,250      6,250      6,000
    State Planning and Research....  .........  .........  .........  .........  .........  .........  .........
    Strategic Highway Research                                                                                  
     Program Implementation (SHRP).     12,000     16,000     20,000     20,000     20,000     20,000  .........
    Technology Partnership                                                                                      
     Fellowship Program (Formerly                                                                               
     SHRP).........................  .........  .........  .........  .........  .........  .........     11,000
    Eisenhower Tranportation                                                                                    
     Fellowship Program............      2,000      2,000      2,000      2,000      2,000      2,000      2,000
    Applied Research and Technology     35,000     41,000     41,000     41,000     41,000     41,000     56,000
    National Technology Deployment                                                                              
     Initiatives (Formerly applied                                                                              
     R&T)..........................  .........  .........  .........  .........  .........  .........  .........
    Seismic Research and                                                                                        
     Development Program...........      2,000      2,000      2,000      2,000      2,000      2,000  .........
    Fundamental Properties of                                                                                   
     Asphalts......................      3,000      3,000      3,000      3,000      3,000  .........  .........
    Timber Bridge Research.........  .........  .........  .........  .........  .........  .........  .........
    GPS Oversight..................  .........  .........  .........  .........  .........  .........      2,100
    R&D Technical Support..........  .........  .........  .........  .........  .........  .........     10,000
                                    ----------------------------------------------------------------------------
      Subtotal.....................    358,300    293,550    357,325    301,458    379,456    405,139    391,053
                                    ----------------------------------------------------------------------------
    ITS Incentive Programs.........  .........  .........  .........  .........  .........  .........    100,000
                                    ----------------------------------------------------------------------------
      Total........................    358,300    293,550    357,325    301,458    379,456    405,139    491,053
----------------------------------------------------------------------------------------------------------------

    Question. Please specify how FHWA obtained its share of the $25 
million of administrative cost savings required in the 1996 DOT 
Appropriations Act. In your fiscal year 1998 budget request have you 
restored these cost savings?
    Answer. To achieve its share of the required fiscal year 1996 
funding reductions, the FHWA continued to implement cost savings 
initiatives which were begun as part of our streamlining efforts to 
implement the NPR objectives. We took reductions in a broad range of 
related administrative areas as we reduced our FTE levels in targeted 
administrative and crosscutting populations. Our cost savings included 
reductions in administrative costs associated with salaries and 
benefits by limiting the backfilling of positions and we realized 
savings in related travel costs, space and facilities costs, and other 
administrative areas. Our fiscal year 1998 budget request has not 
restored these cost savings. We are requesting, however, nominal 
increases in our ADP and communications area to continue to move 
forward with enhancements to our IRM infrastructure which are essential 
as we continue to downsize and redeploy our staff, and streamline our 
operations.
    Question. Are any fiscal year 1997 GOE or ISTEA funds being used to 
pay for various initiatives of concern to OST, the FHWA Administrator, 
or the Secretary that were not specifically requested in the fiscal 
year 1997 budgt? If so, please delineate these expenses in detail.
    Answer. The FHWA has not used any funds for initiatives of OST, the 
FHWA Administrator, or the Secretary that were not requested in the 
fiscal year 1997 budget or authorized under existing law.
    Question. Are you spending any monies during fiscal year 1997 on 
the promotion of technology transfer or educational activities in the 
Republic of South Africa, a summer jobs program related to 
transportation, or the support of possible careers in the 
transportation field for disadvantaged youth?
    Answer. The FHWA is spending fiscal year 1997 funds on program 
activities related to the technology transfer activities between the 
two countries. Approximately half of these activities are education or 
training-related. The U.S. transfers information to South Africa on 
Technology Transfer Centers, education, and training, while South 
Africa transfers technical information on pavement technologies to the 
U.S. Presently, the FHWA is working with two States to plan and 
construct sections of pavement using this South African technology. In 
addition, the FHWA is work with South Africa to develop and present a 
pavement workshop in the U.S. in 1998.
    Question. If yes, please indicate the source and amount of funding 
for each activity listed above and discuss how these expenditures 
affected the amount of funds available during fiscal year 1997 for R, 
D, and T program that were justified in your request. Specify whether 
the funds came from the LGOE account or from other sources.
    Answer. For fiscal year 1997, an estimated $300,000 will be spent 
from Technology Assessment and Deployment GOE funds. Of this, 
approximately $150,000 will be sent on the Technology Transfer Center 
and training activities and the balance on pavement-related technology 
transfer activities. When developing the budget request for fiscal year 
1997, international activities were considered as an element of the 
overall FHWA technology transfer program. These expenditures did not 
affect the amounts of funds available during fiscal year 1997 for 
research, development, or technology transfer programs since the major 
thrust of the FHWA's South Africa program is specifically to exchange 
advanced technical information.
    Question. How much funding is FHWA providing for research conducted 
at or through the Transportation Research Board in fiscal year 1997? 
How much is requested for fiscal year 1998?
    Answer. The FHWA is providing $750,000 in fiscal year 1997 and 
$750,000 in fiscal year 1998 for the Innovations Deserving Exploratory 
Analysis (IDEA) program. These funds are used for projects with the 
potential to produce significant technological improvements in the 
highway community. Proposals are evaluated by a technical committee and 
contracts in the amount of $50,000-$100,000 are awarded.
    Question. Please present a table showing carryover funds for each 
of the last two years for each LGOE category.
    Answer. The information is provided in the following table.

   DEPARTMENT OF TRANSPORTATION, FEDERAL HIGHWAY ADMINISTRATION--TOTAL  
                            CONTRACT PROGRAMS                           
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                  Fiscal years--        
                                         -------------------------------
                                               1995            1996     
                                             carryover       carryover  
------------------------------------------------------------------------
Highway Research, Development and                                       
 Technology.............................       3,761,065       4,308,282
Intelligent Transportation Systems......       4,792,045       4,692,235
Long-Term Pavement Performance..........  ..............         379,371
Technical Assessment and Deployment.....       1,272,414          88,159
Local Technical Assistance Program......         650,206          74,794
National Highway Institute..............         345,361         385,066
Minority Business Enterprise............         492,400         652,764
OJT Skill Training......................       1,150,388          90,345
International Transportation............         332,679         121,791
Rehabilitation of Turner Fairbanks......       2,473,150  ..............
Russia Technical Assistance.............          29,944          10,199
Truck Dynamic Test Facility.............  ..............          22,917
Cost Allocation Study (Truck Size and                                   
 Weight)................................  ..............  ..............
                                         -------------------------------
      Grand total.......................      15,299,652      10,825,922
------------------------------------------------------------------------

    Question. Please prepare a chart of: (a) equipment and 
communications expenses and (b) rent and utilities expenses (p. 30) for 
each of the last five years.
    Answer. The information is provided in the following table.

----------------------------------------------------------------------------------------------------------------
                   Object classification                      1993     1994     1995     1996     1997     1998 
----------------------------------------------------------------------------------------------------------------
GOE:                                                                                                            
    Communications and Utilities Expenses.................    7,805    7,826    8,317   10,120    8,444    9,929
    Rent..................................................  ( \1\ )   16,472   16,619   17,598   17,294   18,275
    Equipment.............................................   10,699    9,598    7,088    3,894    3,512    6,938
MCS:                                                                                                            
    Communications and Utilities Expenses.................      282      309      362      270      240      240
    GSA Rent..............................................      N/A      N/A      N/A      N/A      N/A      N/A
    Equipment.............................................    1,547    3,049    1,287      499      770      900
LGOE (GOE/MCS):                                                                                                 
    Communications and Utilities Expenses.................    8,087    8,135    8,679   10,390    8,684   10,169
    GSA Rent..............................................  ( \1\ )   16,472   16,619   17,598   17,294   18,275
    Equipment.............................................   12,246   12,647    8,375    4,393    4,282    7,838
----------------------------------------------------------------------------------------------------------------
\1\ GSA Rent was paid by OST until fiscal year 1993.                                                            

    Question. Please discuss in extensive detail the need for each of 
the increases proposed on page 39.
    Answer.
                           object class 2300
    The requested increase of $1,474 is required to:
  --Continue the implementation of additional Electronic Data Sharing 
        links between FHWA division offices and their State partners. 
        This will enhance the speed and quality of business processes 
        for delivering the Federal-aid highway program to the State 
        DOT's, including Electronic Data Sharing and Electronic 
        Signatures for Project Authorizations and Agreements and 
        Vouchers for Payment (Current Bill) and access to each other's 
        project databases and e-mail systems, thus improving service to 
        our partners and customers ($100).
  --Provide for the installation and operation of high-speed data lines 
        in FHWA division offices upgrade the speed of the FHWA Wide 
        Area Network to allow for remote access to file server based 
        applications. This will enhance field office access to new 
        graphical user interfaces for nationwide information systems, 
        streamline remote local and wide area network management 
        services, and provide the medium for expanding video-
        conferencing capability--see below ($666).
  --Complete the expansion of the FHWA videoconferencing system to the 
        remaining division offices. This will enhance internal 
        communcations and coordination without increasing travel costs 
        or non-productive travel time ($440).
  --In addition, FHWA is a participant in the US DOT Intermodal Data 
        Network (IDN), which provides ``backbone'' connectivity for all 
        FHWA Headquarters Local Area Networks within the US DOT 
        Headquarters building. The IDN also provides intermodal E-mail 
        links among the DOT Operating Admininstrations and access to 
        the Internet for all DOT employees. As a participant in this 
        network, the Operating Administrations are required to provide 
        funding to support the continuing operations and maintenance of 
        this system ($268).
                           object class 2500
    The requested increase of $1,300 is required to:
  --Provide FHWA with sufficient funding to provide service to 
        mainframe users during the period when systems are being 
        converted to accommodate the Year 2000 (which will require 
        additional mainframe test time), as well as provide funding to 
        begin testing at alternate mainframe sites in the likelihood 
        that the Transportation Computer Center will be consolidated 
        into another site under OMB Bulletin 96-02 and it becomes 
        necessary for FHWA to obtain mainframe support from other than 
        TASC ($600).
  --Provide for annual cost of living adjustment as detailed in the 
        contract for the employees supporting FHWA's nationwide 
        information systems, but no additional level of effort/staffing 
        ($200).
  --Provide services for implementing upgrades to FHWA's Local Area 
        Networks (LAN's) and cover the cost of living adjustment 
        detailed in the contract for employees providing operational 
        support of the FHWA Help Desk, but no additional level of 
        effort/staffing ($200).
  --Provide for necessary upgrading and annual maintenance of 
        Agencywide software site licenses for suites of FHWA's standard 
        PC Office Automation software according to the upgrade/
        migration plan developed by the FHWA Infrastructure Steering 
        Committee. Agencywide site licenses eliminate individual 
        acquisitions and reduce overall costs ($300).
                           object class 3100
    The requested increase of $2,411 is required to:
  --Provide for the implementation of the recommendations of the FHWA 
        Infrastructure Steering Committee to include the purchase of 
        upgraded individual workstations and LAN servers to meet the 
        requirements of new, graphical-based nationwide information 
        systems and to replace the current outdated and unsupported 
        equipment. This is the second year of a three year project 
        ($790).
  --Initiate new IRM improvement projects and local applications 
        development as identified in the annual FHWA IRM Plan to 
        include such items as electronic recordkeeping systems, 
        engineering workstations for electronic plans reviews, enhanced 
        remote LAN access capabilities, expanded electronic data 
        interfaces with State DOT's. These enhancements improve the 
        management and delivery of the Federal-aid highway program to 
        our customers ($1,341).
  --Complete the acquisition of desktop videoconferencing equipment for 
        25 division offices. This will enhance internal communcations 
        and coordination without increasing travel costs or non-
        productive travel time ($250).
  --Emergency replacement of computer equipment for hardware/software 
        that may be stolen, lost, or not cost-effective to repair 
        ($30).
    Question. Why can't these expenses be split funded or spread over 
the next three years?
    Answer. The FHWA's request for increases in Administrative expenses 
included funds for critical IRM infrastructure activities to meet the 
changing role of the FHWA, and further the streamlining of its program 
delivery processes and the restructuring of its organization. These 
funds are required to directly support our program delivery efforts at 
our Division Offices located in each State. They are a part of a multi-
year plan the timing of which is necessary to continue our streamlining 
and restructuring efforts.
    Question. Reprogramming guidelines state that congressional 
approval is required for funding shifts of ten percent or more among 
programs, projects and activities. Did you exceed this 10 percent 
threshold without notification since this requirement went into effect?
    Answer. The FHWA has not exceeded the 10 percent threshold without 
notification since this requirement went into effect.
    Question. Please prepare a table showing actual expenses versus 
appropriated funds as specified in the conference report for each LGOE 
program area and category for fiscal year 1996 and fiscal year 1997 
planned expenses.
    Answer. The information is provided in the following table.

  DEPARTMENT OF TRANSPORTATION, FEDERAL HIGHWAY ADMINISTRATION--FISCAL YEAR 1996 CONTRACT PROGRAMS--FISCAL YEAR 
                                                      1996                                                      
                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                        Fiscal year                             
  Research, development, and technology  -----------------------------------------------------------------------
           transfer activities                1996          1996          1996           1996           1996    
                                           enacted \1\   recissions    enacted \1\    obligations    unobligated
----------------------------------------------------------------------------------------------------------------
Highway Research Development and                                                                                
 Technology.............................    56,772,000   (1,303,000)    55,469,000    (52,851,387)     2,617,613
Intelligent Transportation Systems......   109,779,000   (4,777,000)   105,002,000   (102,471,016)     2,530,984
Long-Term Pavement Perfommance..........     8,739,000     (431,000)     8,308,000     (8,090,190)       217,810
Technical Assessment and Deployment.....    12,622,000     (123,000)    12,499,000    (12,498,410)           590
Local Technical Assistance Program......     3,015,000     (149,000)     2,866,000     (2,865,886)           114
National Highway Institute..............     4,369,000      (42,000)     4,327,000     (4,012,203)       314,797
Minonty Business Enterprise.............    10,000,000     (494,000)     9,506,000     (9,449,860)        56,140
Intemational Transportation.............       500,000      (25,000)       475,000       (425,569)        49,431
Truck Dynamic Test Facility.............       750,000      (37,000)       713,000       (690,083)        22,917
Russian Technical Assistance Program....       400,000      (20,000)       380,000       (370,426)         9,574
Cost Allocation.........................     2,000,000      (99,000)     1,901,000     (1,901,000)  ............
                                         -----------------------------------------------------------------------
      Grand total.......................   208,946,000   (7,500,000)   201,446,000   (195,626,030)     5,819,970
----------------------------------------------------------------------------------------------------------------
\1\ Reflects fiscal year 1996 recessions.                                                                       
                                                                                                                
Note.--Enacted funds are available for 3 fiscal years.                                                          


  DEPARTMENT OF TRANSPORTATION, FEDERAL HIGHWAY ADMINISTRATION--FISCAL  
                       YEAR 1997 CONTRACT PROGRAMS                      
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                              Fiscal year               
                              ------------------------------------------
                                   1997           1997           1997   
                                 enacted    obligations \1\  unobligated
------------------------------------------------------------------------
Highway Research,                                                       
 Development, and Technology.       67,124       (37,158)         29,966
Intelligent Transportation                                              
 Systems.....................      120,358       (71,468)         48,890
Long-Term Pavement                                                      
 Performance.................  ...........  ...............  ...........
Technical Assessment and                                                
 Deployment..................       13,811        (5,919)          7,892
Local Technical Assistance                                              
 Program.....................        2,827        (1,889)            938
National Highway Institute...        4,269          (482)          3,787
Minority Business Enterprise.        9,378        (1,089)          8,289
International Transportation.          475          (251)            225
Russia Technical Assistance..          200           (38)            162
Rehabiliation of TFHRC.......          500          (471)             29
Federal Lands Contamination                                             
 Site Clean-up...............        2,466          (692)          1,774
Transportation Investment....          250          (250)    ...........
Cost Allocation Study........          300  ...............          300
                              ------------------------------------------
      Total..................      221,958      (119,705)        102,253
------------------------------------------------------------------------
\1\ Reflects obligated balances as of 5/31/97.                          
                                                                        
Note.--Enacted funds are available for 3 fiscal years.                  


  DEPARTMENT OF TRANSPORTATION, FEDERAL HIGHWAY ADMINISTRATION--FISCAL YEAR 1997 CONTRACT PROGRAMS--FISCAL YEAR 
                                                      1996                                                      
                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                                  Fiscal years--                
                                                                ------------------------------------------------
   Research, development, and technology transfer activities          1996             1997            1997     
                                                                    carryover    obligations \1\    unobligated 
----------------------------------------------------------------------------------------------------------------
Highway Research, Development, and Technology..................       2,117,613      (1,178,283)        939,330 
Intelligent Transportation Systems.............................       2,530,984      (2,161,086)        369,898 
Long-Term Pavement Performance.................................         217,810          (9,194)        208,616 
Technical Assessment and Deployment............................             590         (73,293)        (72,703)
Local Technical Assistance Program.............................             114         (10,725)        (10,611)
National Highway Institute.....................................         814,797           3,956         818,752 
Minority Business Enterprise...................................          56,140  ...............         56,140 
International Transportation...................................          49,431          (2,635)         46,796 
Truck Dynamic Test Facility....................................          22,917  ...............         22,917 
Russian Technical Assistance Program...........................           9,574          (1,765)          7,809 
Cost Allocation................................................  ..............  ...............  ..............
                                                                ------------------------------------------------
      Grand total..............................................       5,819,970      (3,433,095)      2,386,945 
----------------------------------------------------------------------------------------------------------------
\1\ Reflects obligations as of 5/31/97.                                                                         

    Question. Please assess the costs and benefits of the FHWA 
investment in the Pan American Institute of Highways. Please estimate 
separately fiscal year 1996, 1997, and fiscal year 1998 funds allocated 
or planned for this purpose and provide the funding source of these 
monies.
    Answer.

        Fiscal year                                                  GOE
1996..........................................................  $400,000
1997..........................................................   275,000
1998.........................................................\1\ 200,000

\1\ Planned.

    The benefits of the FHWA investment in the PIH can be summarized in 
the following paragraphs:
    The PIH provides FHWA with an efficient mechanism through which 
FHWA can know of new developments in highway and transportation 
technology in the Americas. This also allows the FHWA to be aware of 
opportunities for U.S. Private Sector and helps to find reliable and 
credible partners for the U.S. Private Sector when needed.
    The FHWA can promote new technologies where the U.S. has a 
technological advantage, such as Intelligent Highway Systems, Highway 
Safety, SUPERPAVE, and similar technologies. This partnership with U.S. 
industry facilitates contacts and setting up of initial meetings that 
can result in sales.
    The PIH provides a forum for developing and implementing 
international standards for highways and transportation technologies.
    The PIH has become a prime example of on operational public/private 
partnership. As of May 1997, 8 U.S. firms are making financial 
contributions to the operation of the PIH Headquarters and they have 
been cooperating with FHWA to send speakers to international events. It 
is anticipated that the number of firms will increase over the coming 
months.
    The FHWA serves as the Headquarters for the PIH, and as such plays 
a major role in setting the agenda for international congresses, 
conferences, and other such events, ensuring that U.S. firms are given 
favorable treatment at trade shows and international conferences held 
throughout the region. This also allows the PIH to know of when and 
where the events will take place so that it can then make sure 
interested U.S. firms know of the events. The PIH can even assist 
representatives from U.S. firms in making the appropriate initial 
contacts.
    With a network of 80 Technology Transfer Centers throughout the 
Americas, the PIH provides FHWA with a programed and efficient 
mechanism to respond to and interact with the highway community of the 
Americas. This mechanism provides a focused, efficient, and effective 
base from which to respond to numerous requests for technical 
assistance, training, technical materials, software, and contacts for 
goods and services produced in the U.S.
    Through the PIH Network, the FHWA identifies and selects 
outstanding young professionals from throughout the Americas who can be 
brought to the U.S. to work on specific projects of research and 
technology transfer. These professionals take back a familiarity with, 
and often a preference for U.S. highway products and technologies which 
helps U.S. firms in establishing market foot-holds in these countries.
    Question. What were the actual fiscal year 1996 and what are the 
expected fiscal year 1997 M&C expenses?
    Answer. The actual fiscal year 1996 expenses were $8,535,868, and 
the estimated expenses for fiscal year 1997 are $10.7 Million.
    Question. In recent years, FHWA has held the line on its 
administrative costs. Why do you judge it essential to increase these 
expenses during fiscal year 1998?
    Answer. Other than for cost-of-living increases for our approved 
level of employees, our fiscal year 1998 Budget request includes 
nominal increases in our ADP and communications areas to continue to 
move forward with enhancements to our IRM infrastructure, and a small 
increase for Permanent Change of Station (PCS) moves. These are 
essential as we continue to downsize and redeploy our staff, and 
streamline our operations. The increase, excluding the increase for our 
Motor Carrier operations, represents only a 2.7 percent increase over 
the enacted fiscal year 1997 annual administrative funds.
    Question. Please further justify in detail why increases are sought 
in travel expenses.
    Answer. Increases in travel are requested to implement field-wide 
training initiatives and to provide technical assistance to States.
    With the transfer of the responsibilities of the Interstate 
Commerce Commission and subsequent rulemakings which affect how those 
responsibilities are carried out, the FHWA must develop and conduct 
training of its field staff and state partners. These enforcement 
personnel do not have the appropriate background nor have they been 
trained to enforce registration and insurance provisions of economic 
regulations.
    In addition, the Federal Motor Carrier Safety Regulations are 
undergoing a complete renovation as a result of FHWA's zero base 
regulatory reform project. The Federal and State enforcement staff must 
be trained in the use of these new regulations which are critical to 
developing enforcement cases.
    To provide the necessary training for these two initiatives and to 
make the most efficient use of Federal funds, the FHWA plans to train 
Federal staff on both programs during the same session.
    The FHWA also requests travel funds to provide a national network 
of Federal personnel to educate judges and legislators on commercial 
vehicle safety programs and advise them on procedures and methods to 
uniformly apply fines and penalties for non-compliance. Courses and 
educational materials have been developed and are ready for delivery to 
the target audience. The result of this assistance will be effective 
judicial and legislative support for commercial motor vehicle safety.
    Question. Please list all reports prepared by the FHWA Office of 
Program Review, key recommendations of each report, and resulting 
improvements in FHWA policies and programs.
    Answer. The Office of Program Quality Coordination (formerly the 
Office of Program Review) list of reviews and status of recommendations 
July 1997:
                              1986 reviews
    ``Turnkey''--Right-of-way Projects.--Led to a model contract to 
carry out full-service acquisition and relocation for local public 
agencies (LPA's) by consultant or State. Many LPA's adopted these 
provisions for obtaining specialized consultant services. (Closed.)
    Design Monitoring Program.--Pre-ISTEA Report stressed early review 
of major projects and more process reviews. (Closed.)
    Financial Management Program.--Led to a Handbook which increased 
flexibility in reviews and reports. (Closed.)
    The use of Consultants.--Led to revised regulations whereby the 
FHWA approved consultant selection processes of States based on more 
definitive guidance. Removed FHWA from review of contracts. (Closed.)
                              1987 reviews
    Bridge Replacement and Rehabilitation Program: Unit Cost 
Determination.--Assessed how unit costs are determined by States. Led 
to the clarifications by the FHWA and reduced data requirements on 
States. (Closed.)
    Contaminated Sites: Impact on Highway Project Development and 
Construction.--Early effort to assess issues and address policy. Led to 
guidance on early testing, avoidance, mitigation, and acquisition of 
sites and potential for State liability. This was followed by training. 
(Closed.)
    Incentive/Disincentive for Early Contract Completion.--Led to the 
issuance of a Technical Advisory on I/D Contracting and provisions for 
A+B bidding. These procedures are now widespread throughout the 
country. (Closed.)
    Managing Unexpended Balances of Obligated Funds.--Review curtailed 
after agreements were reached on providing improved reporting and 
controls. (Closed.)
    Motor Carrier Safety Assistance Program.--Reviewed and commented on 
Chapter 3 of the Motor Carrier of Safety Manual--Guidelines for the 
review of MCSAP. (Closed.)
    RD&T Contracts and Staff Research Program.--Looked at changes in 
the Research Program management as well as the need for basic research. 
Both areas were changed based on a RD&T Actions Plan. (Closed.)
                              1988 reviews
    Evaluation of FHWA'S Wetland Program.--Assessed effectiveness of 
discussions in the environmental document on wetlands values and 
avoidance to minimize problems at the 404 Permit Stage. Led to 
additional guidance and delegated levels of approval. (Closed.)
    FHWA Training System Review.--Reviewed the implementation of Task 
Force recommendations to set goals, narrow course offering, properly 
schedule call for training, ensure courses offered, timely approvals 
and guidance on management training. Report concluded all 
recommendations fulfilled. (Closed.)
    I-4(R) Apportionment--Vehicle Miles Traveled (VMT) Determination.--
Evaluated the effectiveness of the FHWA oversight of the State's data 
collection, analysis and reporting of VMT. Concluded data collection 
and oversight had weaknesses. Led to a definitive policy on oversight 
and major efforts to upgrade collection. (Closed.)
    Property Management Program: Disposal of Excess Property.--Assessed 
the impact of a policy directing States to dispose of excess property 
in a 2-year time frame. Found time frame too exacting and led to 
numerous improvements in management systems. (Closed.)
    Marketing of FHWA'S Research Program.--Determined that the FHWA's 
ability to transfer technology (TT) had eroded over the years. Resulted 
in TT becoming a strategic goal of the agency. Led to policy changes, a 
field focus and employment of staff with professional marketing skills. 
(Closed.)
                              1989 reviews
    Administrative and Legal Settlements Program Evaluation.--Assessed 
the application of legal and administrative settlements in the Right-
of-Way Program. Led to an optional, appraisal-free administrative 
settlement approach for properties under $2,500 (30-40 percent of 
acquisitions), and more liberal application of legal settlements to 
avoid costly court proceedings. (Closed.)
    Local Public Agency (LPA) Acquisition Program Evaluation.--
Reassessed State oversight and assistance to LPA's in Right-of-Way 
acquisition. Determined most States were performing satisfactorily. 
Recommended more State up-front assistance and training, and more 
utilization of simplified techniques. The FHWA updated its ``Real 
Estate Acquisition Guide for LPA's'' to accomplish these objectives. 
(Closed.)
    A Study of the FHWA Audit/Review Follow-up Processes.--Studied the 
FHWA methods for implementing audit recommendations. Resulted in a 
central clearing house for follow-up and an upgraded response system. 
(Closed.)
    Use of Consultants for Construction Engineering and Inspection.--
Review determined wide variations in practice and a high level of 
confusion. The FHWA issued a Technical Advisory to assist States in 
developing and negotiating contracts, and to provide technical guidance 
to the FHWA on program oversight. (Closed.)
                              1990 reviews
    Access Management Program Evaluation.--Looked at the management of 
Access Control (AC) on the Interstate System and other principle 
arterial. Concluded policies and training programs were effective. 
Specific recommendations with regard to fencing of AC facilities for 
safety and clarification on the selling of access were issued. 
(Closed.)
    Bus Safety Inspection Program.--Recommendations led to actions that 
formally incorporated bus safety inspections into State Enforcement 
Plans and the Office of Motor Carriers oversight programs. (Closed.)
    Evaluation of Relocation Services.--Found instances where project 
schedules resulted in insufficient time for adequate relocation 
services. Guidance issued and a follow-up review was scheduled. 
(Closed.)
    Traffic Control Systems Operations and Maintenance.--Found most of 
the 24 systems reviewed to be operating at less than optimum conditions 
due to a lack of local technical expertise. An Action Plan was 
developed focusing on nine priority recommendation and implementation 
was begun. A follow-up review was scheduled. (Closed.)
    Independent Assurance Sampling and Testing.--Found wide variations 
in the FHWA program administration and State certification practices. 
Resulted in improved internal guidance and training and increased 
emphasis on accredited State labs and certified technicians. (Closed.)
    Bid Rigging Review.--Reviewed progress made on program controls and 
developed a list of most susceptible States for the OIG. Led to 
increased emphasis on computer analysis. (Closed.)
                              1991 reviews
    Effect of Hazardous Waste on the Acquisition Process.--Found the 
FHWA Division Offices and States handling hazardous waste 
considerations properly. Updated some training and guidance. (Closed.)
    Pan American Institute of Highways Evaluation.--Reviewed the 
strengths and weaknesses of this technology transfer institution and 
developed an Action Plan to improve performance long term. (Closed.)
    A Report on the FHWA'S HP&R Research Program.--Reviewed the FHWA's 
management of the program and made recommendations which were 
implemented to delegate authority, improve efficiency and broaden 
involvement in program development. (Closed.)
    A Review of the Fiscal Management Information System (FMIS) 
Technical Data Elements.--Determined that data input quality varied by 
elements and usage. Some data elements on pavements, safety, and right-
of-way were dropped as requirements. (Closed.)
    A Report on Technical Expertise (T.E.) Needs Within FHWA.--Internal 
report assessed T.E. needs. It was used by the Strategic Planning Group 
on Human Resources Goal, and by a reorganization task force. A similar 
study is currently underway by a consultant to the FHWA. (Closed.)
                              1992 reviews
    Periodic Inspection of Commercial Motor Vehicles.--Determined the 
extent to which interstate commercial vehicles were complying with 
Federal inspection requirements. Report was disseminated throughout the 
agency with direction to implement. (Closed.)
    Management of Highway Airspace.--Recommended that policy on 
airspace management and credit be clarified and encouraged a single SHA 
Office be designated responsible. Policy was issued and Divisions 
worked with States to assign responsibilities. (Closed.)
    Value Engineering Change Proposals.--Assessed the relative progress 
being made on implementing Value Engineering (VE). Concluded that while 
most States have a VE construction specification, actual usage was 
limited. Recommended increase marketing of the process by the FHWA and 
States and more efficient handling of change proposals. With the ISTEA 
requirements for VE and the FHWA endorsement, VE applications have 
increased. (Closed.)
    Design Exception Process.--Assessed the analysis and documentation 
of design exceptions under the ISTEA. Recommendation led to the 
issuance of a single policy statement for all design exceptions. 
(Closed.)
                              1993 reviews
    Relocation Services Revisited.--This review was a follow-up to a 
1990 review. The review concluded that improvements had been made to 
the program such that time allowances and services to relocatees were 
adequate. (Closed.)
    Evaluation of Environmental Mitigation.--Determined that 
environmental mitigation measures were effective and for the most part 
were being fully implemented. Recommended sensitivity training be 
developed for State and Federal construction and maintenance staffs and 
measures to ensure implementation of mitigation. (Closed.)
    Contractor Acceptance Sampling and Testing.--Recommended 
clarification of the FHWA's policy on Contractor Sampling and Testing. 
Resulted in a policy to accept Contractor Performed Sampling and 
Testing (CPSAT) as a part of an overall, well documented Quality 
Management System. (Closed.)
    Report on Stewardship Under the ISTEA Program Efficiencies.--
Assessed the impact of the oversight exemptions allowed by the ISTEA on 
FHWA Stewardship. Concluded that all States had taken some forms of 
exemptions; although some reluctantly. Also, found extremely strong 
support for maintaining the geographically assigned area engineers. 
Specific recommendations on guidance and best practices were assigned 
to program managers which were reported on at the following FHWA/AASHTO 
Annual Meeting. (Closed.)
    FHWA Specification Approval Process.--Recommended a strong 
facilitation and technical assistance role for the FHWA Headquarters 
Office of Construction and Maintenance (C&M) in the Specifications 
Approval Process. Recommended a continuing involvement by the field 
offices of the FHWA in the development and enhancement of State 
specifications. Led to an Action Plan by C&M which produced 
computerized AASHTO guide specifications in clear, concise language. 
(Closed.)
    Identification of Procedural Differences on Transit/Highway 
Projects.--A joint FHWA/FTA team looked at similarities and differences 
in the FHWA's and FTA's administration of jointly funded projects. An 
Action Plan has been developed to implement the twelve recommendations 
of this report. These recommendations impact legislative and 
regulatory, as well as operations and coordination. (Open.)
    A Report on Research and Development (R&D) Contracting and 
Assistance.--The FHWA staff teamed with academia and private industry 
to look at ways the FHWA R&D Program's contracts and procurements 
procedures could be broadened to facilitate more basic (long-term) 
research. Resulted in formal guidance being directed and an overall 
coordinator for the program being designated. (Closed.)
                              1994 reviews
    The Implementation of Transportation Enhancements.--Concluded that 
the TE program had sufficient projects to not lapse funds in the 
setaside. However, a the nature of the program (i.e., large number of 
small, local projects of nontraditional nature) is such that Federal 
requirements are costly and cumbersome. Led to many State and Federal 
initiatives to improve program efficiency. Also, had legislative and 
regulatory considerations that have been explored during 
reauthorization. (Pending.)
    Report on the Follow-up Review of the Operation and Maintenance of 
Traffic Control Systems.--This was a follow-up to the 1990 review. This 
study concluded that progress had been made since the 1990 report on 
that front. It recommended a strong role for the FHWA in the 
development of these systems to continue to improve technical expertise 
and to facilitate technology deployment and transfer. (Open.)
    State Oversight of Locally Administered Federal-aid Projects.--
Reviewed State oversight and control of local projects which for the 
most part are not on the National Highway System (NHS). Concluded that 
State practices vary greatly on degree of oversight. Study identified 
several best practices and recommended specific areas requiring State 
oversight and the need to provide guidance and leadership in those 
areas. The FHWA Division Offices were directed to take the lead in 
follow-up actions. (Pending.)
    Review on the use of Partnering in Federal Highway Programs.--
Looked at the implementation of partnering and assessed best practices. 
Concluded major benefits in both design and construction partnering. 
Found that partnering works best where operating criteria are developed 
and project personnel are empowered. There is a need for management to 
continually assess how the program is working. Transmittal asked the 
FHWA Division Administrators to be proactive in advancing the 
partnering concept and best practices. (Pending.)
    Report on the Surface Transportation Program (STP) Safety Setaside 
Program.--Assessed the impact of the STP setaside for safety, State 
methodologies and the FHWA program involvement. The Report recommended 
a continuing program involvement at the Division level including 
implementing certain technical aspects of the Program and for 
Headquarters and Regions to take a more active role in meeting 
technical and data needs and overall technology transfer. (Pending.)
    Kazakstan Transportation Mission.--This review, at the request of 
the Kazakstan Government, assessed the current transportation (air, 
rail, highway, and transit) infrastructure and recommended a plan of 
action between the FHWA and Kazakstan Ministry of Transportation. The 
areas covered technical assistance and future cooperation. (Closed.)
    Joint FHWA/Caltrans/Industry Task Force.--Documented lessons 
learned during the Northridge Earthquake to facilitate future emergency 
relief efforts. Recommendations have been enacted to make these lessons 
to future emergencies, recommendations included emergency teams, 
Incentive/Disincentive clauses with A + B Bidding, quick funding 
mechanisms, open communications, etc. (Closed.)
                              1995 reviews
    The FHWA Oversight of the Central Artery/Third Harbor Tunnel 
Project.--Assessed the quality of the FHWA oversight on the Harbor 
Tunnel Project. Concluded overall oversight was excellent and 
commensurate with the level of activity underway. Made specific 
recommendations accepted by the field staff with regard to adding 
process reviews to design and construction monitoring. These included 
impact of tight design schedules on plans, quality, delegations of 
approval authority for nonmajor changes and extra work, and more 
empowerment of the area engineer staff. (Open.)
    Tracking of its Expenditures in FMIS.--Reviewed the type of data, 
consistency/quality of data, and use and retrieval of FMIS information. 
Concluded that data sets did not meet program office needs; data input 
needed more guidance, training, and control; retrieval should be more 
user-friendly. A series of recommendations have been submitted to the 
program office responsible for FMIS which is working to update FMIS to 
meet overall program needs. (Pending.)
    The Federal-aid Highway Program the District of Columbia Department 
of Public Works (DC DPW).--This report used a Federal/State/Industry 
team to assess DC DPW staff capabilities in all functional areas and 
made extensive recommendations concerning organization, staffing, 
training, computer systems, budget, procurement and finance. Resulted 
in the formation of a DC transportation trust fund, a memorandum of 
understanding concerning operational efficiencies, technical assistance 
offered and provided by the FHWA, and the design of a transportation 
element as a part of the President's proposed D.C. Revitalization Act 
of 1997. Coordination with the DC DPW indicates progress has been made 
on many fronts but substantial effort remains to overcome many 
impediments. (Open.)
                              1996 reviews
    Evaluation of Maintenance and the use of Preventive Maintenance on 
the Interstate System.--Looked at the value of the Annual Interstate 
Maintenance Program (IMP) Report, preventive maintenance practices of 
the Interstate System and the effect of of Interstate Maintenance Funds 
(IM) transfers on the program. Concluded the Annual Report was of 
little value to the program and that transfers have not diminished IM 
effectiveness. Recommended a broader IM program to stress preventive 
maintenance. Based on these findings, Headquarters has dropped the 
Annual Report requirement and has recommended system preservation as an 
eligible item for IM funding under reauthorization. (Pending.)
    Stewardship Follow-up Review.--Took another look at field office 
stewardship following the 1993 review. Concluded that the Agency 
continues to make progress in its transition from project oversight to 
program quality improvement. Recommendations were accepted by the FHWA 
Executive Director and issued as a policy response to the FHWA 
management. Included was clear cut guidance on the FHWA role in non-NHS 
projects, commitment to customer responsive training and strong 
technical expertise, and the dropping of the Headquarters requirement 
for Division Office Stewardship Plans. In addition, Headquarters 
recognized States' comments on the need for strong Division Offices and 
a continued strong emphasis on interagency coordination. (Pending.)
    Process Review/Product Evaluation (PR/PE) Program: Use and 
Practices Within FHWA.--Looked at PR/PE as a tool for oversight within 
the FHWA and concluded that its employment continues to grow. The 
report noted concern that this technique can not be the only means to 
accomplish the FHWA objectives. It noted strong State support for 
overall program management as opposed to project management. It 
provided a list of best practices for quality improvement. As a result 
of this review, Headquarters revised its overall stewardship philosophy 
to one of program management to achieve continuous quality improvement. 
It noted PR/PE as one aspect of this. The report also contained 
specific recommendations to broaden PR/PE training to encompass total 
quality enhancement, to focus on proliferation of best practices and to 
move toward more partnering and joint reviews. (Pending.)
    A Review of State Transportation Improvement Programs (STP) and 
Metropolitan Transportation Improvement Program (TIP).--Joint FHWA/FTA 
review found overall support for the TIP/STIP processes as mandated by 
the ISTEA. Recommended some ``clean up'' exceptions affecting 
legislation or regulation, long-term administrative and short-term 
administrative procedures. These include more cooperative financial 
target setting, more flexible certifications and plan updates, more 
FHWA/FTA compatibility, more State/MPO plan compatibility, more 
widespread access to Federal financial information and more education 
and training. The FHWA and FTA have developed an Action Plan to address 
each of these recommendations. (Pending.)
    Interagency Coordination With Federal Agencies During the FHWA 
Project Planning and NEPA Processes.--Looked at the role of the FHWA, 
State, and other Federal agencies in the NEPA/Project Planning process 
and established a current baseline of operations. Found a variety of 
conditions and an outstanding list of best practices. Laid out a 
framework of recommendations at each level of the FHWA to improve 
communications and understanding, determine and implement best 
practices, and move the Agency and others to a resource preservation 
concept of environmental enhancement on a programmatic basis as opposed 
to ``postage stamp'' types of spot mitigation on individual F/A 
projects. (Pending.)
                              1997 reviews
    The following reviews are currently underway:
  --Review of Longitudinal Utility Accommodation
  --Efficiencies in Program Delivery of Small Federal-aid Programs
  --Early Environmental Considerations in Planning Process
  --Federal Role in Highway Safety
    Question. Was there an additional or separate tithing for ADP 
support or for the FHWA electronics laboratory that was not included in 
the TFHRC support and overhead charges during fiscal year 1997?
    Answer. No, the costs for ADP support and the FHWA electronics were 
charged directly to offices that received the benefits.
    Question. How was the study on the District of Columbia 
transportation needs paid for? How did this expense affect the R&D 
programs?
    Answer. The FHWA paid for the study with funds from prior years' 
balances. It did not affect expenditures for the research program in 
fiscal year 1997.
    Question. Please breakdown and futher justify the $934,000 
requested for high speed data lines on p. 35 of the justification.
    Answer. FHWA's Wide Area Network, installed using GSA's FTS 2000 
network, provides FHWA field offices with access to e-mail, FHWA's 
Intranet, the Internet and to FHWA's nationwide information systems, 
which are processed at the US DOT Transportation Computer Center. The 
network was installed in 1992 and provides access to 64 FHWA field 
offices for agencywide E-mail and for access to FHWA's nationwide 
mainframe systems, which are used by FHWA field offices to track 
funding and project data for the $20 billion Federal-aid highway 
program. The State DOT's also directly access and transmit data 
electronically to these mission-critical mainframe-based systems. Since 
that time the usage of the network has been expanded to handle video 
conferencing, access to the Internet and to FHWA's (internal) Intranet, 
and to additonal field offices, including DOT's new intermodal 
Metropolitan Offices.
    To cover the increasing usage and to provide the bandwidth required 
to maintain satisfactory response times for access to the information 
systems that are used to manage the Agency's programs, it has become 
necessary to upgrade the line speeds and connections to the Wide Area 
Network. The request for additional funding provides for upgrading the 
data circuits to FHWA's Division Office in each State and for the 
increased cost of operating these upgraded data circuits. It also 
covers data communications costs for the new intermodal Metropolitan 
Offices. This line item also supports the data lines that provide 
access for all FHWA employees to the standard, Department-wide 
administrative systems that are processed for DOT by the FAA. With the 
new Management Information Reporting capability for the DOT-wide 
personnel and accounting systems, FHWA's data access to these systems 
will increase significantly. In addition, as the FHWA implements more 
client/server applications that have graphical user interfaces and that 
transfer increasing amounts of data between the application server and 
the individual desktop PC's, additional data line capacity is needed to 
accommodate these systems. This increase will provide this required 
additional data transfer capacity and speed. ($666)
    In addition, FHWA is a participant in the US DOT Intermodal Data 
Network (IDN), which provides ``backbone'' connectivity for all FHWA 
Headquarters Local Area Networks within the US DOT Headquarters 
building. The IDN also provides intermodal E-mail links among the DOT 
Operating Admininstrations and access to the Internet for all DOT 
employees. As a participant in this network, the Operating 
Administrations are required to provide funding to support the 
continuing operations and maintenance of this system. ($268)
    Question. Please discuss the components of FHWA's latest strategic 
plan, GPRA initiatives, and total quality management objectives and 
analyze how these are reflected in the fiscal year 1998 budget request.
    Answer. The FHWA is currently in the process of developing a 
Strategic Plan for 1998 through 2003 that will reflect the programs and 
funding levels in reauthorization. The Vision, Mission, Strategic 
Goals, and Values sections of the Plan have been developed and we are 
currently in the process of developing measurable objectives, 
indicators and strategies. Over the past several months we have 
consulted with our customers and partners to get their input into 
defining our objectives and indicators through a series of focus group 
meetings in Washington and a Federal Register notice requesting written 
comments from those who were unable to attend a focus group meeting. 
The first draft of the strategic plan will be presented to agency 
management for consideration in August and we expect to have the draft 
ready for review outside of the agency by the Fall. The Plan will not 
be completed until after the reauthorization since the final plan may 
need to be adjusted to reflect changes in program design and funding 
levels from those proposed by the Administration.
    The FHWA strategic planning process is considered to be a key 
component of the agency's quality management initiative. Strategic 
planning is one of the cornerstones of quality in the President's award 
criteria and we are implementing a process that is consistent with this 
criteria. In addition, our strategic planning process includes many of 
the other characteristics of a well managed organization: customer 
focus, an emphasis on results, and performance measurement. Since these 
are also key components of the GPRA initiative, the performance 
information required by GPRA are a product or our quality management 
initiative. This has eliminated the need for creating a separate 
process to initiate GPRA.
    The FHWA Strategic Plan and the Program Performance Plans being 
developed by our three major programs, Federal-aid, Federal Lands and 
Motor Carriers for fiscal year 1999, will provide the performance 
information required by the GPRA initiative for our budget submissions. 
Although these plans were not ready at the time the fiscal year 1998 
budget request was completed, the fiscal year 1998 request did include 
some preliminary performance information to show how the agency 
expected to use the resources requested to meet its goals and 
objectives. For example, the Federal-aid Program identified as one of 
its goals an increase in the percentage of mileage of pavements in good 
condition on the National Highway System as measured by pavement 
condition (PSR or IRI) and discussed the expected impact of available 
Federal, State and local funding for highways on our ability to meet 
this goal. However, performance indicators and baseline data were not 
available for many of the goals and we were unable to fully link 
resources to expected results. We expect to have a more complete set of 
goals and indicators available for the fiscal year 1999 budget request 
but there will still be gaps in our ability to link resources to 
results. The next phase in our implementation of performance based 
management will be focused on collecting and analyzing the data needed 
to identify these links and to doing the in-depth analysis required to 
better understand the causal relationships between our programs and the 
goals we are working to achieve in cooperation with our partners.
    Question. Please prepare a list of any reports or letters that were 
requested during the last three years by either of the Appropriations 
Committees that have not yet been submitted, and discuss their status 
and expected submittal date.
    Answer. The outstanding reports as of June 1997 are as follows:
    House Report ``Belford Ferry Terminal''.--Status--The report is in 
the final stages of the analysis should be released by August 1997.
    Senate Report ``Multimodal Noise Prediction Model''.--Status--
Conducting research and final report should be released Spring 1998.
    Senate Report ``User Financed CVISN''.--Status--A report which will 
lay out both the methodology for determining the transition and a plan 
of action will be ready in September 1997.
    Conference Report ``Pilot Safety Rating Program''.--Status--
Developing a pilot project expect to release the report in February 
1998.
    Senate Report ``Commercial Drivers License''.--Status--
Incorporating changes and expect release date July 31, 1997.
    Senate Report ``Motor Carrier 5-year Research Plan''.--Status--
Incorporating OMB/OST changes expect to release September 1997.
    House Report ``I-5 Corridor in California''.--Status--FHWA (ITS), 
FTA and the California DOT, are developing a comprehensive 
transportation plan, report released date to be determined.
    Senate Report ``Commercial Vehicle OPS Network Cost-Share''.--
Status--Developing a preliminary report expected to release October 
1997.
    Senate Report ``Grade Crossing Plan''.--Status--FHWA completed its 
study and FRA is in the process of making update, release date to be 
determined.
    Question. What is the scope and nature of the research, development 
and technology transfer activities actually conducted at Turner 
Fairbanks? How are these activities integrated into the FHWA R, D, and 
T program?
    Answer. The Turner-Fairbank Highway Research Center (TFHRC) is the 
primary location for research and development (R&D) within FHWA. The 
major areas of R&D performed at the Center include safety, intelligent 
transportation systems, pavements, structures, and materials. The 
activities of the Center are integrated into the FHWA's R, D, and T 
program through the Research and Technology Coordinating Groups and the 
Research and Technology Executive Board (RTEB). Technical staff from 
the Center serve as members on the individual coordinating groups where 
the R, D, and T programs are developed. The Associate Administrator for 
R&D who is responsible for the TFHRC serves on the RTEB which approves 
the programs.
    Question. Please breakout the total annual costs required to 
maintain and operate the Turner Fairbanks Research Center.
    Answer. The information is provided in the following table.

                        [In thousands of dollars]

        Item                                                      Amount
Salaries and Benefits.............................................10,031
Utilities.........................................................   550
Communications (voice only).......................................   412
Alterations.......................................................    50
Supplies..........................................................    70
Other Services.................................................... 1,200
                        -----------------------------------------------------------------
                        ________________________________________________
      Total.......................................................12,313

    Question. Please evaluate the benefits and costs of maintaining the 
Turner Fairbanks Research Center.
    Answer. The benefits of the TFHRC far outweigh the costs of 
maintaining the Center. Regarding general benefits, the Center:
  --has a critical mass of highway research in one place. The Center 
        has significant capabilities both in the areas of research 
        laboratories and research intellect.
  --provides research, services, and technology that others can't 
        either because of limited resources or for intellectual 
        reasons. This role is especially true in the area of long-term, 
        high risk research. TFHRC has essentially the same number of 
        PhD's that all the State highway agencies have combined in the 
        research area.
  --provides economy of scale in having a collection of unique 
        laboratories in one place rather than having these laboratories 
        located throughout the country. Everyone cannot afford to have 
        each of these laboratories.
  --helps provide legitimacy for a national highway program. Since we 
        are national in scope, the results of our R&D can be much more 
        easily adopted on a national scale.
  --provides training in cutting edge technologies.
  --serves as an arbitrator and final authority on many highway 
        technology issues.
  --a complete research facility at TFHRC permits and encourages the 
        synergy among staff that results in improved technologies in 
        related fields as well as more innovations in the specific 
        fields of endeavor. As an example we will just touch on 
        pavements and the impact of TFHRC work over the last several 
        years. Today's (and tomorrow's) pavements are better than 
        yesterday's in many ways as a result of the research and 
        development work led by FHWA--in portland cement concrete 
        pavement we have: drainable bases, chemical enhancers (set 
        retarders, plasticisers, etc.), engineered joints, improved 
        placement techniques, sawing technologies, curing systems, 
        recycling, significantly better mix designs, rapid testing 
        techniques, smoothness specifications and measurements, high-
        performance concretes and patching materials, performance and 
        QA/QC specifications, high speed insitu testing of surface 
        texture and skid resistance and noise and subgrade support 
        (FWD), void/delamination/etc., detection thru high speed 
        imaging and pattern recognition systems, pavement management 
        systems and software, sophisticated forensic analysis of 
        pavement failures and state of the art material 
        characterization. In the area of asphalt pavements (with some 
        assistance from SHRP initiated research) the researchers at 
        TFHRC have led work resulting in better asphalt pavements 
        including: chemically modified asphalt binders, rut resistant 
        pavements, cold temperature crack resistant pavements, anti-
        strip agents, understanding the effects of construction 
        variation on performance, accelerated pavement testing 
        (accelerated loading facilities at TFHRC, French/Hamburg/
        Georgia/gyratories/etc., laboratory test equipment, test 
        tracks), impact of different tire geometry on pavement life, 
        open graded friction courses, aggregate properties, recycling, 
        bound/unbound bases, SUPERPAVE (development, validation, 
        testing procedures, training, equipment ruggedness testing and 
        calibration, etc.), specifications (smoothness, performance, 
        QA/QC etc.), nuclear testing, rapid testing, crack sealing 
        materials, pothole patching materials and techniques.
  --There are, of course, synergistic relationships as can be drawn 
        from the above concrete and asphalt improvements but 
        furthermore there are the many truck--pavement interaction 
        issues relating to our research in dynamic loadings and 
        suspension systems, weigh-in-motion technologies, and testing 
        protocols. The Long Term Pavement Performance program run from 
        TFHRC draws on the reservoir of pavement technologists, 
        laboratories, computers and data to conduct tests and analyze 
        an international pavement data base so as to provide 
        performance related decision tools ranging from testing 
        protocols to best maintenance strategies to best design 
        parameters so as to lead the nations pavement managers to 
        utilizing the best practices available when designing, building 
        and maintaining the nations highways.
  --As evidenced in the above example of just pavements, one can see 
        that TFHRC brings long-lasting national value to the highway 
        program because of its people, laboratories, international 
        networks, data bases and recognized national highway technology 
        leadership in Making Roads Better. The research Center has 
        contributed to major accomplishments and it is well positioned 
        to deliver the innovation that will lead our industry into the 
        next century.
    Question. Why does this research need to be conducted at this 
particular location?
    Answer. There are several reasons why the research needs to be 
conducted at the TFHRC. First and foremost, communications and 
coordination with the FHWA Headquarters program office and technology 
transfer personnel would be greatly reduced if the Center were at 
another location. There would not be the daily contact which is so 
important to the success of our research program. Communications and 
coordination would also suffer between the FHWA research program and 
the Transportation Research Board, as well as with the many other 
public and private organizations which are located in the Washington, 
D.C. area. It would be prohibitive from a travel budget standpoint to 
maintain the degree of communications and coordination that currently 
exists within the research program if the Center were at another 
location. Because of the Center's location, development of personnel is 
facilitated through exchanges with staff at the Headquarters offices. 
Also, we have a very large investment at TFHRC both in terms of capital 
assets and intellectual knowledge. There is a unique complex of R&D 
laboratories which has been established at the TFHRC. It would be very 
expensive and disruptive to the highway R&D program to recreate these 
laboratories at another location.
    Question. Could the facility be better housed at a UTC or URC to 
achieve synergistic benefits?
    Answer. There would be some benefits to housing the facility at a 
UTC or URC. The interaction with the academic community at a university 
would be beneficial, and there would be excellent opportunities for 
students to participate in the research activities. However, for the 
reasons stated in the response to the previous two questions, there are 
significant and substantial advantages in having the TFHRC at its 
present location in the Washington, DC area.
    It is also important to note that we do have the synergistic 
benefits of approximately 20 graduate research fellows (most students 
are working on their doctorates) and this is typically more doctorate 
students than are in doctorate programs in Civil Engineering at most 
universities. We also host 3-5 university professors and a like number 
of post doctorate scholars at TFHRC. The dynamic is further improved 
through visiting researchers from foreign countries (5 at 
any one time), from State DOTs and from other FHWA offices. The ability 
to direct a long term research, development, and technology program and 
to attract such a broad based intellectual component is something that 
is not easily accomplished in the university environment.

----------------------------------------------------------------------------------------------------------------
                                                                          Fiscal years--                        
                    Program                     ----------------------------------------------------------------
                                                     1993         1994         1995         1996         1997   
----------------------------------------------------------------------------------------------------------------
Safety:                                                                                                         
    ISTEA......................................  ...........  ...........  ...........  ...........  ...........
    Applied Research Technology................  ...........  ...........          $4M          $4M          $4M
LGOE: Highway R&D..............................      $8.862M       $5,738           8M       8.768M       8.768M
Materials:                                                                                                      
    LGOE.......................................  ...........  ...........  ...........  ...........  ...........
    Highway Research and Development...........        5.923        3.685       5.614M         None         None
Pavements:                                                                                                      
    ISTEA......................................  ...........  ...........  ...........  ...........  ...........
    SHRP Implementation........................           6M           8M           6M           6M           6M
    Applied Research and Technology............  ...........  ...........         2.8M           2M           2M
    Seismic Research...........................           2M           2M           2M           2M           2M
    Fundamental Prop. Of Asphalt and Mod.                                                                       
     Asphalts..................................           3M           3M           3M           3M         None
    LGOE.......................................  ...........  ...........  ...........  ...........  ...........
    Highway Research and Development...........        7.278        7.259         7.7M       9.247M          20M
Structures:                                                                                                     
    ISTEA......................................  ...........  ...........  ...........  ...........  ...........
    Timber Bridge Research (1039)..............           1M           1M           1M           1M           1M
    Applied Research and Technology (6005).....  ...........  ...........         3.4M         None         None
    LGOE.......................................  ...........  ...........  ...........  ...........  ...........
    Highway Research and Development...........        6.203       4,860M         6.5M      13.211M      14.558M
Long-term Pavement Performance:                                                                                 
    LGOE.......................................  ...........  ...........  ...........  ...........  ...........
    Highway Research and Development...........           6M           7M           9M   \1\ 8.739M         None
Advanced research..............................  ...........  ...........  ...........  ...........  ...........
ISTEA: Applied Research and Technology (6005)..  ...........  ...........         3.6M       0.600M         None
National Highway Institute:                                                                                     
    ISTEA......................................  ...........  ...........  ...........  ...........  ...........
    Applied Research and Technology (6005).....         None         None          .6M           2M           3M
    Research and Technology (6001).............  ...........  ...........  ...........  ...........  ...........
    Eisenhower Fellowships.....................           2M           2M           2M           2M           2M
    LGOE: NHI..................................         4.5M         4.5M    4,369,000    4,327,000  ...........
National Center for Advanced Transportation                                                                     
 Technology ISTEA-X379.........................           3M         2.5M         None         None         None
University Trans. Centers (6023)-X329..........           6M           6M           6M    5,247,459  ...........
    Fiscal year 1996 reduced by Sec. 1003(c),                                                                   
     Public Law 102-240........................  ...........  ...........  ...........    5,247,459  ...........
University Research Institute--X331............       6.250M       6.250M       6.250M    5,466,103             
    Reduced by Sec. 1003(c), Public Law 102-240  ...........  ...........  ...........  ...........  ...........
Fairbank building renovation:                                                                                   
    LGOE.......................................    1,940,000    1,250,000    3,000,000         None      500,000
    Truck Dynamic Test Facility................  ...........  ...........  ...........        .750M  ...........
    Section 6005...............................  ...........  ...........  ...........  ...........  ...........
----------------------------------------------------------------------------------------------------------------


                    Federal Railroad Administration

                            Office of Safety

            Questions Submitted by Senator Richard C. Shelby
                  safety fiscal year 1996-1998 funding
    Question. Please prepare a comparative funding table for the Office 
of Safety for fiscal years 1996-1998, broken out in the following 
manner:
    Answer. Information follows.

                         [Dollars in thousands]                         
------------------------------------------------------------------------
                                                  Fiscal years--        
                                        --------------------------------
                                            1996       1997       1998  
                                           actual    estimate   estimate
------------------------------------------------------------------------
Federal enforcement program:                                            
    Program Costs......................  .........  .........  .........
    PC&B and Support Costs.............    $37,061    $39,196    $41,081
    Number of staff: (Field)...........        449        456        456
Automated track inspection program:                                     
    Program Costs......................     $1,351     $1,203     $4,220
    PC&B and Support Costs.............  .........  .........  .........
    Number of staff....................  .........  .........  .........
Safety regulation and program                                           
 administration:                                                        
    Program Costs......................     $1,882     $1,760     $2,058
    PC&B and Support Costs.............     $9,262     $9,179     $9,708
    Number of staff: (Headquarters)....         82         87         90
------------------------------------------------------------------------

                         congressional reports
    Question. For each of the rail safety studies specified on page 127 
of Senate Report 104-325, please summarize your findings and 
conclusions to date. When will the studies be released?
    Answer. FRA has been directed by Congress to complete by June 1, 
1997 studies on the following four topics. The studies are currently 
being reviewed by both DOT and OMB. We plan to submit them to Congress 
by mid to late August.
    1. Study the technical, structural, and economic feasibility of 
automatic train escape devices and their benefits to public safety.
    A reliable technology to sense emergency situations does not 
currently exist. This makes automatic escape devices not technically 
feasible, and the additional risks that they create would cast serious 
doubts on their benefit to the public.
    As a result, FRA believes increased emphasis on manually operated 
emergency escape devices will meet the intent of the Committee's 
concern. Manually operated emergency escape devices include: emergency 
windows, manual door releases on powered doors, roof hatches and kick-
out panels or pop-out windows in doors that may become jammed. Working 
with the Passenger Equipment Safety Standards Working Group, FRA has 
developed a Passenger Equipment Safety NPRM. The NPRM proposes separate 
safety standards for equipment that travels at speeds up to 125 mph 
(Tier I equipment) and for equipment that travels at speeds greater 
than 125 mph up to 150 mph (Tier II equipment).
    2. Study whether the development of minimum safety standards for 
fuel tanks of locomotives of rail passenger trains is warranted, taking 
into account environmental and public safety.
    FRA has determined that minimum standards for fuel tanks are 
warranted. The standards proposed by the NPRM for passenger equipment 
safety standards include:
  --The Association of American Railroads Recommended Practice RP-506 
        as minimum standards for fuel tanks on Tier I passenger 
        equipment.
  --Ruggedized construction with bottom skid surfaces and more rail 
        clearance for Tier II or high speed equipment.
    3. Study the feasibility of establishing minimum crashworthiness 
standards for passenger cab cars, including requiring crash posts at 
the corners of rail passenger cars and safety locomotives on rail 
passenger trains.
    FRA has determined that establishing crashworthiness requirements 
for newly constructed cab cars is feasible. The NPRM for passenger 
equipment safety standards will propose such standards including 
minimum requirements for corner posts and increased strength collision 
posts.
    4. Study the placement of rail signals along railways, including 
whether FRA should require that a signal be placed along a railway at 
each exit of a rail station, and that a signal be placed so that it is 
visible only to the train employee of a train that the signal is 
designed to influence.
    FRA's Emergency Order 20 addressed the issue of signal compliance 
following station stops through imposition of the ``delayed in block 
rule,'' which requires that the engineer operate the train in the same 
conservative manner after each station prior to a home signal that can 
require a stop. The requirement is underscored by appropriate signage. 
In FRA's judgment, placing a second distant signal following the 
station stop would not enhance safety. Further, FRA rules already 
address the need for signals to be clearly associated with the track 
they control, and FRA will continue to address the need to properly 
align and focus individual signals through its field compliance.
          national transportation safety board recommendations
    Question. What are the remaining open NTSB recommendations, and 
what is FRA doing to respond? Please also list all NTSB recommendations 
for the last three years that have been addressed, and closed, 
indicating whether or not NTSB was satisfied.
    Answer. As of July 11, the FRA has 45 open NTSB recommendations 
(See attached list). They relate to the following areas:

Track.............................................................     4
Equipment.........................................................    27
Signals...........................................................     5
Operating Practices...............................................     4
Hazardous Materials...............................................     5
                        -----------------------------------------------------------------
                        ________________________________________________
      Total.......................................................    45

    The FRA is working to address all of them and a large majority are 
included in ongoing regulatory development projects. The 4 
recommendations related to track are included in an ongoing rulemaking. 
The Notice of Proposed Rulemaking on Track Safety Standards was 
published July 3. The Motive Power and Equipment recommendations 
primarily relate to locomotive cabs, brake systems, passenger 
equipment, steam locomotives or locomotive event recorders. Most of 
these items are included in rulemaking projects or being considered by 
the Rail Safety Advisory Committee (RSAC) for potential rulemaking. The 
major signal and train control issue is positive train control. There 
are 3 demonstration projects and additional developmental efforts are 
underway. An updated report is about to be transmitted to the Congress 
on this issue. The major operating practices issue is the vision of the 
locomotive engineer, and RSAC is addressing it. The hazardous materials 
recommendations relate to tank cars. Action has been completed on 2 and 
is underway on the third.
    The NTSB has closed the following recommendations in the past 3 
years:

------------------------------------------------------------------------
         Recommendations                Subject         Closed based on 
------------------------------------------------------------------------
1994:                                                                   
    88-23.......................  Alcohol/Drug        Reconsidered.     
                                   Testing.                             
    88-24.......................  Alcohol/Drug        Acceptable Action.
                                   Testing.                             
    88-25.......................  Alcohol/Drug        Reconsidered.     
                                   Testing.                             
    88-29.......................  Alcohol/Drug        Acceptable        
                                   Testing.            Alternate Action.
    88-31.......................  Alcohol/Drug        Acceptable Action.
                                   Testing.                             
    88-32.......................  Alcohol/Drug        Acceptable        
                                   Testing.            Alternate Action.
    80-02.......................  Tank Cars.........  Acceptable Action.
    84-10.......................  Maintenance of Way  Unacceptable      
                                   Cars.               Action.          
    87-47.......................  Hazardous           Acceptable Action.
                                   Materials.                           
1995:                                                                   
    90-51.......................  Grade Crossings...  Acceptable Action.
    91-25.......................  Train Control.....  Acceptable Action.
    93-11.......................  Assessments.......  Acceptable Action.
    89-82.......................  Telemetry Devices.  Superceded.       
    92-11.......................  Locomotive Fuel     No longer         
                                   Tanks.              applicable.      
    92-11.......................  Locomotive Fuel     Acceptable Action.
                                   Tanks.                               
    92-13.......................  Locomotive Fuel     Reconsidered.     
                                   Tanks.                               
    94-15.......................  Train Control.....  Acceptable Action.
    91-39.......................  Hours of Service    Acceptable Action.
                                   Records.                             
    92-1........................  Engineer Training.  Acceptable Action.
1996:                                                                   
    94-1........................  Track Inspection..  Unacceptable      
                                                       Action.          
    94-2........................  Track Standards...  Unacceptable      
                                                       Action.          
    85-64.......................  Tank Cars.........  Acceptable Action.
    88-59.......................  Tank Cars.........  Acceptable Action.
    88-61.......................  Tank Cars.........  Acceptable        
                                                       Alternate Action.
    88-63.......................  Tank Cars.........  Acceptable Action.
    88-64.......................  Tank Cars.........  Acceptable Action.
    92-21.......................  Tank Cars.........  Acceptable Action.
------------------------------------------------------------------------

    List of NTSB recommendations:

----------------------------------------------------------------------------------------------------------------
 NTSB                                                                                                           
number              Subject                                  Status                           Classification    
----------------------------------------------------------------------------------------------------------------
       Track (4):                                                                                               
 91-65     Review Track Standards     NTSB Response Received 7-13-92.................  OAA                      
 91-66     CWR Standards              NTSB Response Received 7-13-92.................  OAA                      
 96-13     Research--Flat Rail Heads  NTSB Response Received 4-16-97.................  OAA                      
 96-14     Regulation--Flat Rail      NTSB Response Received 4-16-97.................  OAA                      
            Heads                                                                                               
       Motive power and equipment                                                                               
        (27):                                                                                                   
 87-23     Locomotive Cabs            NTSB Response Received 1-9-96..................  OAA                      
 88-20     Locomotive Sill Heights    FRA Update Sent 11-30-90.......................  OUA                      
 89-51     Shelf Couplers on          FRA Update Sent 11-30-90.......................  ORR                      
            Locomotives                                                                                         
 89-81     Brake Tests (Cold          NTSB Response Received 6-28-91.................  OAA                      
            Weather)                                                                                            
 90-23     Dynamic Brakes--Indicator  FRA Update Sent 5-10-91........................  OUA                      
 90-24     Dynamic Brakes--           FRA Update Sent 5-10-91........................  OAR                      
            Functional                                                                                          
 91-26     Alerters                   NTSB Response Received 9-22-93.................  OAA                      
 91-51     Special Use Equipment--    NTSB Response Received 8-31-93.................  OAA                      
            Inspection                                                                                          
 91-52     Special Use Equipment--    NTSB Response Received 8-31-93.................  OAA                      
            Derailment Notice                                                                                   
 91-53     Special Use Equipment--    NTSB Response Received 8-31-93.................  OAA                      
            Reporting                                                                                           
 91-54     Special Use Equipment--    NTSB Response Received 8-31-93.................  OAA                      
            Haz-Mat                                                                                             
 92-10     Research Loco Fuel Tanks   NTSB Response Received 2-21-96.................  OAA                      
 93-16     Passenger Train Brake      NTSB Response Received 11-22-93................  OAA                      
            Inspections                                                                                         
 93-24     Passenger Car Corner       NTSB Response Received 4-29-94.................  OAA                      
            Posts                                                                                               
  95-1     Passenger Car Wheels       NTSB Response Received 8-16-95.................  OAA                      
 95-21     TOFC/COFC                  NTSB Response Received 8-4-95..................  OAA                      
  96-7     Commuter-Rail Emergency    FRA Initial Reply Sent 6-6-96..................  ORR                      
            Exits                                                                                               
 96-53     Steam Locomotives          FRA Initial Reply Due 2-3-97...................  OAR                      
 96-54     Steam Locomotives          FRA Initial Reply Due 2-3-97...................  OAR                      
 96-55     Steam Locomotives          FRA Initial Reply Due 2-3-97...................  OAR                      
 96-57     Steam Locomotives          FRA Initial Reply Due 2-3-97...................  OAR                      
 96-58     Steam Locomotives          FRA Initial Reply Due 2-3-97...................  OAR                      
 96-59     Steam Locomotives          FRA Initial Reply Due 2-3-97...................  OAR                      
 96-70     Event Recorder--Testing    FRA Initial Reply Due 5-8-97...................  OAR                      
 96-71     Event Recorder--           FRA Initial Reply Due 5-8-97...................  OAR                      
            Inspections                                                                                         
 96-72     Event Recorder--           FRA Initial Reply Due 5-8-97...................  OAR                      
            Inspection Form                                                                                     
 96-73     Event Recorder--Lead       FRA Initial Reply Due 5-8-97...................  OAR                      
            Locomotive                                                                                          
       Signal, communications and                                                                               
        grade crossings (5):                                                                                    
 87-16     Train Control System       FRA Update Sent 8-24-94........................  OAA                      
 93-12     Dates for ATCS             NTSB Response Received 9-22-95.................  OAA                      
 94-13     Train Control--Identify    NTSB Response Received 11-13-95................  OAA                      
            Benefits                                                                                            
 94-14     Train Control--Cost/       NTSB Response Received 11-13-95................  OAA                      
            Benefit Analysis                                                                                    
 96-50     Grade Crossing Inventory   FRA Initial Response Sent 4-3-97...............  ORR                      
       Operating practices (4):                                                                                 
 87-66     Train Dispatchers--        NTSB Response Received 12-20-95................  OAA                      
            Selection/Training                                                                                  
 96-56     Hours of Service--Tourist  FRA Initial Reply Due 2-3-97...................  OAR                      
            Railroads                                                                                           
  97-1     Color Vision Testing--     FRA Initial Response Due 7-8-97................  ORR                      
            Engineers                                                                                           
  97-2     Engineer Ceritification    FRA Initial Response Due 7-8-97................  ORR                      
            Requirments                                                                                         
       Hazardous materials (5):                                                                                 
 89-48     Closure fittings on tank   FRA Update Sent 3-25-97........................  OAA                      
            cars                                                                                                
 89-49     Tank car valves and        FRA Update Sent 3-25-97........................  OAA                      
            gaskets                                                                                             
 90-38     Position of HM in Train    FRA Update Sent 3-25-97........................  OAA                      
 92-22     Develop Tank Car Testing   FRA Update Sent 3-25-97........................  OAA                      
            Require-  ments                                                                                     
  95-9     Tank Car Interiors         FRA Update Sent 3-25-97........................  OAA                      
----------------------------------------------------------------------------------------------------------------


NTSB classification summary:
    Open Await Reply (OAR)........................................    12
    Open Reply Received (ORR).....................................     5
    Acceptable Response (OAA).....................................    26
    Open Unacceptable Action (QUA)................................     2
                        -----------------------------------------------------------------
                        ________________________________________________
          Total...................................................    45

    The three NTSB recommendations that are not covered in rulemaking 
proceedings are as follows:
  --Recommendation R-95-21 requested the FRA to advise the NTSB of our 
        progress in implementing remedial actions regarding the 
        securement of containers or trailers on flat rail cars. The 
        Board has been provided with the requested information.
  --Recommendation R-96-50 requested that FRA include information 
        regarding preemption of interconnected signals at highway-rail 
        grade crossings in our inventory. This effort is underway. We 
        expect it to be completed by the end of August. The Board has 
        been notified as to the progress and is satisfied.
  --Recommendation R-96-56 requested that we work with the Tourist 
        Railway Association in promoting awareness of compliance with 
        the Hours of Service Act. A Tourist and Historic Railroads 
        working group has been established under the Railroad Safety 
        Advisory Committee to address safety issues on these railroads. 
        FRA has provided the group with Hours of Service information 
        for their members and invited them to our regional training 
        sessions on operating practices safety matters.
                           railroad user fees
    Question. Are the railroad safety user fees described in Sec. 328 
of the bill language in the fiscal year 1998 Budget Appendix to be 
imposed and collected beginning in fiscal year 1998? Why is this 
proposed in appropriations legislation? Isn't ``prescribing by 
regulation a schedule of fees for railroad carriers'' a legislative 
matter under the jurisdiction of the authorizing committees?
    Answer. Our railroad user fee proposal envisions collection of 
railroad user fees in fiscal year 1998. Congress originally established 
the railroad user fee program for a five-year term in the 1990 Budget 
Reconciliation Act. We believe the Congress should reauthorize the 
program this year and could do so either through the reconciliation 
legislation being enacted to carry out the fiscal year 1998 Budget 
Resolution or, due to its close relationship to the Department's 
overall funding, through the fiscal year 1998 DOT Appropriations Act. 
Accordingly, we have included enabling language for the program as part 
of our proposed 1998 DOT appropriations bill language.
                       office of safety user fees
    Question. Are these fees designed to fully offset the costs of the 
FRA's Office of Safety programs in fiscal year 1998? How much money is 
expected to be collected from these fees? How is this reflected in the 
fiscal year 1998 budget request?
    Answer. The Administration's proposed reauthorization for FRA's 
Office of Safety user fees has been expanded to cover all funding of 
Safety Appeals and the Safety Law Division of the Office of Chief 
Counsel. While collections will equal the sum of the two programs, 
collections will not offset FRA appropriations, but instead will be 
reflected as a general receipt to Treasury. The fiscal year 1998 
estimate for these collections is $59.8 million. Additional information 
can be found on pages 3 and 5 of FRA's Congressional Budget Submission.
                    industry responses to user fees
    Question. What are the responses from the railroad industry to the 
user fee proposal?
    Answer. The railroad industry has consistently opposed railroad 
safety user fees. The industry considers these fees to be an 
inequitable financial burden which affects their ability to compete 
with other transportation modes.
                 government performance and results act
    Question. Please discuss how FRA is moving towards performance-
oriented regulation.
    Answer. Risk assessment is the key to establishing performance-
oriented regulations. FRA is using risk assessment to evaluate rail 
corridors, which may become candidates for the installation of Positive 
Train Control Systems. The Agency foresees increasing use of this 
technique in the future. But creating the climate for performance-
oriented regulation requires building confidence among critical 
constituent groups. In addition, it is essential that any new 
regulatory approach considered by FRA provides a constructive means of 
engaging the railroads. This can best be accomplished by developing 
performance standards that address discrete areas of concern, 
implementing those standards successfully, and moving toward more 
flexible approaches as experience is acquired. The Railroad Safety 
Advisory Committee (RSAC) and other collaborative rulemaking forums 
provide venues for moving this evolution forward at a pace that is 
realistic in light of available technical knowledge and all relevant 
externalities.
    The field of high-speed rail is one in which FRA has been most 
aggressive in utilizing system safety and risk assessment techniques to 
fashion a regulatory approach. Our forthcoming notices of proposed 
rulemaking for passenger equipment safety and for the Florida Overland 
Express strongly emphasize system safety planning. FRA believes that 
this effort can provide the beginning of a template for dedicated 
operations. However, the reality confronted by a regulatory agency in 
evaluating an entirely new service involves many complex issues. 
Benchmark criteria are needed for systems, subsystems and critical 
components in order to evaluate the nature and magnitude of technical 
risk before system risk can be fairly estimated.
    The complexity of the effort is certainly no reason not to 
implement the system safety concept. FRA's Safety Assurance and 
Compliance Program shifts the Agency's routine safety monitoring from a 
site-specific to a systems assessment approach. However, system safety 
is a process and discipline that must be internalized by the entity 
actually operating the service. Prior audits of entities that have 
prepared system safety plans have sometimes found that planning 
documents have become stale and were not well integrated into the 
actual operation of the service. FRA seeks to foster meaningful system 
safety planning that becomes an essential element in the way the system 
is actually operated. To the extent this safety focus is established 
and maintained, reinforcement can be provided through allowance for 
much greater flexibility with respect to the manner in which safety 
objectives are achieved.
                  federal enforcement program increase
    Question. Please provide additional justification for the nearly 
$1,900,000 increase requested for fiscal year 1998 as indicated on page 
43 for the Federal Enforcement Program. Why couldn't some of these 
funding expenditures be delayed?
    Answer.
  --The total fiscal year 1998 request for the Federal Enforcement 
        Program is $41 million, which supports the 456 field FTE that 
        are directly involved in monitoring the railroads to ensure 
        that they are complying with Federal Safety rules and 
        regulations.
  --Increase over fiscal year 1997 is $1.885 million.
  --Of this amount, $1.866 million or 99 percent is for non-
        discretionary increases that must be paid in fiscal year 1998 
        since they represent operating costs to maintain ongoing field 
        operations.
  --Costs related to pay raises, inflation, vendor increases, TASC, 
        telephone and other support costs cannot be delayed as they are 
        mandatory bills that must be paid.
  --Only $19K represents new funding for FRA's Video Conferencing 
        initiative. The Safety office is a primary user of this system.
  --If the non-discretionary increases are not funded, the Office of 
        Safety would be required to either reduce the number of 
        inspections or restrict the enforcement activities of each 
        inspector. Either option would jeopardize FRA's safety program.
                         office of safety ftes
    Question. Please break down the number of FTE in each region. What 
does the FRA anticipate the runover rate to be, and are there plans or 
resources for hiring additional staff? How is this reflected in the 
fiscal year 1998 request? How is the staff allocation related to 
problem railroads and risk?
    Answer. The information follows:

        Region                                            Number of FTES
Cambridge.........................................................    50
Philadelphia......................................................    68
Atlanta...........................................................    68
Chicago...........................................................    59
Hurst.............................................................    67
Kansas City.......................................................    52
Sacramento........................................................    44
Vancouver.........................................................    48
                        -----------------------------------------------------------------
                        ________________________________________________
      Total.......................................................   456

    FRA anticipates the turnover rate to be approximately 2.6 percent. 
The FRA does not have any plans or resources to hire additional staff 
in fiscal year 1998, and no funding was included in the Office of 
Safety Budget Submission.
    The Regional Administrators, Safety Coordinators, and headquarters 
managers are responsible for the development of an annual strategic 
resource allocation plan. They meet annually to plan how resources will 
be used for the year. The team uses the Annual Allocation Analysis 
(AAA) model as the starting point for targeting resources.
    The AAA model allocates inspection resources to geographical areas 
that have a higher than average risk factor. This model provides 
information about railroad systems based on a select group of risk 
factors, such as the number of train accidents, serious injuries, train 
miles, employee hours, defect ratio, false proceed signal indications, 
and freight and hazardous materials tonnage.
                       safety field offices/ftes
    Question. Please display, by region, the current safety inspection 
field offices and number of personnel at each office.
    Answer. The information follows:

        Location                                     Number of employees
Region 1:
    Cambridge.....................................................    22
    Clifton Park..................................................     7
    Newark........................................................    14
    Buffalo.......................................................     5
    Bangor........................................................     2
                        -----------------------------------------------------------------
                        ________________________________________________
      Subtotal....................................................    50
                        =================================================================
                        ________________________________________________
Region 2:
    Philadelphia..................................................    26
    Cincinnati....................................................     6
    Cleveland.....................................................     4
    Columbus......................................................     3
    Charleston....................................................     5
    Norfolk.......................................................     4
    Hanover.......................................................     6
    Pittsburgh....................................................     7
    Roanoke.......................................................     3
    Toledo........................................................     2
    Harrisburg....................................................     2
                        -----------------------------------------------------------------
                        ________________________________________________
      Subtotal....................................................    68
                        =================================================================
                        ________________________________________________
Region 3:
    Atlanta.......................................................    24
    Jacksonville..................................................     9
    Louisville....................................................     7
    Nashville.....................................................     4
    Knoxville.....................................................     2
    Memphis.......................................................     4
    Mobile........................................................     5
    Charlotte.....................................................     7
    Birmingham....................................................     6
                        -----------------------------------------------------------------
                        ________________________________________________
      Subtotal....................................................    68
                        =================================================================
                        ________________________________________________
Region 4:
    Chicago.......................................................    33
    Indianapolis..................................................     9
    Ft. Snelling..................................................     9
    Detroit.......................................................     6
    Peoria........................................................     2
                        -----------------------------------------------------------------
                        ________________________________________________
      Subtotal....................................................    59
                        =================================================================
                        ________________________________________________
Region 5:
    Hurst.........................................................    28
    Houston.......................................................    12
    Little Rock...................................................     6
    New Orleans...................................................     8
    Oklahoma City.................................................     3
    San Antonio...................................................     4
    Shreveport....................................................     3
    El Paso.......................................................     3
                        -----------------------------------------------------------------
                        ________________________________________________
      Subtotal....................................................    67
Region 6:
    Kansas City...................................................    28
    St. Louis.....................................................     7
    Lakewood......................................................     9
    Omaha.........................................................     5
    Des Moines....................................................     1
    Wichita.......................................................     2
                        -----------------------------------------------------------------
                        ________________________________________________
      Subtotal....................................................    52
                        =================================================================
                        ________________________________________________
Region 7:
    Sacramento....................................................    27
    Salt Lake City................................................     6
    Riverside.....................................................    11
                        -----------------------------------------------------------------
                        ________________________________________________
      Subtotal....................................................    44
                        =================================================================
                        ________________________________________________
Region 8:
    Vancouver.....................................................    23
    Spokane.......................................................     4
    Seattle.......................................................     4
    Pocatello.....................................................     5
    Bismark.......................................................     5
    Billings......................................................     7
                        -----------------------------------------------------------------
                        ________________________________________________
      Subtotal....................................................    48
                        -----------------------------------------------------------------
                        ________________________________________________
      Total.......................................................   456

                      safety office telecommuters
    Question. How many Office of Safety employees have elected to 
telecommute since the National Partnership Council implemented Phase I 
of the telecommuting process in September 1995 (please break out by 
fiscal year 1996 and 1997)? When will this process be complete? How 
many field offices have been closed (please name locations)?
    Answer. Since the inception of telecommuting in 1995, 122 employees 
have elected to telecommute: 53 in fiscal year 1996 and an additional 
69 in fiscal year 1997.
    It is anticipated that the Office of Safety's telecommuting program 
will be fully implemented by fiscal year 1999 with approximately 200 
employees telecommuting.
    The following ten (10) field offices have been closed: Bangor, ME; 
Memphis, TN; Knoxville, TN; Tampa, FL; Shreveport, LA; San Antonio, TX; 
Spokane, WA; Wichita, KS; Peoria, IL; Roanoke, VA.\1\
---------------------------------------------------------------------------
    \1\ The Roanoke office, originally scheduled to close in fiscal 
year 1998, closed late April 1997.
---------------------------------------------------------------------------
                           inspector workload
    Question. Last year, how many miles of railroad track, freight 
cars, locomotives, and track miles with signal and train control 
systems were inspected? Please compare this level of inspection 
activity with that achieved during the two preceding years. How were 
these activities focused on high risk railroads and shippers?
    Answer.

                             INSPECTION DATA                            
------------------------------------------------------------------------
                                                                 Percent
                                    1994      1995    1996 \1\   change 
------------------------------------------------------------------------
Track:                                                                  
    Number of inspections.......    15,449    12,668    11,522        -9
    Miles inspected.............   329,019   272,476   260,422        -4
    Records inspected...........   169,849   132,420   132,972  ........
    Defects recorded............    88,611    69,817    65,731        -6
Signal:                                                                 
    Number of inspections.......     6,553     5,391     5,327        -1
    Units inspected.............    86,456    55,414    51,097        -8
    Records inspected...........    92,939    66,823    83,486       +25
    Defects recorded............    11,522    22,169    19,078       -14
Motive power and equipment:                                             
    Number of inspections.......    16,956    15,579    14,798        -5
    Locomotives inspected.......    33,597    29,916    24,257       -19
    Cars inspected..............   832,197   700,838   628,250       -10
    Defects recorded............   134,185   123,078   107,633       -13
Operating practices:                                                    
    Number of inspections.......    17,710    13,501    12,801        -5
    Complaints received.........     4,177     1,519     1,383        -9
    Defects recorded............    17,621    35,880    16,758       -53
Hazardous materials:                                                    
    Number of inspections.......    12,047    10,461    10,462  ........
    Tank cars inspected.........    99,356    77,992    76,348        -2
    Defects recorded............    17,073    21,649    17,856      -18 
------------------------------------------------------------------------
\1\ Preliminary                                                         

    The Regional Administrators, Safety Coordinators, and headquarters 
managers are responsible for the development of an annual strategic 
resource allocation plan. They meet annually to plan how resources will 
be used for the year. Accident and inspection data that highlight 
questionable safety performance by a railroad are analyzed to decide if 
a Safety Assurance and Compliance Program (SACP) project is appropriate 
or whether traditional site-specific inspection actions are needed. FRA 
uses its SACP process for system-wide improvements of safety problems 
and traditional site-specific inspections to target individual 
problems.
                            hazmat accidents
    Question. Please chronicle all major hazmat-involved rail accidents 
in calendar year 1996, noting date, location, railroad, type of hazmat, 
any fatalities, injuries, evacuations or other complications, and the 
estimated cost of damage and loss for each. Please also summarize the 
probable cause of each accident Answer: The following major rail 
accidents involving the release of a hazardous material are summarized 
below:
    Date.--02/01/96
    Location.--Cajon, California
    Railroad.--Burlington Northern/Santa Fe (BNSF)
    Type of hazmat.--Hazmat involved: Three cars each of either 
petroleum distillates, denatured alcohol, and trimethyl phosphite 
burned completely. One tank car of butyl acrylate in a pressurized 
tank, was exploded to relieve pressure and released 1,700 gallons of 
product. The remainder was transloaded. One car of methyl ethyl ketone 
derailed one wheel, but was upright and undamaged.
    Fatalities.--2
    Injuries.--1
    Evacuations or other complications.--50
    Estimated cost of railroad damage.--$3,765,294
    Probable cause.--Insufficient braling force allowed the speed of 
the train to increase, making it impossible for the train to negotiate 
the seven degree curve to the left. A blockage in the train line (air 
brake system) occurred which prevented proper application of the air 
brakes from the point of blockage rearward to the end of train. Due to 
the massive destruction of the derailed equipment, the exact point of 
blockage could not be determined.
    Date.--02/06/96
    Location.--Waverly, West Virginia
    Railroad.--CSX Transportation
    Type of hazmat.--One empty car contained potassium nitrate RESIDUE, 
but did not lose product. The derailment ruptured a buried, privately 
owned 2 inch gas transmission line running from a nearby oil well to a 
local cement castings plant. The ruptured gas line began venting 
natural gas, so a nearby school was evacuated. Approximately 150 
residents and students were evacuated.
    Fatalities.--0
    Injuries.--0
    Evacuations or other complications.--150
    Estimated cost of railroad damage.--$43,000
    Probable cause.--Broken rail (transverse/compound fissure).
    Date.--02/07/96
    Location.--Powersville, Missouri
    Railroad.--SOO Line
    Type of hazmat.--Eight boxcars containing EXPLOSIVES 1.1 were 
derailed. Five of the eight were on their sides and three were leaning. 
Twenty-nine bombs had broken out of the lead car and fouled the right-
of-way. A precautionary evacuation affected one family.
    Fatalities.--0
    Injuries.--0
    Evacuations or other complications.--2
    Estimated cost of railroad damage.--$294,903
    Probable cause.--Broken rail (split web).
    Date.--02/21/96
    Location.--Leadville, Colorado
    Railroad.--Southern Pacific (SP)
    Type of hazmat.--Six tank cars containing sulfuric acid derailed 
and spilled 51,351 gallons of product.
    Fatalities.--2
    Injuries.--1
    Evacuations or other complications.--20
    Estimated cost of railroad damage.--$4,907,872
    Probable cause.--The student engineer's failure to control the 
train speed on a steep grade by use of the available train air brake 
system.
    Date.--02/28/96
    Location.--Cushing, Minnesota
    Railroad.--Burlington Northern/Santa Fe (BNSF)
    Type of hazmat.--Two tank cars derailed containing liquid propane 
gas (one car leaked it's product) and four tank cars containing 
anhydrous ammonia (one car leaked it's product).
    Fatalities.--0
    Injuries.--0
    Evacuations or other complications.--33
    Estimated cost of railroad damage.--$691,350
    Probable cause.--Broken joint bar (track).
    Date.--03/04/96
    Location.--Weyauwega, Wisconsin
    Railroad.--Wisconsin Central (WC)
    Type of hazmat.--Seven tank cars containing liquid petroleum gas 
ignited, seven tank cars containing propane derailed and two cars 
containing sodium hydroxide were on their side and breached.
    Fatalities.--0
    Injuries.--0
    Evacuations or other complications.--3,155
    Estimated cost of railroad damage.--$1,165,277
    Probable cause.--Broken right-hand switch point on main track 
turnout (bolt hole break out).
    Date.--03/06/96
    Location.--Selkirk, New York
    Railroad.--ConRail (CR)
    Type of hazmat.--A tank car containing liquid petroleum gas (LPG) 
exploded as it coupled to two other tank cars containing LPG. The 
result was a violent rupture and ensuing fire.
    Fatalities.--0
    Injuries.--0
    Evacuations or other complications.--150
    Estimated cost of railroad damage.--$12,525
    Probable cause.--Tank car shell fracture caused by impact coupling 
forces combined with an ambient temperature below the tank shell 
ductile to brittle transition failure. Contributing factors, the 
existence of a defect in a weld overlay repair to the tank shell 
provided a crack initiation site for the failure.
    Date.--03/21/96
    Location.--Ada, Oklahoma
    Railroad.--Burlington Northern/Santa Fe (BN)
    Type of hazmat.--Nine tank cars containing denatured alcohol 
derailed. Seven of the cars released 195,841 gallons of product and 
caught fire.
    Fatalities.--0
    Injuries.--0
    Evacuations or other complications.--816
    Estimated cost of railroad damage.--$203.113
    Probable cause.--Broken axle (casting defect) on tank car GATX 
79780.
    Date.--04/11/96
    Location.--Alberton, Montana
    Railroad.--Montana Rail Link (MRL)
    Type of hazmat.--One tank car containing chlorine derailed and 
released product, one tank car containing sodium chlorate derailed and 
spilled product, and one tank car containing potassium cresylate 
derailed.
    Fatalities.--1
    Injuries.--123
    Evacuations or other complications.--500
    Estimated cost of railroad damage.--$382,100
    Probable cause.--Broken rail (vertical split head).
    Date.--06/29/96
    Location.--Singer, Louisiana
    Railroad.--Kansas City Southern (KCS)
    Type of hazmat.--Six tank cars containing propylene oxide, no 
leaks; one tank car Alcohol ethyoxylate, lost \2/3\ of its contents; 
one tank car diethanolamine, triethanolamine, lost entire contents.
    Fatalities.--0
    Injuries.--0
    Evacuations or other complications.--50
    Estimated cost of railroad damage.--$840,923
    Probable cause.--Burned off journal caused by a failed roller 
bearing on tank car SUNX 24805.
    Date.--10/04/96
    Location.--Lovell, Wyoming
    Railroad.--Burlington Northern (BN)
    Type of hazmat.--Approximately 9,690 gallons of diesel fuel 
reportedly spilled from the ruptured fuel tanks and a fire ensued.
    Fatalities.--0
    Injuries.--3
    Evacuations or other complications.--11
    Estimated cost of railroad damage.--$1,519,000
    Probable cause.--Head-end collision. The crewmembers of BN 01-223 
did not operate their train at restricted speed.
    Date.--11/07/96
    Location.--Lake Cormorant, Mississippi
    Railroad.--Illinois Central (IC)
    Type of hazmat.--One tank car containing hydrochloric acid residue 
and one tank car containing toluene diiscyanate derailed and 19,000 
gallons of product was released.
    Fatalities.--0
    Injuries.--0
    Evacuations or other complications.--2100
    Estimated cost of railroad damage.--$81,094
    Probable cause.--The cause of the derailment was excessive slack 
action and buff forces within the train.
                          hazmat improvements
    Question. What improvements to FRA's hazmat program have been made 
since last year. Answer: All FRA and State hazardous materials 
inspectors have recently attended a one week recurrent course that 
updated them on the 29 final rules published by RSPA since August 1995. 
State inspectors have been issued lap top computers to assist them in 
preparing their reports. In addition, FRA and State HM inspectors have 
been furnished with a computer program, for their lap tops, (developed 
by FRA field forces) to compute filling densities. This eliminated the 
timely task of performing hand calculations.
    FRA field forces are being furnished with recently published 
notices and final rules issued by RSPA through FRA's Internet system 
(E-Mail). This provides inspectors with a timely notice of what has 
been published and directs them to effective dates of the notice. The 
system is being expanded to our State partners.
    FRA is in the process of updating inspectors laptop computers for 
CD ROM capability. FRA's goal is to provide a CD disk to inspectors 
(including State) that will have FRA interpretations, 49 CFR citations, 
technical bulletins and enforcement manual.
    FRA has been partnering with U.S. Coast Guard (USCG) in their 
Container Inspection Training and Assistance Team training (CITAT). 
Over 40 FRA Hazardous Materials Inspectors have attended CITAT courses 
offered and sponsored by USCG. These courses have assisted our 
inspectors identifying problems with containers and IM portable tanks 
used to transport hazardous materials at port facilities and rail 
container yards. In addition, FRA Hazardous materials inspectors have 
participated in over 10 multi-modal inspections at various port 
facilities involving USCG, Customs, Federal Highway Administration, 
RSPA, and State governments.
    Implementation of a major rulemaking affecting tank car safety. 
Dockets HM-175A and HM-201 pertaining to the crash worthiness 
protection requirements for tank cars; detection and repair of cracks; 
pits; corrosion; lining flaws; thermal protection flaws and other 
defects of tank car tanks. This also includes damage tolerance analysis 
and quality assurance programs for manufacturing and repair facilities.
    FRA's Hazardous Materials Division is currently working with RSPA 
and Transport Canada in developing a North American Standard for tanks 
cars that will be performance based and follow U.N. guidelines.
    FRA continues to partner with its external customers on ``Ensuring 
Tank Car Safety'', numerous meetings have been conducted with rail 
management and labor, chemical shippers, tank car manufacturers, repair 
facilities and suppliers in determining what type of research 
government and industry is currently performing, in an effort to 
consolidate research programs and optimize research dollars available 
for research, and provide direction in areas that need to be addressed 
(e.g.; use of modern technology--Acoustic emission).
                       high risk hazmat shippers
    Question. Previously, FRA promised that FRA inspectors would direct 
adequate focus on high risk hazmat shippers. How is this now done? How 
are high risk shippers identified?
    Answer. FRA has issued, February 28, an Annual Allocation Analysis 
Model to its field that highlights railroad safety performance 
information for use with other resources to determine if a Safety 
Assurance Compliance Program action is needed or whether a focused 
site-specific inspection is needed. The model will be a valuable tool 
in assisting FRA's field in the deployment of field resources to ensure 
that acute compliance problems and other significant safety issues are 
identified and resolved. The model includes a hazmat model that covers 
railroad operations. Another model is near completion that will address 
high-risk hazmat shippers.
                     sacp--railroad system analysis
    Question. FRA is performing safety analyses of railroads on a 
system-wide basis, in an effort to be more risk based and cooperative 
in its safety enforcement efforts. How many railroads have been 
analysed by FRA so far (list by name of railroad and class)? What 
analyses are ongoing?
    Answer. Since October 1994, thirty-six railroads have been analysed 
in conjunction with the Safety Assurance and Compliance Program (SACP).

        Name                                                       Class
1.  Chicago & North Western.......................................     I
2.  Southern Pacific..............................................     I
3.  Iowa Interstate...............................................    II
4.  Conrail.......................................................     I
5.  Kansas City Southern..........................................     I
6.  Florida East Coast............................................    II
7.  Tri-County Commuter Rail...................................... Other
8.  Union Pacific.................................................     I
9.  Montana Rail Link.............................................    II
10. CSXT..........................................................     I
11. Dakota, Minnesota and Duluth..................................    II
12. Gateway Western...............................................    II
13. Northeast Illinois Regional Commuter Metra (Chicago)..........    II
14. Southeastern Pennsylvania Transit (SEPTA).....................    II
15. Wisconsin Central.............................................    II
16. Long Island Rail..............................................    II
17. Springfield Terminal..........................................    II
18. Belt Railway Company of Chicago...............................    II
19. Norfolk Southern..............................................     I
20. Alaska Railroad...............................................     I
21. Railtex....................................................... Other
22. New Jersey Transit Rail Operations............................    II
23. Elgin, Joliet & Eastern.......................................    II
24. Metro North Commuter..........................................    II
25. Burlington Northern/Santa Fe..................................     I
26. Canadian National (GTW/DWP)...................................     I
27. Illinois Central (Chicago Central)............................     I
28. Amtrak........................................................     I
29. Canadian Pacific (SOO)........................................     I
30. Canadian Pacific (Delaware & Hudson)..........................     I
31. Indiana Harbor Belt...........................................    II
32. MetroLink (SCRRA)............................................. Other
33. Central Oregon & Pacific...................................... Other
34. Texas Mexican.................................................    II
35. North American Rail Net....................................... Other
36. I&M Rail Link................................................. Other

    Categorization of railroads is in accordance with guidelines cited 
in FRA's Accident Incident Bulletin.
    Additional railroads scheduled for fiscal year 1997. Texas Oklahoma 
& Eastern/DeQueen & Eastern; Dakota, Missouri Valley and Western 
Railroad; Central Railroad of Michigan; Escanaba and Lake Superior; 
Wisconsin Southern; Toledo, Peoria and Western; Northern Indiana 
Commuter; Carolina Southern; Arizona and California; Blue Mountain 
Reading and Northern; Ann Arbor; Kyle Railroad; Wheeling and Lake Erie; 
Amtrak capital Corridor; Indianapolis and Louisville; Red River Valley 
and Western Railroad; Farmrail/Grainbelt.
     Since the SACP is viewed as a process, FRA continues analysis of a 
railroad after the ``termination or completion'' of a specific SACP 
assessment. The partnerships established as a result of the SACP 
provide a foundation for addressing future safety concerns between FRA, 
railroad management, and labor. Examples of current analyses include 
the following issues:
    Amtrak:
  --Inaccurate accident/incident reporting.
  --Failure to comply with Blue Signal protection regulations.
  --Training of mechanical department employees on new equipment.
    Kansas City Southern:
  --Grade Crossing/Trespasser issues.
    Long Island:
  --Signal and Train Control issues.
    Rail Tex:
  --Daily inspection and maintenance of locomotives.
    Elgin, Joliet & Eastern:
  --Train air brake testing.
    The above issues are being addressed by partnerships composed of 
representatives from FRA, railroad management, and labor organizations.
                            sacp agreements
    Question. Please summarize what safety plan agreements between FRA 
and railroads are now in place. How enforceable are these agreements?
    Answer. Under the Safety Assurance and Compliance Program (SACP), 
FRA seeks to develop partnerships between FRA, railroad management and 
labor organizations to mutually identify and resolve safety concerns. 
Where problems are detected, the railroad presents an action plan aimed 
at resolving them. FRA has entered into informal agreements with the 
following railroads as a result of a SACP assessment of their 
respective operating practices and procedures: Southern Pacific, Iowa 
Interstate, Conrail, Kansas City Southern, Union Pacific, Montana Rail 
Link, CSX, Dakota, Minnesota & Eastern, Gateway Western, SEPTA, Long 
Island Rail Road, Norfolk Southern, Alaska, Railtex Amtrak, and Elgin, 
Joliet & Eastern. The issues cited by FRA's assessments have been 
addressed by the aforementioned railroads and, with the exception of 
Amtrak, are in the process of being resolved or closed. Amtrak's Action 
Plan was recently received in May and FRA is currently reviewing the 
carrier's response to the various issues cited during our assessment. A 
preliminary review of Amtrak's Action Plan indicates that the carrier 
has developed appropriate plans and procedures to rectify all safety 
concerns raised by FRA.
    In general, FRA's experience has been that railroads abide by these 
informal safety agreements. Where there is a material failure to comply 
with the railroad action plan resulting in regulatory noncompliance, 
FRA's policy is to take strong enforcement action. In those situations, 
FRA is acting to enforce the safety rules themselves, not the terms of 
an agreement.
    In two situations, railroad noncompliance has been so significant 
that FRA has entered into a more formal Safety Compliance Agreement 
with the railroad. Under these agreements, FRA refrains from issuing a 
compliance order or emergency order if the railroad takes very specific 
steps to improve compliance. Any violation of the agreement may result 
in FRA's issuance of an appropriate order, which the railroad has 
agreed not to challenge. To date, the railroads are abiding by these 
agreements and FRA has not had to issue an order in either case.
                         success of sacp plans
    Question. How do you establish that your cooperative strategy is 
working? Please provide several examples of how this cooperative 
approach has been effective, and outline how the compliance levels have 
improved with this approach versus an enforcement approach.
    Answer. The most fundamental indicator that the cooperative 
strategy is working is the safety statistical improvement. Preliminary 
results from the various SACP's in conjunction with traditional 
compliance and inspection activities and regulatory initiatives 
indicate significant improvements in certain key safety categories. For 
example, as cited below a comparison of 1990-1993 percentages 
reductions with 1993-1996 percentage reductions clearly reveals a trend 
in safer conditions for employees and the public:

----------------------------------------------------------------------------------------------------------------
                                                  Between 1990-93                      Between 1993-96          
                                       -------------------------------------------------------------------------
                                                                 Percentage                           Percentage
                                           1990        1993     improvement     1993        1996     improvement
----------------------------------------------------------------------------------------------------------------
Fatalities............................       1,297       1,279          1.4       1,279       1,023         20.0
Train Accidents.......................       2,879       2,611          9.3       2,611       2,376          9.0
Crossing Accidents....................       5,713       4,892         14.4       4,892       4,159         15.0
Crossing Fatalities \1\...............         698         626         10.3         626         472         24.6
Trespasser Deaths.....................         543         523          3.7         523         472          9.8
EOD Casualties........................      21,010      15,410         26.7      15,310       8,949        41.9 
----------------------------------------------------------------------------------------------------------------
\1\ Includes all trespasser and employee fatalities at highway-rail grade crossings (Preliminary 1996 data.).   

    Certain improvements in defect ratios are available from a few 
assessments; however, this type of information is the exception and not 
the norm and generally relates to a specific carrier and location(s).
    FRA has witnessed a profound culture change between railroad 
management and labor organizations as to their sincerity and 
willingness to communicate their respective differences regarding 
safety problems and to modify or alter traditional approaches and 
viewpoints; approaches that tended to be an antagonistic or adversary 
in nature due to the parochial interests of the different parties. For 
example, the Burlington Northern Santa Fe (BNSF) Railroad has taken 
significant measures to eliminate the issue of fear and intimidation as 
existing or perceived by their employees in the reporting of an 
accident/incident. In addition, BNSF has modified their policy and 
procedures with regard to disciplinary actions against their employees. 
Both of these actions by BNSF represent a substantial cultural change 
by management in its handling of employee relations issues. These 
actions are unprecedented in the industry and provide a substantial 
impetus in the establishment of additional partnerships with labor 
organizations. On the other hand, labor organizations have formed 
partnerships with BNSF in an attempt to resolve safety concerns, 
including issues sensitive to their members, e.g., accident/incident 
reporting, processing of disciplinary cases, etc.
    Other examples of the effectiveness of the cooperative strategy:
Dakota, Minnesota and Eastern (DME)
    In late 1995, DME made a commitment to relay 100 miles of 72 lb. 
Jointed rail with new 115 lb. continuous welded rail (CWR) because of 
numerous defective rail and joints between Huron and Pierre, South 
Dakota. The railroad also experienced excessive track caused 
derailments. DME announced the project was completed by the end of 
October 1996. There have been no track caused derailments on this 
portion of railroad since the relay.
Amtrak
    Motivated by a desire to protect the lives and safety of railroad 
workers who work along Amtrak's high speed, high density Northeast 
Corridor, representatives from Amtrak management and labor sat down 
together to objectively analyse the risks faced by roadway workers from 
trains and moving equipment. The parties then worked together to 
develop effective safety procedures to minimize those risks. But 
Amtrak's safety partnership did not end there. Recognizing that 
railroad safety rules can only be effective if they are understood and 
obeyed by the people who are affected by them, the parties agreed upon 
a cooperative program to implement the roadway worker protection rules. 
This program includes peer training, empowering employees to enforce 
the rules, and joint labor/management oversight of the program.
    During the Amtrak SACP the team examined the quality of the 
carrier's periodic locomotive inspections after finding an excessive 
number of defects on out-shopped locomotives. Defective conditions 
included exhaust leaks, oil leaks over walkways in engine compartments, 
inoperative sanders and defective alerting devices. As a result of the 
SACP process Amtrak and its mechanical department employees have made 
dramatic improvement in the quality of locomotive inspections. FRA 
follow-up inspections have confirmed that the average number of defects 
per locomotive dropped from nine to one in the Los Angles area, from 
eight to one in the Chicago area, and from five to one in the 
Washington, D.C. area.
Alaska Railroad
    More than a dozen unsafe conditions raised by employees were 
addressed and resolved as the result of findings derived from the SACP 
assessment. These findings included concerns in the operating 
practices, motive power and equipment, signal and train control, and 
track areas. However, perhaps the greatest accomplishment from the 
assessment was the opening of communications and the resolution of 
sometimes long standing contentious issues between management and 
labor.
                       sacp plans not implemented
    Question. Please provide several examples of where the cooperative 
agreement did not work and FRA had to pursue enforcement actions.
    Answer. FRA has encountered very few situations where railroads 
have failed to follow through on commitments they have made as part of 
a SACP action plan. FRA does have a case pending against Conrail for 
several hazardous materials violations that the inspector believes stem 
from a failure by Conrail to live up to relevant portions of its SACP 
action plan.
    There have been several situations, however, where FRA has found 
significant noncompliance during the early stages of a SACP review and 
taken enforcement action as a result. For example, prior to the point 
at which Wisconsin Central was to present a SACP action plan, FRA 
determined that certain aspects of that railroad's compliance warranted 
immediate action, especially in the areas of track and equipment 
safety. In February 1997, FRA and the railroad entered into a Safety 
Compliance Agreement, in which the railroad committed to specific 
remedial actions and waived any right to contest a compliance order 
should there be, in FRA's unilateral view, any deviation from the 
agreement. Implementation of the agreement has gone smoothly to date. 
In June 1997, FRA reached a similar agreement with the Northwestern 
Pacific Railroad in California, where track conditions posed an 
unacceptable threat to tourist passenger operations.
    In 1996, FRA was working with the Central Oregon and Pacific to 
address certain systemic problems under SACP. The seriousness of some 
of the problems noted by FRA and the railroad's slowness to respond led 
FRA to cite the railroad for a variety of violations, especially in the 
hours of service record keeping and hazardous materials areas. The 
citations have helped bring about a more cooperative attitude on the 
part of the railroad, and progress toward improved compliance is 
occurring.
    On the Dakota, Minnesota, and Eastern, SACP activity revealed a 
significant failure to comply with FRA's rules on alcohol and drug 
testing. As a result, FRA cited the railroad for several violations, 
and cases totalling nearly $60,000 are pending.
                 enforcement cases against individuals
    Question. How have you strengthened since last year the systematic 
reinspection procedure of monitoring or revisiting either rail 
management or labor employees who received warning letters from the 
FRA? How many enforcement actions against these individuals has the FRA 
taken during each of the last three years? What types of actions were 
taken?
    Answer. FRA does not conduct reinspections focused on individuals 
who have received warning letters due to noncompliance with the safety 
laws. Our inspections and reinspections are focused on relative safety 
hazards presented at particular locations or across railroad systems. 
If, in the normal course of these inspections, we discover 
noncompliance by an individual whom we had previously warned, or if we 
receive a complaint alleging such noncompliance and confirm those 
allegations, we will pursue enforcement action against that individual. 
Such action is likely to be stronger than a warning letter, given the 
earlier attempt to gain compliance through that means.
    In 1994, FRA issued one disqualification order and closed six 
individual liability cases. In 1995, FRA terminated two 
disqualification cases, closed four individual civil penalty cases, and 
issued one headquarters-level warning letter. In 1996, FRA closed two 
civil penalty cases (one was terminated), issued one civil penalty 
case, and issued two headquarters-level warning letters.
      enforcement policy: balancing cooperation and strong action
    Question. Please explain the policy of the FRA with respect to the 
use of civil penalties in cases of serious safety violations. How has 
an appropriate balance been attained between working cooperatively with 
industry and making strong enforcement cases against it when necessary? 
Please explain your rationale, procedures, and policies followed to 
achieve this balance.
    Answer. In April 1997, FRA issued guidance to all of its safety 
personnel on this very subject. When the Safety Assurance and 
Compliance Program (SACP) was first announced in March 1995, the 
greatest emphasis was placed on getting to root causes of systemic 
safety problems through partnership efforts. This was, and is, the 
program's major innovation. Because this central thrust of the program 
entailed a certain amount of enforcement forbearance concerning the 
subjects of a system audit during the period of the audit, the 
erroneous impression may have developed that SACP called for refraining 
from use of enforcement tools in nearly all cases. However, there never 
was any intent to eliminate or discourage use of the enforcement tools 
or the exercise of discretion, which is necessary for rational 
enforcement. In fact, SACP actually involves stronger enforcement than 
before because it seeks to better target our enforcement efforts toward 
serious safety problems.
    To ensure that all FRA enforcement personnel understand how to 
achieve a balance between cooperation and enforcement, the recent 
guidance issued by FRA contained these basic principles:
    Use discretion.--Exercise enforcement discretion in accordance with 
the agency's longstanding criteria found in 49 CFR Part 209 Appendix A. 
Where, consistent with those principles, the situation warrants use of 
an enforcement tool to ensure compliance and increase safety, take the 
enforcement action.
    Focused enforcement.--In deciding whether enforcement action is 
necessary, make a special effort to focus enforcement where it will do 
the most good, i.e., where accident trends, inspection data, direct 
observations, and/or the violation's inherent seriousness indicate that 
enforcement action is needed to address a significant safety risk.
    Systemwide audits.--In systemwide audits, refrain from enforcement 
action concerning the subjects of the audit as long as full cooperation 
continues, unless a violation is extremely severe. This limited 
forbearance is an important way of developing a cooperative atmosphere 
for mutually identifying root causes of problems and achieving 
solutions.
    Safety action plan violations.--Where a railroad or shipper has 
developed a Safety Action Plan as a response to a Safety Profile and a 
Senior Management Meeting and then committed violations of the safety 
laws directly related to the Safety Action Plan, strong enforcement 
action should be taken in every case, absent a compelling reason.
    Small companies.--In dealing with very small railroads and 
shippers, abide by the dictates of President Clinton and recent small 
business legislation, which generally require that enforcement 
agencies, in deciding whether to assess penalties and determining 
penalty amounts, give great weight to whether violations were committed 
in good faith and the swiftness of remedial action. As has long been 
FRA's policy, we strive to assist these small businesses in their 
compliance efforts. The guidance emphasizes that enforcement is a very 
important element of SACP, and notes that ``balance between firm 
enforcement and cooperative effort is essential to the program's 
success.'' FRA has delivered the written guidance to all of its safety 
personnel and included presentations on and discussion of these 
principles at each of its multi-regional conferences in 1997.
                       inspector trainee program
    Question. Please provide information on the success of the 
inspector trainee program and the retention rate for all individuals 
who have entered this program since its inception. How many individuals 
who entered the inspector trainee program now serve as FRA inspectors 
in the field? How much of the fiscal year 1998 request pertains to this 
program? Please compare this amount with the amounts spent during each 
of the preceding three years.
    Answer. The FRA Inspector Trainee Program has been very successful. 
The inspector trainees have brought new and creative thinking to 
complex safety issues with their various and exceptional educational 
backgrounds. Significant benefits have been gained by the public and 
the railroad industry as the trainees become a part of FRA's inspector 
workforce. The input from the trainees have been significant in helping 
to bring FRA's inspector program to a fact-based, cooperative approach 
to safety.
    Since the inception of the FRA inspector trainee program in fiscal 
year 1991, the retention rate has ranged from a low of 88 percent in 
fiscal year 1992 to a high of 97 in fiscal year 1993 and fiscal year 
1996. The retention rate has been well within what we consider 
acceptable.
    Of the 35 inspector trainees currently on-board, 19 have qualified 
as inspectors and are serving in that capacity. Thirteen additional 
trainees are expected to meet the journeyman inspector qualifications 
within the next year.
    The fiscal year 1998 request includes $1.9 million to continue this 
program. The budgeted amount for fiscal year 1997 is $1.8 million, for 
fiscal year 1996 it was $1.7 million, and for fiscal year 1995 it was 
$1.5 million.
                         safety training budget
    Question. Please prepare a chart of your training budget for each 
of the last four years, specifying the amount spent on Federal and 
State inspectors separately.
    Answer. The information follows:

                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                            Fiscal years--              
                             -------------------------------------------
                                 1995       1996       1997       1998  
                                actual     actual     budget    request 
------------------------------------------------------------------------
State.......................        122        210        240        245
Federal.....................        630        675        796        793
                             -------------------------------------------
      Total training........      1,758      1,637      1,724      1,736
------------------------------------------------------------------------

                              atip vehicle
    Question. FRA has requested $3 million to acquire a new automated 
track inspection vehicle in fiscal year 1998. Why can't funding for the 
ATIP be split funded over the next two years? What additional costs 
would be encountered?
    Answer. Operation of the ATIP vehicle provides FRA with an 
objective method to monitor compliance with minimum track geometry 
safety standards over critical line segments such as those which 
support Amtrak and commuter operations, line segments which support the 
transport of large volumes of hazardous materials, line segments 
considered as heavily utilized freight main lines, and line segments 
designated essential by the Military Traffic Management Command if 
military mobilization were necessary.
    Operation of the ATIP vehicle provides FRA with the opportunity for 
early identification of trends which indicate various levels of track 
degradation. FRA uses the information from the ATIP vehicle to 
supplement its Safety Assurance and Compliance Program (SACP) and to 
identify those areas of the track structure which may require a focused 
enforcement approach by FRA inspectors.
    Funding for the acquisition of the new vehicle should not be split 
funded for several reasons: Estimated time from earliest possible 
contract award to complete the new vehicle is approximately 21 months. 
It is unreasonable to expect industry to undertake a project of this 
duration with only one-year funding available. With split funding, 
contractor costs may be expected to increase by about five to seven 
percent or $150,000 to $210,000 due to costs associated with obtaining 
expert staff for a one-year effort only; certain long-lead items could 
not be ordered until funding was available which could result in 
additional delays or labor stoppages due to lack of parts; and costs of 
shutdown to protect the first year's investment if additional funding 
did not become available.
    Operation of the current T-10 vehicle is becoming extremely costly 
due to high maintenance costs. Additionally, it is uncertain how much 
longer parts can be obtained to repair the T-10 car. This is a model 
SPV 2000 as originally produced by the Budd Company in 1980. Budd has 
been out of business for several years now and FRA's vehicle was one of 
the last ones produced.
    If the ATIP vehicle is not available or inspects at a lesser 
frequency than what has been normal in the past, the effectiveness of 
FRA and State inspectors would be compromised as they will be deprived 
of the critical information which helps them to prioritize their 
inspection activities. FRA itself will be denied the opportunity to 
effectively monitor compliance within the higher speed ranges if the 
ATIP program is not continued and does not keep pace with the changes 
within the industry.
                            use of atip data
    Question. Please explain how FRA has incorporated data provided 
through the ATIP program into its overall safety strategy of ensuring 
the safety of the nation's railroad systems.
    Answer. Operation of the ATIP vehicle provides FRA with real-time 
track geometry data which serves as an excellent indicator of overall 
track quality. This data is analyzed for the early identification of 
trends which can indicate various levels of track degradation. This 
process is an essential part of FRA's overall strategy for monitoring 
compliance, especially on those critical safety-sensitive line segments 
which support Amtrak and commuter operations, those that support the 
transport of large volumes of hazardous materials, and those line 
segments designated essential by the Military Traffic Management 
Command if military mobilization becomes necessary.
    FRA further uses the data from the ATIP vehicle to supplement its 
Safety Assurance and Compliance Program (SACP) by enabling FRA and 
State inspectors to make prioritized judgements on where future on-the-
ground inspection time would be most beneficial in ensuring railroad 
safety.
                         track safety standards
    Question. To what extent will the revised Track Safety Standards 
contain language to accommodate the Gage Restraint Measuring System 
(GRMS) technology?
    Answer. The draft Notice of Proposed Rulemaking (NPRM) recommended 
by the Railroad Safety Advisory Committee (RSAC) does not incorporate 
rule text language which would accommodate the GRMS technology. Lengthy 
discussions within the Track Working Group which drafted the NPRM did 
not yield agreement about the use of the GRMS technology as an 
alternate performance standard.
    Although the Track Working Group could not reach consensus on 
whether or not the revised standards should contain language to 
accommodate this technology, RSAC has recommended that a small task 
group continue evaluating the possibility of developing GRMS standards 
for broad application within the industry. The draft NPRM invites 
public comment regarding the feasibility of this technology as an 
alternate inspection standard or as an additional inspection method.
    Discussions within this small task group, along with public comment 
to the NPRM regarding this issue, will ultimately decide to what extent 
this technology will be accommodated in the Final Rule.
                              atip vehicle
    Question. Can you justify the cost of purchasing a new ATIP vehicle 
before the RSAC resolves issues concerning a revision of the Track 
Safety Standards that might include a GRMS that could replace the need 
for an ATIP?
    Answer. The Gage Restraint Measurement System (GRMS) must be viewed 
as a technology application which is totally different when compared to 
FRA's ATIP program. The GRMS measures the lateral restraint provided by 
the crossties and rail fasteners under constant applied lateral and 
vertical loads. Lateral restraint can be described as the ability of 
the track to resist gage widening forces and therefore is a direct 
indication of track strength. The only track geometry parameter which 
is of concern is the gage of the track.
    FRA's ATIP vehicle measures all track geometry parameters which are 
addressed in the track safety standards. These parameters include track 
gage, track alignment, and track surface which include the parameters 
of crosslevel, warp, and profile. The ATIP vehicle also calculates the 
maximum allowable curving speed based on the existing alignment and 
superelevation.
    GRMS and ATIP can not be considered as compatible systems on the 
same vehicle if the maximum benefit is to be achieved from each system. 
Due to the limitations imposed by the response time of the hydraulic 
split axle, the maximum testing speed of a GRMS vehicle is in the range 
of 30 to 35 mph. Collecting track geometry data at this speed would 
drastically reduce FRA's annual test miles, as our present vehicle 
tests the track at its posted speed up to 80 mph. Conversely, 
collecting track geometry data at 80 mph with a vehicle equipped with a 
retracted (cut out) GRMS split axle assembly, would result in extensive 
wear and tear to the GRMS system.
    The cost of purchasing a new ATIP vehicle is justified regardless 
of what, if any, GRMS language may be included in the revised track 
safety standards.
                fiscal year 1996 regulatory initiatives
    Question. Please list all final regulations, ANPRM's, NPRM's, and 
any new regulatory projects issued or pursued last year.
    Answer. In 1996 FRA issued or pursued the following regulatory 
projects:
  --Issued a final rule on roadway worker protection. This was FRA's 
        first formal negotiated rulemaking.
  --Issued a final rule on devices to enhance the visibility of 
        locomotives at highway grade crossings.
  --Issued a final rule concerning accident reporting.
  --Issued hazardous materials penalty guidelines.
  --Issued final rules revising signal regulations.
  --Amended a final rule on maintenance, inspection, and testing of 
        grade crossing signal devices.
  --Drafted a proposed rule on emergency response for passenger 
        operations, which was developed as part of a statutorily 
        authorized collaborative process.
  --Drafted a proposed rule on passenger equipment, also developed as 
        part of a collaborative process.
  --Drafted a proposed rule on track safety, developed by an RSAC 
        working group.
  --Drafted a proposed rule on radio communications (RSAC).
  --Drafted a final rule on the use of two-way end-of-train devices.
                           regulatory efforts
    Question. Please explain why there is a regulatory backlog of 22 
projects. What is the nature and status of each of these projects.
    Answer. FRA has an ambitious regulatory agenda that fluctuates as 
Final Rules are issued and new rulemaking efforts are added. FRA's 
rulemaking agenda includes 12 Congressionally mandated reports and 
rulemakings, five of which are overdue. This is an inescapable 
consequence of both the complexity of the industry and the colossal 
changes that have occurred in railroading in recent years.
    The Rail Safety Advisory Committee (RSAC) was created in 1996 in 
response to FRA's critical need to address over 40 pending rulemaking 
initiatives and President Clinton's Regulatory Reform Initiative, which 
directed agencies to substantially expand efforts at promoting 
consensual rulemaking. Collaborative rulemaking ensures regulatory 
decisions are based on complete and accurate data, balances costs and 
benefits, accommodates the rapidly evolving changes in the rail 
transportation industry, and allows for the best use of resources. 
Regulations resulting from this collaborative process are more likely 
to be reflective of all the affected interests and more readily 
implemented. Because the final rule is based on consent, acceptance and 
understanding are widespread and compliance is at high levels from the 
start.
    RSAC is working on some of FRA's toughest, most controversial 
regulatory challenges. It is expected that RSAC involvement can shorten 
a rulemaking process. Since RSAC was chartered on March 25, 1996, the 
scope of involvement has included the 50 full Committee members and 
their alternates (110), six working groups (217 members and 
alternates), and 15 task forces (140 members).
    The $200,000 requested for RSAC in fiscal year 1998 would support 
RSAC activities at the optimum level for addressing FRA's regulatory 
program. Railroad labor and management are dedicating significant 
resources to the success of this rulemaking process. Funding below the 
requested level would severely impact the effectiveness of this process 
and the resulting critical contributions to public safety envisioned by 
all parties dedicated to the success of collaborative rulemaking.
    The 4 new FTE's in the Office of Safety and the Office of Chief 
Counsel will be hired to help resolve highly technical and legal issues 
that evolve during the RSAC rulemaking process. Many of the rules to be 
done in 1998 will be developed through the RSAC. The RSAC establishes 
working groups to gather and analyze relevant data and develop Notices 
of Proposed Rulemakings. The experience and expertise of an industrial 
hygienist, mechanical engineer, electrical engineer and safety attorney 
are needed to help with RSAC regulatory projects.
    Current consensus rulemakings under RSAC include Locomotive 
Engineer Certification, Maintenance of Way Equipment Safety Standards, 
Gage Restraint Measurement System, Tourist and Historic Railroads, 
Locomotive Crew Safety (Crashworthiness and Working Conditions), and 
Event Recorder Requirements. Future rulemaking through RSAC include 
Positive Train Control and Accident/Incident Reporting.
    The additional FTE's will certainly improve our ability to handle 
our regulatory workload.
    Attached is a comprehensive overview of FRA's Railroad Safety 
Regulatory Program.
                                 ______
                                 

 [U.S. Department of Transportation, Federal Railroad Administration, 
                             June 20, 1997]

   Overview of the Railroad Safety Regulatory Program and Standards-
                      Related Partnership Efforts

Legend:
    ANPRM=Advance Notice of Proposed Rulemaking
    Italics=Indicates project has been identified for development 
through the Railroad Safety Advisory Committee or a similar forum for 
collaborative rulemaking
    NPRM=Notice of Proposed Rulemaking
    RSAC=Railroad Safety Advisory Committee
                summary of consensus rulemaking efforts
    Roadway Worker Safety.--Consensus achieved in formal negotiated 
rulemaking; final rule published 12/16/96; effective 1/15/97. Denial of 
AAR and APTA petitions for reconsideration published 4/21/97. Misc. 
waiver petitions pending (hearing 5/22/97; comments closed 6/9/97).
    Passenger Equipment Safety.--Partial consensus achieved; NPRM 
circulated to working group 3/19/97. Includes power brake rules for 
passenger service. In review and clearance.
    Passenger Train Emergency Preparedness.--NPRM based on working 
group recommendations was submitted for review and clearance; NPRM was 
published 2/24/97 with significant additions, and a notice of public 
hearings was published 3/6/97. Public hearings were held in Chicago on 
April 4 and in New York City on April 7. Written comments were due by 
4/25/97. Next step will be identification of options based on comments 
to date; working group will be asked to help resolve final rule issues.
    Railroad Safety Advisory Committee.--Last full committee meeting: 
3/24/97. Next meeting 6/24/97.

----------------------------------------------------------------------------------------------------------------
 Task                                                                                                           
  No.               Subject                                               Status                                
----------------------------------------------------------------------------------------------------------------
  96-1 Power Brake Regulations,        Working group charter extended to 1/15/97 to produce NPRM; impasse       
        freight, general revision       reached at 12/4/96 meeting, and subsequent efforts to renew talks were  
                                        not successful. FRA withdrawing task at 6/24/97 meeting. FRA is         
                                        drafting second NPRM for early issuance.                                
  96-2 Track Safety Standards,         Consensus achieved; in balloting that concluded 11/21/96, RSAC voted to  
        general revision                accept working group report and recommend NPRM. NPRM signed 6/19/97     
                                        and forwarded to Federal Register for publication.                      
  96-3 Railroad Communications         Final meeting of working group was held 1/23/97. Working group provided  
        (including revision of Radio    consensus NPRM to RSAC at 3/24/97 meeting. RSAC voted to accept the     
        Standards and Procedures)       NPRM and forward to the Administrator in voting concluded 4/14/97.      
                                        NPRM signed 6/11/97 and forwarded to Federal Register for publication.  
  96-4 Tourist Railroads               Open task to address needs of tourist and historic railroads; working    
                                        group is monitoring steam task.                                         
  96-5 Steam-Powered Locomotives,      Task force of Tourist & Historic Working Group held final meeting week   
        revision of inspection          of 5/19/97 and completed agreement on rule text. Final drafting         
        standards                       underway at FRA on NPRM, which will be considered in the Tourist &      
                                        Historic Railroads Working Group in June and if possible will be        
                                        available to the full Committee 6/24/97.                                
  96-6 Locomotive Engineer             Task accepted 10/31/96; first working group meeting held 1/7-1/9/97;     
        Qualification and               meetings continue monthly. Meeting to review final draft rule language  
        Certification, general          scheduled 10/7/97; expect consensus approval and submission to full     
        revision                        Committee by 10/15/97.                                                  
  96-7 Track Motor Vehicle and         Task accepted 10/31/96. Task force of Track Safety Standards Working     
        Roadway Worker Equipment        Group last met 5/29-5/30, and the task force expects to report to the   
                                        Working Group by 9/30/97.                                               
  96-8 Locomotive Crashworthiness and  Planning task accepted 10/31/96; planning group met 1/23/97; FRA will    
        Working Conditions (planning    present two task statements to full Committee at 6/24/97 meeting.       
        task)                                                                                                   
[97-1] Event Recorder                  Committee requested opportunity to address crash survivability and       
                                        other NTSB-initiated issues on 3/24/97. Task statement to be presented  
                                        to full Committee at 6/24/97 meeting.                                   
----------------------------------------------------------------------------------------------------------------

                    general safety rules and reports
Accident/Incident Reporting
    Summary: The Rail Safety Enforcement and Review Act of 1992 barred 
FRA from adjusting the monetary threshold for reporting of train 
accident (presently $6,300) until the methodology is revised. In 
addition, FRA identified the need to comprehensively revise these 
regulations, which had not be revised since 1974.
    Deadline: The report of the Committee of Conference on the 
Department of Transportation and Related Agencies Appropriation Act, 
1996, directed FRA to issue a final rule in this proceeding by 6/1/96.
    History: An NPRM was issued 8/19/94, followed by public hearings 
and written comment. A public regulatory conference was convened 1/30-
2/3/95 in an effort to resolve outstanding issues. A notice of decision 
to issue a supplemental NPRM was published 7/3/95, but was withdrawn in 
a notice published on 1/24/96.
    Status: Final rule was issued 5/30/96 and published 6/18/96. Stay 
requests have been denied, and technical amendments were published 11/
22/96 (61 FR 59368). A notice of availability of custom software was 
also published 11/22/96 (61 FR 59485). On 12/16/96, the Administrator 
signed final rule amendments, which were published 12/23/96 (61 FR 
67477). Final rule became effective 1/1/97. Industry training 
partnerships are being executed.
Regulatory Reinvention
    Summary: In response to the President's call for regulatory review, 
elimination and reinvention, FRA took several actions to repeal 
obsolete regulations and simplify agency processes that affect external 
customers. Major elements of this effort are included in regulatory 
revision efforts described below under other headings.
    Status: Interim final rule amendments reducing frequency of 
reporting regarding signal and train control systems (49 CFR Part 233), 
simplifying review requirements for certain modifications of signal 
systems (49 CFR Part 235), and making conforming changes regarding 
inspection of ATC/ATS/ACS (49 CFR Part 236) published 7/1/96 (61 FR 
33871). These changes should be finalized in 1997. The Department of 
Transportation has offered legislative proposals to permit flexibility 
for small railroads to make accident/incident report less frequently 
than monthly and to eliminate outdated requirements for notarization of 
reports.
                     safety of railroad operations
Track Safety Standards
    Summary: The Rail Safety Enforcement and Review Act of 1992 
required FRA to revise the Track Safety Standards, taking into 
consideration, among other things, the ``excepted track'' provision. 
Other prominent issues include updating the standards to take advantage 
of research findings for internal rail flaw detection and gage 
restraint measurement. FRA also proposes to adopt track standards for 
high-speed service.
    Statutory deadline: Final rule by 9/1/95.
    Status: FRA published an ANPRM 11/6/92 and conducted workshops in 
the period 1/93-3/93. The Railroad Safety Advisory Committee accepted 
task of preparing an (NPRM) on 4/2/96. The Track Safety Standards 
Working Group reported a draft NPRM to the full committee on 10/31/96. 
In balloting that concluded 11/21/96, RSAC voted to accept the working 
group report and recommend issuance of the NPRM. NPRM signed June 19, 
1997, and forwarded to Federal Register for publication. (RSAC Task 96-
2).
Power Brakes
    Summary: The Rail Safety Enforcement and Review Act of 1992 
required FRA to revise the power brake regulations. The statute 
required adoption of requirements for 2-way end-of-train telemetry 
devices (EOT's) and ``standards for dynamic brakes.''
    Statutory deadlines: Final rule by 12/31/93; 2-way EOT's to be used 
on trains operating greater than 30 miles per hour or in mountain grade 
territory to be equipped by 12/31/97.
    Status: FRA published an NPRM 9/16/94 and conducted six days of 
public hearings ending 12/94. Due to strong objections to the NPRM, 
additional options were requested from passenger interests by 2/27/95 
and from freight interests by 4/3/95. Further action is as follows:
    (1) Passenger standards revision: FRA requested the Passenger 
Equipment Safety Standards Working Group to incorporate new proposals 
for revisions of the power brake regulations in the NPRM for passenger 
equipment safety. Working group proceedings on the elements of the NPRM 
concluded 10/2/96 without full agreement on power brake elements. See 
Passenger Equipment Safety Standards for current status.
    (2) Freight standards revision: On 4/1/96, the RSAC accepted the 
task of preparing a second NPRM. The working group initiated its 
efforts in May, and on 10/31/96 the RSAC extended the deadline for a 
final report until 1/15/97. At the working group meeting 12/4/96, an 
impasse was declared, and subsequent efforts to revive discussions were 
not successful. On May 29, FRA notified the working group by letter 
that the task will be formally terminated. FRA will withdraw task at 6/
24/97 full Committee meeting. FRA is preparing a second NPRM. (RSAC 
Task 96-1)
    (3) Two-way end-of-train devices: FRA published notice on 2/21/96 
that this issue would be separated from the balance of the freight 
issues and expedited for completion of a final rule. A public 
regulatory conference was convened 3/5/96 to explore remaining issues, 
and written comments were due 4/15/96. (Railroads also agreed to an 
expedited schedule that will ensure application of this technology by 
12/15/96 on 2 percent or greater grades and by 7/1/97 for other 
trains.) The final rule was published 1/2/97 (62 FR 278), and it 
becomes effective 7/1/97. FRA received two petitions for 
reconsideration (``local train'' definition and implementation date for 
smaller railroads). A notice denying the request to delete the tonnage 
restriction for local trains and granting extension of the compliance 
date for railroads with fewer than two million work hours was published 
6/4/97 (62 FR 30461).
    Note: On 2/6/96, the Administrator issued Emergency Order No. 18, 
requiring use by the BNSF of 2-way EOT's or equivalent protection for 
heavy grade operations over the Cajon Pass.
Bridge Structural Safety
    Summary: Following a survey of bridge conditions and railroad 
inspection practices, FRA determined that regulatory action is not 
necessary, but that FRA should continue to exercise an oversight role 
regarding bridge structural safety programs. FRA issued an interim 
statement of policy 4/27/95, with comments due 6/26/95.
    Status: Comments support continued FRA partnership role. Final 
statement of policy forthcoming ASAP.
    Note: On 2/12/96, the Administrator issued Emergency Order No. 19, 
which removed from service a bridge on the Tonawanda Island Railroad in 
New York State pending necessary structural repairs.
Bridge Displacement Detection Systems (Report)
    Summary: The Swift Rail Development Act of 1994 required FRA to 
submit a report on systems to detect bridge displacement of the type 
that caused the derailment of the Sunset Limited at Mobile, Alabama, 9/
23/94.
    Statutory deadline: 6/2/96.
    Status: A technical evaluation report was published 6/23/94 and 
made available to the respective committees. The formal report to 
Congress is in preparation.
Freight Car Safety Standards; Maintenance-of-Way Cars
    Summary: Cars not in compliance with the Freight Car Safety 
Standards may be operated at track speed in revenue trains if they are 
company-owned, stenciled cars. FRA published an NPRM 3/10/94 to close 
this loophole. FRA requested the Association of American Railroads to 
amplify its comments by letter of 12/20/94.
    Status: AAR response received 8/4/95 is under review with further 
action to be determined through the Railroad Safety Advisory Committee.
Railroad Communications (includ. Radio Standards and Procedures)
    Summary: In submitting the required report to the Congress on 
Railroad Communications and Train Control on 7/13/94, FRA noted the 
need to revise existing Federal standards for radio communications in 
concert with railroads and employee representatives.
    Status: On 4/1/96, the RSAC accepted the task of preparing an NPRM, 
including consideration of communication capabilities required in 
railroad operations. The working group has presented a consensus NPRM 
to the full Committee on 3/24/97, and the Committee voted to recommend 
issuance of the NPRM to the Administrator in balloting that ended 4/14/
97. NPRM signed June 11, 1997, and fowarded to Federal Register for 
publication. (RSAC Task 96-3)
Northeast Corridor (NEC) Signal & Train Control
    Summary: Amtrak is planning operations to 150 mph on portions of 
the NEC and is implementing improvements to the automatic train control 
system that will provide positive stop and continuous speed control 
capabilities. FRA's Northeast Corridor Safety Committee (NCSC) met 9/
20/94 and approved a set of performance criteria for the new system.
    Status: On January 30, 1997, Amtrak provided to FRA a detailed 
system concept for the Advanced Civil Speed Enforcement System (ACSES), 
including conditions for operation on designated territories on the 
south and north ends of the NEC. A notice of Proposed Order for the new 
signal and train control system authorizing speeds to 150 miles per 
hour (135 mph on the South End with only high-speed trains equipped 
under ``flanking protection'') is being drafted for early issuance. The 
NCSC will be consulted in finalizing appropriate orders.
NEC System Safety
    Summary: Mixed passenger and freight operations at speeds to 150 
mph have not previously been attempted in this country. Through the 
Northeast Corridor Safety Committee (or successor), FRA intends to 
develop system safety criteria for this service territory, integrating 
existing safety measures and identifying any areas of material risk not 
previously addressed.
    Status: Timing of project initiation to be determined.
Positive Train Control (Status Report)
    Summary: The Swift Rail Development Act of 1994 required FRA to 
submit a status report on the implementation of positive train control 
as a follow-up to the 7/94 Report entitled Railroad Communications and 
Train Control.
    Statutory deadline: 12/31/95.
    Status: FRA has provided testimony to the committees of 
jurisdiction reporting the status of efforts to promote implementation 
of positive train control. The report is under review at FRA.
Tourist Railroad Report/Review of Regulatory Applicability
    Summary: The Swift Rail Development Act of 1994 required FRA to 
submit a report to the Congress regarding FRA's actions to recognize 
the unique factors associated with these generally small passenger 
operations that often utilize historic equipment.
    Statutory deadline: 9/30/95.
    Status: Report submitted to the Congress 6/10/96. The RSAC 
authorized formation of a Tourist and Historic Railroads Working Group 
4/1/96. The working group held its initial meeting 6/17-6/18/96 and is 
presently monitoring completion of the steam task. (RSAC Task 96-4)
Passenger Safety Standards
    Summary: The Federal Railroad Safety Authorization Act of 1994 
(enacted 11/2/94) required FRA to issue initial passenger safety 
standards within 3 years and complete standards within 5 years. The 
agency was authorized to consult with industry parties outside the 
Federal Advisory Committee Act, making it possible to conduct an 
informal negotiated rulemaking.
    Statutory deadline: 11/2/97 (initial); 11/2/99 (final).
    Status: An initial meeting of the Passenger Equipment Safety 
Working Group (passenger railroads, operating employee organizations, 
mechanical employee organizations, and representatives of rail 
passengers) was held on 6/7/95, and the group has been meeting 
regularly and conducting task force activities since that time. 
Manufacturer/supplier representatives are serving as associate members. 
FRA prepared an Advance Notice of Proposed Rulemaking indicating the 
issues under review by the working group, which was published 6/17/96. 
The working group held its final meeting on the NPRM 9/30-10/2/96, 
having reached consensus on a portion of the issues presented. An NPRM 
was circulated to the working group on 3/19/97, and that document (with 
minor changes requested by members) is under review and clearance.
Passenger Train Emergency Preparedness
    Summary: The Federal Railroad Safety Authorization Act of 1994 
required FRA to issue emergency preparedness standards for passenger 
service. Initial standards were required within 3 years and complete 
standards within 5 years. The agency was authorized to consult with 
industry parties outside the Federal Advisory Committee Act, making it 
possible to conduct an informal negotiated rulemaking.
    Statutory deadline: 11/2/97 (initial); 11/2/99 (final).
    Status: An initial meeting of the working group for passenger train 
emergency preparedness standards was held on 8/8/95. The group met 2/6-
7/96 to develop elements of an NPRM and met jointly with the Passenger 
Equipment Safety Standards Working Group on 3/26/96 to consider related 
issues, including the implications of Emergency Order No. 20 and 
recommendations of the National Transportation Safety Board. The 
working group includes representatives of passenger railroads, 
operating employee and dispatcher organizations, and rail passenger 
organizations, and an advisor from the National Transportation Safety 
Board. The working group approved draft rule text, which was 
incorporated in an NPRM forwarded for review and clearance. Changes 
requested during review and clearance were provided to the working 
group during the week of 12/16/96. The NPRM was published 2/24/97 (62 
FR 8330), and a notice of public hearings was published 3/6/97 (62 FR 
10248). Public hearings were held in Chicago on April 4 and in New York 
City on April 7. Written comments were due by 4/25/97. FRA is reviewing 
comments and preparing options for discussion with the working group.
Emergency Order No. 20
    Summary: This order deals with the safety of push/pull and electric 
multiple unit service. The order was issued 2/20/96, and amended 2/29/
96. Intercity and commuter passenger railroads were required to adopt 
operating rules providing for observance of reduced speed where delays 
are incurred in blocks between distant signals and signals at 
interlockings or controlled points. Marking of emergency exits and 
testing of emergency windows was required. Interim system safety plans 
were required to be filed.
    Status: The order has been fully implemented. On 3/26/96, the 
Passenger Equipment Safety Working Group and the Emergency Preparedness 
Working Group met jointly to consider implementation issues and 
crossover issues with the two rulemaking proceedings and recent 
recommendations of the National Transportation Safety Board. The 
American Public Transit Association and it members have undertaken a 
number of actions in response to the emergency order, including 
development of comprehensive system safety plans (work ongoing). 
Codification, revision or termination of provisions will be considered 
during the second phase of passenger safety standards rulemaking 
beginning in 1998.
Florida Overland Express
    Summary: FRA has received a petition for a rule of particular 
applicability for operations over a new high-speed railroad between 
Miami and Tampa via Orlando. The State of Florida has established a 
dedicated funding stream of $70 million per year towards creation of 
this new private/public partnership.
    Status: Received petition for rule of particular applicability 2/
18/97. FRA is reviewing the petition and preparing an NPRM for early 
issuance.
Steam Locomotives
    Summary: A committee of steam locomotive experts from tourist and 
historic railroads has sought a partnership with FRA to revise the 
steam locomotive regulations. Proposed revisions would relieve 
regulatory burdens while updating and strengthening the technical 
requirements.
    Status: Revision of the Steam Locomotive Inspection regulations was 
tasked to the RSAC on 7/24/96. A task force of the Tourist & Historic 
Railroads Working Group is actively working toward finalization of an 
NPRM. The task force has finalized rule text, and preamble language is 
being completed at FRA for review by the task force and working group. 
Full NPRM should be circulated 6/97. (RSAC Task 96-5.)
Locomotive Engineer Certification; Miscellaneous Revisions
    Summary: The final rule for locomotive engineer certification 
became effective in 1991, but certain issues were left unresolved. 
Experience under the rule has raised additional issues. Examples of 
issues under review include the status of operators of specialized 
maintenance of way equipment and types of conduct for which 
decertification is appropriate.
    Status: An interim final rule amendment dealing with agency 
practice and procedure concerning engineer certification appeals was 
published 10/12/95. Issues related to procedures on the properties, 
offenses warranting decertification, periods of decertification, 
operation of specialized equipment, etc., are pending. The RSAC 
accepted this task on 10/31/96. The working group's initial meeting was 
held 1/7-1/9/97; meeting to review final draft rule language scheduled 
10/7/97; expect consensus approval and submission to full Committee by 
10/15/97. (RSAC Task 96-6.)
Hours of Service Pilot Projects; Report to Congress
    Summary: The Federal Railroad Safety Reauthorization Act of 1994 
(enacted with the Swift Rail Development Act) authorized FRA to approve 
one or more pilot projects to address fatigue and alertness issues 
among employees subject to the Hours of Service laws. Projects were 
required to have the support of the railroad and affected labor 
organizations. FRA was to report the results of those projects.
    Statutory due date: 1/1/97.
    Status: FRA has encouraged submission of pilot projects and has 
worked with several railroads regarding innovative work and rest 
practices; however, only one formal applications for pilot projects has 
been submitted, and that petition did not involve fundamental reform of 
work and rest requirements. FRA will report regarding the status of 
work and rest issues in the industry.
Small Railroads; Policy Statement on Penalty Program
    Summary: The Small Business Regulatory Enforcement Fairness Act of 
1996 amended the Regulatory Flexibility Act and required, among other 
things, that each agency establish a program to reduce or waive civil 
penalties for small entities under certain circumstances.
    Statutory deadline: 3/29/97.
    Status: Consultations have been initiated in support of this 
effort.
Wisconsin Central R.R.; Informal Safety Inquiry
    Summary: FRA seeks to gather information regarding plans by the 
railroad to expand use of one-person crews and remote control 
operations. The information may assist in evaluating emergency order 
requests submitted by the United Transportation Union.
    Status: A notice of special safety inquiry was published 11/18/96 
(61 FR 58736). A public hearing is scheduled for 12/4-12/5/96 in 
Appleton, Wisconsin. Written submissions were requested by 12/2/96. FRA 
has entered into an agreement with the railroad providing for a 
moratorium on new single person crew and remote control operations, 
together with other undertakings related to compliance with FRA 
regulations.
                            employee safety
Roadway Worker Safety
    Summary: In requiring the review of the Track Safety Standards, the 
Rail Safety Enforcement and Review Act of 1992 required FRA to evaluate 
the safety of maintenance of way employees. In addition, the 
Brotherhood of Maintenance of Way Employes and the Brotherhood of 
Railroad Signalmen petitioned FRA to issue ``on-track safety'' rules.
    Status: FRA published a notice 8/17/94 initiating a formal 
negotiated rulemaking, and the negotiated rulemaking committee reported 
a statement of principles 8/95. NPRM published 3/14/96 (61 FR 10528); 
initial written comments were due 5/13/96. Public hearing 7/11/96. The 
final rule was published 12/16/96 (61 FR 65959); effective 1/15/97. 
Petitions for reconsideration were denied in a notice published 4/21/
97. A consolidated hearing on waiver petitions was held 5/22/97, and 
written comments are due 6/9/97.
Railroad Operating Practices (Blue Signal Protection)
    Summary: On 8/16/93, FRA published a final rule permitting one or 
more utility employees to associate themselves with a train crew for 
the purpose of performing normal operating functions that require 
employees to go on, under or between rolling stock, without use of blue 
signal protection (which is ordinarily appropriate for mechanical 
duties). During the proceeding it was noted that rules for locomotive 
engineers working alone were not clearly defined. FRA published a final 
rule amendment governing single engineers working alone on 3/1/95, but 
granted a requested suspension of the amendment on 6/9/95 pending 
development of additional facts.
    Status: Awaits consultation with objecting parties to develop 
additional facts. On 10/31/96, the RSAC advised FRA that this project 
should not be proposed for early tasking, given conflicting demands on 
the resources of member organizations.
Locomotive Crashworthiness and Working Conditions
    Summary: The Rail Safety Enforcement and Review Act of 1992 
required FRA to conduct a proceeding regarding locomotive 
crashworthiness and working conditions and to issue regulations or 
submit a report. Areas for consideration included structural means of 
preventing harm to crew members in collisions (collision posts, 
anticlimbers, etc.) and matters related to safety, health and 
productivity (e.g., noise, sanitation).
    Statutory deadline: 3/2/95.
    Status: FRA has conducted research, outreach, and a survey of 
locomotive conditions and has finalized a report to the Congress 
transmitted by letter of September 18, 1996. The report conveys data 
and information developed by FRA to date, closes out those areas of 
investigation for which further action is not warranted, and defines 
issues that should be pursued further in concert with the industry 
parties, either for voluntary or regulatory action. On 10/31/96, the 
RSAC accepted a preliminary planning task. The Locomotive Crew Safety 
Planning Group met 1/23/97, but agreement could not be reached on 
several items. Two task statements will be presented to the full 
committee 6/24/97. (RSAC Task 97-1; locomotive crashworthiness issues 
and Task 97-2; cab working conditions and ergonomics).
Track Motor Vehicle and Roadway Equipment Safety
    Summary: A 1990 petition to FRA from the Brotherhood of Maintenance 
of Way Employes asked FRA, among other requests, to propose standards 
for MOW equipment related to the safety of persons riding or operating 
that equipment. FRA elected not to pursue that issue at that time given 
other pending workload. However, this issue was renewed during the 
deliberations of the RSAC Track Safety Standards Working Group.
    Status: On 10/31/96, the RSAC accepted a task of drafting proposed 
rules for the safety of this equipment. A task force of the Track 
Safety Standards Working Group has met several times, and the task 
force is expected to report to the working group by 9/30/97. (RSAC Task 
96-7)
                      highway-rail crossing safety
Grade Crossing Signals (Inspection, Testing and Maintenance)
    Summary: FRA issued a final rule for inspection, testing and 
maintenance of automated warning devices 9/30/94, and the rule went 
into effect 1/1/95. During the initial year, FRA worked with railroads 
and signal employees to disseminate information, conduct training, and 
identify any areas of ambiguity or weakness in the standards. At a 
technical resolution committee (TRC) meeting during the week of 3/13/95 
that included participation by railroads, the Brotherhood of Railroad 
Signalmen, and States, several issues were identified that require 
clarification or refinement. An interim manual dated 4/14/95 
incorporated the findings of the TRC.
    Status: Interim final rule amendments published 6/20/96 (61 FR 
31802). FRA is preparing a notice to make the changes final.
Selection of Grade Crossing Automated Warning Devices
    Summary: FRA published a Notice of Proposed Rulemaking 3/2/95 and 
received over 3,000 written comments through 6/14/95.
    Status: Further action to be determined.
Locomotive Visibility/Auxiliary Alerting Lights
    Summary: In 1991, FRA initiated a new phase of research on 
locomotive conspicuity in relation to safety at highway-rail crossings. 
The Amtrak Authorization and Development Act of 1992 mandated that the 
research be completed and that a regulation be issued to apply alerting 
lights to locomotives.
    Statutory deadline: Final rule by 6/30/95.
    Status: FRA published a ``grandfathering rule'' on 2/3/93 and 
amendments on 5/13/94. After the research was substantially completed 
in early summer of 1995, FRA briefed the industry parties on the 
results, discussed options for regulatory action, and elicited 
additional information concerning railroads' progress in equipping 
their fleets. A Notice of Proposed Rulemaking was published on 8/25/95. 
The AAR and the ASLRA requested a technical conference to perfect the 
rule for final issuance, and that conference was held 11/28/95. Written 
comments were due by 12/12/95. Final rule was published 3/6/96 (61 FR 
31802). Equipping of the locomotive fleet must be completed by 12/31/
97, as provided by law.
Audible Warnings at Highway-Rail Crossings (Whistle Bans)
    Summary: The Swift Rail Development Act of 1994 required FRA to 
issue regulations providing for the use of train horns at highway-rail 
crossings.
    Statutory deadline: Final rule 11/2/96 (most hazardous crossings), 
11/2/98 (other crossings).
    History: This legislative mandate anticipated FRA follow up to 
Emergency Order No. 15, which addressed local whistle bans on the 
Florida East Coast Railroad between Jacksonville and Miami. FRA 
released a report on the national impacts of local whistle bans on 6/1/
95 and has conducted an extensive program of public outreach to make 
communities aware of the forthcoming rulemaking and to seek information 
on supplementary safety measures that would support allowance of quiet 
zones in communities sensitive to train horn noise. Contacts have been 
made with 160+ jurisdictions known to have whistle bans in place. FRA 
representatives have met with or addressed forums of state and local 
officials and community groups. Met with AAR/BRS/AAHSTO/FHWA 12/13/95 
to address technical specifications for 4-quadrant gates.
    Status: Numerous congressional offices encouraged FRA to continue 
outreach and data collection. FRA advised the Congress that the 
deadline for an initial final rule would not be met as a result. 
Immediately prior to adjournment, the 104th Congress enacted the FAA 
reauthorization bill, H.R. 3539, which included amendments to the 
original whistle ban legislation. In general, the legislation affirms 
the latitude available to the Secretary to provide for phase-in of 
regulations and focus on safety results. Missing data on Chicago-area 
commuter lines is being added to the national study. FRA is preparing 
an NPRM for early issuance.
Private Highway-Rail Grade Crossings
    Summary: The Secretary's Action Plan for Grade Crossing Safety (6/
94) commits FRA to conducting a special safety inquiry on private 
crossings.
    Status: Conducted workshop on possible guidelines 7/93; timing of 
further action to be determined.
                          hazardous materials
Tank Car Crashworthiness and Retest
    Summary: Research and Special Program Administration Dockets HM-
175A and HM-201 addressed further improvements in tank car 
crashworthiness, and adoption of advanced non-destructive testing to 
improve tank retest procedures, respectively.
    Status: Final rules published 9/21/95 (60 FR 49048).
Train Placement
    Summary: FRA is evaluating whether to recommend that the Research 
and Special Programs Administration publish proposed amendments to the 
in-train placement requirements for handling rail cars transporting 
hazardous materials. FRA is reviewing accident/incident data to 
determine whether the current non-hazardous materials buffer car 
requirements are still necessary and whether the (as recommended by the 
National Transportation Safety Board) a buffer car should be required 
at the rear of each train.
    Status: Preparing a Notice of Proposed Rulemaking; timing of 
issuance to be determined. Data may be gathered under a requested 
waiver (Union Pacific Railroad) analyzing impact of requiring buffer 
cars on the rear of through trains, while omitting buffer cars behind 
occupied locomotives on local trains.
New Directions for Rail Hazardous Materials Safety
    Summary: FRA and RSPA have recently completed the two major pending 
rulemakings addressing hazardous materials tank car safety 
(crashworthiness and tank retests). With completion of these tasks, it 
is now possible to turn attention to recommendations of the 
Transportation Research Board regarding the tank car design and 
construction process. In order to further this work, FRA is joining 
with its public and private sector partners to define and prioritize 
short and long-range research programs, identify needs for rulemaking, 
and assist in development of improved industry standards.
    Status: A public workshop was conducted 2/13/96-2/14/96 in Houston, 
with participation by labor, railroads, tank car owners, and shippers. 
FRA is seeking means of advancing public/private partnerships for North 
American tank car safety.
             other safety projects and partnership efforts
Hours of Service Electronic Recordkeeping
    Current hours of service record keeping uses paper and ink, but a 
major railroad has been given relief to keep electronic records. Other 
railroads have expressed interest, and similar waivers will involve 
similar issues. At FRA's invitation, the AAR has submitted a petition 
seeking a master waiver for use of electronic record keeping under 
regulations supporting administration of the hours of service law. If 
the master waiver is granted and experience is gained, permanent 
amendments to the recordkeeping and reporting requirements may be 
proposed. FRA is assisting railroads in developing electronic systems 
by providing guidance materials.
Remote Control Locomotives
    Current regulations contemplate operation of a locomotive 
exclusively from within the cab, and provision for the safety of the 
operation is made within that context. FRA has previously proposed a 
test program to gather more data on various types of operations. 
Further action expected.
    FRA has also held an informal safety inquiry regarding use of one-
person crews and remote control locomotives on the Wisconsin Central 
(see 61 FR 58736; 11/18/96).
Train Dispatcher Training
    FRA submitted a report to the Congress on 1/5/95 regarding the 
functions of contemporary train dispatching offices. The report noted 
that traditional pools of candidates for recruitment of train 
dispatchers are no longer adequate to the need. In partnership with the 
American Train Dispatchers Department/BLE (ATDD), FRA identified the 
need for a model train dispatcher training program.
    Experts from Amtrak, the ATDD, the Burlington Northern/Santa Fe 
Railroad and FRA have completed work on a list of elements for 
dispatcher training programs. Required competencies and training 
program elements will be abstracted from this effort for a model 
program. Consideration may be given to referencing appropriate elements 
of this program in Federal regulations. The RSAC was be briefed on this 
effort on 3/24/97, with participants in the training task force 
indicating reluctance to attempt a ``one size fits all'' regulatory 
approach.
Discolored Wheels
    FRA has granted a master waiver of the Freight Car Safety Standards 
permitting continued use of discolored heat-treated, curved plate 
wheels, which have superior resistance to thermal abuse. Data gathered 
under the waiver, together with results of analysis already provided, 
may support a permanent change in the regulation.
TOFC/COFC Securement
    Summary: Following a serious accident at Smithfield, N.C., on 5/16/
94, FRA formed a partnership with major railroads and labor 
organizations to evaluate and improve securement of intermodal loads. A 
report to the Secretary dated 9/15/94 documented the initial results of 
that effort.
    Status: FRA held a meeting on 2/22/95 that focused on an item-by-
item discussion of the status and progress made within the industry 
with respect to the seven recommendations identified in the report to 
the Secretary. The AAR has established an Intermodal Equipment Handling 
Task Force that has developed a number of training aids. A follow-up 
TOFC/COFC loading and securement safety survey was conducted during 
1996. Further action to be determined.
Event Recorder Next-Generation Performance Standards
    Summary: The National Transportation Safety Board has noted the 
loss of data from event recorders in several accidents due to fire, 
water and mechanical damage. In issuing final rules for event recorders 
which became effective 5/5/95, FRA noted the need to provide more 
refined technical standards. NTSB has proposed performance standards 
and agreed to serve as co-chair for an industry/government working 
group that would define appropriate technical standards for next-
generation railroad event recorders.
    Status: Conducted an initial meeting of a working group comprised 
of AAR, RPI, and labor, and co-chaired by NTSB and FRA experts, on 12/
7/95 to consider development of technical standards. At the RSAC 
meeting on 7/24-7/25/96, the AAR agreed to continue this inquiry, and 
on 11/1/6, AAR reported to the RSAC the status of work on proposed 
industry standards. At that time, the NTSB representative to the RSAC 
advised that additional recommendations related to event recorders 
might be forthcoming as a result of recent accidents. On March 5, 1997, 
NTSB issued recommendations regarding testing and maintenance of event 
recorders as a result of finding in the investigation of the BNSF 
accident of 2/1/96 at Cajon Pass, California. On 3/24/97, the RSAC 
indicated its desire to receive a task to consider NTSB recommendations 
with respect to crash survivability, testing and maintenance. A task 
statement will be presented to the full Committee at the 6/24/97 RSAC 
meeting. (Task No. 97-3).
                      mandated regulatory projects
    Question. What are the five regulatory projects that are 
statutorily mandated, and when were these due for final issuance? What 
is the status of each?
    Answer. The five statutorily mandated rulemakings are:
    1. Grade crossing whistle bans.--The Swift Rail Development Act of 
1994 required FRA to issue regulations providing for the use of train 
horns at highway-rail crossings. A final rule was due November 2, 1996, 
for most hazardous crossings and November 2, 1998 for other crossings. 
FRA is preparing an NPRM for release by the summer of 1997.
    2. Track safety standards.--The Rail Safety Enforcement and Review 
Act of 1992 required revision of existing regulations; including review 
of excepted track and standards for high-speed service. A consensus for 
these rules was achieved by an RSAC working group. In balloting 
concluded 11/21/96, RSAC voted to endorse the NPRM, which FRA has 
forwarded for review/clearance.
    3. Passenger car safety standards.--The issuance of initial 
standards by November 2, 1997, and final standards by November 2, 1999, 
is mandated by the Federal Railroad Safety Authorization Act of 1994. 
An NPRM is being finalized, which includes power brake rules for 
passenger service.
    4. Passenger Train Emergency Preparedness.--The Federal Railroad 
Safety Authorization Act of 1994 required FRA to issue emergency 
preparedness standards for passenger service. Initial standards are due 
November 2, 1997, and final standards by November 2, 1999. An NPRM was 
published February 24, 1997, and a notice of public hearing was 
published March 6, 1997. Public hearings were held in Chicago on April 
4 and New York City on April 7. Written comments were due by April 25, 
1997. FRA is reviewing comments and preparing options for discussion 
with the working group preparing the rulemaking.
    5. Power brakes.--The Rail Safety Enforcement and Review Act of 
1992 required FRA to revise the power brake regulations. The statute 
required adoption of requirements for two-way end-of-train telemetry 
devices (EOT's) and ``standards for dynamic brakes.'' FRA published a 
Notice of Proposed Rulemaking (NPRM) in September 1994. Due to strong 
objections to the NPRM, additional options were requested from 
passenger interests and from freight interests. FRA requested the 
Passenger Equipment Safety Standards Working Group to incorporate new 
proposals for revisions of the power brake regulation in the NPRM for 
passenger equipment safety. An NPRM is being drafted. On April 1, 1996, 
the Railroad Safety Advisory Committee (RSAC) accepted the task of 
preparing a second NPRM on freight standards. The working group 
initiated its efforts in May 1996. Consensus could not be achieved and 
on May 29, 1997, FRA notified the working group by letter that the task 
will be formally terminated. FRA is preparing a second NPRM. FRA 
published a notice in February 1996 that the EOT issue would be 
separated from the balance of the freight issues and expedited for 
completion of a final rule. The final rule was published January 2, 
1997 and becomes effective July 1, 1997.
                           penalty guidelines
    Question. Several years ago the Committee directed the FRA to 
publish in the Code of Federal Regulations the range of penalties to be 
imposed for violations by rail carriers or rail shippers of the Federal 
Hazardous Materials Transportation Regulations. What was industry's 
reaction to this final product?
    Answer. FRA published its penalty guideline amounts used in initial 
determinations of proposed civil penalty assessments for documented 
violations of the Department's Hazardous Materials Regulations on July 
25, 1996 (61 FR 38644). Since publication, FRA has made the industry 
aware of the guidelines by providing copies at trade association 
meetings and at numerous presentations given by FRA's Hazardous 
Materials Division staff. The industry has responded in a positive 
manner and appreciative to know of the penalty amounts ($$) assigned 
within the penalty schedule. The penalty amounts makes it easier for 
safety managers to convince their upper management of the seriousness 
that FRA places on non-compliance of the Hazardous Materials 
Regulations.
                     rail safety advisory committee
    Question. FRA has requested a funding increase from $50,000 in 
fiscal year 1997 to $200,000 in fiscal year 1998 to support the rail 
safety advisory committee (RSAC). Please break down all associated 
spending planned for the $150,000 increase requested to support the 
RSAC, including facilities, mailings, equipment, contract support and 
``other'' support costs.
    Answer. RSAC's scope of involvement since it was chartered on March 
25, 1996, to advance critical railroad safety rulemakings through a 
collaborative process has included the full Committee (50 members and 
their alternates), six working groups (217 members and alternates)and 
sixteen task forces (150 members) participating in five full Committee 
meetings, 33 working group meetings, and numerous task force meetings.
    RSAC has accepted tasks involving major regulatory efforts 
including revisions to the track safety standards, the regulations 
governing power brake systems for freight equipment, the radio 
standards and procedures, the regulations governing the qualification 
and certification of locomotive engineers, and event recorder data 
survivability. A Working Group on Tourist & Historic Railroads was 
established to ensure appropriate focus on the unique issues presented 
by application of safety laws and regulations to these operations. In 
addition, a Planning Group was formed to evaluate the appropriate 
responsive actions to recommendations contained in the Report to 
Congress entitled Locomotive Crashworthiness and Working Conditions.
    It is expected that RSAC involvement can shorten a rulemaking 
process to under the three or more years normally required in such 
proceedings. The $200,000 requested would support the fiscal year 1998 
RSAC activities at the optimum level for reducing FRA's regulatory 
backlog. Railroad labor and management are dedicating significant 
resources to the success of this rulemaking process. Funding below the 
requested level would severely impact the effectiveness of this process 
and the resulting critical contributions to public safety envisioned by 
all parties dedicated to the success of collaborative rulemaking.
    Funding for meeting space and accompanying audio/visual 
requirements for the full Committee, Working Groups and Task Forces 
($55,000) will provide required space to accommodate meetings based on 
the number of participants required to be seated at the table and 
members of the general public. Federal agency space available to 
accommodate these requirements is extremely limited and in great demand 
in the Washington DC area. Further constraints for RSAC meetings are 
restrictions on entrance to many federal agency buildings. The majority 
of RSAC members and other attendees are not federal government 
employees and the meetings are open to the general public. Meetings are 
also conducted at locations outside of the Washington area to 
facilitate member participation and availability and to equitably 
distribute the burden of travel time and costs for members. This 
funding will also provide necessary audio-visual support for these 
meetings.
    Funding for supplies, printing and mailing services ($42,000) are 
essential to support the meetings and work of the full Committee, the 
Working Groups and the Task Forces. Adequate funding to support 
processing and dissemination of information and data crucial to the on-
going regulatory tasks and the extensive coordination involved, will 
ensure the effectiveness of this extremely significant undertaking is 
not compromised.
    Travel funds are required ($20,000) for invitational travel for 
state organizational employees who serve as Committee, Working Group, 
and Task Force members. Their participation in the RSAC process is 
essential to ensuring representation of interests other than railroad 
management and labor which are directly affected by FRA's safety 
regulatory program.
    Funding for interpreter services ($3,000) is requested to address 
the requirements of the Federal Advisory Committee Act and the 
Americans with Disabilities Act.
    Facilitation service funding ($25,000) is essential to the success 
of the negotiated rulemaking process. The demands placed on the limited 
number of in-house facilitators necessitates the use of professional 
facilitators. Professional facilitators are crucial to avert delay in 
the negotiated rulemaking process.
    Support for contractual services for specialized data collection 
and analyses and other technical and administrative requirements in 
support of Committee, Working Group and Task Force activities 
($45,000). These services are a critical requirement to supplement 
existing staff and address an escalating workload without increasing 
staffing levels. Meetings of working groups and task forces will have 
to accommodate the needs of members in order to elicit continued rail 
labor and management support and participation in the process. 
Locations outside of FRA headquarters or regional areas will require 
contractual support to meet the administrative requirements for these 
meetings. Specialized data collection and analyses will be required to 
support the work of the task forces. Absent these services, the burden 
that will be imposed upon existing resources will further strain 
limited resources and continue to divert and dilute efforts being 
directed to other critical functions.
    Funding for training ($10,000) provides requisite interest-based 
negotiation training for Committee, Working Group and Task Force 
members to ensure effective participation in this consensual rulemaking 
process.
                         grade crossing funding
    Question. Please list all highway/rail grade crossing safety 
program in the total FRA budget (i.e., research and development, next 
generation high-speed rail, safety), and compare funding for each 
initiative from fiscal year 1997 enacted to the fiscal year 1998 
request. If the total funding is less than that in fiscal year 1997, 
please explain why.
    Answer.

------------------------------------------------------------------------
                                                  Fiscal years--        
                                         -------------------------------
                                               1997            1998     
------------------------------------------------------------------------
Railroad Research and Development:                                      
    Equipment, Operations and Hazardous                                 
     Materials..........................        $985,000        $835,000
    Track, Structures and Train Control.         385,000         562,000
    Safety of High-Speed Ground                                         
     Transportation.....................         650,000         400,000
                                         -------------------------------
      Subtotal, R&D.....................       2,020,000       1,797,000
                                         ===============================
Next Generation High Speed Rail: Grade                                  
 Crossing Hazards and Innovative                                        
 Technologies...........................       2,965,400       2,500,000
Office of Safety:                                                       
    Police Officer Detail...............          50,000          50,000
    Outreach to judges, prosecutors, law                                
     enforcement and the public.........          75,000          75,000
    Analysis of High-Profile (Hump)                                     
     Crossing Problem...................          25,000          25,000
    Software development................          50,000          50,000
    Support collection and processing of                                
     National Inventory and Grade                                       
     Crossing Accident data bases.......         266,000         274,000
                                         -------------------------------
        Subtotal, Safety................         466,000         474,000
                                         -------------------------------
        Total FRA.......................       5,451,400       4,771,000
------------------------------------------------------------------------

    Under Railroad Research & Development, the $150,000 decrease in 
Equipment, Operations and Hazardous Materials reflects the $200,000 
decrease from 97 to 98 for Operation Lifesaver, offset by a $50,000 
increase for a new project for Commuter Rail Safety. The original 
fiscal year 1997 request for Operation Lifesaver funding was $300,000. 
However, Congress earmarked an additional $300,000, for a total of 
$600,000. The fiscal year 1998 request for $400,000 is actually an 
increase over the original fiscal year 1997 request.
    The $250,000 decrease in the Safety of High-Speed Ground 
Transportation is a result of the completion of a three-part study that 
examined signaling and train control, obstruction detection, and 
warning device and barrier technologies suitable for high-speed 
corridors.
    In fiscal year 1997, the $5,000,000 Next Generation HSR 
appropriation did not specify amounts for Grade Crossing Hazards or 
Innovative Technologies program elements. The funds shown are those 
obligated or planned for obligation for grade crossing hazard 
mitigation in fiscal year 1997, the largest award being $2 million to 
NCDOT for the Sealed Corridor Initiative. The fiscal year 1998 budget 
provides $2,500,000 specifically for Grade Crossings.
                          operation lifesaver
    Question. Why has FRA's funding request for Operation Lifesaver 
been reduced below the fiscal year 1997 level?
    Answer. In the FRA's fiscal year 1997 budget request to Congress, 
$300,000 was requested for Operation Lifesaver. The Conference 
Committee increased this request by $300,000 to $600,000 total. In 
fiscal year 1998, FRA is requesting $400,000, which is $100,000 over 
our original fiscal year 1997 request.
               field participation in operation lifesaver
    Question. Did your inspectors meet FRA's goal of participating in 
at least four Operation Lifesaver related activities? Is this still a 
goal in FRA?
    Answer. Operation Lifesaver (OL) activities include, but are not 
limited to, providing educational booths and exhibits at State, county 
and local fairs, law enforcement meetings, participating in railroad-
sponsored safety blitzes and making educational presentations to adults 
and children in all walks of life. These presentations are made in many 
areas including educational settings such as all levels of public and 
private schools, businesses, church groups and nonprofit institutions 
and agencies. FRA views OL as an integral part of the FRA overall 
effort to achieve the goal of zero tolerance for highway-rail 
intersection collisions and trespasser incidents.
    As part of FRA's goal to achieve zero highway-rail intersection and 
trespasser incidents, FRA actively promotes and encourages FRA 
inspectors to become certified OL presenters voluntarily and to 
maintain the certification. In order to maintain certification as an OL 
presenter, each presenter must make a minimum of four presentations a 
year over and above any participation in other OL-sponsored activities. 
As with all volunteer programs, the individual level of participation 
varies. There are a significant number of inspectors, in addition to 
numerous other members of FRA staff, who participate in many different 
OL-sponsored activities and make many more than four presentations a 
year. FRA is proud of the inspectors who, in addition to the many hours 
of safety inspections on the job, volunteer for OL activities off the 
job. While full participation of all the inspectors as part of their 
job is impractical at this time (on-the-job OL presentations mean they 
are not doing track, signal, operating practices, hazardous materials 
and equipment inspections), it is impressive that 60 
percent of FRA's inspectors are maintaining their OL presenter 
certification.
                   grade crossing accidents by state
    Question. Please list the ``top ten'' states that have the highest 
number of highway/rail grade crossing accidents, and cite the number of 
accidents in calendar years 1995, 1996 and thus far in 1997.
    Answer. Note: Data for 1996 is `preliminary,' and no data is yet 
available for 1997.

------------------------------------------------------------------------
                                                    1995         1996   
                     State                       collisions   collisions
------------------------------------------------------------------------
Texas.........................................          474          428
Illinois......................................          295          230
Louisiana.....................................          223          228
Indiana.......................................          271          217
California....................................          200          186
Ohio..........................................          239          180
Minnesota.....................................          152          156
Alabama.......................................          178          154
Georgia.......................................          160          150
Wisconsin.....................................          140          149
------------------------------------------------------------------------

                       top ten states--fatalities
    Question. Please list the ``top ten'' states that have the highest 
number of rail grade crossing fatalities, and cite the number of 
crossing fatalities for 1995, 1996 and thus far in 1997.
    Answer. Note: Data for 1996 is `preliminary,' and no data is yet 
available for 1997.

------------------------------------------------------------------------
                                                    1995         1996   
                     State                       fatalities   fatalities
------------------------------------------------------------------------
Texas.........................................           55           60
Illinois......................................           48           37
Louisiana.....................................           28           31
Indiana.......................................           29           26
Oklahoma......................................           15           22
California....................................           28           21
Arkansas......................................           22           20
Georgia.......................................           17           19
Missouri......................................           22           19
Alabama.......................................           16           18
------------------------------------------------------------------------

          highway-rail intersections and those without signals
    Question. Please prepare a chart that shows, by state, the total 
number of at-grade highway/rail crossings, and breaks out the number of 
those crossings that are not guarded or signaled.
    Answer. Note: Figures have been taken from FRA's annual Highway-
Rail Crossing Accident/Incident and Inventory Bulletin, No. 18, for 
Calendar Year 1995, published September 1996.

------------------------------------------------------------------------
                                           Total                 Total  
                                Total      public     Total     private 
            State               public    without    private    without 
                               at-grade   signals    at-grade   signals 
------------------------------------------------------------------------
Alabama.....................      3,610      2,638      1,982      1,962
Alaska......................        225        144        104        104
Arizona.....................        940        502        686        681
Arkansas....................      3,280      2,485      1,507      1,501
California..................      7,956      3,491      4,871      4,767
Colorado....................      2,069      1,423      1,448      1,437
Connecticut.................        370        126        261        219
Delaware....................        284         83        119        118
District of Columbia........         23         17          8          8
Florida.....................      4,066      1,300      1,480      1,428
Georgia.....................      6,163      4,239      2,775      2,763
Hawaii......................          6          6  .........  .........
Idaho.......................      1,524      1,216      1,376      1,365
Illinois....................     10,219      5,313      5,684      5,580
Indiana.....................      6,587      3,655      2,846      2,808
Iowa........................      5,245      3,582      4,217      4,202
Kansas......................      7,865      6,189      4,232      4,227
Kentucky....................      2,626      1,417      2,761      2,730
Louisiana...................      3,656      2,487      3,222      3,191
Maine.......................        882        423        934        918
Maryland....................        687        361        712        703
Massachusetts...............      1,192        503        537        524
Michigan....................      5,761      3,441      2,717      2,682
Minnesota...................      5,174      3,961      3,133      3,114
Mississippi.................      2,971      2,358      2,099      2,094
Missouri....................      4,864      3,310      3,291      3,265
Montana.....................      1,533      1,184      2,058      2,049
Nebraska....................      4,034      3,148      2,836      2,830
Nevada......................        289        146        265        259
New Hampshire...............        503        315        344        340
New Jersey..................      1,863        785        596        583
New Mexico..................        810        513        589        586
New York....................      3,275      1,168      3,177      3,144
North Carolina..............      4,859      2,973      3,580      3,560
North Dakota................      4,624      4,163      2,180      2,179
Ohio........................      6,551      3,524      3,704      3,664
Oklahoma....................      4,561      3,387      1,735      1,726
Oregon......................      2,302      1,566      2,816      2,793
Pennsylvania................      5,583      3,444      3,418      3,380
Rhode Island................        128         61         71         70
South Carolina..............      3,109      1,970      1,348      1,336
South Dakota................      2,137      1,944      1,361      1,359
Tennessee...................      3,368      2,400      1,918      1,906
Texas.......................     12,490      8,016      6,363      6,282
Utah........................      1,009        667        789        784
Vermont.....................        496        270        650        644
Virginia....................      2,138        909      2,923      2,882
Washington..................      2,854      1,950      3,014      2,997
West Virginia...............      1,893      1,223      2,220      2,205
Wisconsin...................      4,712      2,810      2,868      2,848
Wyoming.....................        527        288        932        927
Puerto Rico.................         24         18          2          1
                             -------------------------------------------
      Totals................    163,917    103,512    104,759    103,725
------------------------------------------------------------------------

               four years of highway-rail safety progress
    Question. Please provide an update of the progress that has been 
made in reducing the number of injuries and fatalities at highway-rail 
grade crossings over the last four years. Please provide a yearly 
comparison table showing the reductions.
    Answer. Preliminary data for 1996 indicates that crossing 
collisions and casualties at highway-rail intersections nationwide 
decreased by 10 and 18 percent respectively when compared to 1995 data. 
These gains can be attributed to multi-modal partnerships which have 
been fostered in communities nationwide and within the DOT to address 
this problem. Specific actions include:
  --The addition of FRA's eight regional managers for highway-rail 
        safety and trespass prevention programs continues to foster 
        partnerships which work;
  --Industry inspection, testing and maintenance practices for highway-
        rail intersection warning devices enhanced by Federal 
        regulations which became effective January 1, 1996;
  --The addition of two alerting lights to the lead-end of locomotives 
        operating over highway-rail intersections. Regulations are not 
        effective until December 31, 1997, but most Class I locomotives 
        have been equipped;
  --Increased use of train horns and increased awareness of the 
        crossing issue fostered by debate over train horns;
  --Increased public awareness fostered by Always Expect A Train, 
        Highways or Dieways? and related Operation Lifesaver 
        promotions;
  --Increased public awareness fostered by the school bus--commuter 
        train collision in Fox River Grove, Illinois, and the aftermath 
        of investigations, hearings and reports;
  --More state and community involvement in highway-rail safety issues 
        fostered by the DOT Action Plan initiatives and the Fox River 
        Grove collision;
  --Partnering within DOT with NHTSA's ``Moving Kids Safely'' and 
        ``Safe Communities'' programs;
  --Improving awareness and enforcement practices at highway-rail 
        intersections on behalf of traffic law enforcement officers;
  --Outreach to the judicial community seeking increased awareness of 
        the problem and the potential of their acknowledgment and 
        involvement; and,
  --Increasing numbers of highway-rail intersection consolidations and 
        closures, and increased awareness of the associated hazards 
        fostered by local debate of the issue.
    Note: Data for 1996 is preliminary.

----------------------------------------------------------------------------------------------------------------
                                                                             Percent                   Percent  
                                                                           change from               change from
                            Year                               Fatalities    previous     Injuries     previous 
                                                                               year                      year   
----------------------------------------------------------------------------------------------------------------
1993........................................................          626         +8.1        1,837         -7.0
1994........................................................          615         -1.7        1,961         +6.8
1995........................................................          579         -5.9        1,894         -3.6
1996........................................................          471        -18.7        1,552        -18.1
----------------------------------------------------------------------------------------------------------------

                         grade crossing funding
    Question. Please indicate how the FRA has worked with other Federal 
agencies in reducing highway rail grade crossing incidents. What 
coordinated efforts with other agencies are planned for fiscal year 
1998, and how is this reflected in the request? Please show on a 
project by project basis how the fiscal year 1997 and fiscal year 1996 
monies were spent, who the recipients of the funds were, and what the 
expected results of these efforts are.
    Answer. The FRA has coordinated the development of the Highway-Rail 
Grade Crossing Action Plan and its grade crossing safety initiatives 
for reducing grade crossing accidents with FHWA, FTA and NHTSA. The FRA 
will continue to work with the other DOT modes to promote DOT's Safe 
Communities initiative by employing the Action Plan as the architect 
for improving community grade crossing safety and continuing to partner 
with Federal, state and local law enforcement and court officials to 
increase the effectiveness of the program. A key element will be the 
further dissemination of the Always Expect A Train public education 
campaign. FRA will also continue to enhance safety at high profile 
crossings by conducting advanced analysis that will assist in 
identifying the best practice of high technology and common-sense 
solutions.
    For fiscal year 1998, FRA will continue to work with FHWA on field 
testing of the Vehicle Proximity Alert System prototypes, funded by 
FHWA in fiscal year 1994 and 95. FRA will also coordinate activities 
with the ITS Joint Program Office (JPO) on development of an 
Intelligent Grade Crossing Controller, also funded by FHWA, which will 
link the train control system, the grade crossing warning system and 
the highway traffic control system, and on the further development and 
implementation of User Service No. 30 in the National Intelligent 
Transportation System Architecture, funded by FRA's Next Generation 
High Speed Rail (NGHSR) program.
    The fiscal year 1996 and fiscal year 1997 funding, recipients, and 
expected results for the grade crossing research projects are shown in 
the following table.

                  GRADE CROSSING RESEARCH AND DEVELOPMENT, NEXT GENERATION AND SAFETY PROJECTS                  
----------------------------------------------------------------------------------------------------------------
                                      Fiscal years--                                                            
                                --------------------------                                                      
            Project                  1996         1997          Recipient               Expected results        
                                   funding      funding                                                         
----------------------------------------------------------------------------------------------------------------
Equipment, Operations and            735,000      985,000                                                       
 HazMat.                                                                                                        
Locomotive Conspic.............       15,000        5,000  Volpe Ctr.........  Locomotives and freight cars will
                                                                                be more visible to drivers,     
                                                                                helping them avoid striking the 
                                                                                train.                          
Freight Car Reflec.............       50,000       25,000  Volpe Ctr.........                                   
Eval Wayside Horns.............      150,000       12,000  Volpe Ctr.........  Locomotive horns will be         
                                                                                optimized for sound quality and 
                                                                                effectiveness while reducing    
                                                                                noise pollution in surrounding  
                                                                                communities.                    
Optml Acoustic Warn............       40,000       20,000  Volpe Ctr.........                                   
Driver Behavior................      180,000       65,000  Volpe Ctr.........  To gain a better understanding of
                                                                                how drivers react to grade      
                                                                                crossings and why accidents     
                                                                                happen in order to educate      
                                                                                drivers and develop new warning 
                                                                                devices.                        
Accident Causation.............  ...........      124,000  Volpe Ctr.........                                   
Driver Education...............  ...........      134,000  Volpe Ctr.........                                   
Operation Lifesaver............      300,000      600,000  Operation           Public education about the laws  
                                                            Lifesaver Inc.      regarding grade crossing, the   
                                                                                dangers at grade crossings and  
                                                                                the importance to obey traffic  
                                                                                laws.                           
Track, Structures and Train          330,000      385,000  ..................  .................................
 Control.                                                                                                       
Loss of Shunt..................      300,000      300,000  Association of      Examine causes for loss of       
                                                            American            contact between rail and wheels,
                                                            Railroads.          resulting in intermittent       
                                                                                operation of grade crossing     
                                                                                warning devices (gate bobble).  
Illumination Guidelines........       10,000       25,000  Volpe Ctr.........  The use of street lights to      
                                                                                illuminate trains at night so   
                                                                                drivers can see and avoid       
                                                                                running into the train.         
Assess Passive System..........       10,000       20,000  Volpe Ctr.........  Assess the Ohio crossbuck and    
                                                                                traffic signals at crossings to 
                                                                                improve warning to drivers.     
Assess Highway Signal..........  ...........       10,000  Volpe Ctr.........                                   
Photo Enforcement..............  ...........        5,000  Volpe Ctr.........  Assess the use of cameras to     
                                                                                monitor crossings and           
                                                                                automatically ticket violators. 
Active Device Fail.............       10,000       25,000  Volpe Ctr.........  Analyze the data from the        
                                                                                failures of automatic warning   
                                                                                devices and recommend           
                                                                                improvements to increase device 
                                                                                reliability.                    
Safety of High-Speed Ground          500,000      650,000                                                       
 Transportation.                                                                                                
HSR Crossing Tech..............      390,000      150,000  Volpe Center/       Examined signalling and train    
                                                            Battelle Labs.      control, obstruction detection  
                                                                                and warning devices and barrier 
                                                                                system technologies available   
                                                                                for use in high speed corridors.
                                                                                Methodology to evaluate improved
                                                                                safety provided by additional   
                                                                                devices developed.              
Crossing Problem Definition....       10,000       10,000  ASTI..............  Examined the crossing problems in
                                                                                five designated high speed      
                                                                                corridors and recommended       
                                                                                solutions.                      
Assess 1036 Demos..............       75,000      150,000  Volpe Ctr.........  Evaluate the technology          
                                                                                demonstration projects funded   
                                                                                under the Section 1036 program  
                                                                                in ISTEA (4-quad gate with      
                                                                                obstruction detection).         
Obstacle/Intrusion Detection...       25,000      150,000  Volpe Ctr.........  Building on the HSR Crossing     
                                                                                Technology project, examine the 
                                                                                obstruction detection systems   
                                                                                suitable for use at grade       
                                                                                crossings and expand for use    
                                                                                along the right-of-way.         
                                --------------------------                                                      
      Subtotal for R&D.........    1,565,000    2,020,000                                                       
                                ==========================                                                      
Next Generation High Speed Rail    1,600,000    2,500,000                                                       
Grade Crossing Haz. and              750,000    2,000,000  NCDOT.............  The North Carolina Sealed        
 Innovative Tech. NC Sealed                                                     Corridor Initiativewill treat   
 Corridor.                                                                      every crossing in the 92-mile   
                                                                                Charlotte to Greensboro segment 
                                                                                of the high-speed rail corridor 
                                                                                with innovative crossing devices
                                                                                like median barriers, long gate 
                                                                                arms, and 4-quad gates.         
                                                                                Redundant crossings will be     
                                                                                closed.                         
NY Locked Gate.................  ...........      215,000  NYSDOT............  The Locked Gate at Private       
                                                                                Crossings project will design,  
                                                                                fabricate, test and evaluate a  
                                                                                low-cost grade crossing gate    
                                                                                system suitable for low volume  
                                                                                traffic crossings on high speed 
                                                                                corridors.                      
TRB IDEA Program...............      500,000      500,000  TRB...............  The TRB IDEA Program, supported  
                                                                                by FRA, FHWA, NHTSA, and FTA,   
                                                                                competitively solicits concepts,
                                                                                conducts peer reviews, and      
                                                                                awards innovative technology    
                                                                                projects nationwide. Examples of
                                                                                completed projects include a    
                                                                                very-wide field of view camera  
                                                                                suitable for automated          
                                                                                monitoring of grade crossings   
                                                                                and a scanning radar antenna for
                                                                                surveillance systems.           
ITS Architecture...............      100,000      100,000  ITS JPO...........  The ITS Architecture is gaining a
                                                                                new User Service--User Service  
                                                                                No. 30--which describes how     
                                                                                grade crossings will be         
                                                                                incorporated into the overall   
                                                                                Intelligent Transportation      
                                                                                System and which will link train
                                                                                control systems with advanced   
                                                                                highway traffic control systems.
Volpe Center Support...........      250,000      150,000  Volpe Ctr.........  Support for assessing hazard     
                                                                                elimination projects and        
                                                                                conducting a Corridor Risk      
                                                                                Analysis.                       
Safety Office..................  ...........  ...........                                                       
Police Officer Detail..........       50,000       50,000  Washington State..  The police officer detail is an  
                                                                                outreach program with the law   
                                                                                enforcement community to raise  
                                                                                awareness of crossing safety and
                                                                                trespass prevention.            
Outreach to Law Enforcement....       85,000       75,000  IACP, NSA, FOP,     Outreach to judges and           
                                                            etc.                prosecutors to enhance their    
                                                                                knowledge of crossing safety and
                                                                                trespass prevention issues, and 
                                                                                defray convention fees and      
                                                                                materials support for FRA's     
                                                                                regional manager promotions of  
                                                                                highway-rail crossing safety and
                                                                                trespass prevention programs.   
Analysis of High-Profile Cross-       25,000       25,000  Univ. WV, Local     Research and analysis of problems
  ings.                                                     Survey Firms AMB.   associated with and alternatives
                                                                                for, high-profile crossings and 
                                                                                low-clearance vehicles.         
Highway-Rail Crossing Inventory       40,000       50,000  AMB...............  Simplify and refine the Highway- 
 and Data Bases.                                                                Rail Crossing Inventory and     
                                                                                collision data base reporting   
                                                                                procedures.                     
Information Processing.........      258,000      266,000  AMB...............  Information Processing supports  
                                                                                Highway-Rail Crossing Inventory 
                                                                                and crossing module of Accident/
                                                                                Incident Report processing.     
                                --------------------------                                                      
      Subtotal for safety......      458,000      466,000                                                       
                                --------------------------                                                      
      Total for FRA............    3,623,000    5,451,400                                                       
----------------------------------------------------------------------------------------------------------------

    In addition to these projects, two efforts are underway paid for 
with FHWA funds:
    Vehicle Proximity Alert System, with $1 million from FHWA ITS 
program (fiscal year 1994 $600,000 & fiscal year 1995 $400,000) awarded 
to the Transportation Technology Center in Pueblo, Colorado ($500,000) 
and Volpe Center ($500,000). VPAS is an in vehicle warning system that 
alerts motor vehicle drivers of the approach of a train, giving them 
adequate time to stop. The initial reliability testing of the 
prototypes has been completed. The next phase of testing will begin 
later this year in an operating environment on a railroad corridor.
    Long Island Railroad Intelligent Grade Crossing, with $7.625 
million from FHWA and $3.175 million from General Railway Signal (GRS). 
This project will connect the GRS Atlas train control system with the 
grade crossing warning system and local highway traffic control system 
to enable crossing gates to remain up for trains that will be stopping 
at stations just before a crossing. Before departing, the locomotive 
engineer will activate the warning lights and gates. This will minimize 
motor vehicle delay while improving safety.
                    1-800 computer answering system
    Question. Section 301 of the 1994 Railroad Safety Act requires the 
Secretary to conduct a pilot program to demonstrate an emergency 
notification system using a toll free telephone number for the public 
to report any malfunctions or other safety problems at highway-rail 
grade crossings. What has FRA done to implement this requirement, and 
what are the results to date?
    Answer. The 1994 Action Plan established the need for an automated 
toll-free crossing trouble reporting system. In September 1994, a 
contract was awarded to develop a Conceptual Design and Implementation 
Plan.
    The Swift Rail Development Act (October 1994) directed the 
Secretary to demonstrate a toll free emergency notification system to 
report emergencies, malfunctions and other safety problems, and to 
conduct a pilot program in two states, but the Act did not appropriate 
funds.
    In the Summer of 1995, the contractor delivered the Conceptual 
Design & Implementation Plan. Also, preliminary discussions were held 
with the States of Illinois and Minnesota regarding the pilot project 
and the FHWA approved the use of Surface Transportation Program Safety 
Set-aside Funds (Section 130) for the required signage.
    FRA proposes to develop and evaluate an automated pc-based computer 
telephone answering and message forwarding system for handling calls 
concerning crossing signal malfunctions and other problems at highway-
rail crossings. The system will use the U.S. DOT/AAR Crossing Inventory 
numbering system for crossing location identification and will receive, 
catalogue and forward telephone messages automatically from concerned 
callers regarding problems with specific crossing signals.
    In 1996, the funds for development of system hardware and the 
conduct of a two-State pilot program were approved, a draft work 
statement was prepared, and preliminary discussions were held with the 
railroad industry to evaluate methods to incorporate similar 1-800 
number systems in use on several major railroads.
    However, because of the Swift Rail Development Act requirement for 
reporting emergency situations at highway-rail crossings, both the 
current Design Concept & Implementation Plan and the previously 
developed work statement must be revised. This revision and a re-
evaluation of the current conceptual design became necessary because of 
the dual non-compatible requirements. The requirement for an emergency 
system is not compatible with the originally conceived 
automatedmalfunction system for which the Design Plan was based. The 
emergency system must be at least partially manned. The automated 
system was not manned. A partially manned system will now have to be 
incorporated or some other way will have to be identified which will 
accomplish the same mission, such as incorporating the system with a 
local 911 emergency telephone network.
    FRA is committed to achieve the objective of the Action Plan and 
Swift Act by developing and evaluating an automatic PC-based computer 
telephone answering and message forwarding system with capability for 
manned intervention.
    Development of a revised work statement and procurement have been 
initiated. The contract will go through the SBA 8-A approval process. 
The estimated funding requirement is $625,000, not including the 
installation of signs at each crossing, nor the public education and 
awareness program, nor the final report to Congress.
    Letters were sent to all States to determine their interest in 
participating in the pilot program and several responses have been 
received. Two States will ultimately be chosen.
    Our goal is to have a contract in place by late-1997 to develop and 
establish a computerized 1-800 telephone number call-in facility. 
Further discussions with the chosen States and involved railroads will 
need to take place in order to resolve important interaction details 
prior to full implementation. Full implementation will take 
approximately two years.
    When the pilot program with two test States is completed and the 
problems of developing a system that is both (1) cost effective and 
automated to handle routine malfunctions and problems at crossings, and 
(2) has the capability to perform as an emergency notification system 
with minimal labor intensive manned effort, it is then expected that 
the FRA and FHWA would jointly recommend that individual States adopt 
such a system.
    Question. FRA estimates the total capital costs of a national 1-800 
notification program at all signalized crossings to be $11,400,000.00 
($8,100,000.00 to procure and install signs; $2,500,000.00 for a 
national public education/awareness program; and $725,000.00 for 
telecommunications and data acquisition). What funds are requested for 
this effort in fiscal year 1998?
    Answer. The original FRA estimate for the total capital cost of a 
national 1-800 notification system for all signalized public crossings 
was estimated to be approximately $11,400,000. The bulk of the funds, 
$8,100,000, was to install two signs at each of all signalized 
crossings (60,405 in 1995) at an estimated cost of $135.00 per 
crossing. There was $2,500,000 estimated for a national public 
education and awareness program, and $725,000 to design, procure and 
implement one telecommunication and data acquisition set of hardware 
for a national system. The system tentatively designed can handle the 
entire country as easily as any individual State.
    If it is desired to install the system at all public crossings 
(approximately 164,000 in 1995), the total cost would escalate to 
$22,140,000. This does not include those signalized private crossings 
(1034 in 1995), most of which are for commercial property. These should 
also be included because the driver can not discern the difference 
between a public crossing and such signalized commercial private 
crossings. This would add an additional $140,000 to the total cost for 
signage. Thus, the total project funding to install such a system 
nationally could approach $25,530,000 and more if it is determined that 
each State should have their own computerized telephone data collection 
system.
    The total cost for the public education and awareness program would 
probably stay the same. This funding estimate is to cover the costs 
associated with the production of the publicity program and it is 
anticipated that the media would provide most of the publicity as a 
public service campaign.
    The hardware and equipment costs, including design and development, 
is sufficient for one system which can be implemented either nationally 
or for a State. At this time, it is anticipated that it will probably 
be more desirable to have each State have its own system. Once 
designed, additional systems are estimated to cost about $300,000 each, 
including the hardware and the development of the special data files 
necessary for each State. This amount could be lower, but that will not 
be known until the first system is completed and operational.
    The $625,000 funding for the design and development of hardware and 
data acquisition system is in FRA's Research and Development ``Safety 
of High Speed Ground Transportation Program'' Budget. No additional 
funds are requested in fiscal year 1998, as all funds requested to 
complete this project were provided in fiscal year 1996.
        highway-rail intersection safety improvement strategies
    Question. Please discuss FRA's latest strategies to reduce the 
number of injuries and fatalities at highway-rail grade crossings. How 
do you measure the effectiveness of these efforts?
    Answer. FRA continues to partner with other DOT administrations, 
states, industry and associated interest groups in implementation of 
DOT's 1994 Action Plan initiatives. This has involved the development 
and support of outreach efforts to the law enforcement and judicial 
communities, corridor safety improvement programs, highway-rail safety 
infrastructure improvements as outlined in NEXTEA, crossing 
consolidation initiatives, public education and awareness (Operation 
Lifesaver and related programs) and an active research program. 
Deliverables to date include a National Cooperative Highway Research 
Program Legal Research Digest titled, ``Photographic Traffic Law 
Enforcement,'' a revised ``Compilation of State Laws and Regulations on 
Matters Affecting Highway-Rail Crossings,'' definition of the nation's 
Principal Railroad Lines, authorizing legislation for incentive 
payments (Federal funds) from States to communities for closing 
crossings, legislation making the cost of crossing closures eligible 
for 100 percent reimbursement from the Federal crossing safety 
improvement program, nine integrated intermodal transportation planning 
symposiums, a check list and detailed procedure for corridor reviews, a 
proposal (in NEXTEA) to provide additional funds to States for crossing 
safety improvements on the basis of need, On-Guard Notices, Advisory 
Bulletins and public service print advertisements targeting the 
nation's trucking industry, a research needs workshop, a study of the 
demographics of crossing fatalities, improved trespasser casualty 
reporting, a national and five regional workshops on trespass 
prevention and a model trespass prevention code. On-going Action Plan 
initiatives include the Always Expect A Train campaign, the detailing 
of an active duty police officer to FRA to assist with and promote 
outreach to the law enforcement community, encouraging states to 
upgrade signs and markings, promoting broader use of STOP signs, 
``Trucker on the Train'' programs and the collection of crossing 
collision data regarding light rail crossings. The FRA was also an 
active participant in the Secretary's Task Force established after the 
school bus--commuter train collision in Fox River Grove, IL in October, 
1995. Since then, FRA has co-chaired (with FHWA) a Technical Working 
Group which included other DOT agencies, states, industry and interest 
groups to implement the Task Force recommendations published in March 
1996. These recommendations deal with interconnected signals, 
preemption timing, joint inspections, high profile crossings, light 
rail crossings and special vehicle operations. A status report was sent 
to the Secretary on May 28, 1997 and was subsequently approved. The 
Status Report is being printed and should be available for distribution 
in mid-July. It is difficult to determine the effectiveness of these 
individual programs and initiatives, but their collective impact is 
clear. Preliminary data for 1996 indicates that collisions at highway-
rail intersections are down 10 percent, and the number of casualties, 
both deaths and injuries, has declined 18 percent, the largest single 
year decline on record and to the lowest point since we have been 
keeping records.
                           trucks and tracks
    Question. One of the recommendations in DOT's Grade Crossing Action 
Plan was to examine the need for a rulemaking to make grade crossing 
violations a disqualifying offense on a commercial driver's license. 
What is the status of this recommendation?
    Answer. The Federal Highway Administration's (FHWA's) Office of 
Motor Carriers is the DOT principal for this initiative. FHWA 
anticipates rulemaking to be initiated this Summer in the form of a 
Supplemental Notice of Proposed Rulemaking; Request for Comments. The 
FHWA has opened a docket, FHWA Docket No. MC-90-10. Public Law No. 104-
88 also applies.
                      office of safety pc&b costs
    Question. Please prepare a table showing personnel compensation and 
benefits appropriated and amounts actually spent for fiscal years 1996 
and 1997 for field and headquarters staff.
    Answer. Information follows:

                       OFFICE OF SAFETY PC&B COSTS                      
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                            Fiscal years--              
                             -------------------------------------------
                                      1996                  1997        
                             -------------------------------------------
                               Plan \1\    Actual    Plan \1\   Estimate
------------------------------------------------------------------------
Field.......................     29,781     29,772     31,119     31,119
Headquarters................      6,957      6,377      7,430      7,430
                             -------------------------------------------
      Total.................     36,738     36,149     38,549     38,549
------------------------------------------------------------------------
\1\ Please note that PC&B costs are not specifically appropriated. Funds
  are appropriated at the account level with general guidance at the    
  budget activity level.                                                

    The difference between ``plan'' and ``actual'' does not represent 
savings, but rather adjustments based on all funding priorities within 
the Office of Safety. The Office of Safety often has to slow their 
hiring process in order to cover non-discretionary support costs.
                  office of safety staffing (on-board)
    Question. Please provide a break down of all staff utilized by the 
Safety Division, and compare this to staffing levels of fiscal year 
1995, fiscal year 1996, and fiscal year 1997. How many vacancies now 
exist in the Office of Safety?
    Answer. Information follows.

------------------------------------------------------------------------
                                                  Fiscal years--        
                                        --------------------------------
                                            1995       1996     1997 \1\
                                           actual     actual    estimate
------------------------------------------------------------------------
Field..................................        447        449    \2\ 442
Headquarters...........................         86         82     \3\ 82
                                        --------------------------------
      Total............................        533        531        524
Fiscal year 1997 ceiling...............  .........  .........       543 
------------------------------------------------------------------------
\1\ As of 6/30/97.                                                      
\2\ Firm commitments (3)--EOD 7/6/97 (1); and 7/20/97 (2). Firm recruit 
  actions (11)--Three selectees will be given a firm EOD pending drug   
  test. Remaining eight actions in various stages of recruit process.   
  Positions should be filled by August 1.                               
\3\ Firm recruit actions (5)--All positions have been paneled. Waiting  
  for interviews and/or final selection.                                

                          safety travel budget
    Question. How much was spent on travel during fiscal year 1996, 
fiscal year 1997, and proposed for fiscal year 1998? Please separate 
the spending amounts for travel by field staff and headquarters staff, 
as well as for State employees.
    Answer. The information follows:

                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                  Fiscal years--        
                                        --------------------------------
                                            1996       1997       1998  
                                           actual    enacted   requested
------------------------------------------------------------------------
Headquarters...........................        480        281        285
Field..................................      4,671      4,948      5,016
State Inspector Travel.................        210        240        245
                                        --------------------------------
      Total............................      5,361      5,469      5,546
------------------------------------------------------------------------

              effect of videoconferencing on travel budget
    Question. How will the $135,000 that is requested for 
videoconferencing and imaging be used to reduce the current amount 
spent on travel? How have these associated reductions been reflected in 
the fiscal year 1998 travel request?
    Answer. The use of an imaging system enhances access of records 
between offices and allows the reduction of hard copy files and the 
amount of floor space required for file cabinets. This system would 
have no impact on travel.
    The video teleconferencing system (VTS) will enhance communication 
between field and headquarters offices, enhance telecommuting efforts, 
and increase FRA's ability to quickly respond to railroad accidents and 
emergencies. The use of a VTS will not result in a net reduction in 
travel, but could reduce the percentage growth in headquarters travel 
related to the training/meeting of field staff.
   office of safety--personnel compensation and benefits, and other 
                                support
    Question. Please break down the fiscal year 1998 requested amount 
for the following: PCS, inspector trainee program, data collection, 
grade crossing safety, alcohol and drug testing, overtime, non-
mandatory bonuses, training and travel. Please prepare in tabular form 
comparable expenditures for fiscal year 1996 and fiscal year 1997.
    Answer. Information follows:

                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                  Fiscal years--        
                                        --------------------------------
                                            1998       1997       1996  
                                          request    estimate    actual 
------------------------------------------------------------------------
PCS....................................        802        744        875
Inspector Trainee Program..............      1,736      1,845  \1\ 1,734
Data Collection........................      1,291      1,273      1,277
Grade Crossing Safety \2\..............  .........  .........  .........
Alcohol and Drug Testing...............        522        515        316
Overtime...............................         88         88        201
Non-mandatory bonuses..................         16         16         52
Training...............................        314        310         80
Travel.................................      5,546      5,469      5,316
------------------------------------------------------------------------
\1\ Reflects budgeted amount, trainee costs were not tracked separately.
\2\ Funding for grade crossing is not tracked in the budget or          
  accounting reports.                                                   

                            safety training
    Question. How much money was spent for management retreats and 
diversity training in each of the last three years. How much is planned 
for similar efforts during fiscal year 1998?
    Answer. During the last three years, approximately $25,000 has been 
spent on diversity training. In fiscal year 1996, supervisors received 
diversity training as a part of a week-long training course covering 
many topics. Also, in fiscal year 1996, all employees received 
diversity training as part of training received during the safety 
multi-regional conferences. This training was given by in house staff 
resulting in minimum costs, i.e., travel. No specific diversity 
training has been identified for fiscal year 1998.
    The Office of Safety holds approximately two management retreats 
each year for strategic planning. The only costs associated with these 
retreats are travel costs which we do not track separately from other 
travel costs.
                     reprogramming of safety funds
    Question. Please show any reprogramming or reallocation of Office 
of Safety funding from the appropriated amounts for fiscal year 1996 
and fiscal year 1997.
    Answer. Funding for the Office of Safety was appropriated at the 
total account level. fiscal year 1996 and fiscal year 1997 levels were 
$49.558 million and $51.338 million respectively. FRA has not 
reprogrammed any funds between the Safety and other FRA accounts.
                              cost sharing
    Question.What has FRA done since last year to promote additional 
cost sharing in the research and development program? How does FRA plan 
to continue this practice in 1998?
    Answer. The FRA's Office of R&D has continued to meet with the 
Association of American Railroads and the railroad industry (railroads, 
suppliers, unions) to identify cooperative research projects. One major 
effort is the Facility for Accelerated Service Testing (FAST), a joint 
government industry research project conducted at the Transportation 
Technology Center in Pueblo, Colorado. Another effort is with the RPI/
AAR Tank Car Research Project where FRA and the industry are 
cooperating on several research projects to reduce the release of 
hazardous materials from tank cars involved in accidents. These 
projects include testing, which FRA funds, and tank cars and other 
equipment for testing, supplied by the industry. Industry also 
contributes technical expertise.
    To ensure maximum leveraging of research funding and to eliminate 
duplication in the area of passenger car research, the FRA cooperates 
extensively with organizations such as the American Public Transit 
Association and the Federal Transit Administration.
    FRA will continue meeting with interested parties to further 
cooperative research in 1998. FRA will also use the Railroad Safety 
Advisory Committee process and their Working Groups to investigate 
additional projects for cooperative research.
                    non-federal cost sharing in r&d
    Question. Please update and specify cash equivalents, in-kind 
services, or other funds obtained from non-Federal sources for each of 
the subcomponents of the R&D program for fiscal years 1996 and 1997. 
How will cost sharing be encouraged during fiscal year 1998, and how is 
this reflected in the budget proposal?
    Answer.

              EQUIPMENT, OPERATIONS AND HAZARDOUS MATERIALS             
                         [Dollars in thousands]                         
------------------------------------------------------------------------
                                            Non-                Percent 
         Fiscal year           Federal    Federal     Total       non-  
                                funds      funds      funds     Federal 
------------------------------------------------------------------------
1996........................     $5,535     $5,728    $11,263         51
1997........................      5,545      3,295      8,840         37
------------------------------------------------------------------------

    About half of the cost-sharing under this program is the industry's 
contribution of equipment for the advanced braking project and the 
wayside bearing project. Other cost-sharing includes in-kind 
contributions of technical expertise and equipment and related shipping 
costs for hazardous materials test projects. Not included in the above 
figures is the industry contribution to the Operation Lifesaver program 
which is con-funded by FRA, FHWA, Amtrak, Association of American 
Railroads, Railway Progress Institute, and individual railroads.

                  TRACK, STRUCTURES, AND TRAIN CONTROL                  
                         [Dollars in thousands]                         
------------------------------------------------------------------------
                                            Non-                Percent 
         Fiscal year           Federal    Federal     Total       non-  
                                funds      funds      funds     Federal 
------------------------------------------------------------------------
1996........................     $7,078     $5,747    $12,825         45
1997........................      7,346      6,156     13,502         46
------------------------------------------------------------------------

    Nearly half of the cost-sharing under this program is provided by 
industry contributions to the Facility for Accelerated Service Testing. 
Other significant fractions are provided by industry support to the 
vehicle Track Systems program and by individual railroad contributions 
of train crews for test operations of the FRA's Gage Restraint 
Measurement System (GRMS) as well as transportation of FRA's GRMS 
instrumentation car between test sites.

               SAFETY OF HIGH-SPEED GROUND TRANSPORTATION               
                         [Dollars in thousands]                         
------------------------------------------------------------------------
                                            Non-                Percent 
         Fiscal year           Federal    Federal     Total       non-  
                                funds      funds      funds     Federal 
------------------------------------------------------------------------
1996........................     $9,373     $2,300    $11,673         20
1997........................      4,600        156      4,756          3
------------------------------------------------------------------------

    There has not been much cost-sharing in this program due to the 
fact that the freight railroad industry is not conducting research in 
high-speed passenger car safety issues. Most of the current work is in 
support of rules of particular applicability for the Office of Safety. 
This type of research does not lend itself to cost-sharing.

                             R&D FACILITIES                             
                         [Dollars in thousands]                         
------------------------------------------------------------------------
                                            Non-                Percent 
         Fiscal year           Federal    Federal     Total       non-  
                                funds      funds      funds     Federal 
------------------------------------------------------------------------
1996........................       $400       $383       $783         49
1997........................        420        510        930         55
------------------------------------------------------------------------

    A major portion of FRA's research funding support projects that are 
conducted at the Transportation Technology Center (TTC). The TTC is 
operated for the FRA by the Association of American Railroads (AAR) 
under a long-term Care, Custody, and Control contract. The total 
business volume of the AAR at TTC is on the order of $30 million per 
year. Of this, approximately 25 percent or less is provided by FRA. 
Therefore, the majority of the costs for operation, maintenance, and a 
few selectively chosen capital improvements to the TTC is borne by the 
AAR and its customers via AAR's overhead rate and pricing structure for 
non-FRA projects at TTC.
                        r&d programs with volpe
    Question. Please list all FRA research and development program 
contracts with the Volpe National Transportation Systems Center in 
fiscal years 1996 and 1997, including a short summary of each specific 
contracted project, and the associated amount.
    Answer. The information follows.
RR-03.--Next generation high speed rail support
    This project provides support to the FRA's Next Generation High 
Speed Rail Program. The purpose of this effort is to enhance the 
deployment of high-speed passenger rail, particularly on existing 
infrastructure, by improving, adapting and demonstrating innovative and 
cost-effective technologies which have wide application in U.S. 
corridors.
    The Volpe Center provides technical support to the FRA in assessing 
candidate technologies and procedures to determine the likely impact on 
rail operations, including safety, performance, reliability and 
economic viability.
    Research activities conducted under this program include: High-
Speed Positive Train Control; Grade Crossing Risk Assessment and 
Reduction; High Performance Non-Electric Locomotive Development; 
Innovative Technologies for Track and Structural Improvements; Railroad 
Test Track Upgrade.

Funding

Fiscal year:
    1996......................................................$1,250,000
    1997......................................................   600,000
RR-19.--Track systems research
    The Track Systems Research Program provides the FRA with 
engineering analysis tools and analytical and experimental study 
results. These results will be applied to assess risk of derailment 
induced by track defects and to manage inspection and maintenance 
resources to minimize these risks. The results of these studies promote 
railroad safety and economic efficiency by enabling track engineers to 
target inspection and maintenance resources based on actual performance 
on track. Specific tasks are pursued based on accident statistics, 
track maintenance costs, and engineering expectations of potential 
problems.
    The work conducted under this program is in direct support of the 
goal of the FRA to promote and improve the safety of the nation's rail 
system in the area of railroad track systems. The efforts build upon 
the Volpe Center's engineering capabilities developed as a result of 
rail and vehicle safety research projects conducted over the years in 
support of the FRA. The results of this research have been incorporated 
in the risk management strategies of railroads throughout the United 
States, and are being applied by the FRA in the development of 
revisions to the current track safety standards. Analysis tools and 
studies conducted under this program have provided the FRA with data 
for use in evaluation of waiver requests and monitoring performance 
under waivers issued.
    Research activities under this program include: Rail Integrity; 
Track Structural Mechanics; Track Inspection Tools; Vehicle Track 
Interaction; Train Control Device Safety; Risk Assessment and 
Management Strategies; Special Projects related to Track Systems 
Safety.

Funding

Fiscal year:
    1996......................................................$1,810,000
    1997...................................................... 1,772,000
RR-28.--Rail equipment safety
    The FRA sponsors research and engineering studies to provide the 
technology to reduce the likelihood of accidents related to the design 
and the operating and maintenance practices of railroad equipment.
    This project provides the FRA with a base of Volpe Center expertise 
to support the FRA's research and development program on railroad 
equipment and operating practices and hazardous material safety. 
Research activities under this program include: Structural Integrity of 
Tank Cars/Components; Human Factors Influencing Operator and Crew 
Performance; Advanced Operation and Information Displays; Train Make-
Up, Handling, and Controls; Rail Passenger Evacuation Safety; Rail 
Equipment Collision Safety; Rail Vehicle Dynamics; Dedicated Trains; 
Advanced Risk Analysis; Trailer/Container Securement; Steam Locomotive 
Study.

Funding

Fiscal year
    1996......................................................$3,246,576
    1997...................................................... 1,537,000
RR-93.--High speed ground transportation safety
    This project provides the FRA with timely technical information for 
informed rulemaking initiatives and with technical assessments of the 
safety implications of the implementation of advanced high speed ground 
transportation systems proposed for construction in the United States. 
Information is developed in topic areas critical to the safety of HSGT 
systems that may not have been explored for traditional U.S. rail 
systems. Technical safety assessments include systems based upon 
foreign developed technologies that have been proposed for 
implementation by a variety of private interests and state and local 
authorities. The Volpe Center staff with support of the Center's 
contractor base have been conducting studies of the applicability of 
existing regulations and requirements for new regulations to permit 
these new technologies to operate safely in the U. S. environment. 
Volpe Center staff have worked with FRA staff in the drafting of 
waivers to permit demonstration of new equipment and in preparation of 
new rules of particular and general applicability to permit safe 
operation of the proposed systems.
    Research activities under this HSGT program include: System Safety/
Emergency Preparedness; System-Specific Safety Assessments; Automation 
Safety and Operational Control-Critical System Monitoring/Alerting; 
Fire Safety; Corridor Risk Assessment Model Development; Human Factors; 
Vehicle Crashworthiness; Advanced Braking; Track Standards; Guideway 
Safety; Aerodynamic Safety Issues-Platform and Vehicle; Glazing Safety; 
Electrical Safety; Electromagnetic Fields; Magnet Safety.

Funding

Fiscal year:
    1996......................................................$1,600,277
    1997...................................................... 1,925,000
RR-97.--Highway-rail grade crossing safety
    The Volpe Center is supporting the FRA's highway-railroad grade 
crossing safety research program. This research includes innovative 
warning signs, more reliable active signal systems, techniques to 
increase the conspicuity of trains, improved acoustic warning systems, 
and technologies applicable to the needs of high speed rail passenger 
service. Other initiatives include enforcement and education activities 
as well as a greater emphasis on the human response to grade crossing 
warning device applications.
    Research activities under this program being conducted at the Volpe 
Center include: Locomotive Conspicuity; Freight Car Reflectorization; 
Optimal Acoustic Warning Systems; Wayside Horn Systems; Driver 
Behavior; Causal Analysis of Crossing Accidents; Driver Education 
Programs; Illumination Guidelines; Active Warning Device Failure 
Analyses; Assessment of Passive Systems;Obstacle and Intrusion 
Detection; Vehicle Proximity Alerting System; High Speed Rail Grade 
Crossing Safety; High Speed Rail Grade Crossing Demonstration 
Evaluations; Risk Analysis of High Speed Rail Crossing Improvements.

Funding

Fiscal year:
    1996......................................................$1,595,000
    1997...................................................... 1,103,000
              strategic plan and research and development
    Question. Please outline how the FRA's strategic plan outlines the 
direction and nature of research to be conducted during the next five 
years for the entire research and development program
    Answer. The R&D activities in this Plan are those needed both to 
support the safety rulemaking and enforcement activities of FRA's 
Office of Safety and to foster the development of technologies needed 
for high-speed passenger operations. Safety recommendations from the 
National Transportation Safety Board were taken into account, along 
with National, Departmental, and Agency strategic goals. Contributions 
to the plan were solicited and received from across the spectrum of 
scientific, operational, and user communities. These contributions from 
both inside and outside government are always welcome, provide valuable 
inputs, and are greatly appreciated. They provided input for the 
development of research proposals.
    FRA's five-year strategic plan for the Office of Research and 
Development groups projects into two major program areas that cover 16 
program elements:
    Improving railroad safety:
  --Reduction of human factors accidents.
  --Detection of rolling stock defects and improvement of rolling stock 
        performance.
  --Detection & prevention of track and structure defects.
  --Track/train interaction safety.
  --Prevention of train collisions and over speed accidents.
  --Prevention of grade crossing accidents.
  --Improved hazardous materials transportation safety.
  --Improved protection for occupants of trains.
  --Improved safety of high-speed ground transportation.
  --Improved R&D facilities and test equipment.
    Advance technology to accelerate high-speed rail:
  --Development of high-speed positive train control systems.
  --Development of non-electric locomotives for high-speed passenger 
        corridors.
  --Development of high-speed grade crossing protection.
  --Track and structures technology.
  --Integrated corridor demonstration.
  --Advancement of maglev technology.
    To review and prioritize these research proposals, review teams of 
project and program managers were formed for each of the 16 R&D program 
elements. This prioritization was based on the criticality of project 
contributions toward eliminating shortfalls that affect FRA strategic 
goals. Congressional issues, concerns of the railroad community as a 
whole, as well as cost effectiveness and long and short-term benefits 
were also considered as prioritization factors. After prioritization 
within program elements, R&D management worked across element 
boundaries to develop an integrated R&D program. With this process, FRA 
believes that it has moved its R&D program from one that was reactive 
to one that will be more anticipatory.
    The FRA, in an effort to ensure maximum leveraging of research 
funds and to eliminate duplication, cooperates extensively with the 
AAR, the Railway Progress Institute (RPI), American Public Transit 
Association (APTA), Amtrak, and the Federal Transit Administration 
(FTA). Cooperation with the AAR occurs primarily in the areas of track/
train interaction, track safety research, bearing defect detection, 
braking systems, grade crossings, train control, and hazardous 
materials (hazmat) transportation. The RPI arranges for its supplier-
members to provide material and equipment for the Facility for 
Accelerated Service Testing at the TTC, and also participates in the 
hazmat transportation projects. The APTA, Amtrak, and the FTA cooperate 
with the FRA on projects aimed at improving protection for railroad 
passengers. Representatives from the FRA serve on a number of industry 
committees to ensure that duplication of effort is avoided.
    The FRA continues to investigate avenues for leveraging scarce 
research resources with other government agencies, the railroads and 
railroad supply industry, and foreign railroad research and development 
organizations.
                     research and development/gpra
    Question. Please summarize the office of research and development's 
efforts to comply with the Government Performance and Results Act.
    Answer. Research and development programs pose a special challenge 
with regard to establishment of outcome-oriented performance 
measurement as required by the Government Performance and Results Act. 
FRA recognizes that R&D activities, even when addressing highly applied 
topics, are not ends in themselves. Rather, they are generally 
components of broader, outcome-oriented programs, and realization of 
those goals will ultimately depend in large part on program 
implementation factors that are typically far removed from the enabling 
research. Furthermore, in railroading, federal activities are generally 
only a small part of achieving outcomes, with much of the 
responsibility for implementation falling to the private sector (and 
state and local agencies with respect to commuter operations and to 
grade crossings), and with final success determined by transportation 
system users and other affected parties. Finally, outcomes are likely 
to be very distant in time from the R&D that contributes to them.
    In spite of these difficulties, FRA's Office of Research and 
Development is implementing a performance-oriented management process. 
The Office of R&D has identified its key ``customers'' for its work, 
and relates it to their needs. The R&D program elements are linked 
directly to National, Departmental, and Agency Strategic Goals. The 
five-year R&D strategic plan explicitly establishes those linkages.
    The Office is taking steps to identify the difference between 
``outputs'' and ``outcomes'' of its R&D projects. These outputs are 
related to the desired outcomes which are directly linked to FRA goals 
and objectives. The Office of R&D has recognized that the end of an R&D 
project is not when a report is printed and distributed, and that staff 
resources need to be devoted to bringing about the appropriate 
implementation of the R&D findings.
                         human factors research
    Question. Please provide an update of the progress that has been 
made in the human factors program since last year. How much of the 
fiscal year 1996 and fiscal year 1997 allocated funds have been spent, 
and for what purposes? Please delineate objectives on a project by 
project basis. Please provide additional details on the plans for any 
new human factors research in fiscal year 1998.
    Answer. Following is a summary of the progress on projects during 
fiscal year 1997, project objectives, and funding for fiscal years 1996 
and 1997 and the fiscal year 1998 request. New phases or extensions of 
ongoing research are identified where applicable.
Stress and Fatigue
    1. Data collection for Enginemen Stress and Fatigue: Phase II was 
completed in early fiscal year 1997. Reports are being prepared for 
publication by the end of fiscal year 1997. The majority of this 
project was funded prior to fiscal year 1996. The objective is to 
determine if current scheduling practices impose an excessive burden of 
sleep deprivation, circadian disruption, and fatigue which could 
degrade the train handling performance and vigilance of locomotive 
engineers.

Fiscal year:
    1996......................................................  $200,000
    1997................................................................
    1998................................................................

    2. Study design for Engineer Napping Strategies has been initiated 
and is expected to be completed in fiscal year 1997. The primary 
purpose of this research is to determine if strategic on-duty napping 
can improve locomotive engineer performance and safety. Future year 
funding will be needed to complete this project.

Fiscal year:
    1996....................................................\1\ $630,000
    1997......................................................   355,000
    1998......................................................   400,000

\1\ $530,000 obligate in fiscal year 1997.

    3. Information on Vigilance Monitoring devices and techniques that 
are being marketed or that are in the research and development stages 
are being assembled during fiscal year 1997 as a part of the Volpe 
Center's technical support activity. While this has been a low level 
effort to date, evaluation of these and other potential technologies is 
planned for fiscal year 1998. Testing of the most promising 
technologies is also planned. The intent is to identify, test and 
validate a cost effective technology for determining the level of 
alertness of a locomotive engineer while on duty and initiating a fail-
---------------------------------------------------------------------------
safe action, if needed.

Fiscal year:
    1996................................................................
    1997......................................................  $325,000
    1998......................................................   300,000

    4. The study design for Dispatcher Workload, Stress and Fatigue is 
expected to be completed by the end of fiscal year 1997 and pilot tests 
of the methodology initiated in early fiscal year 1998. Methods of 
measuring workload, stress and fatigue (alertness) in a uniform manner 
and thresholds for safe performance are to be established. Out year 
funding will be needed to complete this project.

Fiscal year:
    1996......................................................  $100,000
    1997......................................................   200,000
    1998......................................................   224,000

    5. The draft report ``Human Factors Phase III: Effects of Control 
Automation on Operator Performance'' is currently being reviewed and 
revised. It should be published by the end of fiscal year 1997. This 
work provides background for FRA's concern with High Speed Operator 
Stress and Fatigue. Another element, to begin by the end of fiscal year 
1997, is to evaluate the effects of increased information flow which 
must be handled by the operator at higher speeds.

Fiscal year:
    1996......................................................  $285,000
    1997......................................................   100,000
    1998......................................................   200,000
Operating Practices
    1. Non-Accident Hazmat Releases was initiated in fiscal year 1997 
to examine training practices for, and educational background of 
personnel handling hazardous materials.

Fiscal year:
    1996................................................................
    1997......................................................  $130,000
    1998................................................................

    2. An evaluation of Yard and Terminal Safety Practices was 
initiated in fiscal year 1996. An interim report on Phase 1, which is 
an analysis of accident data bases to determine the major human factors 
contributing to accident causation, is expected to be completed by the 
end of fiscal year 1997. The next phase will be an in-depth evaluation 
of these human factor issues.

Fiscal year:
    1996................................................................
    1997......................................................  $200,000
    1998......................................................   150,000

    3. Dispatcher Training Evaluation was begun in fiscal year 1996. 
This study was designed to examine training issues for dispatchers in 
light of recent changes in technology, workload, and operational 
experience of the job applicant pool. Currently, model syllabi are 
being drafted for FRA and subject matter expert review. This review 
will be performed during the early months of fiscal year 1998, and 
followed with revisions, as needed. A subsequent workshop on the 
findings of this effort is anticipated.

Fiscal year:
    1996......................................................  $300,000
    1997......................................................   100,000
    1998......................................................   200,000

Applied Technology
    Currently, there is only one project in this group of activities. 
It is referred to as Knowledge Display Interface and was initiated in 
fiscal year 1996 to explore innovative ways to visualize and share 
information, particularly among teams of operating personnel.

Fiscal year:
    1996......................................................  $450,000
    1997......................................................   200,000
    1998......................................................   200,000
Grade Crossings
    1. Operation Lifesaver has historically been funded in the human 
factors part of the R&D program. This program is managed by the Office 
of Safety.

Fiscal year:
    1996......................................................  $300,000
    1997......................................................   600,000
    1998......................................................   400,000

    2. Several activities are in various stages under the overall 
heading of grade crossing safety. They are: Freight Car 
Reflectorization--report being reviewed; Evaluation of Wayside Horns--
report being reviewed; Optimal Acoustic Warning Systems--ongoing; 
Driver Behavior--initiated in fiscal year 1997; Accident Causation 
Analysis--initiated in fiscal year 1997.

Fiscal year:
    1996......................................................  $435,000
    1997......................................................   385,000
    1998......................................................   435,000
                  locomotive engineer fatigue research
    Question. What are the fatigue mitigation strategies that have been 
investigated during the last year? What were the results of these 
efforts?
    Answer. Enginemen Stress and Fatigue: Phase II has been completed 
and two reports are nearing publication. This research determined that: 
current Federal regulations governing Hours of Service for locomotive 
engineers allow work schedules that have backwards rotating shift start 
times that may not allow sufficient sleep; locomotive engineers who 
work under such schedules can accumulate a progressive sleep debt over 
a period of days; the locomotive engineers in this study, while working 
on such schedules, reported progressive decreases in subjective 
alertness across the duration of the study; and, several aspects of job 
performance, including safety sensitive tasks, degraded during the same 
time period. This suggests, that greater care in scheduling train crews 
is necessary to maintain high levels of safety and efficiency.
    FRA plans to evaluate potential strategies to mitigate the effects 
of fatigue. An evaluation of planned, on-duty napping has been 
initiated in fiscal year 1997 at an estimated cost of $1.2 million and 
is expected to require about three years to complete. An evaluation of 
vigilance monitoring devices is planned to start by the end of fiscal 
year 1997. Initial cost is expected to be $300,000.
    In addition to these research activities, FRA held a round-table 
last year with labor and management participation and is encouraging 
industry initiatives demonstrating different approaches to use of 
napping, scheduling and crew calling.
                        fatigue research results
    Question. Please provide updated results of the fatigue research 
sponsored by FRA. What information has been collected that could lead 
to regulatory revision of the hours-of-service requirements? How has 
the fiscal year 1997 program contributed toward this objective, and 
what are the planned fiscal year 1998 research objectives?
    Answer. Enginemen Stress and Fatigue: Phase II was completed in 
fiscal year 1997 and the earliest stages of Engineer Napping Strategies 
initiated. While the work just completed provides some basis for 
considering changes in the way work assignments are scheduled, whether 
this should be done in a regulatory setting or by some other means 
remains to be determined. Continuation of the napping study in fiscal 
year 1998 will move closer to determining if on-duty napping is a 
useful fatigue mitigation strategy.
                     passenger equipment standards
    Question. Please provide a discussion of how the equipment and 
components subprogram reflects the congressional mandate for FRA to 
develop passenger equipment standards. How much money was spent for 
this purpose in fiscal year 1996 and fiscal year 1997, and how much is 
planned for fiscal year 1998?
    Answer. To respond to the mandate of the Congress to develop 
passenger equipment safety standards, FRA has expanded its passenger 
equipment safety project within the equipment and component subprogram 
since fiscal year 1996. A project on passenger rail vehicles dynamics 
was initiated in fiscal year 1996 to verify the safety assessment 
method and derailment criteria. Another project on passenger restraint 
systems was initiated in fiscal year 1997 to study the effectiveness of 
various passenger restraint designs. Funding for fiscal year 1996 and 
fiscal year 1997 was $500,000 and $800,000 respectively. We are 
requesting $700,000 for fiscal year 1998 to support this important 
project, and $100,000 to support research specifically for commuter 
rail cars.
                            operating rules
    Question. What additional research might be conducted to improve 
the clarity and understanding of railroad operating rules? How has 
misunderstanding these rules contributed to crashes?
    Answer. Information derived during fiscal year 1997 from individual 
interviews and a focus group involving representatives of the 
Association of American Railroads, National Transportation Safety 
Board, Federal Railroad Administration and several railroads with 
responsibility for operating rules development or compliance is 
currently being evaluated to determine the most productive course of 
action for further research. The misapplication of rules for 
``restricted speed'' (various definitions, but usually under 20 mph.) 
is the most frequently cited problem by this group. In 1995, nearly 
half of all train collisions occurred at speeds under 20 mph.
    Several issues regarding the communication and understanding of 
railroad operating rules may warrant further research. The railroad 
industry has recognized the importance of having clear, succinct, 
unambiguous operating rules that can be easily and accurately 
understood by operating employees. Major railroads in the Northeast 
enlisted the aid of a language and communications expert when they 
devised their operating rule book known as the NORAC Operating Rules.
    The American Train Dispatchers Division of the Brotherhood of 
Locomotive Engineers (ATDD/BLE) has conducted preliminary research 
regarding ``active'' listening techniques. ``Active'' listening 
requires active participation from the listener which may translate 
into more careful listening and more accurate communication.
    Research into the skills and techniques associated with 
communication and listening may provide valuable information that can 
enhance the safety of railroad operating rules and procedures.
                dispatcher workload, stress, and fatigue
    Question. The fiscal year 1997 budget request stated that tests and 
methodology for the evaluation of dispatcher workload, stress and 
fatigue would soon be completed. Were they? Please describe the results 
and how the fiscal year 1998 research and development will continue the 
progress made in fiscal year 1997. How could the results of the study 
contribute to a regulatory revision of the hours of service 
requirements?
    Answer. In Phase II of the locomotive engineer research, 
performance effects of scheduling on sleep deficit, accounting for the 
circadian cycle, were examined. Research on locomotive engineer stress 
and fatigue continues with evaluations of mitigation strategies. 
Currently, this includes on-duty napping and vigilance monitoring. 
Other strategies such as scheduling alternatives may emerge from tests 
by various railroads. Stress and fatigue, particularly relating to 
types of work assignments during different shifts, in the work 
environment of yard and terminal workers, is likely to become a 
discreet focus of that broader study.
    Methodologies to be used in the examination of dispatcher workload, 
stress and fatigue are still being developed. They are to be 
unobtrusive during the dispatcher's work period. Both objective and 
subjective measures of workload, stress and fatigue will be used. Pilot 
tests are expected to begin in October 1997, and be completed during 
the summer of 1998. Amtrak and Conrail have agreed to provide sites and 
support for these activities. The main body of data collection will 
begin as soon as possible thereafter. The implications for action on 
hours of service, workload control and distribution, and other features 
of the dispatcher job cannot be known until results of the research 
become available. There have been delays in the original schedule of 
this project, but they have not adversely affected the direction or 
relevance of the research.
                 high-speed operator stress and fatigue
    Question. One of the ongoing research projects included in the 
operations subcomponent of FRA's research and development request is to 
evaluate stress and fatigue issues unique to high-speed train 
operators. Please explain how the high-speed conditions are replicated 
in order to conduct this evaluation. Does FRA have a high-speed rail 
simulator?
    Answer. The FRA's Strategic R&D plan identifies stress and fatigue 
issues unique to high-speed train operators as an area of concern. The 
FRA's approach to the simulation of high-speed rail operations has 
emphasized problems caused by the high rate of information flow at high 
operating speeds. Human capacity to receive, process and react to 
information is limited. The FRA is using a ``part task'' simulator at 
the Volpe Center to simulate visual and other sensory-motor aspects of 
high-speed operations to evaluate the stress and fatigue caused by high 
rates of information flow and the requirement to act and react on the 
basis of that information. Since the conditions of interest are 
computer generated, they are easily replicated for evaluation. The 
``part task'' simulator which is used for this evaluation does not 
simulate the physical motion, or many other aspects, of high-speed 
operations.
                          high-speed simulator
    Question. Are there any plans in the next five years to add the 
capability for high-speed rail simulation?
    Answer. A study to determine the need for and desired 
characteristics of a high speed simulator is planned for fiscal year 
1999. Amtrak has contracted for trainsets based on French technology 
that are intended to operate on existing, improved track at speeds up 
to 150 mph. These tracks will also continue to carry slower freight 
traffic. Florida's FOX system is also based on French technology and is 
planned to operate at 200 mph on dedicated right of way. French, 
German, Swedish and Japanese technologies continue to offer promise of 
faster trains in the future. Each have different views of the most 
desirable mix of automation and human control. U.S application will 
likely be variations of these approaches. While no details are known at 
this point, it is anticipated that the capability to sort through the 
most likely options will be needed. This can be best provided through 
the use of well designed simulation.
                         track research funding
    Question. How were the funds allocated in fiscal year 1997 spent 
for track research? Please explain purpose of each project and the 
amount funded. What are the comparable planned expenses in this area 
for fiscal year 1998, and how is this reflected in the request? How did 
the results of the fiscal year 1996 research help FRA?
    Answer. In fiscal year 1997, a total of $7.346 million was 
allocated for track research. The total funding request for track 
research in fiscal year 1998 is $7.746 million. The following shows how 
these funds were allocated among the four major program activities for 
fiscal year 1997 and the allocation planned for fiscal year 1998. A 
detailed list of projects for fiscal years 1995-1998 can be found on 
page 75 of FRA's fiscal year 1998 Congressional Budget submission.

                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                       Fiscal years--   
                                                   ---------------------
                                                       1997       1998  
                                                     enacted    request 
------------------------------------------------------------------------
Track and Components..............................      2,785      2,585
Inspection-Detection..............................      2,150      2,750
Track Train Interaction...........................      1,364      1,364
Signal, Train Control, and Electrification........      1,047      1,047
                                                   ---------------------
      Total.......................................      7,346      7,746
------------------------------------------------------------------------

    The purpose for each of these program activities is as follows:
    Track and Components.--The purpose of this program activity is to 
aid in assessing the structural integrity of the existing track 
structure and its components in light of the changing environment of 
higher axle loads, traffic densities, and speeds and the recent trends 
of introducing newer unconventional vehicle types and newer track 
materials. It includes research on more complex track components, such 
as turnouts, in addition to more commonly considered track components, 
such as rail, crossties, and ballast. Emphasis is given to failure 
modes and degradation processes which most impact the safety of track.
    Inspection-Detection.--The purpose of the Inspection-Detection 
program activity is to improve track defect detection techniques and 
other technologies related to inspection equipment, with the goal of 
reducing train accidents resulting from failures in the track 
structure. Potential research products include new techniques and 
equipment that could provide accurate and reliable assessment of track 
safety, or aid in the effective planning of track maintenance as a 
preventive measure against hazardous structural failure of track or 
bridges. The new techniques could serve as the basis for performance 
based track safety standards which do not inhibit innovation.
    Track Train Interaction.--The objective of this research area is to 
develop analytical tools, instrumentation, and test data that can 
accurately describe the interaction between the rolling stock and the 
supporting track structure. This interaction is not limited to the 
instantaneous transfer of dynamic forces from vehicle to track but 
extends to cover cumulative effects on track degradation such as wear 
and surface fatigue of railheads and deterioration of track geometry. 
Some of the safety related issues which will greatly benefit from 
progress in this research area include the impact of high speed 
passenger service on existing track, the development of performance-
based track geometry standards, and the development of guidelines for 
optimum inspection and maintenance practices to enhance track safety 
and durability.
    Signal, Train Control, and Electrification.--The goal of this 
research area is to evaluate critical and interrelated areas of railway 
signaling and electrification technology that are outpacing the content 
of existing Federal standards. Prime emphasis is placed on safety and 
operability of high-speed guided ground transportation (HSGGT) systems. 
As a corollary, another related goal is to seek application of existing 
or new technology to improve railroad safety.
    Much has been gained from the track research and test activities 
that were completed in fiscal year 1996. The most notable 
accomplishments and their benefit to FRA can be summarized as follows:
    Track Safety Standards.--In 1996, a government-industry-labor 
effort under the auspices of the Rail Safety Advisory Committee was 
initiated to accelerate the development of revised track safety 
standards for all present classes of track, as well as new standards 
for high speed tracks.
    This process was greatly influenced and guided by results from 
research completed in fiscal year 1996. One example is results from 
testing and analysis of track twist and its influence on vehicle 
safety, which were completed in fiscal year 1996, and have led to 
significant revision of current standards. Another notable example is 
the development of new high speed track geometry and vehicle-track 
interaction safety standards, where fiscal year 1996 research results 
provided the very first building blocks allowing the development of 
comprehensive performance-based standards.
    Track Buckling.--Testing and analysis in track buckling mechanism 
has resulted in maintenance guidelines which have been useful to the 
industry in combating this source of train accidents. Significant 
reductions in the number of accidents attributed to track buckling have 
been seen since this research began. Additional work is still needed on 
methods and devices to measure track lateral resistance and rail 
longitudinal force and to extend results to tracks constructed with 
unconventional crossties.
    Gage Restraint.--An ongoing effort in fiscal year 1996, is 
application of the Gage Restraint Measurement System (GRMS) developed 
by the FRA to measure the ability of track to maintain gage under 
service load conditions. In 1996, the GRMS continued to gain acceptance 
as a mature technology resulting in at least two major railroads 
acquiring GRMS capabilities, based on this FRA developed prototype, for 
their own use in locating areas of track with weak or unsafe gage 
restraint. FRA's longer range GRMS testing continued on a large 
southeastern railroad. This railroad can now, on the 500-mile test 
zone, assure that crosstie replacements are being installed in areas of 
maximum risk for wide-gage derailments from weak ties.
    Heavy Axle Loads.--During fiscal year 1996, a new phase of 
accelerated testing was begun at the Pueblo test track in order to 
assess track safety and performance under 125-ton cars equipped with 
improved suspension systems. Initial results from more than 100 million 
gross tons of traffic accumulated on the test track under these loads 
indicated a potential enhancement to safety due to reductions in 
lateral loads and fatigue related rail defects. Experiments on rail 
grinding practices and their impact on rail wear and fatigue were also 
begun.
    Rail Steel Integrity.--Work supported by FRA grants at the Oregon 
Graduate Research Institute has resulted during fiscal year 1996 in the 
completion of two doctoral theses concerning fatigue-induced cracks in 
rail steel. Research findings documented in these theses have provided 
valuable insight into the phenomena of crack generation and growth 
rates under a variety of conditions of instantaneous and cumulative 
tonnage burden as well as various methods for top-of-rail lubrication. 
The knowledge gained from these multi-year research projects that have 
recently come to fruition will now be employed in devising rail flaw 
inspection revisit protocols and in generating test procedures for 
assessing rail lubrication strategies. For instance, one surprising 
result from the research was that rail lubrication which is often used 
to reduce flange wear on curved track may actually accelerate the 
growth of fatigue-induced cracks in the rail head via forced 
advancement of the crack vertex due to hydrostatic pressure of 
lubricant trapped in the crack by the wheel tread.
    Question. What are the implications of delaying or split funding 
(half in fiscal year 1998, half in fiscal year 1999) any new 
initiatives on track technology? In your answer, please address the 
advantages and disadvantages of split funding the proposed upgrade of 
the T-6 car.
    Answer. FRA is requesting $650 thousand in new initiatives in Track 
Research. Of this amount, $500 thousand is for the replacement of the 
T-6 car. FRA is already split funding this cost, as the balance will be 
requested in the fiscal year 1999 budget. The requested $500 thousand 
will support the design of the replacement car, initiation of the 
procurement process and acquiring of long lead items to ensure a 
delivery date of mid-2000.
    The envisioned replacement car is essential for the effective 
implementation of a number of track safety related initiatives in the 
Five-Year Strategic Plan. Consequently, our top enhancement priority in 
fiscal year 1998 is to initiate the replacement of this deteriorating 
40-year old railcar that is FRA's only platform for mounting 
instrumentation to conduct investigations that support development of 
advanced track inspection technology.
    The rapid payoff from this one-time purchase investment will be 
savings of $400K per year from the combined effect of reduced 
maintenance costs, increased efficiency of operations (less downtime), 
and gains in field-testing productivity, thereby providing cost-
effective use of Government funds. Furthermore, this investment should 
enable FRA to automatically detect track flaws related to 87 percent of 
current FRA cause codes, up from 46 percent now. This new level of 
capability will move FRA farther along the path toward the 
Administrator's goal of zero tolerance for derailments.
    If we do not acquire a new car, there will continue to be an 
expenditure of funds on recurrent ``band-aid'' maintenance of the old 
car and idle manpower during frequent breakdowns. Equally important, 
the lack of a suitable testing platform will severely limit our 
envisioned integration of advanced track inspection technologies with a 
potential to yield significant synergies and corresponding safety 
improvements.
    It should be noted that the T-6 will have to be adequately 
maintained and used until the replacement car is available in mid-
fiscal year 2000.
    The remaining $150 thousand for the advanced braking system project 
cannot be split funded because it would delay the realization of the 
benefits of the anticipated technological advances.
                   advanced braking system evaluation
    Question. Please describe the progress made in evaluating the 
advanced braking system. Will this study be completed in fiscal year 
1998?
    Answer. FRA has been working with industry co-operatively in the 
development of industry performance and interchange requirements for an 
advanced electrically controlled pneumatic braking system (ECP). Thus 
far, the train line communications standards have been established and 
adopted. Performance requirements, similarly, for braking forces, 
response times, and other key parameters have been selected and 
adopted. FRA has supported the safety related work inherent in the 
development of these specifications. Work remains to be done on the 
electronically controlled pneumatic brake/locomotive systems 
integration (ECP/LSI) interface and on the standards for the Head End 
Unit (HEU) control layout and mounting requirements.
    Laboratory testing of generic prototypes was conducted to 
investigate various failure modes and their consequences. Two industry 
suppliers have emerged to build equipment. These suppliers have 
selected a hardwired system both as a source of power for individual 
cars (as opposed to local generators or batteries) and for train line 
communication of signals. Several trainsets have been placed in test 
service mainly in unit coal and intermodal trains. The safety of these 
trainsets is being closely monitored, with failures of individual 
components being recorded. A system safety and reliability study is 
planned using the Failure Modes and Effects and Criticality Analysis 
approach.
    Beyond fiscal year 1998 the safety record will be followed and 
additional control and surveillance functions will be proposed for 
addition to the total ECP system. We will be examining both hard wired 
and RF versions of ECP brakes. ECP braking systems have improved the 
stop distance performance dramatically and the uniformity of braking 
among cars. Use of ECP braking systems will be extended to cars in 
general service so that the nation's entire fleet can utilize the 
safety benefits of this new technology. This will require a means to 
couple adjacent cars electrically and pneumatically in an automated 
fashion without manual connections. This work will be the principal 
focus in the ensuing fiscal years. ECP braking represents a major 
safety improvement in the rail industry.
               safety of high speed ground transportation
    Question. Specifically, what high-speed grade crossing safety 
research initiatives are ongoing with the fiscal year 1997 funding 
level of $950,000? What initiatives will be pursued with the requested 
funding level of $700,000?
    Answer. The fiscal year 1997 funding is providing $300,000 for 
research to support development of track safety standards and $650,000 
for grade crossing research. Of the $650,000; $150,000 is being used to 
evaluate grade crossing improvement projects previously funded, and 
$500,000 will continue work on intrusion detection and other devices, 
improved warning systems, and begin work on development of national 
warrants for grade crossing warning systems. For the fiscal year 1998 
request of $700,000; $300,000 will be used for development of track 
safety standards and $400,000 will continue the fiscal year 1997 grade 
crossing research efforts.
               safety of high speed ground transportation
    Question. Were any funds spent in fiscal year 1997 on the maglev 
safety research, and if so, how were these funds used? Are any maglev 
projects going on at this time?
    Answer. No funds were spent in fiscal year 1997 specifically on 
maglev safety research. Some of the rail safety work such as 
electromagnetic field effects is also relevant to maglev. At the 
present time there is one maglev technology project underway, ``Maglev 
2000 of Florida,'' using Florida DOT plus matching federal (but not 
USDOT) funds. In addition there are several local maglev projects 
seeking funding. These include a Baltimore to Washington project, a 
Pittsburgh, PA project, a Las Vegas to Southern California project, and 
the Mashantucket-Pequot Tribal Nation project between Norwich, CT, the 
Foxwoods resort and Westerly, RI. FRA staff is preparing a mandated 
report to Congress on the near term applications of maglev technology.
               safety of high-speed ground transportation
    Question. What is the purpose and likelihood of success for the 
proposed $500,000 in fiscal year 1998 for maglev work as indicated on 
page 76 of the budget justification? Why is it necessary to go forward 
with this project? How has the FRA established partnerships with the 
private sector that encourage cost sharing in this area?
    Answer. The bulk of the $500,000 is proposed to contribute to the 
cost of equipping the Holloman AFB High-Speed Maglev Sled Test Track 
with 1,000 feet of linear synchronous motor propulsion windings. The 
advantage to FRA is that it will allow FRA to test a critical subsystem 
of a maglev transportation system on a much longer track that is 
already outfitted with magnetic levitation components, at a small 
fraction of the cost of building the entire track. The Air Force 
benefits because it allows it to assess the efficacy of eliminating 
rocket propulsion without equipping the entire maglev track with an 
electric motor. The major risk is failure of the maglev portion of the 
system, but inasmuch as the propulsion windings will not be installed 
until that part of the system is validated, the risk of failure is 
minimal. What will be learned is the operating characteristics of the 
propulsion system, its efficiency, power factor, limits of dynamic 
stability, limitations of computer modeling, and opportunities for cost 
reduction.
    This effort is an attempt to continue meaningful innovative 
research and development in maglev technology in the environment of 
severe funding limitations. In this time of budget constraint, keeping 
alive a modest research and development effort which would at the least 
keep the U.S. abreast of developments overseas and possibly result in 
innovations which would afford a future entree into this world 
technology,is the most prudent course of action for the Department of 
Transportation. Cooperation with on-going efforts in maglev, including 
the Air Force, the Navy and NASA, and with the German and Japanese in 
maglev is a cost-effective way of making progress in magnetic 
levitation technology. To the extent that funding permits and within 
FRA mission constraints, FRA will cooperate in maglev tasks with NASA 
and the Navy so long as those projects move forward.
                             r&d facilities
    Question. In addition to the Transportation Test Center in Pueblo, 
Colorado, what other research and development facilities does FRA own? 
How many non-headquarters staff are associated with other research and 
development facilities?
    Answer. In addition to the Transportation Test Center in Pueblo, 
Colorado, the FRA owns the Research and Locomotive Evaluator/Simulator 
(RALES) located at the IIT Research Institute (IITRI) in Chicago, 
Illinois. IITRI operates and maintains the facility under contract with 
FRA. Costs are covered by fees charged to all users, including FRA. 
There are no FRA personnel located at the RALES facility.
                       research at r&d facilities
    Question. Please outline what research projects are performed at 
each facility, and delineate the associated fiscal year 1997 and 
requested fiscal year 1998 costs.
    Answer. Main research projects being performed at the 
Transportation Technology Center are as follows:

                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                     Fiscal years                       
         Project Title          ----------------------    Organization  
                                    1997       1998                     
------------------------------------------------------------------------
Track Stability Investigations.        150        200  FRA, VNTSC, AAR  
FAST (Heavy Axle Load Safety)..      1,835      1,670  FRA, AAR, RPI    
Loss of Shunt..................        300        300  FRA, AAR         
Improved Component Safety......        125        200  FRA, AAR         
VPAS Prototypes................        200  .........  FRA, VNTSC, FHWA 
Tank Car Safety................        190        300  FRA, VNTSC, AAR, 
                                                        RPI             
Rail Defect Farm...............        150        150  FRA, AAR         
Evaluation of New Lubrication          175        100  FRA, AAR, DOE    
 Practices.                                                             
Vehicle/Track Systems..........        425        500  FRA, AAR         
                                ----------------------                  
      Total....................      3,550      3,420                   
------------------------------------------------------------------------

    The projects shown in the above table have been awarded and are at 
various stages of completion. fiscal year 1998 activities to a large 
extent will build on the results and accomplishments under these 
projects. Considering the investigatory nature of research, it is 
difficult to predict with a reasonable degree of precision the duration 
of performance and the cost of all research work, particularly the more 
complex projects. Accordingly, while we cannot accurately delineate the 
associated fiscal year 1997 and requested fiscal year 1998 costs for 
each project, we fully expect the FRA goal of $5M per year level of 
research and test activities at TTC to be met in both fiscal years. For 
fiscal year 1997 the TTC will gross from FRA well over that figure when 
facility upgrade costs not listed above are included.
    The most recent project to be completed at the RALES facility is 
Engineman Stress and Fatigue: Phase II (reports in production). Tests 
in the Engineer Napping Strategies project, which is just beginning, 
will be conducted on RALES. Fiscal year 1997 funds budgeted to this 
project are $330,000 and $400,000 is requested for fiscal year 1998.
                         r&d facilities funding
    Question. Please explain in detail why the request for facilities 
restoration more than doubled over the fiscal year 1997 enacted level. 
What activities are included in this $850,000 request? What activities 
would be foregone/deferred if the program were funded at fiscal year 
1997 level of $420,000? What activities would be foregone/deferred if 
the program were funded at $600,000?
    Answer. There are two main reasons for this: delayed reinvestment 
or rehabilitation, and increasing requirements for restoration and 
upgrade of a mature (25-years old) facility. It should be noted here 
that during the period 1983-92 no site restoration funds were provided 
for these facilities valued at well over $200M in current dollars. It 
should be further noted that, for planning purposes, the typical 
facilities re-roofing interval which is considered a capital outlay, is 
in the range of 20 to 25 years.
    The activities included in the current $850K request, in order of 
priority, are as follows:

                        [In thousands of dollars]

                                                                        
Restoration of site radio communication system to full operation 
    condition.....................................................   110
Design of HSR Project Maintenance Facility........................    80
Procurement of 75-Ton mobile crane, front end loader, and grader..   380
Rebuilding of Wheel Truing Machine................................   150
Roof Restoration Program on support buildings.....................   130
                        -----------------------------------------------------------------
                        ________________________________________________
      Total.......................................................   850

    If the program were funded at fiscal year 1997 level of $420K, the 
procurement of a front end loader and a grader (item 3, partial), 
rebuilding of the wheel truing machine (Item 4), and the roof 
restoration (Item 5) activities would be deferred. Emergency roof 
repairs (wasteful band-aid) would have to be done to minimize damage to 
buildings. At $600K level, roof restoration (Item 4) and the 
procurement of the front end loader would be deferred.
                    transportation technology center
    Question. How much has the private sector contributed in each of 
the last few years to improve the Transportation Technology Center?
    Answer. Private sector contributions in each of the last few years 
are as follows:

                        [In thousands of dollars]

        Year                                                      Amount
1993..............................................................   405
1994..............................................................   474
1995.............................................................. 2,680
1996..............................................................   383
1997..............................................................   510
                        -----------------------------------------------------------------
                        ________________________________________________
      Total amount................................................ 4,452

    All of these are direct cash investments by the AAR, with the 
exception of the 1995 figure which includes direct cash investment of 
$270K plus an installed equipment contribution of $2,410K.
                               ttc funding
    Question. Has FRA been able to maintain its 1992 goal of performing 
a $5 million level of research and test activities at Transportation 
Test Center annually, as specified in the TTC operating contract with 
the Association of American Railroads?
    Answer. Yes. The FRA has been able to maintain its goal. The 
average FRA funding level of research and test activities at the TTC 
has been about $5.1M per year.
              high speed ground transportation for america
    Question. How much closer today, as compared to five years ago, is 
the Nation to having a reliable, cost effective, and safe high-speed 
rail passenger transportation system?
    Answer. In August 1996, we sent a study to Congress known as ``High 
Speed Ground Transportation for America,'' in which we examined the 
potential for public/private partnerships to implement high-speed rail 
projects. We looked at the full spectrum of high speed technologies, 
including: upgraded existing rail with top speeds of from 90 mph to 150 
mph; new high speed rail on separate rights-of-way at 200 mph; maglev 
at 300 mph. We studied applications in seven corridors plus the Texas 
Triangle. We found that in practically all cases, high speed rail could 
cover its operating costs and continuing investment needs and pay for 
varying portions of capital costs. In every corridor there was at least 
one of the high speed technologies in which total benefits exceeded 
total costs, thus providing justification for the public investment 
share.
    In the five high speed corridors designated under Section 1010 of 
ISTEA, real progress has been made in construction, planning for high-
speed rail, conducting environmental assessments, renovating passenger 
stations using ISTEA Enhancement Funds and consolidating or reducing 
the hazards at grade crossings. Beyond all our studies and all the 
successes of foreign nations, we are well on our way toward 
implementing high speed ground transportation and can see an 
accelerating interest in this concept. Most states have adopted an 
approach which upgrades existing railroads. For example:
Northeast Corridor
    The Northeast Corridor is being brought to a still higher plateau 
of customer service. Amtrak is completing the electrification of the 
corridor all the way to Boston, allowing rail to tap the lucrative New 
York-to-Boston market much as it now serves New York-to-Washington. And 
last Spring, Vice-President Gore and then-Transportation Secretary Pe--
a announced the purchase of Amtrak's new 150 mph high speed train sets 
that will realize the potential of the Northeast Corridor.
Outside NEC
    Outside the Northeast Corridor, States and the private sector are 
driving major efforts to implement high-speed ground transportation. 
Here are just a few examples.
California
    California has just completed an extensive study of a complete 
high-speed ground transportation system about 680 miles long linking 
San Francisco and Los Angeles, with extensions to San Diego and 
Sacramento. Such a system would serve as the backbone of intercity 
passenger transport in California in the 21st century. Their High-Speed 
Rail Commission found the proposal feasible, and the State is seeking 
to send a plan to the voters by the year 2000. The State has invested 
over $400 million in the last five years to improve its passenger rail 
system.
Pacific Northwest
    The States of Washington and Oregon are upgrading the track 
connecting Eugene-Portland-Seattle and Vancouver, B.C. for eventual 125 
mph service. Last year, Washington signed a contract to purchase two 
Spanish TALGO tilting trainsets and Amtrak has also signed a contract 
to purchase one TALGO trainset for use in this corridor. These trains 
can cut over 15 minutes off of the current running schedule. Within 
three years, Seattle will also institute commuter rail service between 
Everett and Tacoma, Washington and this service will share many 
facilities and some track with the planned high speed rail.
    Oregon is working on a satellite based positive train separation 
project. Two major railroads, BNSF and UP have invested heavily in this 
project which is targeted at eliminating train accidents in the 
Portland terminal area.
Illinois
    Illinois has begun to upgrade the line between Chicago and St. 
Louis for 125 mph service. The state plans to demonstrate a high speed 
train control system on a portion which will then allow passenger 
trains to achieve 110 mph. Work will soon begin near St. Louis to 
remove a bottleneck in the service. Also, Illinois will install 
``arrestor nets'' this spring at three grade crossings to test the 
feasibility of this type of grade crossing protection for high speed 
service.
Michigan
    Amtrak service on the 279 mile line now takes about five and one-
half hours and the highway trip takes about five hours. By the end of 
the upgrading project, Michigan plans for nine round trip frequencies, 
using 125 mph electric locomotives and a running time of three hours. 
Some 79 miles of Amtrak owned property already has been fitted with a 
satellite based train control system which was tested last October 11 
at 100 mph and an extensive grade crossing treatment and right of way 
improvement plan is underway.
Midwest
    Nine states in the Midwest have been quick to seize on the 
potential for a high speed rail network based in Chicago and are 
presently conducting a feasibility study. This would involve an upgrade 
of lines for current Amtrak service and eventually provide 125 mph non-
electrified service. The states are Illinois, Michigan, Iowa, Nebraska, 
Missouri, Wisconsin, Minnesota, Ohio and Indiana.
Florida
    The State of Florida recently awarded a franchise to the Florida 
Overland Express (FOX) consortium to design, build, operate and 
maintain a 200 mph electrified system based on the French TGV system 
between Orlando, Tampa and Miami--a distance of about 320 miles. Miami 
to Orlando service would begin in 2004 and the system would be fully 
built by the year 2006. The State and the FOX group are now working on 
all of the economic, engineering and environmental studies necessary 
before construction can begin.
Virginia and North Carolina
    The State of Virginia has as its highest rail priority to extend 
the ``Northeast Corridor'' to Richmond. The State recently named a High 
Speed Rail Commission to develop a plan for implementing rail service. 
A Major Investment Study is also underway to evaluate improvements to 
the Newport News to Richmond corridor. Virginia is working closely with 
North Carolina in improving the Washington to Charlotte Corridor for 
125 mph service.
    North Carolina has been upgrading stations, buying equipment, and 
improving the track between Charlotte and Raleigh. The State has 
initiated a ``Sealed Corridor Concept'' plan for treatment of all grade 
crossings in the Greensboro to Charlotte segment.
New York
    The Empire Corridor ranks with San Diego-LA as second only to the 
Northeast Corridor in terms of frequency of service. In addition, 
speeds already reach 110 mph on major portions of the NY-Albany 
segment. New York State DOT has invested heavily in corridor 
improvements since the late 1970's and early 1980's. The State of New 
York retrofitted the two power units of an Amtrak RTL turbo train to 
demonstrate the efficiencies of new, Turbomeca Makila gas turbine 
engines. These engines operate at a 20 percent fuel savings and were 
tested at 125 mph. This was one of the efforts underway in the Next 
Generation High Speed Rail (NGHSR) nonelectric locomotive development 
program. The success of this project, and its enthusiastic acceptance 
by passengers, has supported NYSDOT's plan to reconstruct the six 
remaining RTL turbo trains to be used in the Empire Corridor.
    All these are merely some prominent examples. Many other States 
have studied, or are seriously considering, high-speed rail solutions. 
Together with FRA's Safety and R&D efforts, we have made significant 
progress toward bringing safe, reliable high speed ground 
transportation to more areas of the country.
                   istea--high-speed rail development
    Question. Please specify how other funds authorized in ISTEA have 
been used to date to promote high speed rail development. Which 
specific sections of ISTEA authority have been utilized? What specific 
cooperative agreements or other financial arrangements have been 
initiated or completed thus far to further high speed rail development? 
What other actions are being considered? Please be certain to specify 
the progress made with these funds?
    Answer. The largest expenditures so far, though not funded from 
ISTEA, are for the electrification and upgrade of the Northeast 
Corridor from Boston to New Haven and the purchase of the American 
Flyer trainsets for Amtrak.
    FRA has been working with FHWA, FTA, FAA, and MARAD through the 
Intermodal Terminal Committee which meets monthly to promote and find 
funding for intermodal passenger terminals. For high speed rail to be 
effective, the terminals must be able to handle high volumes of 
passengers and must be well connected to each of the other public 
transportation providers. The intermodal terminal committee has been 
successful in initiating projects with Amtrak with Next Generation High 
Speed Rail Planning funding as well as funding from Sections 3, 18 and 
21 of Federal Transit Act Funds. CMAQ funds have also been used 
extensively. These efforts have resulted in the construction of 
intermodal terminals in Meridian, Ms., Albany, NY, Los Angeles, CA, 
Seattle, WA, Salem, OR, New Orleans, LA, Portland, OR and many others 
expected to be key cities in high speed rail development. The committee 
has worked with several MPO's and state departments of transportation 
such as California, Florida, Virginia, North Carolina, Louisiana, 
Illinois, Michigan and others.
    Intermodal terminal developments have been initiated through the 
State Departments of Transportation, cities and MPO's through a variety 
of grant agreements.
    Other activities have included working with state DOT's to apply 
ISTEA Sections 1010 and 1036 and Title 23 Section 130 funding to remove 
and protect grade crossings. Several states have used these sources of 
funding to boost train speeds. For instance, Michigan has removed 12 
grade crossings so far and North Carolina is working on its ``Sealed 
Corridor Concept'' described more fully below.
    FRA's Next Generation High Speed Rail Program a portion of which 
was funded from ISTEA has led to progress in key areas:
1. Advanced train control
    Michigan.--The Incremental Train Control System (ITCS) on the 
Chicago-Detroit corridor is being demonstrated in a partnership of FRA, 
Michigan DOT, Amtrak, and Harmon Industries. A successful 100 mph 
initial demonstration was accomplished in October, 1996. FRA funding is 
$9M for the train control system, and $100,000 to date for worker 
training in the new technologies being used. Michigan and Amtrak have 
provided over $11M in matching funds and in-kind contributions. 
Production of hardware is underway to equip the planned 71 mile 
demonstration segment. Regular train service at 100 mph is targeted for 
mid-1998.
    Illinois.--The High Speed Positive Train Control project will be 
tested on the Chicago to St. Louis high speed corridor, in partnership 
with Metra, the State of Illinois, Amtrak, and a supplier yet to be 
designated. FRA has obligated $7M, matched with over $5M from IDOT. A 
contract for hardware and software is expected to be let by the State 
of Illinois this summer, with installation to occur in 1998 and testing 
to begin in late 1998.
    Pacific Northwest.--The Positive Train Separation (PTS) project is 
sponsored by BNSF and UP railroads on 800-miles of joint trackage in 
the Pacific Northwest. The two railroads have invested approximately 
$35 million. Testing of PTS is expected to be completed by the end of 
1997. FRA-funded related activities include a computer model of the 
interaction of high-speed passenger trains and freight trains in the 
PTS territory, and installation of PTS and evaluation of its impact on 
Portland Union Station and Vancouver, WA. FRA is also working with the 
Coast Guard, Oregon, and the US Air Force to establish Differential 
Global Positioning System (DGPS) coverage in the Columbia River valley 
to permit testing of the PTS automatic location system.
    Conrail/CSX/Norfolk Southern.--The three eastern freight railroads 
and FRA are jointly undertaking a Positive Train Control (PTC) project 
on shared trackage between Harrisburg, PA, Hagerstown, MD, and 
Manassas, VA. The first phase of the project will develop on-board 
locomotive devices to deal with the different technical approaches used 
in HSPTC, PTS and ITCS to attain the maximum possible system 
interoperability. An initial FRA cooperative agreement award of 
$500,000 to Conrail is pending for Phase 1, to be followed by 
cooperative efforts to install wayside systems in subsequent years. 
This work, while not funded under the Next Generation program, is 
expected to be an incremental step to more advanced train control 
systems that could be used for high speed passenger service.
2. Non-electric locomotives
    The Advanced Locomotive Propulsion System (ALPS) project at the 
University of Texas, in partnership with AAR, Allied Signal, and GM-EMD 
and the Advanced Research Projects Agency of DOD, continues to develop 
a flywheel and turbine powered locomotive to provide acceleration 
equivalent to that of a an electric locomotive without the need for 
catenary. The construction of the full-scale flywheel rotor has begun. 
Discussions are underway with both NYSDOT and Bombardier on alternative 
prototype locomotive platforms to construct ALPS rolling demonstration 
units.
    Daily service is operating on the Empire Corridor at 110 mph with 
the RTL-2 Turboliner. NYSDOT is upgrading six Rohr Turboliner trainsets 
to RTL-3 configuration with advanced turbines to permit operations at 
speeds up to 125 mph and with enhanced acceleration capability, with a 
target of Albany-NYC service under 2 hours in 1998. NYSDOT is working 
with Amtrak and FRA to finance the overall RTL-3 upgrade program. The 
$4 million earmarked for this project in fiscal year 1997 will be 
obligated when the program financial structure is defined.
3. Grade crossing hazards and low-cost innovative technologies
    The State of North Carolina has begun a demonstration their 
``Sealed Corridor'' Concept to address grade crossing hazards on a 
comprehensive, corridor wide basis using $2 million in FRA funding. 
Innovative, low cost techniques, selected and applied on a crossing-by-
crossing basis, and thorough evaluations of the needs and the results, 
are key elements of the approach.
    Projects are underway at University of Delaware and Zeta Tech 
Associates to reduce excessive maintenance requirements and improve 
high-speed ride quality at track locations such as highway grade 
crossings and bridge ends, where track stiffness changes lead to high 
impact forces and chronic problems for both high speed and freight 
operators. Rapid track degradation at these locations also poses 
potential derailment hazards.
    BBN Systems and Technologies successfully demonstrated a brassboard 
active noise control unit. It uses roof-mounted loudspeakers driven by 
computers and sensors which instanteously create ``anti-noise'' to 
cancel the noise waves emanating from the locomotive stack. This has 
the potential to significantly reduce wayside exposure to diesel 
locomotive engine noise.
    Morrison-Knudsen Advanced Systems and the University of Idaho are 
investigating the requirements to effectively and efficiently 
interconnect multiple flywheels or other energy sources on a single 
locomotive.
4. Track and structures technology
    Track and signals will be upgraded to permit higher speed 
operations on the Portland-Eugene, OR portion of the Northwest 
Corridor, using the $5.65 million earmarked in fiscal year 1997.
5. Corridor planning
    Funds to support corridor planning activities have been awarded to 
several states. See state-by-state corridor status summaries.
    Question. Please provide information on how NEXTEA would promote 
the funding of the high speed rail projects.
    Answer. For the first time rail capital projects would be eligible 
for trust fund funding: Both the National Highway System, under certain 
circumstances, and the Surface Transportation Program would be open to 
passenger rail projects, including those involving Amtrak. States and 
MPO's could now use these funds to support intercity passenger rail 
service, including high speed rail service, by purchasing equipment, or 
constructing or improving rail lines, stations or related facilities. 
States may operate the services directly or under contract with private 
providers or Amtrak. Direct support of operating costs would remain 
prohibited.
    All rail projects, including high speed rail, continue to be 
eligible under the Congestion Mitigation and Air Quality Improvement 
(CMAQ) Program. As long as projects contribute to meeting a non-
attainment area's air quality goals, any transportation project would 
be eligible for CMAQ funding. NEXTEA would provide significant funding 
increases for CMAQ, allowing states and MPO's more resources to support 
innovative projects. The Section 130 Grade Crossing Program would be 
retained, and grade crossing projects would remain eligible under 
several other programs. Recent changes that allow payments for grade 
crossing closings would be retained. Educational programs and safety 
improvements for private crossings could be funded.
    Grade separations, clearance improvements, and rail relocations 
would remain eligible under various FHWA programs.
    Intermodal Terminals: Publicly owned terminals could be built using 
NHS funds as long as the terminal is located at or adjacent to NHS 
routes or connections--the project need not be constructed in a non-
attainment area.
    State Infrastructure Banks would be permitted in all states: With 
additional funding available for ``SIB's,'' and the expanded 
eligibility described above, this program could provide substantial 
benefits to high speed rail projects.
    The Infrastructure Credit Enhancement Program would be created, 
offering credit support for major projects. This program, available to 
projects approved by the Secretary, would offer credit support for 
major capital projects of national significance. Projects selected 
would have to have an overall cost of $100 million and generate 
benefits in more than one state. For each selected project, NEXTEA 
would establish a fund to reimburse creditors to the extent of the fund 
(federal share limited to 20 percent of project cost), in the event 
that project revenues were inadequate. This enhancement, (which would 
not be a federal guarantee, leaving the project eligible for tax-exempt 
financing) should enable project sponsors to secure funds at a lower 
interest cost. Both public or public-private partnerships projects 
would be eligible (e.g. a high speed rail project where states award a 
franchise to a private firm could be eligible.)
                       trb recommendations on hsr
    Question. Please provide a listing of the March 1997 TRB 
recommendations for improving HSR. Also provide a detailed explanation 
of how FRA is responding to each of the recommendations.
    Answer.
FRA Comments on specific TRB committee recommendations
    ``R1. The (TRB) Committee recommends that FRA staff develop a 
timetable for the evolution to a performance-oriented regulatory 
approach. One aspect of such an approach would be requiring a ``system 
safety plan. To accommodate administrative and institutional factors, 
this evolution could follow two paths--one for dedicated operations and 
one for mixed passenger and freight operations.''
    It is not clear how a specific timetable for evolution to a 
performance-oriented regulatory approach would speed the evolutionary 
process. FRA is already involved in the development of performance 
standards in several contexts. Creating the climate for performance-
oriented regulation requires building confidence among critical 
constituent groups. In addition, it is essential that any new 
regulatory approach considered by FRA provides a constructive means of 
engaging the railroads. This can best be accomplished by developing 
performance standards that address discrete areas of concern, 
implementing those standards successfully, and moving toward more 
flexible approaches as experience is acquired. The Railroad Safety 
Advisory Committee (RSAC) and other collaborative rulemaking forums 
provide venues for moving this evolution forward at a pace that is 
realistic in light of available technical knowledge and all relevant 
externalities.
    As the TRB Committee recognizes, FRA is subject to a significant 
list of legislative mandates requiring specific types of technology and 
practice. FRA is not at liberty to set these priorities aside in favor 
of a top-to-bottom rewrite of its regulations. System safety planning 
and risk analysis are important tools and are increasingly critical as 
technology presents new challenges. However, safety is earned through 
daily, sustained effort across a broad front of activities. There is no 
experience of which we are aware that would warrant wholesale 
abandonment of safety strategies that work. Prescriptive regulations 
work well in some contexts without inhibiting innovation (e.g., 
specific operating rules and restrictions on alcohol/drug use), and 
some performance standards prove difficult to enforce over time (e.g., 
verifying the current functioning of high temperature thermal 
protection for tank cars). Rather, a process of transition and growth 
must be initiated and tended at whatever pace it can be appropriately 
sustained.
    However, the charge of the TRB Committee relates specifically to 
high-speed rail service. The field of high-speed rail is one in which 
FRA has been most aggressive in utilizing system safety and risk 
assessment techniques to fashion a regulatory approach. The High Speed 
Ground Transportation research series, produced by the Volpe National 
Transportation Systems Center, has initiated this process. Our 
forthcoming notices of proposed rulemaking for passenger equipment 
safety and for the Florida Overland Express strongly emphasize system 
safety planning. FRA believes that this effort can provide the 
beginning of a template for dedicated operations, as the TRB Committee 
suggests. However, the simplicity contemplated by the supplementary 
discussion provided by the TRB Committee is far from the reality 
confronted by a regulatory agency in evaluating an entirely new 
service. Benchmark criteria are needed for systems, subsystems and 
critical components in order to evaluate the nature and magnitude of 
technical risk before system risk can be fairly estimated.
    The complexity of the effort is certainly no reason not to 
implement the system safety concept. Commuter railroads and Amtrak have 
agreed to undertake broad system safety planning efforts in 
consultation with FRA. However, system safety is a process and 
discipline that must be internalized by the entity actually operating 
the service. Prior audits of entities that have prepared system safety 
plans have sometimes found that planning documents have become stale 
and were not well integrated into the actual operation of the service. 
FRA seeks to foster meaningful system safety planning that becomes an 
essential element in the way the system is actually operated. To the 
extent this safety focus is established and maintained, reinforcement 
can be provided through allowance for much greater flexibility with 
respect to the manner in which safety objectives are achieved. Arriving 
at this state of maturity will not come quickly, and it cannot be 
forced through an administrative timetable.
    ``R2. The (TRB) Committee also recommends that, as part of a plan 
for the evolution to a performance-oriented regulatory process, the 
Office of R&D, in conjunction with the Office of Safety, conduct 
research on management of the safety regulatory process in order to 
establish a framework for the transition. (In its December 30, 1996 
letter report, the (TRB) Committee listed ``safety regulatory 
processes'' as an appropriate subject for future research.) * * *''
    The regulatory process itself has been the subject of extensive 
scholarship, including highly focused work by the former Administrative 
Conference of the United States. With respect to railroad safety 
regulation specifically, FRA is scrutinized daily by the National 
Transportation Safety Board (NTSB), the Office of the Inspector 
General, the General Accounting Office, various offices within the 
Office of the Secretary of Transportation, congressional committees, 
and the full range of external agency customers. FRA rulemakings are 
subject to Executive Branch and Departmental review and clearance 
procedures that are identical to those employed for the Federal 
Aviation Administration, the National Highway Traffic Safety 
Administration and other DOT agencies. The issues and challenges 
regarding the manner in which regulations are crafted can be clearly 
discerned by those who spend time working within the process, though 
the appropriate way of resolving many of these will remain in dispute.
    The TRB Committee's emphasis on risk assessment and system safety 
is a refreshing counterweight to the understandable and inevitable 
focus that FRA, NTSB, and industry parties maintain during 
deliberations on individual safety issues. FRA will share the TRB 
Committee's views with the RSAC.
    ``R3. The (TRB) Committee recommends that FRA's approach target 
performance goals at a higher level of system concept design, rather 
than at the component level, to provide more flexibility and 
opportunities for innovation * * *''
    FRA agrees in concept; however, component standards, in addition, 
may still be needed in many cases. For example, a standard for wheel/
rail interaction is optimal if there is just one wheel design using the 
track. Since there are many, the rail specification may need to reflect 
``worst case.''
    The proposed high-speed track standards discussed with the TRB 
Committee feature performance standards for wheel/rail interaction, 
which are based on extensive research and experience internationally. 
FRA does not specify wheel metallurgy, wheel profile, rail head 
profile, truck design, etc. That same document, however, addresses 
other issues in a more directive manner. Gage and other geometry 
constants are provided so that a variety of equipment manufacturers 
will know how to achieve the desired wheel/rail interaction. Other 
component standards have been proposed where constituent groups engaged 
in the RSAC negotiation felt that they were necessary (and railroad 
representatives assented) or where use of performance criteria would 
really be impractical. Many benefits flow from this pragmatic approach.
    In virtually all areas of regulation, further research will 
certainly be appropriate to broaden our knowledge base so that we can 
more confidently fashion performance standards (e.g., research into the 
thermal tolerances of wheels and discs), but where this learning is not 
available, more traditional standards will have to serve.
    ``R4. Risk assessment capability is the key to establishing 
performance-oriented regulations, and FRA has begun to explore risk 
assessment methodologies. The committee recommends that those efforts 
continue.''
    Risk assessment is certainly the key to establishing performance-
oriented regulations, and FRA foresees increasing use of this technique 
in the future. However, critical inputs to risk assessments must be 
sound. Where insufficient empirically-derived data are available as 
inputs, endeavoring to conduct a quantitative risk assessment may 
actually increase the chance that flawed assumptions will not be 
recognized. Accordingly, risk assessment should only be employed when 
sufficient valid and current data are available to ensure the 
objectivity of the inquiry.
TRB Recommendations regarding the next generation HSR program
    ``R5. To accomplish any of the (NGHSR) program goals at the 
available funding levels, it is necessary to focus on a smaller number 
of objectives and projects, and the (TRB) Committee therefore 
recommends that the focus of the program shift accordingly. 
Specifically * * *
    ``The (TRB) Committee recommends that in the development of 
positive train control, the number of corridors where demonstrations 
are under way or planned be reduced.''
    FRA agrees that the program should focus on core projects. In 
particular, we have two corridor demonstrations of train control 
(Michigan and Illinois). The Pacific NW train control project receives 
minimum financial aid from FRA except for earmarked infrastructure 
improvement projects; but, we will learn a lot from the project. In the 
Next Generation program, FRA is not proposing that demonstrations be 
conducted on additional corridors.
    R5 continued: ``The flywheel project, viewed as long-term research, 
may not produce usable results in the near term and should be 
terminated. FRA should, however, stay up to date on flywheel research 
being conducted for other modes to determine whether this technology 
may become a viable option for use in locomotives.''
    FRA agrees that the flywheel project, which has the potential for 
substantially enhancing locomotive performance, may have a longer term 
delivery than other projects in the program and its development risks 
may be greater. Existing non-electric locomotives have a speed range of 
79 to 110 mph; and, once such locomotives approach 100 mph, they 
however, have little available power for acceleration. The TRB 
Committee acknowledged that ``even though existing equipment is capable 
of speeds up to 110 mph, in practical use the maximum speed is limited 
to about 95-100 mph.'' FRA believes that the flywheel project risk is 
justified by the magnitude of the potential performance improvement.
    R5 continued: ``The grade-crossing effort should be focused on the 
practical, low-cost and low-tech risk-reduction technologies being 
applied in North Carolina's ``sealed corridor'' approach (see Annex B), 
rather than on more expensive technologies being considered elsewhere 
(e.g., the ``arrester net'' project planned in Illinois).''
    FRA agrees that the practical, low-cost, low-tech technologies are 
a highly valuable approach to the grade crossing problem, and we are 
vigorously pursuing that approach. Nonetheless, we believe that the 
Next Generation program is an appropriate place to demonstrate and test 
state proposals for innovative technology in arrestor nets and other 
technology approaches.
    R6. ``The state-focused program being pursued by FRA is not 
producing generic technologies for the wider-scale adoption of 
incremental HSR. In each program area, major projects either have been 
canceled, have limited application to one state, or have been 
interrupted by freight railroad mergers that have put project 
implementation in doubt (see Annex B). The (TRB) Committee recommends 
that the limited available funds be focused on projects with the 
greatest potential for widespread applicability. To this end, the (TRB) 
Committee believes the appropriate investment would be in train control 
technology.''
    ``For the fiscal year 1998 program, funds allocated to locomotive 
development and funds available from reprogramming the canceled 
lightweight diesel project could be reallocated to this area. 
Locomotive technology for the speed range of 79 to 110 mph already 
exists to satisfy the needs of many states for incremental high-speed 
operation. However, positive train control technology is not available, 
and this is a critical constraint. Development of appropriate 
technology must meet two conditions: (1) it must be affordable for 
freight rail operations, and (2) it must be compatible with existing 
equipment.''
    The ``Next Generation'' is primarily a demonstration program. The 
advantages of having a partner that is invested in eventual 
implementation outweigh the advantages of direct FRA management of each 
project. Even with the increased coordination it carries, good progress 
is being made across the board in the Next Generation program, which 
has been in existence for only 30 months. FRA acknowledges that 
demonstrations have some risk; not all will succeed. Successful 
deployment of incremental high-speed rail will involve multi-faceted 
participation from states, passenger and freight railroads, suppliers, 
unions, and FRA. The demonstration programs underway have acknowledged 
this fact and obtained involvement from all relevant participants. A 
GPS based train control demonstration has been tested at 100 mph in 
Michigan, the upgraded Turboliner is running at 110-125 mph in New 
York, and a ``sealed corridor'' grade crossing demonstration is taking 
place in North Carolina. These projects have widespread applicability. 
The program areas are all crucial for the states to succeed in 
implementing incremental high-speed rail.
    ``R7. The (TRB) Committee believes FRA's most effective role in the 
development of positive train control technology would be in research 
that would foster the development of reliable safety-critical software 
by ensuring that the algorithms used in advanced train control systems 
are sound. These algorithms should address the problem of train 
separation by treating it as a problem in resource allocation, where 
the track is the resource being allocated to the users (e.g., freight 
and passenger trains, maintenance crews). Such algorithms are universal 
and have generic application. This effort might lead to actual 
development of software and/or to the development of methods for 
validating the safety-critical performance of the software.''
    FRA agrees that an effective role for FRA in positive train control 
would be in developing safety-critical software. Indeed our proposed 
``moveable block'' activity in fiscal year 1998 would include some of 
this development. However, the development of ``generic'' algorithms 
and software is best pursued in the context of a cooperative 
demonstration program among freight and passenger railroads and 
suppliers, with FRA as a necessary catalyst.
    ``R8. The (TRB) Committee recommends that FRA strengthen its 
program management capabilities to speed up and better control the 
individual projects.''
    FRA agrees. We have taken steps to improve on our management 
capabilities within overall staffing level constraints.
    ``R9. The (TRB) Committee recommends that the R&D program and the 
NGHSR demonstration program be more tightly and explicitly linked 
together. NGHSR could also be more closely linked with the Commercial 
Feasibility Study, which points out the importance of advances in train 
control technologies to permit the mixing of high-speed passenger with 
freight operations.''
    FRA believes that our three high-speed rail activities: R&D, NGHSR 
Demonstration, and Planning/Outreach, are already well linked among 
themselves and with our Safety regulatory activities. Nevertheless, we 
would appreciate any suggestions the TRB Committee may have for 
improving the linkages.
                    next generation high-speed rail
    Question. Have any States applied under the State Infrastructure 
Bank program for a HSR corridor project?
    Answer. At this time, no States have applied for a HSR corridor 
project under the State Infrastructure Bank program.
    Question. If the final version of NEXTEA does not allow the 
flexibility that FRA is seeking in terms of allowing states to use STP 
and other funds for HSR, will FRA need some flexibility to use NGHSR 
funds to promote planning and associated activities?
    Answer: Yes.
                        linkage of r&d and nghsr
    Question. What steps can FRA take to ensure that the research and 
development program and the NGHSR demonstration programs be more 
closely and explicitly linked together?
    Answer. FRA concurred with the TRB recommendation that the R&D 
program and the NGHSR demonstration program be more closely linked. A 
number of steps have been implemented to improve coordination among R&D 
and the various elements of the high-speed rail program. The Office of 
Research & Development pursues research activities in high-speed rail 
an acts as a resource in technical issues for the Office of Passenger & 
Freight Services, which has the responsibility of implementing the 
NGHSR demonstration program. The latter office is also closely linked 
to State sponsors of demonstration projects and high-speed rail 
corridor implementation programs and thus plays a pivotal role in 
bringing the R&D results ``to market'' through the NGHSR demonstration 
program. Two senior executives, reporting directly to the Associate 
Administrator, link and coordinate the NGHSR & R&D activities. In 
addition, the five year strategic plan explicitly addresses both 
research and technology demonstration activities, as well as the rail 
safety work that takes place through the Office of Research & 
Development and NGHSR.
    Question. In fiscal year 1997, the appropriated NGHSR program 
funding level of $24,757,000 was augmented by $1,420,882 in carryover 
authority. How much carryover is anticipated in fiscal year 1998?
    Answer. The $1,420,882 was the amount remaining to be spent from 
the Highway Trust Fund as provided for high speed rail demonstrations 
in ISTEA Section 1036c. Congress rescinded authority for this purpose 
which otherwise would have been provided in fiscal year 1997. The 
$1,420,882 will be obligated in fiscal year 1997 and no Trust Fund 
authority will carryover into fiscal year 1998 in the Next Generation 
program.
                             results of cfs
    Question. In 1996, the Federal Railroad Administration issued the 
Executive Summary of ``High-Speed Ground Transportation for America.'' 
Known informally as the Commercial Feasibility Study (CFS), this study 
analyzed the costs and benefits of achieving several thresholds of 
increased speed on several rail corridors. Please describe the emerging 
high-speed rail policy issues that have come forth as a result of the 
CFS. How are these policy issues reflected in the fiscal year 1998 
request?
    Answer. The CFS demonstrated that in a number of regions of the 
country, ``Accelerail'' solutions--upgraded intercity rail passenger 
services utilizing existing track in cooperation with the freight 
railroads--may offer the most cost-effective way to provide high-speed 
ground transportation. This conclusion raises the key question: how can 
the Federal Government--with its limited discretionary resources that 
must be conserved for efforts of truly national significance--best 
support Accelerail implementation? Given the inability of many States 
to effect Accelerail due to its initial investment threshold 
requirements, the Department has concluded that Federal efforts would 
best be focused on developing and demonstrating existing technologies 
that would materially reduce the capital cost of Accelerail in diverse 
locations. These promising technologies include: wireless, computer-
based train control (allowing higher speeds at lower cost than typical 
track circuit-based signaling systems); high-speed, non-electric 
locomotives, offering excellent acceleration without the need to 
install capital-intensive overhead electric wires and supporting 
systems; highway/rail grade crossing safety enhancements, reducing 
risks to occupants of motor vehicles and trains; and more cost-
effective means of upgrading and maintaining track for high-speed 
service. The lion's share of the Next-Generation High-Speed Rail 
Program, as requested in the fiscal year 1998 Budget, would go toward 
these four critical technology areas, thus maximizing the benefits of 
Federal involvement in this promising, but as yet largely unfulfilled, 
mode of transportation.
                     cost benefits of hsr projects
    Question. The CFS identifies projects as having partnership 
potential when total benefits exceed total costs, and when revenues are 
sufficient to cover operating costs and continuing investments. 
However, a majority of total benefits accrue only to users of the 
systems, and in most cases, each dollar of public investment returns 
less than one dollar of public benefits. Is it appropriate for the 
public at large to find such projects?
    Answer. Some additional background is necessary to place the 
question in context. First, although a majority of ``total benefits'' 
(as defined in the CFS) accrue to users, those same users fully pay for 
a significant portion of their benefits through farebox revenues. When 
we subtract those benefits for which users pay fully, we find that in 
several corridors, 50 percent or more of the benefits actually accrue 
to the public at large. Second, in a number of cases, each dollar of 
public investment returns much more than a dollar of public benefits: 
the ratio of public benefits to public costs reaches 2:1, or even 3:1, 
in regions as diverse as California, the Chicago Hub, the Pacific 
Northwest, and Texas. Finally, specific States may choose to recognize 
in their analyses a whole category of public benefits--economic 
development and job impacts from high-speed rail construction and 
operation--that the CFS ignored because they might not benefit the 
Nation as a whole. When we take these three factors into account, we 
can appreciate that in several States the perceived return to the 
public on the public's investment in high-speed rail may well exceed 
the estimates contained in the CFS.
    Nevertheless, as your question indicates, the CFS indeed reports on 
many cases in which the majority of benefits accrue to users. We 
consider it entirely appropriate for the public to consider partial 
funding of such cases because transportation benefits are primarily 
user benefits. They are typically the largest benefit component in the 
benefit/cost analysis used in project justification for a wide variety 
of projects including highways, airports, transit systems, canals, etc. 
Public funding, including Federal assistance, has for decades been 
associated with such projects. For example, a highway project is 
justified not according to whether the total additional gas tax 
collected exceeds the cost of the road, but rather according to what it 
is worth to users and non-users compared to the cost of the road. 
Applying the same total benefit/total cost criterion to high-speed rail 
projects makes sense as a preliminary screening device, as the CFS has 
done.
                         public funding of hsr
    Question. The General Accounting Office (GAO) reported in 1993 that 
the federal government is the only public entity capable of funding 
much of the construction cost of HSGT systems. What portion of the 
public cost would the federal government be expected to bear?
    Answer. We do not believe that the Federal Government is the only 
public entity capable of funding high-speed rail systems. Many 
Accelerail options, for example, would have such low capital costs and 
such favorable operating economics as to make them suitable candidates 
for State/private partnerships, provided that the State sets a 
sufficient priority on their implementation. Furthermore, some States 
may have sufficient resources and will to finance large portions of the 
cost of New HSR and Maglev systems as well.
    Clearly, however, cases would exist for which Federal funding would 
be indispensable. For administrative convenience, uniform matching 
ratios are typically established such as 80/20 Federal/State-Local for 
all surface transportation projects, with some exceptions. By making 
high speed ground transportation projects eligible for STP funding, for 
example, we would extend that general matching ratio to high speed 
ground transportation. However, in particular instances, the Federal 
Government might be expected to pay more to the extent that the project 
benefits the nation as a whole, or the benefits transcend State 
boundaries, or the project responds effectively to national goals.
                         useful life estimates
    Question. The CFS used a 40-year time frame for considering project 
costs and benefits, which include the continuing investments required 
over this period to maintain, replace, and expand the infrastructure. 
Are there significant capital replacement costs associated with 
infrastructure components whose useful life is greater than 40 years? 
If so, do the CFS projections include set-asides for these future 
funding requirements? Is an additional public investment expected at 
some point after 40 years as the infrastructure requires major 
replacements?
    Answer. Of course, long-lived items like concrete ties and rail 
would ultimately require replacement and consequently additional public 
expenditures after the end of the 40-year cycle. The projections do not 
include set-asides for these because (1) their impact on the analysis 
would be relatively small (the present value of one dollar spent 40 
years from now at 10 percent discount rate is about two cents) and (2) 
to fairly assess the period beyond 2040 would also require estimates of 
revenues, operating expenses, and operating surpluses, which would 
likely counterbalance the effect of the future continuing investments.
                 hsr projects--planned vs actual costs
    Question. Large projects such as these tend to substantially exceed 
their original construction cost estimates. The CFS includes 
contingencies for such increases at the rate of 30 percent for the more 
modest technology options, and 41 percent for new high-speed rail and 
Maglev options. How were these numbers determined? How do they compare 
with final vs. Planned costs for recent rail (or other public works) 
projects in these corridors?
    Answer. Our engineers developed these numbers based on their 
informed judgment and experience with engineering components of the 
types envisioned in the commercial feasibility study (CFS), as well as 
public transit and highway projects. Standard practice in engineering 
cost estimation is to use a higher contingency factor in the 
preliminary phases of project planning and to reduce the factor as the 
design becomes more detailed.
    CFS cost estimates utilize engineering cost databases that are 
updated using recently completed projects and thus the costs of key 
materials and components (e.g., bridges, rail, electrical systems, and 
tunnels) necessarily reflect the current cost structure. Retrospective 
studies of ``final'' versus ``planned'' costs for similar work 
(feasibility studies, preliminary engineering, final design, 
construction) typically yields a series of ``planned'' costs as the 
projects become more fully designed. Typically, the project scope 
changes, so that the costs projected in the feasibility studies are not 
comparable with the actual completed costs. FRA has no comparable 
corridor upgrading projects for the more modest options (the Northeast 
Corridor, with its density of traffic and hundreds of daily commuter 
trains, is unique), nor does FRA have any new high-speed rail or Maglev 
projects completed in this country. Cost overruns can occur in projects 
for any mode of transportation--highway and airport as well as transit 
and railroad.
    FRA can adduce, as recent specific examples, two passenger 
railroad-related projects that have progressed from a preliminary 
design level to final design and have been under construction for about 
the last five years. These two examples illustrate the difference 
between the preliminary construction cost estimates, with an allowance 
of 15 percent contingency factor, and the final estimates in each case. 
These two cases show some variance (plus and minus), but they are 
typical of well-estimated projects.

NJ Transit Dover and Port Morris storage yard facility

                                                                        
Preliminary estimate including 15 percent contingency...     $12,315,000
Final estimate including no contingency.................      12,756,000
Variance................................................         441,000
                                                                or +3.5%

NJ Transit Morrisville Storage Yard Facility

Preliminary estimate including 15 percent contingency...    $15,276,000 
Final estimate including no contingency.................     14,641,000 
Variance................................................       (635,000)
                                                                   -4.1%

    The FRA considers its capital cost estimates to possess a level of 
accuracy that is sufficient for the purpose of the CFS--to gauge the 
comparative partnership potential of a spectrum of high-speed rail and 
maglev projects in a series of illustrative corridors. The States and 
their public and private partners will need to conduct detailed 
feasibility, preliminary engineering, and environmental studies for 
individual corridor projects. Such further studies, including capital 
costs on a much more site-specific basis than was possible in the CFS, 
will be prerequisite to any financing and implementation decisions for 
future corridor projects.
                       hsr ridership forecasting
    Question. In 1993, GAO reported that HSGT ridership forecasting is 
more of an art than a science because many of the databases needed do 
not exist. Has the situation changed since 1993? How does the CFS 
account for the fact that ridership forecasting is difficult?
    Answer. The GAO's statement should perhaps be restated to say that 
ridership forecasting is more art than science when the data bases do 
not exist. In fact, one can spend money on market studies geared to 
specific corridors in order to create specific data bases. There are 
two types of data bases that are important:
    (1) Data on how many persons use different modes of travel between 
pairs of zones for different trip purposes.
    (2) Behavioral data on what percentage of these people would use a 
new high speed system, depending on the relative trip time, 
convenience, and price.
    Data of type (1) are expensive to collect for individual markets, 
particularly for automobile travel. We expect a major breakthrough upon 
publication this year of a nationwide survey of intercity personal 
travel known as the American Travel Survey sponsored by the Bureau of 
Transportation Statistics in 1995. Even so, these data must be 
supplemented by more detailed surveys of selected markets.
    Behavioral data of type (2) have become available in data bases 
applicable to several markets and can be adapted to specific markets 
based on demographics.
    The CFS did not claim that it could produce the accuracy of 
projections that could be made through these more detailed surveys for 
any specific corridor. However, its data sources were broad based and 
its methods consistent across all markets--as appropriate for an 
objective study designed to draw broad conclusions across many 
corridors and many forms of high speed ground transportation.
    Question. Please prepare a table indicating separately the status, 
problems, and challenges faced, and the fiscal year 1996, fiscal year 
1997, and planned fiscal year 1998 FRA investments made in developing 
high-speed non-electric locomotive technologies. Please include 
information on each major FRA project in this area.
    Answer. The table follows.

                                                                  [Dollars in millions]                                                                 
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                    Fiscal years--                                                                                      
                                          ---------------------------------                                                                             
                                                                  Federal                                                                               
                 Project                    Federal    Federal     funds               Status 6/97                       Problems, challenges           
                                             funds      funds     proposed                                                                              
                                              1996       1997       1998                                                                                
--------------------------------------------------------------------------------------------------------------------------------------------------------
Advanced Locomotive Propulsion System      \1\ $1.72         $2         $2  Spin testing of rotor components  High-speed generator needed more          
 (ALPS--Flywheel).                                 8                         has begun.                        development than anticipated to adapt    
                                                                                                               from prior planned DOD application.      
Locomotive Integration...................  .........  .........          6  Project phase will start with     Must select suitable demo. platform.      
                                                                             fiscal year 1998 funding;                                                  
                                                                             manufacturers GM-EMD,                                                      
                                                                             Bombardier, plus NYSDOT have                                               
                                                                             expressed strong interest.                                                 
NY Turboliner 3 Upgrades.................          6          4  .........  First $6M will be under contract  NYSDOT seeking $20-$40M additional        
                                                                             8/97.                             financing to upgrade all 7 RTL trainsets.
Test Track Upgrade.......................          3          3  .........  Nearing completion on schedule..  None.                                     
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Funded from R&D Appropriation in fiscal year 1996.                                                                                                  

                    focus of hsr locomotive program
    Question. Where does FRA believe the focus of the non-electric HSR 
locomotive program should be now?
    Answer. The goal of the non-electric locomotive program remains 
unchanged; that is, the development of a non-electric locomotive with 
the acceleration and peak speeds of current NEC electric locomotives 
but without the inefficiencies and environmental concerns of earlier 
non-electric locomotives. Within this overall goal, the primary focus 
of the program today is facilitating the development of a commercially 
viable locomotive with enhanced capabilities in these areas in the 
short term to meet the needs of service on intercity corridors that are 
the subject of State-sponsored incremental high-speed improvements. As 
examples, Washington has ordered new passenger cars for the Pacific 
Northwest corridor and North Carolina and Illinois will soon be in the 
market for equipment on their corridors. However, as of now, the 
performance of this equipment is limited by the currently available 
diesel-electric locomotives.
                    non-electric locomotive designs
    Question. How is the non-electric locomotive program developing a 
consensus about a common design that could serve several markets and 
generate sufficient demand? How do the States influence this 
development?
    Answer. FRA will work with teams seeking to demonstrate 
alternatives for faster, non-electric locomotives. FRA will host 
quarterly technical sessions between each of the teams and high speed 
corridor states to discuss performance targets and progress. The 
project teams and FRA will respond to state questions on timing of 
availability and performance. As the initial project stages are 
completed, FRA will initiate a specific outreach project element to 
attain maximum utility and commonality for the ultimate locomotive test 
platform.
                     investment in hsr locomotives
    Question. What level of demand for HSR locomotives would be needed 
to create an incentive for potential manufacturers to invest? Could 
joint ventures among manufacturers be used to reduce risk and 
development expenses?
    Answer. The willingness of a prospective manufacturer to invest in 
development of a new high-speed locomotive is dependent on the size of 
the market, on the manufacturer's production costs, and on the price 
the manufacturer can charge. A manufacturer has to see a way to recover 
its development costs and still earn a profit as great as it could earn 
by investing the same sum of money. The manufacturer's production costs 
will vary according to the degree to which the new product can be 
adapted from, or has components in common with, the manufacturer's 
existing product lines so that production costs for the new design can 
be shared with other production efforts.
    The history most relevant to this subject is the acquisition of 
Amtrak's order for 150-mph, high technology electric trainsets for the 
Northeast Corridor. The proposed purchase attracted substantial 
interest at quantities of 18 trainsets, requiring 36 locomotives once 
the decision was made that a power car/locomotive would be required at 
each end of each trainset. However, all the prospective bidders were 
associated with consortia in which the cost of locomotives was included 
in an overall trainset purchase price, and the technology being offered 
was largely to be adapted from units in European service. FRA can not 
state a specific estimate of demand because the circumstances of each 
manufacturer, such as product development already planned or underway, 
are highly proprietary activities--areas in which FRA has no 
information.
                 cost share of non-electric locomotives
    Question. What is the status of cost sharing efforts to advance 
non-electric high-speed locomotives? Please specify amount received for 
cost sharing for each project.
    Answer. The New York State DOT (NYSDOT) turboliner upgrade project 
is matching Federal contributions on a dollar-for-dollar basis. After 
1997 funds are obligated, FRA and NYSDOT will each have funded $10 
million, for a project total available funding of $20 million. The 
Advanced Locomotive Propulsion System Project is being conducted 
through a Defense Advanced Research Projects Agency (DARPA) program 
which requires 50-50 matching.
            technical challenge of non-electric locomotives
    Question. What are the remaining technical challenges in developing 
non-electric high-speed locomotives?
    Answer. The core technical challenge of achieving a practical high-
speed non-electric locomotive is to achieve very high self-contained 
power levels at relatively light weights. Making such advanced designs 
work on a daily basis, in quantity, in the railroad environment are the 
heart of the remaining technical challenges.
                       lightweight diesel project
    Question. How much money for the lightweight diesel high-speed 
diesel project has not been obligated, and could be reprogrammed? When 
will this occur?
    Answer. By cooperative agreement, and resulting from a competitive 
award under a broad agency announcement, FRA obligated a total of 
$2,000,000 of fiscal year 1995 non-electric locomotive funding to New 
York State DOT for the lightweight high-speed diesel project. In 1996, 
NYSDOT awarded the funding by contract to Republic Locomotive of South 
Carolina. Republic was unable to execute the project, and the contract 
between NYSDOT and Republic was terminated after total costs of about 
$250,000 were incurred. NYSDOT must close out the Republic contract to 
make the remaining funding of approximately $1,750,000 again available. 
In keeping with the original appropriation, FRA and NYSDOT propose to 
redirect the funding to the ongoing Advanced Locomotive Propulsion 
System (ALPS) project at the University of Texas (UT), via contract 
between NYSDOT and UT. This action is expected to be completed within 
fiscal year 1997.
                          ny turboliner train
    Question. How much of the fiscal year 1997 monies will be allocated 
to upgrade the NY turbo-liner trains? Will fiscal year 1998 monies also 
be used? If so, how much?
    Answer. FRA will obligate $4,000,000 of fiscal year 1997 NGHSR 
funds to NYSDOT for turboliner upgrades, as directed by the Committees 
in the 1997 Appropriations Act. This will be added to the $6,000,000 of 
NGHSR funding provided in fiscal year 1996, and NYSDOT will provide 
$10,000,000 of state funds to match the FRA funds to provide a total of 
$20,000,000 to be applied to the performance enhancement and 
refurbishment of the seven turboliner trainsets. NYSDOT has not sought 
additional funding for this upgrade program from FRA.
    However, the turboliner power car is a candidate platform under 
consideration for installation and demonstration of the turbine-
electric and flywheel energy storage technologies. If the turboliner 
platform is selected for the ALPS demonstration, a portion of the 
requested fiscal year 1998 non-electric locomotive funding might be 
directed to NYSDOT.
                            flywheel project
    Question. How many additional years will be required to complete 
work on the flywheel project? How much will this likely cost? Please 
provide costs for both development and large-scale testing. What is the 
likelihood of this technology will be commercialized? What is the 
status of this project, and what are the planned activities for fiscal 
year 1998? How much is requested for fiscal year 1998, and how much was 
spent in prior years? What is the cost sharing arrangement for this 
project?
    Answer. The flywheel project will require at least three additional 
years through 1998, 1999, and 2000. The flywheel energy storage battery 
system is expected to cost a total of $9,000,000 including 
demonstration testing in conjunction with a prototype locomotive. 
Locomotive manufacturers have shown interest in the potential of 
flywheel energy storage for railroad use, so commercialization 
prospects for this technology appear to be possible.
    With regard to project status, an initial spin test of a one-third 
scale flywheel rotor has been completed. In this test, the rotor 
reached over 39,000 rpm at which its surface was traveling over 2,000 
mph. This testing validated rotor design performance in excess of 90 
percent of project goals, with further testing to full performance 
levels scheduled for July and August, 1997. Construction of full-scale 
flywheel components is underway with initial full-scale tests planned 
for early fiscal year 1998. Design modifications to adapt the DOD-
sponsored high-speed high-power generator are nearing completion. 
fiscal year 1998 activities will include construction and delivery of 
the prototype motor/generator for testing with the flywheel, 
construction of power electronics for the flywheel and turboalternator, 
and construction of a second full-scale flywheel for safety testing. 
Integration activities into a prototype commercial locomotive will 
begin. The following table details spending on the flywheel project:

                        [In thousands of dollars]

        Fiscal year                                               Amount
1995 actual.......................................................   800
1996 actual....................................................... 1,728
1997 actual....................................................... 2,000
1998 request...................................................... 2,000
                        -----------------------------------------------------------------
                        ________________________________________________
      Total....................................................... 6,528

    FRA's fiscal year 1998 request for the flywheel is $2,000,000. As 
shown, through fiscal year 1997, $4,528,000 has been obligated for this 
project. The cost-sharing arrangement for this project is 50/50.
                   tier 2 car construction standards
    Question. Would FRA support a non-electric HSR locomotive project 
that utilized technology meeting the ``tier 2'' (126-160 mph) car 
construction standards? Which current locomotive projects are being 
designed to these standards?
    The energy-absorption capability (crashworthiness) which will be 
built into equipment to meet the forthcoming ``tier 2'' standards 
provides clear safety benefits for passengers and crew, not only in 
train-train collisions, but also during grade crossing collisions and 
derailments from any cause. Equipment which successfully meets ``tier 
2'' for operation at very high speeds will also likely be of 
lightweight construction, to minimize acceleration times and energy 
consumption. These features make equipment meeting ``tier 2'' highly 
desirable for use as part of any high-speed self-propelled locomotive 
demonstration whether on existing corridors or on dedicated right-of-
way, provided the equipment is available at reasonable cost.
    The power cars for the Amtrak American Flyer trainsets are being 
constructed to a design which is likely to meet the forthcoming ``tier 
2'' requirements. FRA is not aware of any other equipment presently 
existing or under construction which is likely to meet the ``tier 2'' 
requirements, in North America or in any other part of the world.
                          train control system
    Question. Please prepare a table indicating separately the status, 
problems and challenges faced, and the fiscal year 1996, fiscal year 
1997, and planned fiscal year 1998 FRA investments made in developing 
high-speed train control systems. Please include information on each 
major FRA project in this program.
    Answer. The table follows.

                                                                  [Dollars in millions]                                                                 
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                    Fiscal years--                                                                                      
                                          ---------------------------------                                                                             
                                                                  Federal                                                                               
                 Project                    Federal    Federal     funds               Status 6/97                       Problems, challenges           
                                             funds      funds     proposed                                                                              
                                              1996       1997       1998                                                                                
--------------------------------------------------------------------------------------------------------------------------------------------------------
Michigan DOT/Amtrak Incremental Train             $3         $1  .........  Installation on 80 mile corridor  Interoperability with other systems.      
 Control (ITCS).                                                             segment continuing; revenue                                                
                                                                             service expected mid-98.                                                   
Illinois DOT High-Speed Positive Train             6  .........   \1\ $3.5  RFP for system integrator to be   New test zone on METRA under plan         
 Control (HSPTC).                                                            issued 9/97.                      resulting from UP/SP merger;             
                                                                                                               interoperability.                        
Pacific NW BNSF/UP Positive Train              \2\ 5          3  .........  Release 2 of 4 software releases  Railroads considering implementing PTC    
 Separation (PTS).                                                           now under test on each            rather than PTS; location not certain    
                                                                             railroad; fiscal year 1997        after PTS tests are completed;           
                                                                             funds planned for                 interoperability.                        
                                                                             communications upgrade.                                                    
Inter-operability demonstration..........  .........  .........        1.5  Plan is to achieve maximum        Coordinate with freight industry          
                                                                             commonality of FRA-sponsored      initiatives.                             
                                                                             systems.                                                                   
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Candidate for flexible block demonstration.                                                                                                         
\2\ Funded in FRA R&D Safety of High Speed Ground Appropriation, not NGHSR.                                                                             

                     train control/its technologies
    Question. What efforts have been made to link train control systems 
with ITS technologies? What contracts have been signed in this area? 
Please specify objectives and funding amounts of specific projects and 
indicate the status of each and progress to date.
    Answer. Several projects, either directly funded by FRA or funded 
with FHWA funds, are now underway.
    1. Vehicle Proximity Alerting System (VPAS).--The objective is to 
develop a method to alert priority vehicles (such as ambulances, police 
cars, fire engines, school buses, and hazmat trucks) of an approaching 
train at a highway/rail grade crossing. The challenge is to provide the 
warning only to priority vehicles approaching the crossing and not to 
other vehicles near the crossing but not headed towards it. This 
testing is required by ISTEA Section 1072 and is funded from FHWA ITS 
funds, and administered by FRA. Reliability testing of three VPAS 
prototype systems at the Transportation Technology Center (TTC), funded 
at $600,000, has been completed and the evaluation of the test results 
is underway by the Volpe Center. The second phase, funded at $400,000, 
will be field testing in an actual railroad corridor of those systems 
deemed reliable. The field testing will begin later in 1997. Two 
systems, a 3-point system from SmartStops Unlimited, Inc. (Which uses a 
transceiver on the locomotive, at the crossing, and a receiver in the 
vehicle) and a one-point system from Dynamic Vehicle Safety Systems 
(which uses a receiver in the vehicle which detects the Front/Rear End 
Device (FRED)) will be tested. Potential test locations are in 
Michigan, Minnesota, and Washington State.
    2. Incremental Train Control System (ITCS).--A portion of the 
Incremental Train Control System (ITCS) being implemented in the 
Detroit to Chicago corridor by Michigan State Department of 
Transportation and Amtrak is developing technologies for ITS and 
railroad use. This will allow an ITCS-equipped high speed train and the 
grade crossing warning systems to communicate so that the crossing 
equipment will provide the required twenty-second warning time without 
the need for expensive track circuits to be installed. The Federal 
funding for the ITCS system, so far, has been $6.08 million in fiscal 
year 1995 and $3 million in fiscal year 1996. Michigan and Amtrak have 
provided approximately $12.6 million. An additional $1.0 million from 
FRA may be awarded in fiscal year 1997.
    3. Long Island Railroad/GRS Atlas project.--General Railway 
Signal's ATLAS train control technology is being linked to three 
crossings in the Long Island Rail Road system in heavily congested 
Queens Borough, New York City. This technology will allow uniform time 
warnings to roadway motorists, eliminate unnecessary gate down time if 
a train is stopped at a station near a crossing but not blocking it 
(the gates will stay up, allowing traffic to proceed; only when the 
train is ready to depart will the engineer activate the crossing 
warning devices), detect and report stalled highway vehicles in the 
crossing, mitigate traffic congestion through intelligent control of 
highway traffic signals in the immediate streets nearby to direct 
traffic around blocked crossings, detect the arrival of emergency/
priority highway vehicles that require safe passage through the grade 
crossing, and monitor the health of crossing equipment. The FHWA is 
providing $7.625 million in ITS funds for this project ($2.625 million 
fiscal year 1995, $1.25 million fiscal year 1996, $2 million fiscal 
year 1997 and $1.75 million from the reprogramming of a Mineola grade 
crossing demonstration). GRS is contributing $3.175 million, for a 
total project cost of $10.8 million.
    4. Texas Transportation Institute/Washington State DOT.--The Texas 
Transportation Institute (TTI) is working with the Washington State DOT 
and the Union Pacific and Burlington Northern Santa Fe railroads in 
developing the Positive Train Separation system. Part of PTS 
development involves examining techniques for connecting the train 
control system to the grade crossing warning system. In fiscal year 
1995, Washington State DOT was awarded $1 million from the Section 1010 
program to examine seven techniques for improving safety at grade 
crossings in the high-speed corridor. Two of the areas to be examined 
are VPAS systems and integrating the train control system and grade 
crossing warning system with the local advanced traffic management 
systems being developed by ITS. Linking the local traffic management 
system to the grade crossing warning system could be especially useful 
in preventing through or turning moments to the grade crossing to 
aggravate any backups that occur when a train blocks a crossing, and 
alternative signing could be used to direct traffic around a blocked 
crossing.
                     positive train control systems
    Question. Please provide an update on what progress has been made 
by the railroads in installing positive train control systems. What has 
been done since last year, and how many of the major railroads have 
installed these systems?
    Answer. Testing of the positive train separation project (PTS) by 
UPRR and BNSF in the Pacific North West continues; tests of ``Release 
2'' of expected 4 releases will be conducted in June, 1997, to verify 
differential GPS automatic location capability and begin to verify 
``smart'' braking. Testing is expected to be completed in early-1998, 
at which time equipment is to be removed from locomotives. UPRR and 
BNSF are considering next steps to more advanced demo or deployment 
systems.
    The Incremental Train Control System (ITCS) has been tested on a 
25-mile portion of the 80-mile Amtrak-owned corridor in Michigan in 
October, 1996, and hardware is now being manufactured for the remainder 
of the corridor. Revenue service at high speeds is expected to begin in 
mid-1998.
    The joint CR/CSX/NS project started in mid-1997, and is targeted at 
creating an interoperable onboard platform. Arinc is their contractor, 
and testing of an equipped locomotive on the Harrisburg-Manassas 
corridor is expected in 1999.
    The Alaska Railroad is in the process of selecting the contractor 
for a positive train control system to be installed on the entire 600-
mile railroad. Phase 1, the implementation of a computer-assisted 
conflict tracking system, and Phase 2, the issuance of digital track 
warrants to trains and maintenance-of way crews, are being funded 
through a grant for $2.2 million from fiscal year 1997 FRA funds. Phase 
3, the installation of on-board computers and GPS receivers on 
locomotives, and Phase 4, the provision for on-board enforcement of 
movement authorities, are scheduled to take place in 1998 and 1999.
                       ptcs--non-federal funding
    Question. What is the anticipated level of non-federal spending for 
positive train control systems over the next three years? Please 
provide further explanation of the importance of these systems, and how 
appropriated funds will be used to further this development.
    Answer. FRA does not know how much non-federal spending there will 
be for positive train control systems over the next three years. A 
spate of recent collisions is increasing the pressure from the NTSB, 
unions, and the Congress on railroads to install PTC and on FRA to 
require railroads to install PTC.
    The Union Pacific Railroad is considering a sizable ``initial 
implementation'' of PTC on a major high-density corridor that would 
involve the equipping of several hundred locomotives. Their project 
could cost $50 million or more. However, they have not made their 
decision as yet.
    Other railroads appear to be taking a ``wait and see'' attitude and 
so far have not indicated an interest in making more than token 
investments in the next couple of years. Only the Alaska Railroad has 
committed to installing PTC on their railroad, and their program is 
estimated to cost about $11 million.
    FRA is considering the possibility of initiating a rulemaking later 
in 1997. Studies are underway to examine corridor safety risks as well 
as PTC business benefits, and these studies are scheduled for 
completion in August, 1997. What kind of regulation might result from 
the rulemaking, and what territories it might cover, are unknown at 
this time.
        grade crossing hazard mitigation/innovation technologies
    Question. Please prepare a table indicating separately the status, 
problems and challenges faced, and the fiscal year 1996, fiscal year 
1997 and planned fiscal year 1998 FRA investments made in developing 
grade crossing hazard mitigation technologies. Please include 
information on each major FRA project in the program.
    Answer. The status of the major projects in developing grade 
crossing mitigation technologies is presented in the table below.

                                                                 [Dollars in thousands]                                                                 
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                    Fiscal years--                                                                                      
                                          ---------------------------------                                                                             
                                                                  Federal                                                                               
                 Project                    Federal    Federal     funds               Status 6/97                       Problems, challenges           
                                             funds      funds     proposed                                                                              
                                              1996       1997       1998                                                                                
--------------------------------------------------------------------------------------------------------------------------------------------------------
North Carolina Sealed Corridor...........       $750     $2,000    ( \1\ )  State is installing median        Coordination of construction with NCDOT   
                                                                             barriers, 4-quad gates, long      highway section is time consuming.       
                                                                             gate arms and beginning to        Closing crossings is not possible without
                                                                             close redundant crossings.        an environmental assessment--time        
                                                                                                               consuming and expensive.                 
New York Locked Gate at Private Crossings  .........        215        $75  Grant awarded to NYSDOT. Review   Project just begun and on schedule.       
                                                                             of barrier systems is complete.                                            
TRB IDEA Program.........................        500        500        500  Four awards have been made so     Program has proved very successful and is 
                                                                             far, with two more recommended,   continuing to attract innovative         
                                                                             for innovative grade crossing     submittals.                              
                                                                             hardware, such as a wide angle                                             
                                                                             lens for viewing the entire                                                
                                                                             crossing with one camera.                                                  
ITS Architecture Support.................  .........        100        100  User Service No. 30 completed.    No problems. Challenge will be adjusting  
                                                                             Grade crossing impacts now        other user services to incorporate grade 
                                                                             being incorporated in other       crossing impacts and developing hardware 
                                                                             user services..                   compatible with ITS traffic control      
                                                                                                               systems.                                 
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Not yet determined.                                                                                                                                 

        grade crossing hazard mitigation/innovation technologies
    Question. Please describe the differences in determining highway/
railroad crossing safety standards for high-speed and non high-speed 
rail operations.
    Answer. The current guidelines for highway/railroad grade crossings 
where train speeds are below 80 mph require warning devices--cross 
bucks, flashing lights, bells and gates--appropriate for the volume of 
motor vehicles that use the crossing.
    Between 80 and 110 mph.--Eliminate redundant crossings; install the 
most sophisticated traffic control/warning devices compatible with the 
location (median barriers, special signing, four-quadrant gates); and 
automated devices should be equipped with constant warning time 
equipment.
    Between 111 and 125 mph.--Protect the rail movement with full width 
barriers capable of absorbing the impact of a highway vehicle, 
including vehicle detection capability between the barriers. Notify 
approaching trains of warning device or barrier failure in sufficient 
time to stop short of the crossing.
    Above 125 mph.--Close or grade separate all crossings.
    The difference in the highway/railroad crossing safety standards 
for high-speed and non high-speed operations is due to the added danger 
to railroad passengers from the impact of the train with a large truck 
(concrete mixer, log hauler, gasoline tanker, etc.) or a derailment at 
high speed following an accident at the highway/railroad grade 
crossing. At conventional speeds, the cross bucks, flashing lights, 
bells and gates are considered warning devices because they cannot 
really protect the motor vehicle driver or the train. Derailments 
resulting from accidents at crossings are infrequent, and when there is 
a derailment the cars often remain upright. Injuries to passengers 
invariably are bumps and bruises. More serious injuries may be suffered 
by those passengers who are not seated at the time of the accident--
those standing or moving through the cars. However, for high-speed 
operations, although the potential for accidents does not increase, the 
potential for more severe passenger injuries does increase due to the 
higher train speeds. To prevent more severe injuries, the additional 
requirements for crossing protection were developed.
Grade crossing hazard mitigation/innovation technologies
    Question. Please discuss the full range of high-speed crossing 
technologies. Include a list of any current installations, and 
associated federal funding where appropriate (by fiscal year provided).
    Answer. Several technologies for use at high-speed highway-rail 
crossings are being demonstrated, or will begin shortly:
Vehicle arresting barrier--Illinois
    The state of Illinois will demonstrate an innovative arrestor net, 
the Vehicle Arresting Barrier (VAB), at three locations on the 
Chicago--St. Louis high-speed rail corridor. The VAB is similar to the 
nets used on aircraft carriers to stop planes in an emergency and is 
used today to provide protection at construction sites and draw 
bridges. In tests, the VAB has successfully stopped small vehicles, 
pickup trucks, and a fully loaded semitrailer (80,000 lbs) in 100 feet, 
six inches with minimal damage to the vehicles. The manufacturing 
contract was awarded to the Entwistle Company at a cost of just under 
$1.375 million for six units. Installation began in May, 1997 and is 
scheduled for completion in the Fall. Following a one year 
demonstration period, technical and human factors evaluations will be 
conducted.
    Federal funding has been provided from the Section 1010 program of 
ISTEA. In fiscal year 1993 $950,000 was provided for development and 
testing, in fiscal year 1996 $1.5 million was provided for installation 
of the six units at three locations, and part of the $575,000 awarded 
in fiscal year 1997 will provide for video recording systems to monitor 
operation and motorists actions.
Four-quadrant gate with obstruction detection--Connecticut
    Four quadrant gates are in operation on various crossings through 
the country. However, the State of Connecticut will demonstrate an 
advanced grade crossing warning system which will use four-quadrant 
gates with an obstacle detection system and a communication system to 
notify the locomotive engineer of an obstruction in adequate time for 
the train to be stopped. The location for this project is at the School 
Street at-grade crossing in Groton, Connecticut, milepost 131.50, on 
the Northeast Corridor. It is a two lane road protected now by gates, 
flashing lights and bells. It provides access to a residential area and 
three boat yards.
    The original concept was based on the Swedish X2000 system 
technology and that grade crossing warning system is an integral part 
of the X2000 train control system. However, it proved infeasible for 
the Northeast Corridor. The state of Connecticut and Amtrak are 
planning for the installation of additional crossing gates and 
obstruction detection circuitry this summer and fall. The obstruction 
detection system will be connected to the signal system to be installed 
as the segment between New Haven and Boston is electrified. These 
modifications will notify the locomotive engineer of an obstruction at 
the crossing. Once installed in the Spring 1998, the system will be 
tested for one year to measure its performance and to determine any 
refinements needed before such a system could be installed at other 
high-speed rail crossings.
    The total project grant is $1 million. The Federal share is 
$800,000 from Section 1036(c) of ISTEA, and the $200,000 balance is 
provided by the State. The state has provided an additional $18,600 for 
civil engineering design work at the site, and will use approximately 
$100,000 from Federal Highway Administration funds to rebuild the 
crossing to eliminate a hump that now can cause boat trailers to get 
hung up on the crossing.
Sealed corridor initiative
    The Sealed Corridor Initiative is a project to address the 130 
grade crossings in the 92-mile Charlotte to Greensboro segment of North 
Carolina's proposed high speed rail corridor between Charlotte and 
Raleigh. Each crossing has been examined for its site geometry, traffic 
volume and other factors. Some will be closed, and all that remain will 
receive the appropriate treatment for its location and traffic volume. 
This Initiative builds upon the demonstrations of innovative warning 
devices conducted at Sugar Creek Road in Charlotte, NC, the major 
arterial in the corridor. Each violation of the warning devices was 
videotaped and the impact of the various improvements tested was 
clearly demonstrated:

                                                     Violations per week
Baseline/flashing lights and gates................................    43
Median barriers...................................................    10
Four quadrant gates...............................................     6
Four quadrant gates and medians...................................     1

    Other elements of the initiative include examining articulated 
gates, long gate arms, and closing redundant crossings. FRA will work 
with North Carolina DOT to extend this effort throughout the remainder 
of the corridor and to develop a methodology to be used in developing 
other high-speed rail corridors around the country.
    Federal funding for the Initiative has been provided from the Next 
Generation High Speed Rail program ($2.75 million total--$750,000 in 
fiscal year 1996 and $2 million in fiscal year 1997) and Section 1010 
of ISTEA ($1.2 million total--$450,000 in fiscal year 1996 and $750,000 
in fiscal year 1997). Total project cost is estimated at $5.1 million, 
with the state providing the balance.
    Intelligent Grade Crossing.--FHWA & Long Island Railroad This 
system is being developed by the General Railway Signal Company (GRS) 
for the Long Island Railroad with $2 million in fiscal year 1996 FHWA 
funds and active FRA participation. It will tie the local grade 
crossing gate controller to both the train control system and the 
highway traffic signal system to minimize the delays to motorists in 
the vicinity of stations in urban areas. This project began in July 
1996, and the demonstration of the system, at three grade crossings and 
involve six locomotives, is scheduled to begin in late 1998.
    Friendly Mobile Barrier.--Consolidated Launcher Technology, Inc. 
(CLT) of Chesapeake, VA, received a grant for $400,000 in November, 
1993, from the Section 1036(c) Technology Demonstration program, to 
demonstrate a ``friendly mobile barrier'' (FMB), which is a crash 
attenuation device that rises from a vault in the roadway, after the 
crossing gates go down, preventing motor vehicles from penetrating and 
blocking the tracks while stopping the vehicle safely. Total project 
cost was estimated at $500,000. The $100,000 balance was to be provided 
by CLT and its partners (BF Goodrich, Environmental Solutions Inc., and 
Kamatics Corporation), Old Dominion University and Virginia's Center 
for Innovative Technology. CLT and its partners encountered a cost 
overrun in the FMB's design and manufacture, and eventually provided an 
additional $109,000 in order to complete the required crash tests.
    The potential advantage of the FMB was that it would be installed 
right next to the track, and there are locations where such a barrier 
might have unique advantages. The alternative approach, arrestor nets, 
must be installed 100 to 200 feet from the track or more, depending 
upon highway speed, which will limit their use.
    Vehicle impact testing was conducted four times in March, June and 
July 1995. The barrier was damaged in each of the first three tests, 
and after each test the barrier was modified to strengthen it and to 
improve its performance.
    Evaluations of the crash tests were conducted by FRA, FHWA and 
Virginia DOT. Meetings were held with FRA, FHWA, CSX, the Virginia 
Department of Transportation (VADOT), members of the CLT consortium and 
Congressional Staff to discuss the test results (it had failed the 
vehicle occupant deceleration criteria) the barrier's stiffness, its 
complexity and weight (34,000 lbs.), the power requirements to raise 
the barrier and the practicality of using such a device. Liability and 
weather concerns, the need for life-cycle testing, and finding a 
suitable demonstration site were also discussed.
    From these discussions, it became apparent that the technical 
complexities of the FMB just could not be overcome. Development costs 
were already 20 percent above the original estimate, and the cost to 
complete the demonstration was estimated at $500,000 to $1 million! The 
cost of using the barrier system at any crossing was estimated to 
$800,000 to $1 million for a two lane road (four barriers would be 
needed, one for each lane). In addition, because of the FMB's storage 
in a vault in the roadway, there was the potential need to have a human 
operator deploy the barriers. For all these reasons, the project was 
terminated.
    Low Cost Grade Separation.--The State of Florida received a grant 
for $252,000 to develop a low cost grade separation. The total cost and 
time of construction was expected to be approximately 50 percent less 
than the time and cost of a traditional pile supported, concrete wall 
and beamed structure. The total project cost was estimated in their 
original submission at approximately $400,000.
    Three designs were to be examined and bid upon by private 
contractors:
    1. A multi-plate SuperSpan system of prefabricated, corrugated (6 
inch by 2 inch) steel panels forming an arch;
    2. A ``classic'' design using two vertical walls of reinforced 
concrete covered by a concrete deck; and
    3. A prefabricated, prestressed concrete arch.
    All designs would have reinforced concrete ``thrust beams'' and 
eight foot high stem walls to protect the arch from train derailments. 
The ``thrust beams'' are poured along the upper portion of the 
completed structure and help support the roadway. They prevent 
horizontal movement of the soil during backfill, increase the ease of 
soil compaction, and reduce the amount of backfill needed.
    Site selection proved difficult due to local site conditions, such 
as power lines and irrigation channels that would have to be relocated 
at additional cost, etc. Despite examining more than 10 locations, none 
proved convenient for highway operations and the final construction 
costs varied by site from $1.4 to $1.7 million. Because of this 
significant cost overrun, the project was terminated by FLDOT.
                  challenges in high-speed development
    Question. Please prepare a table indicating separately the status, 
problems and challenges faced, and the fiscal year 1996, fiscal year 
1997, and planned fiscal year 1998 FRA investments made in developing 
high-speed rail track and structure technologies. Please include 
information on each major FRA project in this program.
    Answer. The information follows:

                                                           MAJOR TRACK AND STRUCTURES PROJECTS                                                          
                                                                  [Dollars in millions]                                                                 
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                    Fiscal years--                                                                                      
                                         ------------------------------------                                                                           
                                                                    Federal                                                                             
                 Project                   Federal      Federal      funds            Status 6/97                       Problems, challenges            
                                            funds     funds  1997   proposed                                                                            
                                             1996                     1998                                                                              
--------------------------------------------------------------------------------------------------------------------------------------------------------
Northwest Corridor Upgrade..............  .........         $5.65  .........  Award Pending..............  None.                                        
Correcting Weak Subgrade................  .........          0.5       $1.25  Award Pending..............  Final project definition underway.           
High-Speed Switches Integrated with ITCS  .........          0.25        .25  Award Pending..............  Final project definition underway.           
 Signal System on the Detroit-Chicago                                                                                                                   
 Corr.                                                                                                                                                  
Several small projects..................  .........          0.1         .05  Award Pending..............  None.                                        
                                         ------------------------------------                                                                           
      Total.............................  .........          6.5        1.55                                                                            
--------------------------------------------------------------------------------------------------------------------------------------------------------

                 lightweight materials in hsr trainsets
    Question. What progress has been made to adapt new, lightweight 
materials from aerospace airframe manufacturers to high speed rail 
trainsets to meet North American crash worthiness standards?
    Answer. Although this topic has been prominently featured in Next 
Generation Program solicitations, to date we have not received 
meaningful proposals at least in part because demonstrations of these 
technologies involve relatively large initial investments in fixed 
tooling and other production equipment. The Federal Transit 
Administration has sponsored a project to apply advanced materials in 
the construction of a transit bus, and expenditures in the tens of 
millions of dollars were required to achieve a prototype.
    Although progress has not been made in carbody construction, 
progress in applying advanced materials is being made in the NGHSR 
program. The 4,500 pound flywheel rotor being constructed for the 
Advanced Locomotive Propulsion System is being constructed of graphite 
fiber composites, which weigh one-sixth as much as steel of the same 
strength while increasing the energy storage capability of the flywheel 
at least three times. These characteristics are necessary to make it 
possible to shoehorn a respectable size energy storage capacity into 
the railroad carbody. Advanced composite materials are also being 
prepared for demonstration as brake friction pads for high speed cars, 
using their superb high-temperature characteristics at light weights. 
Application of these friction materials could save several thousand 
pounds of weight per car over the present steel brake disks, pads, and 
shoes.
                    next generation high-speed rail
    Question. Please list separately the time lines for completion of 
each of the high speed rail corridor projects now underway, and the 
estimated amount of Federal funds that will be needed to assure 
completion.
    Answer. Since there is no current Federal program for supporting 
high-speed rail construction outside the Northeast Corridor we have 
shown total capital costs, based primarily on planning documents from 
the respective States. If these projects were to be funded from the 
proposed NEXTEA fleexible funding, the Federal share would be 80 
percent of the figures shown.

------------------------------------------------------------------------
                                                        Estimated total 
      HSR Corridor project         Estimated time of   funds needed for 
                                      completion          completion    
------------------------------------------------------------------------
California--San Diego, Los        Unknown...........  Unknown.          
 Angeles, Oakland/Sacramento.                                           
Florida--Miami, Orlando, to       2006 entire         $5.3 billion in   
 Tampa.                            corridor.           1995 dollars.    
Pacific Northwest--Eugene,        20 years..........  WA $400 million.  
 Portland, Seattle to Vancouver,                      OR $385 million.  
 BC.                                                                    
Chicago Hub Corridor Chicago to   Late 2001.........  IL $400 million.  
 Detroit, Chicago to St.Louis,    2003..............  MI $500 million.  
 Chicago to Milwaukee and                             WI $360 million.  
 Minneapolis.                                         MN under study.   
Empire Corridor--Albany to New    Late 2001.........  $100 million.     
 York.                                                                  
Southeast Corridor--Washington,   2003-2005.........  NC $660 million.  
 Richmond to Newport News and                         VA $740 million.  
 Richmond to Raleigh to                                                 
 Charlotte.                                                             
Deep South Corridor.............  Under study.......  Unknown.          
Philadelphia to Harrisburg, PA..  Under study.......  Under study.      
------------------------------------------------------------------------

    The Northeast Corridor is estimated to be completed in late 1999, 
although cost estimates are not included here. Amtrak has provided cost 
estimates to Congress on the various projects--track improvements, 
signalization, electrification, rolling stock purchase--needed for this 
corridor.
                            hsr cost sharing
    Question. How has the FRA incorporated cost-sharing into each of 
these program areas? Please quantify cost-sharing for each project.
    Answer. Cost sharing varies by program, and by project within that 
program. For example: In the Section 1010 program for grade crossing 
improvements in high-speed corridors, no cost sharing is required, 
although almost all states provide state funds to do additional 
projects.
    In the Section 1036(c) Technology Demonstration program, cost 
sharing varied by recipient:

------------------------------------------------------------------------
                                       Federal                          
              Grantee                   funds              Match        
------------------------------------------------------------------------
Consolidated Launcher Technology        $400,000  $100,000.             
 (Friendly Mobile Barrier).                       $109,000 additional   
                                                   provided later.      
Connecticut DOT (4-quadrant gate)..      800,000  $200,000 plus.        
                                                  $118,600 additional.  
                                                  $100,000 is FHWA      
                                                   funds.               
Florida DOT (Low Cost Grade              252,000  $142,000.             
 Separation).                                                           
New York DOT (RTL Turbotrain           3,000,000  $2,000,000 from       
 retrofit).                                        Amtrak.              
                                                  $2,000,000 from       
                                                   NYSDOT.              
Illinois DOT (Environmental Impact     2,500,000  $625,000.             
 Statement).                                                            
North Carolina DOT (Corridor Master    1,000,000  $200,000.             
 Plan).                                                                 
------------------------------------------------------------------------

    Planning awards made in fiscal year 1996 and fiscal year 1997 
require a 50/50 match.
    In addition, although not part of the Section 1036(c) program, two 
grants were made in fiscal year 1995 to Illinois and North Carolina.

----------------------------------------------------------------------------------------------------------------
                                                  Federal                                                       
                    Grantee                        funds                            Match                       
----------------------------------------------------------------------------------------------------------------
Illinois DOT (Track rehabilitation from          $3,000,000  $750,000.                                          
 Granite City to East St. Louis).                                                                               
North Carolina DOT (Complete Corridor Master      1,000,000  None required or provided.                         
 Plan).                                                                                                         
Advanced Train Control (Next Generation High                                                                    
 Speed Rail Program):                                                                                           
    Michigan (Incremental Train Control System    9,100,000  $12,591,000 MIDOT and Amtrak.                      
     (ITCS)).                                                                                                   
    Illinois (High Speed Positive Train           7,000,000  $5,000,000.                                        
     Control).                                                                                                  
    Pacific Northwest (Positive Train               750,000  $35,000,000 BNSF & UP.                             
     Separation).                                                                                               
Non-Electric Locomotives:                                                                                       
    Advanced Locomotive Propulsion System         4,528,000  $4,528,000 GE, Univ. Texas, and Allied Signal.     
     (ALPS).                                                                                                    
RTL Turboliner Reconstruction (Empire            10,000,000  $10,000,000 NYSDOT.                                
 Corridor).                                                                                                     
----------------------------------------------------------------------------------------------------------------

                     next generation planning funds
    Question. How many states or MPO's have benefited from FRA's 
current planning assistance? What is the status of these projects? What 
specific projects have been funded with fiscal year 1997 monies?
    Answer. Fourteen state Departments of Transportation received 
funding from FRA's planning assistance in fiscal year 1997. The table 
below provides a project description and other data for the fiscal year 
1997 funds. We have focussed the grants primarily on the state DOT's 
but have discussed various elements of the work with various MPO's 
throughout the country such as the New Orleans MPO (Regional Planning 
Commission) which is assisting the Southern Rapid Rail Commission.

                                                           FISCAL YEAR 1997--NEXT GENERATION HIGH-SPEED RAIL CORRIDOR PLANNING AWARDS                                                           
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                         Amount       Grant                                                     
                State                                              Project  description                               applied for     award                          Remarks                    
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
California..........................  Conduct additional technical planning along the California corridor...........     $900,000     $100,000  ................................................
Florida.............................  Conduct ridership and market studies for Miami-Orlando-Tampa HSGT corridor....      900,000  \1\ 100,000  ................................................
Illinois............................  Complete environmental impact statement (EIS) for Chicago-St. Louis high-speed      125,000      100,000  ................................................
                                       rail corridor.                                                                                                                                           
Michigan and Indiana................  Update right-of-way improvements, ridership and revenue forecasts along the         118,695      118,695  ................................................
                                       Detroit-Chicago HSGT corridor.                                                                                                                           
Minnesota/Wisconsin.................  Phase II of the Minneapolis/St. Paul to Chicago route study...................    1,000,000      100,000  ................................................
Nevada..............................  Evaluate Maglev feasibility in Las Vegas-Southern California corridor.........      100,000  ...........  Funding available from earlier grant agreement. 
North Carolina......................  Conduct Charlotte-Washington DC corridor environmental study..................      250,000      200,000  ................................................
Southern Rapid Rail Commission        HSGT feasibility study in corridor between Atmore, AL through New Orleans to        200,000       81,305  Continue ridership demand work. Active interest 
 (LA,MS, AL).                          Lake Charles, LA.                                                                                         in incremental development.                    
Washington..........................  Conduct EIS and Reliability and Safety Improvement Study on Pacific Northwest       400,000      200,000  ................................................
                                       Corridor.                                                                                                                                                
 VNTSC..............................  Analytical & Planning Support.................................................  ...........      250,000  ................................................
                                                                                                                     --------------------------                                                 
      Totals for HSR funding........    ............................................................................    3,993,695    1,250,000                                                  
                                                                                                                     --------------------------                                                 
Funding from R&D:                                                                                                                                                                               
    Virginia........................  Complete Southeast corridor rail signal system analysis begun under fiscal          100,000      100,000  Complete study begun under fiscal year 1996     
                                       year 1996 grant.                                                                                          grant. R&D funding will be used for this       
                                                                                                                                                 purpose.                                       
                                                                                                                     --------------------------                                                 
      Grand total...................    ............................................................................    4,093,695    1,350,000                                                  
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Additional funding of $260,000 will be transferred from Section 1036 for EIS work.                                                                                                          

                      management of nghsr projects
    Question. The TRB has recommended that the FRA strengthen its 
program management capabilities to speed up and better control the 
individual projects. How will this be accomplished?
    Answer. FRA has reassigned the Next Generation Program staff, 
moving them from the R&D Office to the Office of Passenger and Freight 
Services in order to reflect better an orientation toward project 
implementation. Management of the program will be carried out through a 
combination of project managers and corridor coordinators. The former 
are responsible for working closely with States with which we have 
cooperative funding agreements and their contractors and host railroads 
on individual Next Generation projects to ensure timely accomplishment 
and technical review. The latter are responsible for a broader series 
of efforts to help our State partners implement high-speed rail through 
technical assistance in planning market and cost analysis, advice on 
available funding, and information on work in other States that is of 
common interest.
    The project managers hold frequent meetings and site visits with 
State/contractor/railroad personnel and monitor progress. The corridor 
coordinators communicate with State rail planners, maintain a world 
wide web page, hold semi-annual meetings with States, and keep track of 
developments in individual corridors, whether or not a Next Generation 
project is involved. They keep FRA management informed of the needs of 
the States in these corridors. Being in the same office, they 
communicate closely with the project managers and, together with them, 
provide broad based guidance on the direction of the Next Generation 
program. The Office of R&D continues to pursue research activities in 
the high-speed rail field and to act as a resource on related technical 
issues.
                      planning technology funding
    Question. Why is planning technology considered a non-recurring 
expense? Is it FRA's view that further federal coordination in these 
targeted high-speed rail corridors is no longer needed?
    Answer. In fiscal year 1996 and fiscal year 1997 FRA, as permitted 
under the Appropriations Act, used ``planning technology'' funds for 
two activities, both of which were aimed at helping our State partners 
with the planning and implementation of high-speed rail. The first was 
a modest planning grant program to States which provided matching 
funds. The Administration did not request planning technology funds in 
fiscal year 1998 because of the expected enactment of NEXTEA and the 
resulting ability of States to use Federal surface transportation funds 
for high-speed rail projects.
    The second activity was for contract assistance for FRA to provide 
information useful to States planning high-speed rail systems. Further 
Federal coordination among those states developing high-speed rail is 
very important. Twenty-three States have different levels of activity 
regarding high-speed rail and many states have sought FRA's assistance 
on various matters such as environmental analyses, market analysis, 
cost estimation, and the ownership costs, operational record and safety 
record of different types of equipment. Under our NEXTEA proposals the 
resulting ability of states to use Federal funds for high-speed rail 
projects will put FRA in the mode of providing the same kind of 
technical assistance which FTA and FHWA have been providing for 
decades. FTA and FHWA, however, have had much larger headquarters and 
field staffs and additional resources. In fiscal year 1998 FRA will 
provide these services using its own in-house staff.
                     nghsr administrative expenses
    Question. Please break down in detail the expected uses of the 
administrative expenses dealing with the next generation of high speed 
rail technology. How much of these funds are used to hire consultants? 
Why can't FRA employees do the work? Please further justify the 
requested increase.
    Answer. The NGHSR account is requesting $545 thousand for 
administrative support. Funds support the following

                        [In thousands of dollars]

                                                                        
PC&B (5 FTE)......................................................   372
Travel............................................................    41
Communications....................................................     2
Printing..........................................................     1
Contractual Services \1\..........................................   114
Supplies..........................................................     3
Equipment.........................................................    12
                        -----------------------------------------------------------------
                        ________________________________________________
      Total.......................................................   545

\1\ Includes training, TASC, PC and equipment maintenance contracts, IT 
support, etc.

    No administrative funds will be used to hire consultants.
    As noted on pages 171, 172, and 177 of FRA's Congressional Budget 
Submission, the fiscal year 1998 request of $545K reflects an increase 
of $119K over the fiscal year 1997 enacted level. Of this amount, $118K 
is for non-discretionary increases related to payroll, TASC, and 
inflation. In fact, $97K represents the transfer of 1 position/FTE from 
the OA account to the NGHSR account. The balance of $1K is for the FRA-
wide technology systems.
                 rhode island rail freight development
    Question. What is the total time frame and cost estimate, broken 
out by fiscal year, for the freight rail improvement project in Rhode 
island?
    Answer. The total time frame for the freight rail improvement 
project is seven years--1995 through 2001. The Federal investment, 
including appropriations through fiscal year 1997 and budgets through 
2001, is as follows:

                        [In millions of dollars]

        Fiscal year                                               Amount
1995..............................................................     5
1996..............................................................     1
1997..............................................................     7
1998..............................................................    10
1999..............................................................    10
2000..............................................................    10
2001..............................................................    12
                        -----------------------------------------------------------------
                        ________________________________________________
      Total.......................................................    55

    Question. What is the administration's planned Federal grant 
schedule by fiscal year for the project?
    Answer. The Rhode Island Rail Freight Improvement Project grant was 
signed by Administrator Molitoris and the Director of RIDOT in March 
1995. This document obligated the fiscal year 1995 appropriation of 
$5.0 million. The Grant has not been amended to include the fiscal year 
1996 and 1997 appropriations of $1.0 million and $7.0 million 
respectively. An amendment to the Grant is scheduled immediately after 
publication by RIDOT of the Record of Decision which will complete the 
environmental impact phase of the project.
    Question. There is a fifty percent funding match required for the 
project. Has the State of Rhode Island matched the $13,000,000 provided 
by the Federal Government over the past three years? Is FRA aware of 
plans to release state funds in fiscal year 1997?
    Answer. Rhode Island has matched nearly $1 million of the $13 
million appropriated for the Freight Rail Improvement Project. 
Significantly more of the appropriation will be matched when the 
environmental impact process is completed during the summer of 1997. In 
all likelihood, state funds will be released in fiscal year 1997 to 
purchase long-lead materials for the 1998 construction season. In 
November 1996 Rhode Island voters approved a bond referendum which will 
provide the State match of Federal funds.
    Question. Has Rhode Island taken advantage of the State's ability 
to ``flex'' their highway congestion mitigation or NHS funds for rail 
projects?
    Answer. The State of Rhode Island did not use the flexibility 
allowed by the National Highway System Designation Act (NHSDA). Neither 
Congestion Mitigation Air Quality nor funds from any of the other 
funding sources for which flexibility was allowed under NHSDA have been 
used by RIDOT on this project.
    Question. Ultimately, who will own and have responsibility for the 
third track once it is built and in operation?
    Answer. Amtrak and the Rhode Island Department of Transportation 
have begun negotiating ownership and related responsibilities for the 
third track. Rhode Island has taken the position that they will own all 
newly constructed rail infrastructure and all assets improved by the 
Freight Rail Improvement Project, excluding improvements made by Amtrak 
in accordance with FRA's Record of Decision (5/95) for the 
electrification project. Amtrak, owner of the underlying rail right-of-
way, is studying its options. All parties agree that these issues must 
be resolved before construction begins.
    Question. Please discuss all potential shared track safety 
concerns, if the final EIS recommends the ``partial build'' option.
    Answer. Publication of the Final Environmental Impact Statement is 
scheduled for June 1997. The ``partial build'' option is not limited to 
a fixed number of additional track miles, but can range anywhere from 
eleven to eighteen miles of third track over the twenty-two mile Boston 
Switch to Davisville segment of the NEC. The greater the number of 
additional track miles recommended the fewer will be the track miles 
over which operations will be shared by freight and passenger trains. 
Without knowing the exact locations, and likely operating conditions, 
where freight and passenger trains will share the right-of-way, it is 
difficult to address specific safety concerns. Among the safety issues 
which will be addressed are: allowable speeds, hours of operations, 
train separation, shifting load detection and appropriate levels of 
train control and signals. Amtrak made all of these issues known to 
RIDOT in its response to the draft EIS, and it is expected that all 
will be addressed in the FEIS.
             direct loan financing account-alameda corridor
    Question. Between 1992 and the present, have any direct loans been 
made to private sector railroads or other entities by the U. S. 
Government under the Title V Railroad Rehabilitation loan programs 
(Section 505 or 511), other than the fiscal year 1997 provision of 
$58,680,000 to leverage $400,000,000 over three years for the Alameda 
Corridor project?
    Answer. Yes. The Fiscal Year 1994 Department of Transportation 
Appropriations Act included $250,000 to leverage $5,000,000 for a 
Section 511 loan guarantee. Funding supported a project between 
Syracuse and Binghamton, operated by the New York, Susquehanna and 
Western Railway (NYS&W). The final loan guarantee was $4,204,575.
                federal role in alameda corridor project
    Question. Is FRA responsible for oversight of the Alemeda Corridor 
project during the 3-year lending cycle and repayment to the Treasury? 
Please describe the federal role in this program.
    Answer. The FRA and FHWA will be jointly responsible for the 
oversight of this project throughout the 3-year lending cycle, and 
throughout the loan repayment period.
    The Fiscal Year 1997 Omnibus Consolidated Appropriations Act 
(Public Law 104-208) provides $59 million for FRA/DOT to pay the 
capital charges (subsidy costs) associated with making a direct loan 
not to exceed $400 million to Alameda Corridor Transportation Authority 
(ACTA) for the Alameda Corridor Project. It also provides that the loan 
must be repaid within thirty years from the date of project completion.
    This Federal loan offers permanent financing with flexible payment 
features that should alleviate market concerns and promote efficient 
use of private capital by positioning the Federal Government as a 
patient investor in the project with a long term horizon and no 
liquidity requirements. Those features include:
  --structuring the loan to include flexible repayment provisions with 
        deferrable interest and principal, thus matching realized 
        project revenues;
  --facilitating the project's access to private capital by enhancing 
        senior debt coverage, lowering interest rates, and reducing 
        reserve requirements; and
  --leveraging substantial private financing by limiting Federal 
        participation to 20 percent of total project costs.
    At a budgetary cost of only $59 million, the Federal Government is 
providing a $400 million loan that will help advance a $2 billion 
project with significant local, regional, and national benefits.
    Question. Please update the Committee on the authorization status 
of the railroad loan guarantee programs. Are the Section 505 and 
Section 511 loan guarantee programs currently authorized? If not, when 
did the authorizations expire? To the knowledge of the agency, is there 
any movement toward reauthorization of either program by the 
appropriate committees?
    Answer. Statutory authority for the Section 505 Program has 
expired. The Urgent Supplemental Appropriation Act of 1986 extended the 
authority to make loans under Section 505 until September 30, 1988. No 
further extension has been provided with one exception. The subsidy 
appropriation for the Alameda Corridor Project included in the Fiscal 
Year 1997 Department of Appropriations Act provided a one-time 
authority for that project. While the authorization for the Section 511 
Program has not expired, no subsidy has been appropriated to generate 
budget authority since fiscal year 1994.
    FRA is not aware of any movement toward reauthorization of either 
program by the appropriate committees.
    Question. Please describe the difference between the two loan 
programs.
    Answer. The Section 505 Program provided direct loans to railroads 
and financially responsible persons for track rehabilitation and 
acquisition of rail freight lines. A total of $580.2 million was 
provided to 24 recipients. The period of repayment was 30 years or less 
and the interest rates ranged from 2.03 percent to 11.9 percent. Under 
Section 511, loan guarantees were available for financing or 
refinancing to acquire or rehabilitate and improve facilities or 
equipment. A total of $253 million was provided to 8 recipients for the 
purchase and repair of locomotives and freight cars, track 
rehabilitation, acquisition of rail freight lines, and labor protection 
payments to furloughed employees of the Chicago, Milwaukee, St. Paul 
and Pacific Railroad.
    All of the loan guarantees were financed through the Federal 
Financing Bank (FFB). The FFB interest rate is the cost of borrowing to 
the Government plus one-eighth of one percent. The rates varied from 
5.8 percent to 12.54 percent. The loan repayment period generally 
ranged from 10 to 20 years depending on the economic life of the 
project. The statutory maximum is 25 years. An investigation fee and 
annual premium fee are required. The statutory maximums are one-half of 
one percent for the investigation fee and one percent of the 
outstanding principal balance for the annual premium fee.
     local rail freight assistance program and emergency railroad 
                       rehabilitation and repair
    Question. Why is there $6,763,000 in outlays associated with the 
local rail freight assistance program?
    Answer. Local rail freight assistance remains available until 
expended. A total of $10,437,000 was appropriated in fiscal year 1995. 
It takes several years for states to implement projects, liquidate the 
funds, audit the costs incurred, and close out the grants.
    Question. Please update the Committee on the authorization status 
of the local rail freight assistance program. When did the LRFA 
authorization expire? To the knowledge of the agency, is there any 
movement toward reauthorization of the program by the appropriate 
committees?
    Answer. The local rail freight assistance program was authorized 
through fiscal year 1995. FRA is not aware of any movement toward 
reauthorization of the program by the appropriate committees.
    Question. Please update the Committee on applications the FRA has 
received from flood-impacted railroads for the fiscal year 1997 
emergency railroad rehabilitation and repair funding.
    Answer. While we have not yet received any applications for West 
Virginia or the Northern Plains States, we anticipate that the full 
amount of $18.9 million will be requested and obligated.
                           operation respond
    Question. What are the costs, benefits and current status of FRA's 
involvement in the Operation Respond project? Please specify fiscal 
year 1995, fiscal year 1996, and fiscal year 1997 funding. How much 
longer is it anticipated that FRA will help finance this project? What 
is the total amount requested within the Department for Operation 
Respond? What is the amount of FRA's share?
    Answer. DOT's three-year investment in the Operation Respond 
program has produced substantial progress, and has successfully 
generated commensurate investments from rail and motor carriers. 
Through software and training developed by Operation Respond, fire and 
law enforcement dispatch centers are able to quickly and accurately 
determine the contents of a hazardous material rail car or truck 
trailer which is involved in an accident. Currently there are 
approximately 104 installations in 17 States.
    The FRA-FHWA-RSPA partnership plans to continue its joint 
participation by assisting in continuing research and development 
improvements, and in outreach activities. Additional refinements can 
extend the software's usefulness and adaptability to other emergency or 
law enforcement organizations, and the Emergency Medical Services (EMS) 
community. FRA sees benefit in expanding the program to include 
regional and shortline railroads as well as continuing refinements in 
the area of passenger rail. Greater participation by more members of 
the industry will also lead toward voluntary standardization of 
software displays, reducing training time and error rates for users, 
and enhancing credibility with the chemical industry. FRA will continue 
to cooperate with Operation Respond to gain acceptance by additional 
surface transportation carriers.
    We and our participating private sector partners believe that 
continued DOT financial support for the Operation RESPOND Institute, 
Inc. is needed through fiscal year 2000.
    FRA's grant agreement for the program in fiscal year 1995 included 
funds from FRA, FHWA and RSPA: $129,000 from FRA; $350,000 from FHWA; 
and $120,000 from RSPA. In fiscal year 1996: $75,000 from FRA; $190,000 
from FHWA; and $120,000 from RSPA. In fiscal year 1997: $53,000 from 
FRA; and FHWA directly entered into a Cooperative Agreement with 
Operation Respond for $1 million earmarked by Congress.
    In the fiscal year 1998 budget, the Department has requested 
$103,000 for Operation Respond; this amount is in FRA's budget. FHWA 
and RSPA will continue to work with FRA in the continued development of 
this project. FRA will continue to support outreach efforts in the rail 
industry and work towards the development of enhanced software features 
and improvements stemming from continued user feedback.
                        fra personnel reductions
    Question. Senate Report 104-325 directed that none of the FRA 
personnel reductions planned for fiscal year 1997 be obtained from the 
Safety Division of the Office of Chief Counsel. How has this directive 
been followed, and how will FRA continue this directive in fiscal year 
1998?
    Answer. Yes, this directive was followed in fiscal year 1997. In 
fiscal year 1998, the Office of Chief Counsel is requesting an increase 
of 1 position/FTE for the Safety Division to support the regulatory 
process.
                 need for additional attorney position
    Question. FRA is pursuing fewer enforcement cases now compared to 
several years ago. Doesn't this free up the time of some of your 
attorney staff? If so, why do you need one additional FTE for the 
Office of Chief Counsel?
    Answer. The reduction in the civil penalty workload has occurred 
over a period when the Safety Law Division of the Office of Chief 
Counsel has seen its workload expand significantly in several other 
areas. FRA's regulatory workload has shown continued growth in the last 
several years. New technology, changes in industry practices, and 
response to statutory mandates have combined to create a reservoir of 
regulatory tasks that require prompt action. At present, FRA has more 
than 20 important regulatory projects in various stages of development 
and all of these require legal support. FRA, of course, has moved 
toward a more collaborative rulemaking process since 1995, having 
completed a negotiated rulemaking on roadway worker protection, begun 
advisory committee efforts on passenger equipment and emergency 
response, and established the Railroad Safety Advisory Committee to 
address a wide range of safety issues. This collaborative method, which 
aims at producing consensus-based rules, is actually more attorney-
intensive than the more traditional method. FRA attorneys participate 
in every regulatory working group and are generally the primary 
drafters of all rulemaking documents recommended by those groups. 
Developing these documents through a consensual process often requires 
more discussion and redrafting than when FRA drafts rules unilaterally. 
Before the drafting begins, of course, the issues are debated at length 
in meetings attended by the FRA attorney. While FRA believes the 
collaborative process will produce rules that are more soundly based in 
fact, more widely accepted and understood, and less likely to be 
challenged, an increase in the safety attorneys' workload is one cost 
FRA must pay for these improvements.
    FRA attorneys also have an increasing workload in the area of 
engineer certification. The attorneys both draft decisions for FRA's 
Locomotive Engineer Review Board (LEB.) and litigate cases involving 
challenges to LEB. decisions before FRA's administrative hearing 
officer. In 1996, FRA received the highest number of hearing requests 
ever (16), and thus far in 1997 the LEB. is receiving petitions for 
review at a record pace.
    In 1997, FRA has been sued by a commuter railroad challenging FRA's 
assertion of jurisdiction, all freight railroads challenging recent FRA 
guidance on equipment inspection issues, and a rail union challenging 
FRA's decision about the legality of a renovation of an employee 
sleeping quarters. FRA attorneys play a very active role in litigating 
these cases.
    Even though the number of recommended civil penalty actions has 
been down in recent years, there is no guarantee that trend will 
continue. More important, despite the lower number of civil penalty 
cases, FRA attorneys have been very active in FRA's use of its other 
enforcement tools. FRA issued three emergency orders in 1996, and has 
entered into two safety compliance agreements so far in 1997. 
Developing and drafting these documents takes a great deal of attorney 
time. Also, FRA Administrator Molitoris has directed that FRA civil 
penalty efforts be more fully integrated with its SACP efforts, which 
requires greater coordination between its attorneys and those directing 
SACP reviews of railroads. Finally, while FRA has in recent years 
become very current in transmitting civil penalty cases and closing 
those cases against major railroads, we still have a large number of 
cases against small railroads and shippers that need to be settled.
    Accordingly, the downturn in the number of violation reports 
received in recent years does not signal an overall reduction in the 
workload of FRA's safety attorneys. On the contrary, their workload has 
continued to increase, and the addition of one attorney will help 
significantly in improving timeliness in the areas of regulation, 
engineer certification, and civil penalty enforcement against small 
railroads and shippers.
                      video teleconferencing costs
    Question. During the last two years, which source of funds from 
which FRA sub-account was used to pay for installation of video 
teleconferencing equipment? How much has been spent on purchase and 
installation? Why can't you use these same funds for actual usage 
costs?
    Answer. In fiscal year 1996, a total of $940 thousand was used for 
the purchase and installation of the video teleconferencing equipment. 
The source of funds included carryover funds from OA (which are no 
longer available) and information technology funds in Safety. The funds 
in Safety were non-recurred in the fiscal year 1997 budget since this 
was a one-time equipment cost.
    No funds were budgeted in fiscal year 1997 for actual usage. At the 
time the fiscal year 1997 budget was developed, FRA did not anticipate 
the completion of the installation until late fiscal year 1997. Thus, 
fiscal year 1998 was the first year that usage costs were budgeted.
    While the equipment is now ready, FRA has virtually banned all 
usage due to lack of funding. However, this critical communication tool 
cannot stay idle in fiscal year 1998. Therefore, it is important that 
funding requested be approved, and approved in all FRA accounts as 
noted.
                        office of administration
    Question. Why can't the monies requested for technology systems be 
split funded during fiscal year 1998 and fiscal year 1999. How much is 
included in the fiscal year 1998 base for computer systems., i.e., to 
replace and upgrade hardware and software and to enhance automation 
systems. How much is in the base for Technology systems and the 
information technology.
    Answer. The OA account is requesting $125 thousand for FRA-wide 
technology systems.
    Of the $125 thousand, $48,000 is for the Video Teleconferencing 
Initiative FRA has completed installation if its video teleconferencing 
equipment. Funding requested in fiscal year 1998 will support actual 
usage and system maintenance--costs that will continue during the life 
of the system. If funding is not provided, then FRA will not be able to 
use the system. This is the first year funds have been requested for 
operation of the system, thus no funds are included in the fiscal year 
1998 base.
    The remaining $77 thousand is for FRA's Imaging System. Most of 
this funding ($62K) is a one-time cost. A minimum amount of funding 
will be required for supplies and maintenance of the system. The 
project cannot be split funded as the base cost to complete project is 
$77K.
    The OA account has $67 thousand in its fiscal year 1998 base for 
hardware and software replacement and/or upgraded for 154 FT. This is 
inadequate, considering the number of computers/printers and other 
equipment that must be replaced due to the age of equipment. Much of 
the OA computer equipment will be 5 years or older by fiscal year 1998.
    The OA is requesting $292 thousand for the replacement/upgrade of 
37 computers, 12 notebooks, 35 printers and 1 FAX. Funding will also 
support software and database upgrades.
    Any delay in replacing this equipment will jeopardize the 
management of FRA programs. FRA cannot function without its computers 
and automated databases which are experiencing a much higher rate of 
breakdowns and lost of productive time than in previous years-again due 
to age and increased use.
                compliance/enforcement-related functions
    Question. Several years ago the Office of Chief Counsel received 
additional appropriations to conduct certain compliance/enforcement-
related functions. Please specify the amount of these funds which are 
now reflected in the base of the fiscal year 1998 proposed budget and 
discuss the amounts actually used in fiscal year 1996 and fiscal year 
1997 versus the amounts actually appropriated.
    Answer. In fiscal year 1995, FRA sought $386,000 to fund the costs 
of administrative litigation related to the FRA safety program (e.g., 
engineer qualifications, hazardous materials enforcement, 
disqualification of unfit railroad employees and emergency orders). FRA 
at that time employed, through a reimbursable agreement, administrative 
law judges (ALJ's) from the Department's Office of Hearings to preside 
over the hearings in these cases. FRA's funding request was based on an 
Office of Hearings estimate that each engineer qualification case would 
cost approximately $33,000, and FRA's anticipation of having 15 cases 
involving a review of railroads' decisions to revoke or deny engineers' 
certificates. To reduce the administrative litigation costs to the 
agency, in fiscal year 1996 FRA decided to discontinue using DOT ALJ's 
and instead use an FRA attorney as a hearing officer, in addition to 
handling non-safety FRA legal matters. The fiscal year 1996 and fiscal 
year 1997 budgets reflect a reduction of $368,000 as a result of this 
decision. The fiscal year 1997 Enacted Budget contained no funding for 
ALJ's and the same is true for the fiscal year 1998 request. FRA's 
hearing officer is currently handling all of FRA's administrative 
litigation.
             enforcement actions over the last three years
    Question. Please prepare a table describing, for each of the last 
three years, the number of enforcement actions taken, the amount of 
civil penalties assessed and those collected or settled, and the number 
and type of violation reports submitted. What percentage of these 
actions have come from Federal inspectors and what percentage from 
state inspectors?
    Answer. The tables follow.

                          FRA CIVIL PENALTY ENFORCEMENT ACTIONS, FISCAL YEARS 1994-1996                         
----------------------------------------------------------------------------------------------------------------
                                                       Cases          Dollars      Cases  closed      Dollars   
                   Fiscal year                      transmitted      assessed           \1\          collected  
----------------------------------------------------------------------------------------------------------------
1994............................................           2,019     $16,159,250           1,525      $7,959,765
1995............................................           1,447      10,897,600           1,313       5,230,044
1996............................................             827       5,157,500             970       3,588,765
----------------------------------------------------------------------------------------------------------------
\1\ Many cases are closed in years after the year they were transmitted. Accordingly, the cases transmitted and 
  cases closed are largely different groups of cases.                                                           


       VIOLATION REPORTS SUBMITTED BY TYPE, FISCAL YEAR 1994-1996       
------------------------------------------------------------------------
                                                  Fiscal years--        
                  Type                  --------------------------------
                                            1994       1995       1996  
------------------------------------------------------------------------
Alcohol and drug use [AD]..............         97         30         30
Accident reports regulations [AR]......         97         84         41
Bridge worker safety standards [BW]....          2          5          5
FRA Emergency order [EO]...............         46         11  .........
Rilroad safety enforcement [EP]........  .........  .........          2
Engineer qualifications [EQ]...........         78         48         18
Freight car safety standards [FCS].....        344        276        204
Grade crossing signal safety [GC]......  .........  .........          2
Safety glazing standards [GS]..........  .........  .........          1
Hazardous materials regulations [HMT]..        662        419        273
Hours of service laws [HS].............      1,714      1,440        148
Hours of service record keeping [HSR]..        534        335         76
Locomotive safety standards [LI].......        538        280        194
Railroad noise emission compliance [NE]          1          3  .........
Rear end marking devices [REM].........         26         19          9
Railroad operating practices [ROP].....        116         53         32
Railroad operating rules [ROR].........         10          3  .........
Radio standards and procedures [RSP]...         28         13          9
Safety appliance statutes [SA].........        466        411        242
Signal inspection regulations [SI].....        139         86         74
Track safety standards [TS]............        151         82         55
                                        --------------------------------
      Total............................      5,049      3,598      1,415
                                        ================================
Federal Inspectors (percent)...........         92         91         91
State Inspectors (percent).............          8          9          9
------------------------------------------------------------------------

                           other services--oa
    Question. Why is there a decline in other services on page 17 from 
$4,573,000 to $1,928,000? What services will be eliminated?
    Answer. The fiscal year 1997 estimate of $4.573 million for other 
services includes $3.148 million in carryover funds which will not be 
available in fiscal year 1998.
                    travel--office of chief counsel
    Question. What is the estimated current travel budget for the 
Office of Chief Counsel? How much is proposed for fiscal year 1998?
    Answer. The information follows:

Office of chief counsel--travel

                        [In thousands of dollars]

                                                                        
Fiscal year:
    1997..........................................................    79
    1998..........................................................    80
                  policy and immediate office staffing
    Question. Please list separately the number of FTP and FTE in the 
Office of Policy and Program Development and in the immediate Office of 
the Administrator for each of the last three years.
    Answer. The information follows:

                                                    STAFFING                                                    
----------------------------------------------------------------------------------------------------------------
                                                                       Fiscal years--                           
                                           ---------------------------------------------------------------------
                  Office                        1994          1995          1996          1997          1998    
                                           ---------------------------------------------------------------------
                                             FTP    FTE    FTP    FTE    FTP    FTE    FTP    FTE    FTP    FTE 
----------------------------------------------------------------------------------------------------------------
Office of Policy and Program Development..     34     33     33     32     31     30     28     27     23     22
Immediate Office of the Administrator.....     12     10     12     10     12     10     12     10     12     10
----------------------------------------------------------------------------------------------------------------

                     office of civil rights funding
    Question. Please specify the amount appropriated and the amount 
spent for each of the last three years for civil rights activities. How 
much is requested for fiscal year 1998?
    Answer. The information follows:

                                 FUNDING                                
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                          Appropriation/      Actual/   
           Civil Rights Office                request         enacted   
------------------------------------------------------------------------
Fiscal year:                                                            
    1998................................             294             294
    1997................................             268             268
    1996................................          \1\ 64             250
    1995................................             244             238
------------------------------------------------------------------------
\1\ Does not include an additional $186K in carryover authority approved
  to fund 2 FTE restored to this office.                                

              technical assistance and contractor support
    Question. Please list the amount actually spent on technical 
assistance and contractor support for the Office of the Administrator 
for each of the last three years and compare these amounts to the 
appropriated amount for the activity.
    Answer: FRA had no ``Technical Assistance'' budget category in 
fiscal year 1995. In fiscal year 1996, none of the $20,000 reserve 
funds were used for Technical Assistance and Policy Support. This 
$20,000 has been carried forward to fiscal year 1997 and will be 
obligated along with the $20,000 allocated in fiscal year 1997 to 
assist the Office of Policy and Program Development to analyze the 
merger proposal of the Norfolk Southern, CSXT, and Conrail.
                       office of policy contracts
    Question. Please indicate the purpose, amount, and recipient of any 
contracts, including those for technical assistance and policy support, 
signed during fiscal year 1996 and thus far in fiscal year 1997 by the 
Office of Policy and Program Development or the immediate Office of the 
Administrator?
    Answer:

                          [Dollars in thousands]                        
------------------------------------------------------------------------
                                     Fiscal year                        
                               ----------------------                   
            Purpose                1996       1997         Recipient    
                                  actual   estimated                    
------------------------------------------------------------------------
Stracnet Density Data.........        $10        $10  U. of Wisconsin   
                                                       Curt Richards.   
Economic/Financial Data.......         75         85  Bureau of Transp. 
                                                       Statistics;      
                                                       Association of   
                                                       American         
                                                       Railroads;       
                                                       Operations       
                                                       Technology       
                                                       Services; Volpe  
                                                       Center.          
Carload Waybill Sample........        209        225  ICC/Surface       
                                                       Transportation   
                                                       Board.           
Operation Respond.............         75         53  Operation Respond 
                                                       Institute.       
Intermodal Network GIS........         23        100  Ensco; Caliper    
                                                       Corp.            
Network Operations Maintenance         44         56  CSG; Hickling     
                                                       Lewis; Freight   
                                                       Services.        
Prior Year Deobligation.......        -82  .........  ..................
Technical Assistance and        .........         20  ..................
 Policy Support.                                                        
                               ----------------------                   
      Total...................        354         54                    
------------------------------------------------------------------------

                      office of the administrator
    Question. Please break down in further detail the expected use of 
and the immediate need for contract support service funds requested by 
the Office of Policy and Program Development or the immediate Office of 
the Administrator. How much is in the base for each of the items listed 
on page 23?
    Answer. The OA account is requesting and increase of $51,000 for 
general contractual services under the Salaries & Expenses budget 
activity (not the ``Contract Support'' budget activity). As noted, 
increases will support the following:

                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                                               Fiscal years--   
                                                                                           ---------------------
                  Purpose                                  Office                   Base       1998       1998  
                                                                                             increase   request 
----------------------------------------------------------------------------------------------------------------
Consultant Sprt...........................  Policy.............................  .........         25         25
Administrative, conference, and other       Psngr and Freight..................  .........         15         15
 outreach spt.                                                                                                  
Development of training materials for       Admin..............................         26         10         36
 automated data bases.                      Civil Rights.......................          1          1          2
                                                                                --------------------------------
      Total...............................    .................................         27         51         78
----------------------------------------------------------------------------------------------------------------

                    policy studies and contributions
    Question. What are the most important policy studies and 
contributions made by the Office of Policy and Program Development in 
fiscal year 1997, and what is planned for fiscal year 1998? Please 
specify how this is reflected in the request.
    Answer. The Office of Policy and Program Development leads the 
Federal Railroad Administration in several areas: rail structural 
analysis (mergers), rail network geographic information systems (GIS), 
rail needs for national defense, Operation Respond, and railroad data 
development. In addition the Office of Policy and Program Development 
has taken a lead role in developing tools to evaluate the cost/benefit 
of rail projects utilizing innovative financing techniques.
    The Office of Policy and Program Development has been the lead 
Department of Transportation (DOT) group for analyzing rail merger 
proposals for over 10 years. They analyzed and developed the DOT's 
written position on the merger of the Union Pacific and the Southern 
Pacific railroads. During fiscal year 1997 and fiscal year 1998, they 
will similarly lead the DOT analysis of the proposed acquisition of 
Conrail by the Norfolk Southern and CSXT railroads. Additionally, they 
will begin an assessment of the issues involved in competitive access 
in the rail industry. Much of the data (traffic, financial, and general 
economic) that will support this as well as other policy analyses is 
acquired, compiled, and funded as explained below.
    The Office of Policy and Program Development created a rail network 
GIS, representing all 150,000 route miles of track in the United States 
railroad system. The GIS is extremely detailed, containing ownership, 
trackage rights, and traffic statistics for each line segment in the 
country. It is updated annually and has been widely distributed to 
other federal agencies, states, MPO's, local jurisdictions, and 
railroads. It has been coupled with a highway GIS from DOT's Federal 
Highway Administration and a waterway GIS from the United States Coast 
Guard to create the initial stages of an intermodal network GIS. During 
fiscal year 1997 and fiscal year 1998 the FRA Rail Network GIS will be 
updated, enhanced, and distributed to the public. Also, hazardous 
materials movements (extracted from the Waybill Sample) will be 
simulated over the Rail Network GIS to be used as an aid by the Office 
of Safety in deploying its inspection fleet.
    The Office of Policy and Program Development, in cooperation with 
the Military Traffic Management Command (MTMC) of the Defense 
Department, reevaluates on an annual basis the rail requirements for 
the defense of the United States based on changing rail traffic density 
and defense traffic pattern shifts. This effort defines the Strategic 
Rail Corridor Network (STRACNET), those rail lines identified as 
necessary to defense.
    The Office of Policy and Program Development administers the FRA's 
portion of the federal grant to Operation Respond. FRA's funding helped 
to develop a very successful pilot project in Houston, Texas that paved 
the way for better response to rail hazardous materials spills. Funding 
in fiscal year 1997 and fiscal year 1998 will expand these efforts to 
other localities in the United States and also broaden the railroad 
base to include short line carriers.
    The Office of Policy and Program Development jointly with the 
Surface Transportation Board (STB) funds the creation of the Rail 
Carload Waybill Sample data base on an annual basis. Funding is 50 
percent FRA and 50 percent STB. The Waybill Sample data base is the 
only comprehensive source of rail traffic data that includes details 
for both commodity and routing. As such it functions as the official 
traffic data source for proceedings before the STB, including mergers, 
acquisitions, and abandonments.
    The Office of Policy and Program Development purchases and collects 
rail economic and financial data to support policy analysis of the rail 
industry. Economic data is purchased from Data Resources, Inc. (DRI) to 
track economic trends in the rail industry. Rail financial data is 
compiled into a financial data base to evaluate individual rail 
companies and the industry as a whole. These data are used extensively 
in rail structure analysis such as mergers.
    The Office of Policy and Program Development has funded the 
development of a computerized model (RailDec) to assess the cost/
benefit of innovatively financed rail projects. It has been made 
available to and is widely used by states, Metropolitan Planning 
Organizations (MPO's), and regional jurisdictions to analyze the worth 
of such projects in their own areas. During fiscal year 1997 and fiscal 
year 1998 the model will be modified to better include projects 
directly related to rail/highway crossings.
    Funding for all these projects is included in the request of $682 
thousand under the budget activity ``Contract Support''.
    [Note.--General contractual services are used to support the day to 
day operations of the offices.]
                   intermodal transportation planning
    Question. What resulted from the numerous meetings FRA conducted to 
help integrate intermodal transportation planning? How much did you 
spend on this activity during fiscal year 1996 and fiscal year 1997? 
How much is planned for fiscal year 1998?
    Answer. Fiscal year 1996: In fiscal year 1995, FRA had worked 
closely with FHWA and FTA on the Department of Transportation's ongoing 
series of Enhanced Planning Reviews, focussing on Metropolitan Planning 
Organizations where freight, particularly rail and intermodal freight, 
was a major issue. The only such review in fiscal year 1996 in this 
category took place in the New Orleans Metropolitan Area in November 
1995. FRA led the panel on intermodal freight mobility and provided 
insight from the experiences of other MPO's and on the availability of 
freight-related data sources. The reviews were used by the Department 
as a way to assist MPO's in refining their transportation planning 
processes, and assess the effectiveness of the ISTEA planning 
regulations. Also during 1996, FRA conducted focus group meetings in 
Trenton, NJ (July 1996) with state DOT officials and railroads and in 
Erie, PA (August 1996) with the executive board of AASHTO's Standing 
Committee on Rail Transportation, to solicit information on what had 
worked with ISTEA as currently configured and their ideas on needed 
changes to ISTEA, including any changes to the planning regulations. 
Additionally, FRA participated in Department-led ISTEA outreach 
meetings in Philadelphia (August 1996), Providence (Sept. 1996), and 
St. Louis (Sept. 1996). The results of these and other DOT-initiated 
meetings were the basis of DOT's January 1997 outreach report entitled 
``How To Keep America Moving: ISTEA; Transportation for the 21st 
Century,'' and helped to shape DOT's NEXTEA legislation. Finally, FRA 
participated in the Conference on State and Infrastructure Banks in 
Denver (Nov. 1995) and EPA's ISTEA Workshop in Philadelphia (Nov. 
1995). Total cost for these activities was approximately $6300, all for 
travel expenses.
    Fiscal year 1997: The Office continued the process of soliciting 
views on the impact of ISTEA and the need for changes by leading a 
focus group on ISTEA with a number of railroads meeting in Nashville, 
TN (Oct. 1996) and with state DOT officials at AASHTO's semi-annual 
meetings of its Standing Committee on Rail Transportation in 
Williamsburg, VA (April 1997). FRA participated in the Western 
Governors Association meetings on rail planning in Denver (May 1997) to 
share the experiences of various MPO's under ISTEA, and to discuss 
potential solutions to increased rail freight density problems. Total 
cost, again all for travel, was $1,885.

             National Highway Traffic Safety Administration

            Questions Submitted by Senator Richard C. Shelby
                           safety performance
    Question. Please prepare a table indicating the amount requested 
and the amount actually appropriated for the four programs in the 
Safety Performance Standards Budget for fiscal years 1995, 1996, and 
1997.
    Answer. Below is a budget comparison table for fiscal years 1995, 
1996, and 1997.

                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                      1995                   1996                   1997        
                  Programs                  --------------------------------------------------------------------
                                             Request  Appropriated  Request  Appropriated  Request  Appropriated
----------------------------------------------------------------------------------------------------------------
Vehicle safety.............................      500         500        850         642        589         929  
New car assessment.........................    2,460       1,685      2,792       1,707      3,542       2,786  
Fuel economy...............................      785         420      2,285         118      1,560          60  
Theft and Consum...........................  .......         100        110         106         50          50  
Motor vehicle title information............  .......  ............  .......     \1\ 890    .......  ............
                                            --------------------------------------------------------------------
      Total................................    3,745       2,705      6,037       3,463      5,741      3,825   
----------------------------------------------------------------------------------------------------------------
\1\ Funds administered by Traffic Safety Programs (pilot demo).                                                 

    Question. Please prepare a table for each of the four programs in 
the Safety Performance Standards Program, showing how all of the funds 
requested for fiscal year 1998 are intended to be spent, and please 
include in that table a comparison with the amount provided for each of 
those activities for fiscal year 1997. On a separate page, please 
justify the need for the requested increases.
    Answer. Below is a comparison tables for Safety Performance 
Standards Program for fiscal year 1997 and 1998. There were no 
requested increases. Use of fiscal year 1998 funds are as follows:

                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                         Fiscal years-- 
         Vehicle safety and consumer standards         -----------------
                                                          1997     1998 
------------------------------------------------------------------------
Quick Reaction Testing................................      424      424
Consumer Information..................................       90       90
Cost and Leadtime Analysis............................       75       75
Off-Set Frontal Testing...............................      340      340
                                                       -----------------
      Total...........................................      929      929
------------------------------------------------------------------------

    Quick Reaction Testing.--$424 thousand will be used to focus on 
responding to petitions and continue work trying to reduce on-road, 
untripped rollover crashes, prevent backup crashes involving small 
children, simplify and clarify the lighting standard, improve rear 
signaling lights, determine braking-in-a-curve performance requirements 
for large single unit trucks, standardize 5th percentile female, 3 year 
and 6 year-old child dummies, negotiated rulemaking on multi-stage 
vehicles, and continue work on vehicles adapted for use by people with 
disabilities and efforts to harmonize our safety standards with those 
of other countries.
    Consumer Information.--$90 thousand will be used to conduct 
marketing and consumer focus group research, to develop and disseminate 
consumer information regarding proper usage of anti-lock brakes, and to 
develop and disseminate consumer information materials pertaining to 
vehicle theft prevention and Uniform Tire Quality Grading Standards 
(UTQGS).
    Cost and Leadtime Analysis.--$75 thousand will be used to assess 
advanced air bag technologies.
    Off-Set Frontal Testing.--$340 thousand will be used to test 
vehicles as part of establishing a harmonized Federal Motor Vehicle 
Safety Standard for frontal offset crash testing.

                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                          Fiscal years--
               New car assessment program                ---------------
                                                           1997    1998 
------------------------------------------------------------------------
NCAP Testing............................................   2,538   2,538
Consumer Information....................................     247     247
                                                         ---------------
      Total.............................................   2,786   2,786
------------------------------------------------------------------------

    NCAP.--$2,538 thousand will be used to conduct a total of 70-75 
frontal and side crash tests. A determination has not been made as to 
the number of tests for each mode. With two crash modes, the agency 
will provide consumers with a better understanding of the potential 
safety that a vehicle may provide in high-speed front and side crashes.
    Consumer Information.--$247 thousand will be used to update and 
disseminate the ``Buying A Safer Car'' brochure, develop and 
disseminate a new ``Buying A Safer Car for Child Passengers'' brochure, 
update and improve the crash test information site on NHTSA's Web Page, 
and develop video news releases and public service announcements on the 
results of NCAP crash tests.

                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                          Fiscal years--
                  Fuel economy program                   ---------------
                                                           1997    1998 
------------------------------------------------------------------------
Fuel Economy Analysis...................................      60      60
------------------------------------------------------------------------

    Fuel Economy.--Will be used for ``plants and lines'' database to 
provide pertinent details on automobile manufacturing plants, such as 
products, capacities, employment levels, financial data, and planned 
changes.

                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                          Fiscal years--
                      Theft program                      ---------------
                                                           1997    1998 
------------------------------------------------------------------------
Theft Analysis..........................................      50      50
------------------------------------------------------------------------

    Theft.--Will be used to continue to issue the consolidated 
insurance information and provide an in-house analysis of FBI theft and 
recovery data on stolen motor vehicles from over 26,000 law enforcement 
jurisdictions in order to calculate the theft rates of motor vehicles.
    Question. Please explain in detail how the fiscal year 1997 
appropriated funds have been spent to conduct cost/benefit studies 
related to petitions and ongoing rulemaking activities?
    Answer. The Office of Planning and Consumer Programs is charged 
with conducting manufacturing cost, retail price, incremental weight, 
and lead time impact analyses of proposed Federal Motor Vehicle Safety 
Standards. Although Safety Performance Standards often develops its own 
estimates of the potential benefits of proposed Federal Motor Vehicle 
Safety Standards, ultimately the estimation of incremental safety 
benefits is the responsibility of the Associate Administrator for Plans 
and Policy. Safety Performance Standards does not use its contract 
program to conduct benefit studies. For fiscal year 1997, expenditures 
for cost, weight, and lead time impact assessments of new safety 
proposals totaled approximately $190,000. The vast majority of these 
funds ($155,000) are supporting cost and lead time analyses of advanced 
air bag systems. The remaining funds were expended on analyses of steel 
brackets for reflective tape on heavy duty trucks, and temperature and 
locking radiator cap technology.
    Question. In Senate Report 104-325, the Committee urged NHTSA to 
proceed with care in processing with the NPRM regarding elimination of 
the standard for placing triangular warning devices for certain 
disabled buses and trucks. What is the status of this rulemaking 
action, when can a final rule be expected?
    Answer. On June 16, 1997, the agency terminated its rulemaking 
action to eliminate the standard for warning triangles. This means the 
warning triangle standard will remain in effect. A copy of the 
termination notice is enclosed for your information.

  [Federal Register, June 16, 1997 (Volume 62, Number 115), Proposed 
                                 Rules]

                      DEPARTMENT OF TRANSPORTATION

             National Highway Traffic Safety Administration

                            49 CFR Part 571

                     [Docket No. 95-56, Notice 02]

                             RIN 2127-AF77

        Federal Motor Vehicle Safety Standards; Warning Devices

      AGENCY: National Highway Traffic Safety Administration, DOT.

                   ACTION: Termination of rulemaking.

                                summary
    In this document, NHTSA terminates rulemaking to rescind the 
Federal Motor Vehicle Safety Standard on triangular warning devices 
intended to be placed on the roadway behind disabled buses and trucks 
that have a gross vehicle weight rating (GVWR) greater than 10,000 lbs. 
Terminating this rulemaking relieves the Federal Highway Administration 
(FHWA) of the necessity for conducting a rulemaking proceeding to adopt 
its own requirements on triangular warning devices. Further, 
terminating this rulemaking will give the Department more effective 
enforcement authority regarding the performance of those devices. This 
rulemaking (61 FR 29337, June 10, 1996) was initiated as part of the 
agency's efforts to implement the President's Regulatory Reinvention 
Initiative.
                    for further information contact
    For technical issues: Mr. Richard Van Iderstine, Office of Vehicle 
Safety Standards, NPS-21, telephone (202) 366-5280, FAX (202) 366-4329.
    For legal issues: Ms. Dorothy Nakama, Office of Chief Counsel, NCC-
20, telephone (202) 366-2992, FAX (202) 366-3820.
    Both may be reached at NHTSA, 400 Seventh Street, SW, Washington, 
DC 20590.
                       supplementary information

             President's Regulatory Reinvention Initiative

    Pursuant to the March 4, 1995 directive ``Regulatory Reinvention 
Initiative'' from the President to the heads of departments and 
agencies, NHTSA undertook a review of its regulations and directives. 
During the course of this review, NHTSA identified regulations that it 
could propose to rescind as unnecessary or to amend to improve their 
comprehensibility, application, or appropriateness. Among the 
regulations identified for potential rescission is Federal Motor 
Vehicle Safety Standard No. 125, Warning devices (49 CFR Sec. 571.125).

                     Background of Standard No. 125

    Federal Motor Vehicle Safety Standard (FMVSS) No. 125, Warning 
devices, specifies requirements for warning devices that do not have 
self-contained energy sources (unpowered warning devices) and that are 
designed to be carried in buses and trucks that have a gross vehicle 
weight rating (GVWR) greater than 10,000 lbs. The unpowered warning 
devices are intended to be placed on the roadway behind a disabled 
vehicle to warn approaching traffic of the vehicle's presence. The 
Standard does not apply to unpowered warning devices designed to be 
permanently affixed to the vehicle. The purpose of the Standard is to 
reduce deaths and injuries due to rear-end collisions between moving 
traffic and stopped vehicles.
    The standard requires that the unpowered warning devices be 
triangular, covered with orange fluorescent and red reflex reflective 
material, and open in the center. These characteristics are intended to 
assure that the warning device has a standardized shape for quick 
message recognition, can be readily observed during both daytime and 
nighttime, and provides limited wind resistance so that it does not 
blow over when deployed.
    NHTSA has never required that any new vehicle be equipped with the 
Standard No. 125 warning device or any other warning device. However, 
as explained below, FHWA, which has authority to regulate interstate 
commercial vehicles-in-use, mandates that operators of those vehicles 
carry and use unpowered warning devices meeting Standard No. 125, 
fusees or flares.

                  Previous Changes to Standard No. 125

    Before 1994, Standard No. 125 applied to unpowered warning devices 
that are designed to be carried in any type of motor vehicle. On May 
10, 1993 (58 FR 27314), NHTSA issued a notice of proposed rulemaking 
(NPRM) to amend Standard No. 125 so that the Standard applied only to 
warning devices that are designed to be carried in buses and trucks 
that have a gross vehicle weight rating (GVWR) greater than 10,000 lbs.
    NHTSA proposed to narrow the scope of Standard No. 125 in order to 
provide manufacturers of unpowered warning devices with greater design 
freedom and to relieve an unnecessary regulatory burden on industry. At 
the specific request of FHWA, the agency proposed to retain the 
requirements for warning devices for buses and trucks with a GVWR 
greater than 10,000 lbs. This aspect of NHTSA's proposal supported 
FHWA's regulation of commercial motor vehicles under the Federal Motor 
Carrier Safety Regulations (FMCSR) (49 CFR parts 350-399). Section 
393.95 of the FMCSR requires either that three Standard No. 125 warning 
devices or specified numbers of fusees or flares be carried on all 
trucks and buses used in interstate commerce.
    NHTSA limited the applicability of Standard No. 125, as proposed, 
in a final rule published on September 29, 1994 (59 FR 49586). In the 
final rule, NHTSA stated that it was retaining Standard No. 125 in its 
narrowed form largely to ensure the continued availability of 
standardized unpowered warning devices which FHWA could specify as a 
means of complying with its warning device requirements for commercial 
vehicle operators.

                Proposed Rescission of Standard No. 125

    After reviewing Standard No. 125 in light of the President's 
Regulatory Review Initiative, NHTSA tentatively determined that 
retaining Standard No. 125 is not necessary to ensure the continued 
availability of unpowered warning devices. Accordingly, the agency 
developed a rescission proposal which reflected written and oral 
comments from FHWA staff. It published the NPRM on June 10, 1996 (61 FR 
29337).
    In the NPRM, NHTSA suggested that if Standard No. 125 were 
rescinded, FHWA would have two options. First, instead of specifying 
warning devices meeting NHTSA's Standard No. 125, FHWA could specify 
devices meeting criteria adopted by FHWA and placed in its own 
regulations. More specifically, FHWA could adopt the current 
manufacturing standards for the warning devices, i.e., those in 
Standard No. 125, as an appendix to the Federal Motor Carrier Safety 
Regulations. Section 393.95 would be revised to reference the newly 
created appendix as opposed to Section 571.125.
    Second, FHWA could work with an industry voluntary standards 
setting organization such as the Society of Automotive Engineers (SAE) 
to develop an industry standard on unpowered warning devices containing 
requirements similar to those in Standard No. 125. Once those 
requirements were developed, FHWA could incorporate them by reference 
in Section 393.95.

                 Public Comments on Proposed Rescission

    NHTSA received mixed comments in response to its proposal to 
rescind Standard No. 125. Two commenters, Chrysler and Ford, supported 
NHTSA's proposal to rescind the Standard. Chrysler stated its agreement 
with NHTSA that Standard No. 125 is unnecessary ``since devices meeting 
these requirements are already stipulated by the FHWA for commercial 
carriers.'' Ford suggested that Standard No. 125's provisions could be 
transferred to FHWA's Federal Motor Carrier Safety Regulations (FMCSR).
    Other commenters, including 3M Company, Advocates for Highway and 
Auto Safety (Advocates), Dr. Merrill J. Allen, American Highway Users 
Alliance (AHUA), American Trucking Associations (ATA), Automotive Parts 
and Accessories Association (APAA), Center for Auto Safety (CAS), 
Cortina Tool and Molding and James King Company (in one submission) 
(Cortina/King), National Private Truck Council (NPTC), Sate-Lite 
Manufacturing Company, Transportation Safety Equipment Institute 
(TSEI), Truck Manufacturers Association (TMA) and several members of 
the U.S. House of Representatives opposed the proposed rescission of 
Standard No. 125. The commenters offered the following reasons for 
their opposition:
1. Standard No. 125 Has Value
    The commenters opposed to rescinding Standard No. 125 generally 
stated that the Standard has value, and expressed various reasons for 
their belief. Sate-Lite, a triangular warning device manufacturer, 
stated that it did not consider the Standard's performance requirements 
unnecessary or a burden. 3M, which operates a fleet of over 5200 
vehicles, stated that: ``Each of the criteria in the standard represent 
items of value to the users of those devices.'' 3M stated that 
deviations from these criteria would reduce and possibly eliminate this 
value.
    Other commenters stated that Standard No. 125 is needed simply 
because it ensures uniformity in the triangular warning devices. 
Erosion of uniformity would impair the ability of those devices 
designed to meet the current standard to communicate hazards 
effectively. 3M and APAA stated that with the recent increases in the 
nation's speed limits, there is a greater need for motorists to have 
advance, distinctive warning of a disabled vehicle ahead, and the 
triangular warning device meets that need. Cortina/King commented that 
Standard No. 125 devices are the only safe warning devices for 
deployment in conjunction with a stopped vehicle carrying flammable 
materials.
    TSEI commented that NHTSA appears ready to adopt an ``anything 
goes'' approach that would confuse motorists and violate the agency's 
longstanding policy of maintaining consistency in visual signals to 
motorists. TSEI contrasted the present rulemaking with NHTSA's past 
interpretations of Standard No. 108, Lamps, reflective devices, and 
associated equipment. Those interpretations emphasized the safety 
importance of avoiding even momentary confusion of motorists as to the 
meaning of the supplemental lighting signals.
2. State Regulation and International Harmonization Issues
    Related to the lack of uniformity issue, Advocates, ATA, and TSEI 
expressed concern that the States would regulate in the absence of 
Standard No. 125. Advocates, AHUA, and TSEI also suggested that 
rescinding Standard No. 125 would conflict with NHTSA's recently 
announced efforts (see 61 FR 30657, June 17, 1996) to harmonize the 
FMVSSs with international standards.
3. NHTSA Administration and Enforcement of Triangular Warning Devices 
        is Preferred
    Many commenters expressed the view that NHTSA has more effective 
statutory authority to administer and enforce a unpowered triangular 
warning device standard than FHWA. Some commenters raised the 
possibility that there could be a period after NHTSA rescinds the 
Standard and before FHWA enacts it, when there would be no triangular 
warning device regulation at all. Some commenters incorrectly 
speculated that there had not been any consultation between NHTSA and 
FHWA during NHTSA's development of its proposal.
4. Rescinding the Standard Would Be ``Arbitrary and Capricious''
    Some commenters stated that in its proposed rescission of Standard 
No. 125, NHTSA did not show that there is no safety need for the 
Standard, and in absence of showing no safety need, NHTSA has no legal 
authority to rescind the standard.

                            Agency Decision

    In response to the President's Regulatory Reinvention Initiative, 
NHTSA carefully examined Standard No. 125. Although NHTSA has a safety 
standard for warning triangles, FHWA is the part of the Department that 
has the greatest program responsibilities for warning triangles. It is 
FHWA that requires vehicle operators to carry warning triangles or 
other warning devices in vehicles and it is FHWA that requires vehicle 
operators to use warning triangles or other warning devices to alert 
other motorists of the presence of a disabled vehicle. In issuing its 
proposal, NHTSA believed it would make the government program for 
warning triangles more effective and more efficient if the FHWA were 
also responsible for establishing the performance requirements for 
these warning devices.
    After reviewing the public comments on this proposal and after 
further consultation with FHWA, NHTSA believes that the current 
division of program responsibilities and regulatory requirements has 
served the public well. In fact, the current division of 
responsibilities assures the public the benefits of the joint expertise 
of NHTSA and FHWA working together on issues that arise in connection 
with these warning devices. In addition, the proposal would have forced 
FHWA to expend resources to promulgate a rule that would be identical 
to the rule NHTSA rescinded. After reconsidering all these factors, 
NHTSA has concluded that its proposal to rescind the warning triangle 
standard should be terminated. This notice announces that termination.
    Potential rulemaking actions may arise from one or more pending 
petitions. Because it will retain Standard No. 125, NHTSA will proceed 
with its consideration of pending petitions for rulemaking to amend 
Standard No. 125 from the TSEI and Gault Industries.
                               authority
    49 U.S.C. 322, 30111, 30115, 30117, and 30166; delegations of 
authority at 49 CFR 1.50 and 501.8.
    Issued on: June 10, 1997.
                                         L. Robert Shelton,
          Associate Administrator for Safety Performance Standards.

               [FR Doc. 97-15746 Filed 6-13-97; 8:45 am]

                                 ______
                                 
    Question. Please list the purpose, amount and recipients of your 
contracts over $50,000 issued during fiscal year 1997 and fiscal year 
1996.
    Answer. Below is a list of contracts over $50,000 issued during 
fiscal year 1997 and fiscal year 1996.

Fiscal year 1996:on                                               Amount
    Study rear back up mirrors to identify which ones improve 
      the rear view for drivers of commercial vans and certain 
      delivery trucks--Scientex Inc...........................   $60,364
    Identify baseline child restraint designs and any changes 
      required to conform to the ISOFIX configuration--Ludtke 
      & Associates............................................    70,626
    Focus group to examine potential countermeasures to the 
      problems associated with air bags and children--Global 
      Exchange, Inc...........................................    91,984
    21 frontal barrier crash tests for MY 96 NCAP--MGA........   256,734
    6 frontal barrier crash tests for MY 96 NCAP--MGA.........   139,482
    5 frontal barrier crash tests for MY 96 NCAP--TRC.........   109,675
    9 frontal barrier crash tests for MY 96 NCAP--Calspan.....   147,295
Fiscal year 1997:
    Study the feasibility of possible upgrade to FMVSS No. 
      218, Motorcycle Helmets--USC, Head Protection Research 
      Laboratory..............................................    50,000
    Conduct research on consumer knowledge of vehicle safety 
      and focus group sessions to determine consumer 
      perceptions and needs about vehicle safety--Global 
      Exchange, Inc...........................................    75,000
    9 frontal barrier crash tests for MY 97 NCAP--Karco 
      Engineer- ing...........................................   198,893
    8 frontal barrier crash tests for MY 98 NCAP--Calspan.....   144,840
    11 side impact tests for MY 97 NCAP--MGA..................   188,340
    16 side impact tests for MY 97 NCAP--MGA..................   262,288
    6 side impact tests for MY 98 NCAP--MGA 160,4568 offset 
      frontal tests--Karco....................................   113,052
    Quality assurance for NCAP data--Conrad Technologies......    85,000

    Question. How has NHTSA reduced the average time taken to process a 
rulemaking action?
    Answer. The time to process rulemaking has always been of concern 
to NHTSA. A team comprised of members from the various offices within 
NHTSA was established to reviewed the complete rulemaking process. As 
part of this assignment, the team interviewed each office involved in 
the rulemaking process to obtain what information was necessary to 
reach a rulemaking decision and how this information could best be 
collected. After analyzing all of the data, the team recommended 
several administrative changes. These changes were accepted and 
adopted. One of the major changes was to establish a team for each 
significant rulemaking. This approach will promote efficiency and 
quality by encouraging staff from different offices within the agency 
to work collaboratively. A team can be established for non-significant 
rulemaking if an office deems one is necessary. Another major change 
was to allow certain Preambles to be written in the Safety Performance 
Standards office and cleared through the agency instead of having the 
Chief Counsel's Office responsible for writing all Preambles. This can 
save approximately two to three months of processing time. Even though 
the administrative changes recommended by the Team are currently being 
implemented, the rulemaking process will continue to be reviewed to see 
if these changes are in fact improving the quality of the rulemaking 
and reducing the average time to process a rulemaking action.
    Question. How have you improved your cost/benefit analyses to help 
consumers?
    Answer. The agency is continuously trying to improve its economic 
assessments and regulatory evaluations. The agency has developed data 
bases on motor vehicle crashes that are second to none in the world. 
The agency has been recognized by the Office of Management and Budget 
as the premier example of how regulatory analyses should be conducted 
in the Federal Government. A cost/benefit analysis for consumers is the 
central focus of these analyses. We carefully examine safety benefits 
(the number of lives saved, injuries reduced and property damage 
reduced), consumer costs, and economic costs. The economic assessments 
and regulatory evaluations include analyses required by Executive Order 
12866, the Regulatory Flexibility Act of 1990, and the Unfunded 
Mandates Reform Act of 1995.
    Question. What is the number and nature of the key rulemaking 
activities that are now before NHTSA?
    Answer. Of the current 108 pending rulemaking activities, 
approximately 30 are considered key rulemakings. The majority of these 
activities address the issues of air bag aggressiveness particularly as 
they relate to the safety of children. A significant number also relate 
to the establishment of new and varying sizes of dummies to be used for 
compliance testing of new air bags. Other major activities include 
labeling requirements to improve consumer information, warning labels 
for child restraint systems used in motor vehicles with air bags, 
uniform child restraint attachment systems, new technologies for 
interior impact protection, exemptions for businesses that modify 
vehicles to accommodate persons with disabilities from the ``make 
inoperative'' prohibitions, and the establishment of a regulatory 
negotiation for certification of multi-stage vehicles.
    Question. Please prepare for the record a list of all final 
rulemakings that have been issued since you submitted a similar list 
last year.
    Answer. Below is a list of all final rulemakings that were issued 
from June 1996 through May 1997.

1996:   Description                                             Std./Pt.
    Revises the whip resistance test conditions to permit the 
      use of a supplemental support in attaching certain brake 
      hose assemblies for the purpose of compliance testing...       106
    Requires that the rear of truck tractors be equipped with 
      retroreflective material similar to that required on the 
      rear of the trailers they tow to increase nighttime 
      conspicuity. Adopts new photometric requirements for 
      motorcycle headlamps....................................       108
    Technical amendment to four standards (109, 117, 119, 120) 
      and the regulation on the identification and record 
      keeping to delete obsolete dates, update statutory 
      citations, correct typographical errors, and update the 
      designations of the offices to which requests and 
      reports are submitted (part of the President's 
      regulatory reinvention initiatives).....................   109/574
    Transfers most of the requirements to the safety standard 
      on lamps, reflective devices, and associated equipment 
      (FMVSS No. 108) and the remaining requirements of the 
      standard are rescinded (part of the President's 
      regulatory reinvention initiatives).....................       112
    Combines the vehicle identification number (VIN) 
      requirements in a single regulation, previously, the VIN 
      requirements were specified in two separate regulations, 
      FMVSS No. 115 and Pt. 565 (part of the President's 
      regulatory reinvention initiatives).....................   115/565
    Amends the reservoir requirements for trucks, buses and 
      trailers equipped with air brakes amends the location, 
      labeling, color, activation protocol, and photometric 
      intensity of antilock brake system (ABS) malfunction 
      indicator lamps on the exterior of trailers and trailer 
      converter dollies. Amends the air pressure at which a 
      bus's air compressor must automatically activate........       121
    Rescinds FMVSS No. 126 and combines its provisions with 
      Pt. 575.103 to make the requirements easier to 
      understand and apply (part of the President's regulatory 
      reinvention initiative).................................   126/575
    Permits the installation of a new item of motor vehicle 
      glazing, Item 4A--rigid plastic for use in side windows 
      in motor vehicles to provide greater flexibility for 
      manufacturers to develop and use more aerodynamic, 
      lighter weight glazing designs, resulting in lower fuel 
      consumption.............................................       205
    Grants request for a phase-in of the compliance date of 
      the new requirements and establishes the usual reporting 
      and record keeping requirements necessary for 
      enforcement of a phase-in and clarifies the definition 
      of ``trunk lid'' with respect to vehicles in which the 
      seatbacks of rear seats fold down to provide additional 
      cargo space.............................................       206
    Requires vehicles with air bags to bear three new warning 
      labels, two of the labels replace existing labels on the 
      sun visor, the third is a temporary label on the dash...       208
    Addresses the use of child harnesses and backless child 
      restraints in aircrafts. Corrects and clarifies 
      provisions made in the July 1995 final rule and permits 
      manufacturers to produce belt-positing seats with a mass 
      of up to 4.4 kg (rather than limit the mass to 4 kg) and 
      permits them to use the word ``mass'' in labeling child 
      seats...................................................       213
    Amends certain labeling requirements, specifically the 
      inspection interval and deletes references to certain 
      pamphlets...............................................       304
    Publishes the final data on thefts of model year (MY) 1994 
      passenger motor vehicles that occurred in calendar year 
      (CY) 1994...............................................       541
    Updates the list of passenger motor vehicle insurers that 
      are required to file reports of motor vehicle theft loss 
      experiences.............................................       544
    Amends the specifications for the hybrid III test dummy 
      for use in FMVSS No. 208 compliance tests...............       572
1997:
    As a result of a negotiated rulemaking, this standard 
      adopts an option to existing headlamp aiming 
      specifications which is intended to improve the 
      objectivity and accuracy of the motor vehicle headlamp 
      aim. Modifies the final rule requiring that the rear of 
      truck tractors be equipped with retroreflective material 
      similar to that required on the rear of the trailers 
      they tow to increase nighttime conspicuity..............       108
    Includes another phase-in option to allow manufacturers to 
      carry forward credits for vehicles certified to the new 
      requirements prior to the beginning of the phase-in 
      period..................................................       201
    Extends until September 1, 2000, the time period during 
      which vehicle manufacturers are permitted to offer 
      manual cutoff switches for the passenger-side air bag 
      for vehicles without rear seats or with rear seats that 
      are too small to accommodate rear facing infant seats. 
      Temporarily amend the standard to ensure that vehicle 
      manufacturers can quickly depower all air bags so that 
      they inflate less aggressively..........................       208
    Makes further amendment to previous amendment so that 
      certain exclusions from requirements in two other 
      standards are available for vehicle certification to the 
      unbelted barrier test will also be certified to the 
      alternative sled test...................................       208
    Clarifies and allows additional wording in the required 
      text of the warning labels on rear-facing child seats on 
      an interim basis........................................       213
    Established average fuel economy standard for light trucks 
      manufactured in model year (MY) 1999....................       533
    Adopts modifications to the Hybrid III test dummy used in 
      compliance testing for neck measurements under FMVSS No. 
      208.....................................................       572

             vehicle safety and consumer standards program
    Question. In fiscal year 1997, an additional $340,000 was added to 
this program to establish a federal motor vehicle safety standard for 
frontal offset crash testing. What is the status of this standard? How 
long will it take before it is completed?
    Answer. Congress provided $340,000 in fiscal year 1997 funding to 
``be used toward establishing a federal motor vehicle safety standard 
for frontal offset crash testing.'' Further, Congress wanted these 
activities to reflect ongoing efforts to enhance international 
harmonization of safety standards. In response to this directive, the 
agency is studying the recently (November 1996) adopted European Union 
(EU) directive as a potential offset testing crashworthiness standard. 
With the $340,000 provided in fiscal year 1997, the agency is 
conducting eight offset crash tests to evaluate this EU offset test 
with both 50th percent male and 5th percentile female dummies (see test 
matrix). The agency is coordinating this activity with the safety 
community and the vehicle manufacturers through NHTSA's Motor Vehicle 
Safety Research Advisory Committee (MVSRAC) and has had an initial 
meeting with EU representatives. It is not expected that the EU 
directive could be adopted as a replacement for Federal Motor Vehicle 
Safety Standard (FMVSS) No. 208, ``Occupant Crash Protection,'' but is 
being considered as an option of harmonization to the standard as a 
supplemental regulation. A status report will be delivered to Congress 
on this offset testing activity in July 1997.
    In fiscal year 1998, the agency has requested an additional 
$340,000 for this effort. fiscal year 1998 crash test plans will 
address the repeatability and reproducibility of the EU test procedure, 
the performance of additional dummy sizes in frontal crashes, and the 
feasibility of the test procedure for lighter or heavier vehicles. 
After completion of these testing activities, adequate information 
should be available to conduct the requisite benefit and cost analysis 
to evaluate the feasibility of promulgating a supplemental offset test 
requirement to FMVSS 208.

                               TEST MATRIX                              
------------------------------------------------------------------------
                                                Dodge    Toyota    Ford 
                 Frontal test                    Neon    Camry    Taurus
------------------------------------------------------------------------
Full \2\ 48 kph with 50th percent male dummy,                           
 unrestrained \2\............................  ( \1\ )  ( \1\ )  ( \1\ )
Full \2\ 56 kph with 50th percent male dummy,                           
 restrained \3\..............................  ( \1\ )  ( \1\ )  ( \1\ )
Full \2\ 48 kph with 5th percent female                                 
 dummy, restrained...........................  .......  .......  .......
40 percent offset \2\ 60 kph with 50th                                  
 percent male dummy, restrained \4\..........  ( \1\ )  .......  .......
40 percent offset \2\ 64 kph with 50th                                  
 percent male dummy, restrained \5\..........  ( \1\ )  ( \1\ )  ( \1\ )
40 percent offset \2\ 60 kmph with 5th                                  
 percent female dummy, restrained............  .......  .......  .......
------------------------------------------------------------------------
\1\ Data already exists for this test condition and make model          
  combination.                                                          
\2\ NHTSA FMVSS No. 208 crash test results.                             
\3\ NHTSA NCAP crash test results.                                      
\4\ Transport Canada test results.                                      
\5\ IIHS EU test results.                                               

                       new car assessment program
    Question. Why did the budget for this program increase 63 percent 
from 96 to 97?
    Answer. The principle reason for this increase was the new 
initiative to provide side impact safety information to the US 
consumer. Twenty-six vehicles have been tested in fiscal year 1997 with 
the resulting data providing relative side impact crash performance 
information to consumers on 46 percent of the model year 1997 passenger 
cars. Other minor increases were due to inflation in the costs of 
vehicles and testing.
    Question. How much front and side impact safety information is 
available on the Internet?
    Answer. For model year 1997, the agency's Web Site has frontal 
safety information on 152 vehicles accounting for about 86 percent of 
new vehicles sold in the USA. The Web Site has side impact safety 
information on forty-one cars for model year 1997 accounting for about 
46 percent of new cars sold in the USA.
    During fiscal year 1997, the agency worked diligently to make the 
NHTSA Web Site easy to use and to make the information clear. The 
quality & clarity of Web Site has been greatly improved during this 
period. The numbers of consumers visiting NCAP (on the Web Site) grew 
from an average of about 900 visitors a week in June 1996 to an average 
of thirty-four hundred visitors a week in May 1997.
    For model years 1995 and 1996, the agency has the safety ratings 
for frontal impact on the Web Site. Because of staff limitations, we do 
not yet have the pre-1995 NCAP information on the Web Site. At this 
time, the agency is bringing in a direct support contractor to place 
the previous year's NCAP information on the Web Site.
    The agency's Web Site provides direct links for consumers to crash 
test information at other sites. We provide links to front impact 
safety information at sites in Japan, Australia, and the Insurance 
Institute for Highway Safety.
    Question. Please discuss the cooperative efforts NHTSA has 
established with foreign NCAPS. How much do these cost? What do NHTSA 
and consumers gain from these?
    Answer. The success of United States NCAP prompted international 
efforts. As early as 1990, representatives from Japan and Australia met 
with the agency to establish NCAP consumer information programs in 
their countries. Later, meetings were held with European NCAP 
representatives. The first Australian NCAP results were published in 
1993. These test data showed that vehicles sold in the Australian 
market had a lower level of safety performance than those sold in the 
U.S. market. Japan released their first data on full frontal crash 
ratings in March of 1996. The Euro NCAP released their first NCAP 
results in February 1997.
    At the Fifteenth International Conference on the Enhanced Safety of 
Vehicles in May 1996, a special session was conducted specifically to 
address the international crashworthiness rating systems and to assure 
that harmonization be considered by the different countries in the 
development and execution of these programs. Representatives from all 
major countries attended this session and discussed their activities 
and the potential for improved harmonization.
    These cooperative efforts lead to international consistency and 
harmonization in many of the aspects of the programs. This is very 
beneficial for both consumers and vehicle manufacturers. The Japan and 
Australian NCAP's use identical full frontal test procedures. The 
offset frontal test procedures used in Australia and Europe are the 
same as those used by the Insurance Institute for Highway Safety. Many 
of the approaches for presenting information to consumers are similar. 
The sharing of information and the international cooperation 
significantly enhance the knowledge of each individual country in 
understanding, evaluating, and developing the best methods for 
conducting consumer programs. The agency gains from these cooperative 
efforts because it leads to establishing universal procedures such that 
data generated in one country may be directly comparable to United 
States NCAP data. The consumer in the other country gains because a 
safety rating process, developed in the United States, is now available 
in his/her country.
    As with any harmonization effort, a major cost is travel. Because 
the agency's travel budget has been extremely limited, the travel has 
been from the foreign countries to the United States. Consequently, 
these cooperative efforts with foreign NCAP programs have had little 
direct cost to NHTSA.
    Question. Please provide an update on how the funds appropriated 
for fiscal year 1997 were used to expand NCAP. How many tests have been 
conducted, and what were the results?
    Answer. The fiscal year 1997 NCAP funds were used to continue 
frontal NCAP testing, to maintain promotional and consumer activities, 
and to expand NCAP into side impact testing. The following tables 
provide the costs, number of vehicles tested, and test results.

Detailed breakdown of fiscal year 1997 NCAP costs

Frontal Impact--NCAP fiscal year 1997:                     Budget amount
    Vehicle Purchase (42).....................................  $698,000
    Vehicle Testing (42)......................................   914,000
    Dummy Calibration & Refurbishing..........................    76,000
    Administrative Costs......................................\1\ 17,000
                    --------------------------------------------------------------
                    ____________________________________________________

        Total................................................. 1,705,000
                    ==============================================================
                    ____________________________________________________
Side Impact NCAP fiscal year 1997:
    Vehicle Purchase (26).....................................   409,000
    Vehicle Testing (26)......................................   385,000
    Dummy Calibrations & Refurbishing.........................    38,000
    Administrative Cost....................................... \1\ 8,000
                    --------------------------------------------------------------
                    ____________________________________________________

        Total.................................................   840,000
                    ==============================================================
                    ____________________________________________________
NCAP Promotional: Promotional Material (Brochures, Radio & 
    Print Spots and Internet Dissemination)...................   150,000
Program: Reproduce and Disseminate Consumer Material..........    97,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Total...................................................   247,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Total fiscal year 1997 NCAP Costs....................... 2,792,000

\1\ Administrative costs include computer support, hot copy, printing, 
and distribution costs.

                                        1997 FRONTAL IMPACT NCAP VEHICLES                                       
----------------------------------------------------------------------------------------------------------------
                                                                                              Star ratings      
            Manufacturers                        Model                 Body style      -------------------------
                                                                                           Driver     Passenger 
----------------------------------------------------------------------------------------------------------------
Chrysler.............................  Caravan.................  MPV..................            4            5
                                       Cherokee................  MPV..................            3            3
                                       Dakota Excab............  PU...................            4            4
                                       Neon....................  2DR..................      ( \1\ )      ( \1\ )
                                       Ram Excab...............  PU...................            4            3
                                       Sebring.................  Conv.................            4            4
                                       Wrangler................  MPV..................            4            5
Ford.................................  Club Wagon..............  VAN..................            3            4
                                       Escort..................  4DR..................            3            4
                                       Escort 98...............  2DR..................      ( \2\ )      ( \2\ )
                                       Expedition..............  MPV..................            4            5
                                       F-150...................  PU...................            4            5
                                       Ranger..................  PU...................            4            4
                                       Windstar................  VAN..................            5            5
GM...................................  Blazer..................  MPV..................            3            1
                                       C/K.....................  PU...................            5            4
                                       C/K-Excab...............  PU...................            5            4
                                       Cavalier................  2DR..................            4            4
                                       Cavalier................  4DR..................            4            3
                                       Deville.................  4DR..................            4            4
                                       Grand Prix..............  4DR..................            4            4
                                       Grand AM................  2DR..................            4            5
                                       Grand AM................  4DR..................            5            4
                                       Lesabre.................  4DR..................            4            4
                                       Malibu..................  4DR..................            4            4
                                       S-10 Excab..............  PU...................            3            2
                                       Tahoe...................  MPV..................            4            4
                                       Venture.................  VAN..................            4            4
Honda................................  Accord..................  2DR..................            4            4
Hyundai..............................  Accent..................  4DR..................            3            4
KIA..................................  Sephia..................  4DR..................            4            4
                                       Sportage................  MPV..................            3            3
Mitsubishi...........................  Galant..................  4DR..................            4            4
                                       Montero.................  MPV..................            3            3
Nissan...............................  200SX...................  2DR..................            5            4
                                       Pathfinder..............  MPV..................            3            3
Toyota...............................  Camry...................  4DR..................            4            4
                                       Paseo...................  2DR..................            4            4
                                       RAV4....................  MPV..................            3            3
                                       Tacoma Excab............  PU...................            1            3
                                       Tercel..................  2DR..................            4            4
Volvo................................  960.....................  4DR..................            4            4
----------------------------------------------------------------------------------------------------------------
\1\ Data being reviewed.                                                                                        
\2\ To be tested.                                                                                               


                                      1997 SIDE IMPACT NCAP PASSENGER CARS                                      
----------------------------------------------------------------------------------------------------------------
                                                                                              Star ratings      
            Manufacturers                        Model                 Body style      -------------------------
                                                                                           Driver     Passenger 
----------------------------------------------------------------------------------------------------------------
Chrysler.............................  Stratus.................  4DR..................            3            2
                                       Intrepid................  4DR..................            4            3
Ford.................................  Escort..................  4DR..................            3            3
                                       Thunder-Bird............  2DR..................            3            1
                                       Crown Victoria..........  4DR..................            4            4
                                       Taurus..................  4DR..................            3            3
                                       Contour.................  4DR..................            3            4
GM...................................  Deville.................  4DR..................            4            4
                                       Malibu..................  4DR..................            1            3
                                       Cavalier................  2DR..................            1            2
                                       Camaro..................  2DR..................            3            4
                                       Lumina..................  4DR..................            4            3
                                       Grand AM................  4DR..................            1            3
                                       Saturn SL...............  4DR..................            3            3
Honda................................  Accord..................  4DR..................            2            3
                                       Civic...................  4DR..................            3            3
Hyundai..............................  Sonata..................  4DR..................            1            2
Kia..................................  Sephia..................  4DR..................            2            1
Mazda................................  626.....................  4DR..................            2            3
Mitsubishi...........................  Galant..................  4DR..................            3            2
Nissan...............................  Maxima..................  4DR..................            4            3
Subaru...............................  Legacy..................  4DR..................      ( \1\ )      ( \1\ )
Toyota...............................  Corolla.................  4DR..................            3            3
                                       Camry...................  4DR..................            3            3
                                       Tercel..................  2DR..................            3            4
Volvo................................  850.....................  4DR..................            4     ( \2\ ) 
----------------------------------------------------------------------------------------------------------------
\1\ Data being reviewed.                                                                                        
\2\ No data available.                                                                                          

    Question. How will NHTSA utilize the fiscal year 1998 requested 
funding to provide improved information regarding full frontal and side 
crashes to consumers?
    Answer. The attached tables contain the projected breakdown of the 
fiscal year 1998 NCAP costs.

Impact Testing NCAP fiscal year 1998 Budget Plans:         Budget amount
    Vehicle Purchase (70).....................................$1,093,000
    Vehicle Testing (70)...................................... 1,161,000
    Dummy Calibration and Refurbishing........................    70,000
    Quality Assurance of NCAP Data............................   110,000
    Video Production..........................................    25,000
    Administrative Costs......................................\1\ 80,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Total................................................... 2,539,000
                    ==============================================================
                    ____________________________________________________
NCAP Promotional Program:
    Promotional Material (Brochures, Radio and Print Spots and 
      Internet Dissemination).................................   150,000
    Reproduce and Disseminate Consumer Material...............    97,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Total...................................................   247,000
                    --------------------------------------------------------------
                    ____________________________________________________

    NHTSA Staff (4)...........................................   278,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Total fiscal year 1998 NCAP Costs....................... 3,064,000

\1\ Administrative costs include computer support, hot copy, printing, 
and distribution costs.

    Question. Please provide a detailed discussion on how this 
information will be distributed to consumers, and what will be 
contained in that information.
    Answer. NCAP data are made available through regular press releases 
as the tests are completed. These press releases are distributed to all 
the major news services, consumer groups, magazines, and many other 
associations. Over 1,000 different organizations with readership in the 
tens of millions receive these press releases. The data will be 
separate Star ratings for frontal impact and for side impact.
    At the time of the press release, the frontal and side impact NCAP 
Star ratings will be placed on the agency's Web Site. The NCAP portion 
of the Web Site was running about 3,400 visitors a week in May 1997.
    In addition to the Star ratings, the test result numbers recorded 
by the dummies will be placed on the Web Site for those who wish 
greater detail.
    In 1995, a joint effort with the American Automobile Association 
and the Federal Trade Commission led to the development and 
distribution of 230,000 copies of a brochure Buying a Safer Car which 
contains NCAP results. It is reasonable to project that a half million 
copies of the 1997 Buying a Safer Car will be distributed. The 1997 
brochure included side impact crash test results for the first time. 
Other evidence of the success of this brochure is that, for the first 
year, NHTSA has been asked by numerous manufacturers to include 
additional vehicles.
    Consumer Reports, a popular publication of Consumers Union (CU), 
annually uses the NCAP data in a special issue on automobiles. In 
discussions with CU editors, it was verified that this annual 
automotive issue is consistently the most popular issue published by 
CU. The sales of their annual issue exceed over five million copies.
    The Car Book, originally published by the Department of 
Transportation in 1980, is now published each year by Jack Gillis of 
the Consumer Federation of America. This publication also uses the 
crash test data from NCAP tests as the principal source of safety 
information. Sales of The Car Book average approximately 75,000 per 
year.
    The United Services Automotive Association (USAA) Foundation, the 
nation's sixth largest insurer of motor vehicles, publishes a very 
comprehensive booklet, ``The Car Guide'', which provides its members 
with information regarding passenger safety, damage ability, theft 
risk, and insurance experience of various vehicles. The safety 
information is based on the NCAP test results. ``The Car Guide'' is 
distributed annually to USAA's approximately two million members.
    The exposure to the public of the NCAP data through the different 
media also results in many individual inquiries to NHTSA.
    During fiscal year 1997, NHTSA will conduct focus groups to test 
whether the public would find a combined frontal and side impact NCAP 
rating useful. The focus groups will also examine the usefulness of the 
present star rating system currently used for NHTSA is comprehensible 
to the public. This activity will be one step towards a summary rating 
of a vehicle's crashworthiness.
    Question. How does depowering of air bags affect funding needs for 
NCAP? Does depowering suggest a need for additional tests?
    Answer. The agency's fiscal year 1998 NCAP funding request did not 
anticipate the depowering of air bags. Normally vehicles, previously 
tested in NCAP, which are not changed in the new model year (MY), are 
carried forward to provide consumers with comparative safety 
information on a large percentage of the new vehicles. For MY 1997, 
this practice provided consumers with comparative frontal crash safety 
information on more than 85 percent of the fleet. From information that 
the agency has already gathered from the manufacturers, it is known 
that a large percentage of MY 1998 vehicles will have depowered air 
bags. The effect of depowered air bags on NCAP results is not known. 
Therefore, any previously tested vehicle without depowered air bags 
cannot be carried forward to represent a MY 1998 vehicle with depowered 
air bags. To provide information to consumers on any make/model vehicle 
with depowered air bags, NCAP frontal performance will need to be 
assessed. NCAP gave frontal safety ratings on 85 percent of the MY 1997 
vehicles sold in the United States.
    A significant increase in funds will be needed to test this 
percentage of the fleet for MY 1998. It is anticipated that at the 
presently requested funding level, frontal NCAP data will be available 
on approximately 50 percent of the MY 1998 new vehicles. To test 80 to 
85 percent of the new depowered vehicles will require additional 
resources to conduct an additional 20 tests. In addition to the normal 
consumer information, this increased number of NCAP tests of vehicles 
with depowered air bags will provide the agency and the safety 
community with a comprehensive view of the effects of depowering on the 
level of safety provided in high severity crashes.
    Question. Please outline the activities NHTSA conducted to promote 
NCAP during fiscal year 1996 and fiscal year 1997, and planned for 
fiscal year 1998? How successful have these been? What funding sources 
have been used?
    Answer. In fiscal year 1996 and 1997, the agency initiated several 
actions to increase the public's awareness of the New Car Assessment 
Program (NCAP). A video news release (VNR) releasing the first set of 
side impact test results was developed and the story aired on the three 
major network morning shows. Upon the release of the 1997 NCAP results, 
a series of prepackaged news stories were developed and distributed to 
a number of newspaper editors and news and wire services. To increase 
the focus on providing consumers more information about NCAP, a 
contract was awarded to develop a 60-second PSA to provide audience 
participants with relative crashworthiness information on passenger 
vehicles to assist them in their car buying decisions. The PSA will be 
shown prior to motion picture feature presentations in selected 
theaters around the nation.
    The agency announced the release of a new edition of the popular 
Buying a Safer Car brochure. For the first time, the brochure also 
includes ratings for side-impact tests and now provides consumers with 
relative safety information on the two most common injury causing crash 
events--frontal and side impacts.
    The agency worked diligently to make the NHTSA Web Site easy to use 
and to make the information clear; thereby increasing the public's 
access to crash test information by placing the NCAP results on NHTSA's 
Web Site.
    In fiscal year 1998, the NCAP program will continue to provide 
consumers with relative safety information on a high proportion of new 
vehicles. NCAP promotional activities will continue the development and 
distribution of brochures, video news releases, public service 
announcements, and NCAP exhibits and expand these activities to provide 
consumers with additional and improved safety information to help them 
make motor vehicle purchase decisions.
    The NCAP promotional activities, which are funded out of the NCAP 
budget ($247,000 in 1997), have been successful. Release of the NCAP 
VNR was made available via satellite to all TV markets and reached 
millions of households. Annual distribution of the Buying A Safer Car 
brochure exceeds 400,000 copies. During the first month of 1997 alone, 
more than 8,000 users made over 50,000 queries to the NCAP database on 
the NHTSA home page. While these activities have been successful, much 
more needs to be done as a recent NHTSA customer survey found that 40 
percent of the respondents had never seen or heard the crash test 
ratings.
    Question. How many passenger car side impact tests have been 
conducted so far during fiscal year 1997, and how many are planned for 
fiscal year 1998? How is the cost for conducting these tests reflected 
in your fiscal year 1998 budget request?
    Answer. The agency crash tested 26 cars in side impact in 1997 
NCAP. For 1998, the agency plans to conduct a total of 70-75 frontal 
and side crash tests. A determination will be made as to the number of 
tests for each mode after all information from manufacturers on air bag 
depowering is received. The agency would prefer to test at least 
another 26 cars in the 1998 side impact NCAP. However, once the 
manufacturers have made public their plans for depowering their frontal 
air bags in model year 1998, the agency may find that it is necessary 
to shift some tests from side impact to frontal NCAP to maintain a 
reasonable amount of consumer information on comparative frontal 
crashworthiness.
    Question. What is the status of NHTSA's efforts to promote 
international harmonization? How much do you plan on spending in this 
area during fiscal year 1998? During fiscal year 1997?
    Answer. The agency is committed to continuing to carry out the 
provisions of the New TransAtlantic Agenda and Action Plan signed by 
President Clinton, in December of 1995, in Madrid. These provisions 
include promises to achieve global regulatory uniformity and to 
encourage a collaborative approach in testing and certification 
procedures by promoting greater compatibility of standards and health 
and safety-related measures. The agency has led the efforts in the 
drafting of a multinational proposal by the Steering Group of the 
Working Party on the Construction of Vehicles (WP.29), to establish an 
agreement for the development of globally harmonized motor vehicle 
regulations. Negotiations regarding the agreement are ongoing and NHTSA 
representatives expect to complete the text of the Agreement during the 
June Session of WP.29.
    The agency has also completed the development of a generic process 
for the assessment of functional equivalence of USA and other 
countries' motor vehicle safety regulations. NHTSA will soon begin the 
process in a final rule that amends Part 552 of the CFR by adding a 
flowchart of the process as an appendix. The agency has recently used 
this Functional Equivalence process in devising a plan to harmonize the 
Unites States and European Union (EU) side impact regulations.
    Congress provided $340,000 in fiscal year 1997 funding to ``be used 
toward establishing a federal motor vehicle safety standard for frontal 
offset crash testing.'' Further, Congress wanted these activities to 
reflect ongoing efforts to enhance international harmonization of 
safety standards. In response to this directive, the agency is studying 
the recently (November 1996) adopted EU directive as a potential offset 
testing crashworthiness standard. With the $340,000 provided in fiscal 
year 1997, the agency is conducting eight offset crash tests to 
evaluate this EU offset test with both 50th percentile male and 5th 
percentile female dummies. The agency is coordinating this activity 
with the safety community and the vehicle manufacturers through the 
Motor Vehicle Safety Research Advisory Committee (MVSRAC) and has had 
an initial meeting with EU representatives. It is not expected that the 
EU directive could be adopted as a replacement for Federal Motor 
Vehicle Safety Standard (FMVSS) No. 208, ``Occupant Crash Protection,'' 
but is being considering as an option of harmonization to the standard 
as a supplemental regulation. A status report will be delivered to 
Congress on this offset testing activity in July 1997.
    In fiscal year 1998, the agency has requested an additional 
$340,000 for this effort. fiscal year 1998 crash test plans will 
address the repeatability and reproducibility of the EU test procedure, 
the performance of additional dummy sizes in frontal crashes, and the 
feasibility of the test procedure for lighter or heavier vehicles.
    In the fiscal year 1997 Congressional Conference Report 104-785 
accompanying H.R. 3675, which provided funding for side impact testing 
in the New Car Assessment Program, the conferees noted ``that there are 
substantial differences between the U.S. side impact standard and the 
new European standard. These differences are inconsistent with the need 
for the international harmonization of motor vehicle safety 
standards.'' The House and Senate committees on Appropriations 
requested the agency develop a plan for achieving harmonization of the 
side impact standard and submit a report on this plan to Congress. The 
agency has developed a plan and is proceeding with testing and analysis 
activities. NHTSA will determine the potential for international side 
impact harmonization by: (1) Analyzing past research and performing new 
tests to determine the relative safety benefits offered by each 
regulation; (2) Coordinating with industry and other interested groups 
to establish consensus on the activities, eliminate duplication of 
work, and reduce cost; (3) Determining if functional equivalence exists 
or can be established between the two requirements; (4) Coordinating 
with EU to assess harmonization options and approaches. Presently, 
funding for this effort has been provided from the Research and 
Development budget. A full report on this project will be sent to 
Congress in July.
    In addition, the agency is in the process of trying to have the new 
U.S. headlamp beam pattern adopted as a worldwide standard. NHTSA 
published a final rule implementing the consensus position from its 
regulatory negotiation on optical/visual headlamp aim in March 1997. 
Participants in the negotiation included manufacturers, dealers, repair 
shops, State highway officials, and consumer groups. This new rule will 
improve the aim of headlamps in service and give a better beam pattern 
to the American public, while reducing costs for manufacturers and 
simplifying aiming procedures for dealers and repair shops. The rule 
also represents a breakthrough for international harmonization, because 
European manufacturers and the Japanese Center for International 
Standardization participated in the negotiations and believe that this 
new NHTSA standard can become a worldwide standard. NHTSA will 
officially submit this rule on behalf of the United States to the UN 
group in Geneva, Switzerland in October 1997 in an effort to get the 
U.S. standard for headlamp beam pattern adopted as a worldwide 
standard.
    Question. Please discuss how NHTSA responded to the conclusions and 
recommendations of the National Academy of Sciences' study on consumer 
information regarding automotive safety that were released March 26, 
1996. How are these responses reflected in the fiscal year 1998 budget 
request?
    Answer. On May 20, 1997, NHTSA published a notice in the Federal 
Register summarizing the recommendations of the NAS study, and asking 
for comment on the agency's response to those recommendations and on 
programs NHTSA has begun or is considering to address those 
recommendations (62 FR 27648).
    NHTSA generally agrees with the recommendations of the NAS study, 
and has a number of activities planned to address those 
recommendations, including: improvements to existing programs; 
development of proper use materials; research to determine what 
consumers understand about vehicle safety, how safety factors into 
vehicle purchase decisions, and how such information should be 
presented; exploration of a summary crashworthiness rating for new 
vehicles; and dissemination of information on vehicle crash avoidance 
features such as braking and lighting.
    While the notice requesting comments was recently issued, NHTSA 
included initiatives in the fiscal year 1998 budget request that we 
anticipated initiating in fiscal year 1998 in response to the NAS 
recommendations. These initiatives include the development of proper 
use materials on equipment such as anti-lock brakes, consumer research 
activities, and assessing the feasibility of providing consumer 
information on head lighting and braking performance. While the fiscal 
year 1998 budget request is sufficient to begin addressing some of the 
NAS recommendations at a very minimum level, it is likely that future 
funding requirements will be much greater.
                          fuel economy program
    Question. What is the Administration's policy on changing the CAFE 
standards for passenger cars? For light trucks and vans? What is the 
status of NHTSA's rulemaking activity with respect to changing CAFE 
standards for light trucks and vans?
    Answer. The statute fixes the passenger car CAFE standard at 27.5 
mpg unless the Administration sees a need to change it under the 
statutory considerations. The last change was for model year 1989 when 
the standard was lowered to 26.5 mpg before returning to 27.5 mpg for 
model year 1990 and thereafter. NHTSA has no plans to propose amending 
the passenger car CAFE standard. On the other hand, the statute does 
not provide a basic standard for light trucks, but directs the 
Department to establish a standard for each model year. The agency 
issued a fuel economy standard for light trucks for model year (MY) 
1999 of 20.7 mpg as required by the DOT Appropriations Act for Fiscal 
Year 1997. The standard for MY 2000 must be issued by March 31, 1998. 
To meet that date, the agency will issue a notice of proposed 
rulemaking before the end of this calendar year.
    Question. Please provide a detailed explanation of the efforts 
underway to maintain the plants and lines database. What data have been 
collected, and what are these data telling you?
    Answer. The Volpe Transportation Systems Center is refining the 
database structure to improve the access and utility of the 
information. Data are extracted from public media sources on individual 
auto manufacturers and major suppliers. The data include product 
planning information; plant locations, capacities, and employment; the 
relationship of assembly plant products to engine and transmission 
plant products; and basic financial information on the domestic auto 
manufacturers. The information in the database is used in agency 
rulemaking analyses by providing insights into manufacturers' 
technological and economic capabilities.
                            theft prevention
    Question. Please explain the request to repeal the requirements for 
collection and analysis of insurance information relating to the 
effectiveness of the parts-marking standards.
    Answer. 49 U.S.C. 33112, Insurance reports and information, 
requires insurers to report annually on vehicle thefts and recoveries 
and provides that NHTSA ``shall compile and publish information'' 
obtained from insurers in a form that will be helpful to the public, 
the law enforcement community, and Congress. NHTSA receives information 
from certain insurance companies and rental/leasing companies regarding 
theft activities, comprehensive rates and payments for stolen motor 
vehicles each year. Contractors compile and evaluate this information 
for the agency. The agency requested that Section 33112 be repealed 
because the reporting requirement represents a paperwork burden for 
motor vehicle insurers and rental/leasing companies, while the reports 
provide untimely information (the data is three years old when 
submitted to NHTSA) that has not proven useful in assessing the 
program. Both the Department of Justice and the Department of 
Transportation are currently assessing the effectiveness of the parts-
marking standards. Neither Department has found the data submitted 
under the requirements of 49 U.S.C. 33112 to be of value to their 
respective evaluation efforts. This is why NHTSA's regulatory reform 
efforts identified insurer reporting requirements as something that 
could be eliminated. Such a change can only be made by Congress, since 
the existing law must be amended. The Department's NEXTEA proposal 
includes a provision that would eliminate this requirement.
    Question. If this requirement is repealed, would that eliminate the 
need for the $50,000 request for this purpose?
    Answer. Approximately half the original contract cost would still 
be necessary. In addition to supporting contractor analysis of the 
information submitted by insurance companies and rental/leasing 
companies, the funds also support computer time sharing costs to 
perform in-house analysis of FBI theft and recovery data on stolen 
motor vehicles from over 26,000 law enforcement jurisdictions in order 
to calculate annual theft rates and issue rules requiring the 
designation of likely high-theft vehicles.
                            safety assurance
    Question. Please prepare a table indicating the amount requested 
and the amount actually appropriated for the four programs in the 
Safety Assurance Program for fiscal years 1995, 1996 and 1997.
    Answer. The information follows.

----------------------------------------------------------------------------------------------------------------
                                                                Fiscal years--                                  
                             -----------------------------------------------------------------------------------
           Program                       1995                        1996                        1997           
                             -----------------------------------------------------------------------------------
                                Request    Appropriation    Request    Appropriation    Request    Appropriation
----------------------------------------------------------------------------------------------------------------
Vehicle Safety Compliance...   $5,400,000    $5,231,000    $5,353,000    $4,775,000    $6,033,000    $5,837,000 
Auto Safety Hotline.........      557,000       557,000     1,667,000       657,000     1,787,000     1,483,000 
Defects Investigation.......    2,481,000     2,481,000     2,460,000     2,419,000     2,481,000     2,478,000 
Odometer Fraud..............  ...........  .............      100,000        60,000       100,000        60,000 
                             -----------------------------------------------------------------------------------
      Total.................    8,438,000     8,269,000     9,580,000     7,911,000    10,401,000     9,858,000 
----------------------------------------------------------------------------------------------------------------

    Question. Please prepare a table for each of the four programs in 
the Safety Assurance Program, showing how all of the funds requested 
for fiscal year 1998 are intended to be spent, and please include in 
that table a comparison with the amount provided for each of those 
activities for fiscal year 1997. On a separate page, please justify the 
need for the requested increases.
    Answer. The information follows.

                        VEHICLE SAFETY COMPLIANCE                       
------------------------------------------------------------------------
                                                     Fiscal years--     
                   Activity                    -------------------------
                                                    1997         1998   
------------------------------------------------------------------------
Vehicle Compliance Testing....................   $3,670,000   $3,575,000
Equipment Compliance Testing..................    1,800,000    1,770,000
Uniform Tire Quality Grading (Facility in San                           
 Angelo, Texas)...............................      367,000      367,000
                                               -------------------------
      Total...................................    5,837,000    5,712,000
------------------------------------------------------------------------


                          DEFECTS INVESTIGATION                         
------------------------------------------------------------------------
                                                     Fiscal years--     
                   Activity                    -------------------------
                                                    1997         1998   
------------------------------------------------------------------------
Defect Identification and Evaluation..........   $1,428,000   $1,428,000
Testing and Surveys...........................      700,000      700,000
Recall Monitoring and Performance.............      350,000      350,000
                                               -------------------------
      Total...................................    2,478,000    2,478,000
------------------------------------------------------------------------


                           AUTO SAFETY HOTLINE                          
------------------------------------------------------------------------
                                                     Fiscal years--     
                   Activity                    -------------------------
                                                    1997         1998   
------------------------------------------------------------------------
Call handling Support.........................     $348,000     $125,000
Contract Personnel............................      575,000      650,000
Defect Reporting..............................      160,000      228,000
Phone.........................................      300,000      330,000
Printing......................................      100,000      125,000
                                               -------------------------
      Total...................................    1,483,000    1,458,000
------------------------------------------------------------------------


                      ODOMETER FRAUD INVESTIGATION                      
------------------------------------------------------------------------
                                                     Fiscal years--     
                   Activity                    -------------------------
                                                    1997         1998   
------------------------------------------------------------------------
Cooperative Agreements for 3 States to conduct                          
 in-State program.............................      $60,000  ...........
Cooperative Agreements for 4 States to provide                          
 law enforcement agent........................  ...........     $210,000
                                               -------------------------
      Total...................................       60,000      210,000
------------------------------------------------------------------------

                      justification for increases
    Auto Safety Hotline.--Savings accrued from one-time hardware 
upgrades purchased in fiscal year 1997 will be used in fiscal year 1998 
to increase contractor personnel support, defect reporting, and 
increases in phone and printing costs. The agency anticipates that four 
additional representatives will need to be hired in fiscal year 1998 in 
order to decrease the hangup rate to an acceptable rate.
    In addition, the agency would like to continue to develop and 
expand the Hotline outreach program which was begun in fiscal year 
1997. The Office of Defects Investigation (ODI) relies heavily on 
consumer reports of problems with motor vehicles or items of motor 
vehicle equipment.
    Odometer Fraud Program.--In fiscal year 1996 and fiscal year 1997, 
NHTSA entered into contracts or cooperative agreements to three states 
to provide ``seed money'' for enhancement of state odometer enforcement 
programs. Those states, working independently, conducted investigations 
and assisted defrauded consumers in recovering damages within their 
states. Each of the states received $20,000 for this level of effort. 
In fiscal year 1998, the agency plans to enter into cooperative 
agreements with four states and change the nature of the cooperative 
agreements. Under agreement, each of the four states will provide an 
investigator to the agency's odometer enforcement program. This will 
not only to stimulate the enforcement programs in those states, but 
will also supplement NHTSA's investigative staff. While working with 
NHTSA's enforcement staff, the state investigators will receive the 
training necessary to enhance the state's enforcement program plus 
increase the number of investigations the agency can conduct, 
particularly in areas that are known ``hotbeds'' of odometer fraud, 
thereby reducing NHTSA's backlog of investigative leads. The requested 
funds will pay living expenses for the investigators, approximately 
$52,000 each, for one year while they are assigned to NHTSA. Although 
this type of cooperative agreement is more costly than the prior 
system, the agency believes the program, states, and the public will 
benefit in the short term (as more odometer fraud investigations are 
commenced and completed) and in the long term (by training state 
employees who will continue to use their newly-developed skills to 
combat odometer fraud in the future).
                          auto safety hotline
    Question. Why did the budget for the Auto Safety Hotline more than 
double from fiscal year 1996 to fiscal year 1997?
    Answer. The Auto Safety Hotline budget increased from $657,000 in 
fiscal year 1996 to $1,483,000 in fiscal year 1997. Approximately 
$300,000 of this increase was necessary to pay the phone bill, which 
was previously paid out of agency operating expenses. The Operating 
Expenses budget was reduced accordingly. The remaining increase has 
allowed the agency to upgrade the electronic and computer hardware 
equipment utilized by the Hotline and to hire additional contract 
representatives, with a small portion being used for activities which 
will increase the number of potential defects reported to the Hotline 
in support of defect investigations.
    Question. What is the number of calls to the hotline each year for 
the last three years?
    Answer. Total calls received by the Hotline for the last three 
calendar years are as follows:

        Years                                                      Calls
1994..........................................................   533,801
1995..........................................................   809,496
1996..........................................................   778,819

    Question. Could improved or more use of the Internet save money for 
NHTSA?
    Answer. The Internet is a useful tool for individuals to get 
information about various motor vehicle safety issues and to report 
problems with their vehicles or motor vehicle equipment, such as child 
safety seats. The agency is continuously examining ways to improve and 
expand use of the Internet, including hotlinks with other websites. 
Additionally, the outreach program that the Auto Safety Hotline has 
undertaken to increase defects reports to the agency is promoting both 
the Hotline and the Internet as methods of filing. Both the Hotline and 
the Internet are complementary methods for consumers to gain valuable 
safety information and to report potential defects and both must be 
used to get the maximum amount of exposure to NHTSA and the services it 
offers. However, at the present time the agency does not believe that 
increases in the use of the Internet will save money for NHTSA. The 
number of consumers with access to the Internet is still limited. 
Approximately 36 percent of the households in the United States have a 
personal computer, with a smaller number having access to the Internet. 
Additionally, nationwide call center surveys indicate that 70 percent 
of the people who call hotlines indicate a preference to speak directly 
to a person who can answer their questions.
    Question. Please explain why NHTSA maintains that fiscal year 1998 
funding for the Hotline should not revert to the fiscal year 1996 
level.
    Answer. Approximately $300,000 of the increase to the Auto Safety 
Hotline was necessary to pay the telephone bill, which previously had 
been paid for out of agency operating expenses. The Operating Expenses 
budget was reduced accordingly. Reverting back to the fiscal year 1996 
funding level would drastically reduce the services provided by the 
Hotline. The cost of the contract representatives hired during fiscal 
year 1997 with the increased funding is a recurring expense, and the 
agency anticipates that four additional representatives will be needed 
in order to decrease the hangup rate to an acceptable rate. Finally, 
the agency would like to continue to develop and expand the Hotline 
outreach program, which was begun in fiscal year 1997. The Office of 
Defects Investigation (ODI) relies heavily on consumer reports of 
problems with motor vehicles or items of motor vehicle equipment. 
Hotline complaints are the agency's primary source of information 
regarding vehicle problems. However, most consumers do not contact the 
Hotline. Therefore, it is important that funds are available to educate 
the public about the benefits of reporting potential defects to the 
Hotline or through the Internet. A 1995 consumer survey by NHTSA has 
shown that the public perceives a need for a federal Hotline from which 
they can receive and to which they can report safety information. 
However, that same survey shows that less than 20 percent of the public 
knows of the Auto Safety Hotline, and of those who know, only five 
percent know that it is operated by NHTSA. By increasing the outreach 
efforts, the motoring public will receive the safety information they 
need and be able to report important information for use in the 
agency's investigations.
    Question. What activities would cease if the fiscal year 1996 level 
of funding was provided?
    Answer. With funding at $657,000, the fiscal year 1996 level, the 
operations of the Auto Safety Hotline would have to be drastically 
reduced. The telephone expenses are based on a monthly flat rate, plus 
a fee-per-minute charge. It is anticipated that with fewer 
representatives to answer the phone calls, more callers would leave 
their names and phone numbers for call-backs or their names and 
addresses for information to be mailed to them. Thus, the reduced 
amount of time spent on each call would reduce the phone bill 
proportionately. The agency estimates that the bill would be reduced to 
$176,000. Printing costs would remain the same at about $125,000. The 
cost to transcribe telephone messages left on the automatic answering 
system would increase due to the increased number of messages left on 
the automatic phone answering system. The agency estimates that the 
cost to transcribe these calls would increase to $110,000. That would 
leave $246,000 to be spent on contract representatives to answer the 
phones. Approximately five representatives could be hired for this 
amount. Currently, the Auto Safety Hotline has 16 contract 
representatives that answer the telephones. To reduce this number to 
five would seriously diminish the Hotline's ability to provide quality 
service to the motoring public.
                         odometer fraud program
    Question. Please explain the $150,000 increase requested under the 
odometer fraud program for fiscal year 1998. How will the additional 
funding be spent, and what will be done in this program that was not 
done during fiscal year 1997?
    Answer. In fiscal year 1996 and fiscal year 1997, NHTSA entered 
into contracts or cooperative agreements to three States to provide 
``seed money'' for enhancement of state odometer enforcement programs. 
Those States, working independently, conducted investigations and 
assisted defrauded consumers in recovering damages within their States. 
Each of the States received $20,000 for this level of effort. In fiscal 
year 1998, the agency plans to enter into cooperative agreements with 
four States and change the nature of the cooperative agreements. Under 
agreement, each of the four States will provide an investigator to the 
agency's odometer enforcement program. This will not only to stimulate 
the enforcement programs in those States, but will also supplement 
NHTSA's investigative staff. While working with NHTSA's enforcement 
staff, the state investigators will receive the training necessary to 
enhance the state's enforcement program plus increase the number of 
investigations the agency can conduct, particularly in areas that are 
known ``hotbeds'' of odometer fraud, thereby reducing NHTSA's backlog 
of investigative leads. The requested funds will pay living expenses 
for the investigators, approximately $52,000 each, for one year while 
they are assigned to NHTSA. Although this type of cooperative agreement 
is more costly than the prior system, the agency believes the program, 
States, and the public will benefit in the short term (as more odometer 
fraud investigations are commenced and completed) and in the long term 
(by training State employees who will continue to use their newly-
developed skills to combat odometer fraud in the future).
    Question. Do the States have more resources than NHTSA to 
investigate these types of violations? Did the States request NHTSA to 
increase their participation in the odometer fraud program?
    Answer. The amount of resources each State has available to 
investigate odometer fraud varies from State to State. Generally, other 
than the funds provided by NHTSA to the States, the States have not 
dedicated resources to full-time odometer fraud enforcement. Several 
States have more investigators than NHTSA that conduct odometer fraud 
investigations; however, those investigators are involved in numerous 
other types of enforcement activities. Although NHTSA has received no 
specific requests from the States to increase participation in the 
odometer fraud program, the States continually look to NHTSA for 
assistance in carrying out their enforcement programs. Each year, more 
States submit applications for cooperative agreements than are 
available.
    Question. Which States does NHTSA have cooperative agreements with 
in fiscal year 1997, and which four States will NHTSA enter into an 
agreement with if the fiscal year 1998 requested level is provided?
    Answer. In fiscal year 1997, NHTSA entered into cooperative 
agreements ($20,000 each) with the New Jersey State Police, Georgia 
Governor's Office of Consumer Affairs, and the Colorado Department of 
Motor Vehicles. Because Congress has not acted on the fiscal year 1998 
DOT Appropriations bill, NHTSA has not selected any States. When 
funding is available for fiscal year 1998, the agency will solicit 
applications from the States for cooperative agreements. The States 
will be selected based on the information contained in the 
applications.
         highway safety safe communities injury control program
    Question. Please prepare a table indicating the amount requested 
and the amount actually appropriated for the Safe Communities Injury 
Control program for fiscal years 1995, 1996, and 1997.
    Answer. See table below.

                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                   Fiscal years--                               
                                   -----------------------------------------------------------------------------
              Program                         1995                      1996                      1997          
                                   -----------------------------------------------------------------------------
                                     Request   Appropriation   Request   Appropriation   Request   Appropriation
----------------------------------------------------------------------------------------------------------------
Safe Communities Injury Control...  .........  .............      5,600           675       1,800           900 
----------------------------------------------------------------------------------------------------------------

    Question. Please prepare a table for the Safe Communities Injury 
Control Program, showing how all of the funds requested for fiscal year 
1998 are intended to be spent, and please include in that table a 
comparison with the amount provided for each of these activities for 
fiscal year 1997. On a separate page, please justify the need for the 
requested increases.
    Answer. The table follows.

------------------------------------------------------------------------
                                                  Fiscal years--        
                                         -------------------------------
                                               1997            1998     
------------------------------------------------------------------------
Demonstration and Evaluation Cooperative                                
 Agreement..............................        $800,000        $400,000
                                                                        
Materials Development, Printing and                                     
 Distribution...........................         100,000         100,000
Safe Communities Quality Improvement                                    
 Strategies or Alternative Demonstration                                
 Project................................  ..............         400,000
                                         -------------------------------
      Total.............................         900,000         900,000
                                         ===============================
Safe Communities Newsletter.............     \1\ 131,000     \1\ 150,000
Cooperative Agreement with American                                     
 Association of Health Plans to promote                                 
 Safe Communities.......................     \1\ 275,000     \1\ 275,000
------------------------------------------------------------------------
\1\ Funded with additional Section 403 program funds                    

    There was no increase requested for the Safe Communities Injury 
Control Program in fiscal year 1998.
    Question. Who were the grants made to in fiscal year 1997? Where 
are they located?
    Answer. A Federal Register Notice was published on February 12, 
1997, announcing the program. The application period expired on May 1, 
1997. A technical evaluation panel was convened and is still in the 
process of evaluating the proposals. Awards to two sites will be made 
in August 1997.
    Question. What overlap is there with the injury control programs 
funded under the alcohol program?
    Answer. There is no overlap with the injury control program funded 
under the alcohol program. The Safe Communities program is intended to 
support the expansion of partners from the health and medical 
communities as part of NHTSA's efforts to involve health and medical 
groups in motor vehicle injury control programs. Funds from the alcohol 
program will be used to increase training and technical assistance for 
health and medical partners so they can develop impaired driving 
messages and programs, and implement the strategies in Partners in 
Progress: An Impaired Driving Guide for Action, with their members and 
constituents.
    Question. What evidence do you have of injury prevention resulting 
from this program?
    Answer. It is too early to judge the results from the program. 
Three year cooperative agreements were awarded to two sites in fiscal 
year 1996.
    These agreements will end in fiscal year 1999, at which time 
results from the efforts are expected. Two additional three year 
cooperative agreements will be awarded in August 1997, with results 
expected in fiscal year 2000. An interim report will be developed and 
is expected to be available two years into the program cycle. In 
addition, a large-scale evaluation effort is planned for fiscal year 
1999.
    Question. When will NHTSA funding for this initiative end?
    Answer. NHTSA expected to request funding through fiscal year 1999 
to expand the current demonstration and evaluation program, to explore 
and evaluate alternative implementation strategies such as a quality 
improvement methodology, and to conduct a large-scale evaluation of the 
Safe Communities program.
                    alcohol, drug and state programs
    Question. Please prepare a table indicating the amount requested 
and the amount actually appropriated for each of the four subprograms 
in the Alcohol, Drug and State program for fiscal years 1995, 1996, and 
1997.
    Answer. See table below.

                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                Fiscal years--                                  
                             -----------------------------------------------------------------------------------
           Program                       1995                        1996                        1997           
                             -----------------------------------------------------------------------------------
                                Request    Appropriation    Request    Appropriation    Request    Appropriation
----------------------------------------------------------------------------------------------------------------
Alcohol.....................        6,767         6,604         9,057         8,398         9,015         8,800 
DEC.........................        1,530         1,499           957           907           600           599 
Ped/Bike....................          594           248           474           250           474           473 
Motorcycle..................          345           338           327           327           338           337 
----------------------------------------------------------------------------------------------------------------

    Question. Please prepare a table for each of the four subprograms 
of the Alcohol, Drug and State program showing how all of the funds 
requested for fiscal year 1998 are intended to be spent, and please 
include in that table a comparison with the amount provided for each of 
those activities in fiscal year 1997. On a separate page, please 
justify the need for the requested increases.
    Answer. The information follows.

------------------------------------------------------------------------
                                                     Fiscal years--     
                   Activity                    -------------------------
                                                    1997         1998   
------------------------------------------------------------------------
Alcohol Program:                                                        
    Education and Prevention..................   $4,077,000    $3,075,00
    Enforcement and Sanction..................    1,450,000     1,725,00
    Prosecution/Adjudication..................    1,000,000     1,150,00
    Youth.....................................    1,217,000     1,181,00
    Innovative Grants (Partners in Progress)..    1,056,000      544,000
                                               -------------------------
      Total...................................    8,800,000    7,675,000
                                               =========================
Drug Evaluation and Classification............      599,000      476,000
                                               =========================
Pedestrian and Bicycles:                                                
    Pedestrian Program........................      224,000      285,000
    Bicycle Program...........................      130,000      200,000
    School Bus Safety.........................      120,000      170,000
                                               -------------------------
      Total...................................      474,000      655,000
                                               =========================
Motorcycle Program............................      337,000      337,000
------------------------------------------------------------------------

    The increases in the Alcohol Program are in the areas of: (1) 
enforcement and sanctions and (2) prosecution and adjudication. The 
agency will target enforcement programs at the high risk groups, 
including youth and repeat offenders. NHTSA will continue training for 
prosecutors and judges and outreach to other larger organizations, such 
as the American Bar Association, to provide information on impaired 
driving cases.
    The increases in the Pedestrian and Bicycle program reflect new 
initiatives with Cops on Bikes, the National Association of City and 
County Health Officials, and other health, medical and business 
partners. NHTSA will also initiate documentation of case studies of 
successful pedestrian and bicycle program implementation to provide to 
communities interested in initiating such programs and develop 
approaches to reduce the incidence of illegally passing stopped school 
buses. The Pedestrian and Bicycle funding request also reflects 
resources needed to advance programs and activities initiated in 
response to recommendations from the National Transportation Safety 
Board: completion and distribution of an in-service training module on 
key school bus safety issues and development of a school bus hazard 
routing system.
    Question. What specific areas of the alcohol program have been 
enhanced with the additional fiscal year 1997 funds?
    Answer. The $400,000 increase from fiscal year 1996 to fiscal year 
1997 has focused on the innovative grant program to support the 
strategies identified in the Partners in Progress: Impaired Driving 
Guide for Action. The guide identifies broad strategies in seven areas: 
public education; individual responsibility; health care community; 
businesses and employers; legislation; enforcement/adjudication; and 
technology. Many grass-roots organizations have creative and innovative 
ideas on how to implement these strategies, but lack resources. These 
grants will fund several promising ideas, see if they work, and 
document their successes.
    Question. What are the highest priorities of NHTSA within the 
alcohol and drug program?
    Answer. The highest priorities of NHTSA with the alcohol and drug 
program are to continue progress towards the national goal to reduce 
alcohol-related fatalities to 11,000 by the year 2005. NHTSA's key 
initiatives in these areas include implementing the strategies 
identified in the Partners in Progress: An Impaired Driving Guide for 
Action to reach this ambitious national goal. NHTSA will continue to 
support effective laws--administrative license revocation, zero 
tolerance for under age 21, graduated licensing systems, .08 BAC, 
vehicle sanctions and new 410 incentive grant criteria.
    The agency will continue its special emphasis on youth--to stop 
drinking and driving before it starts--using strategies including 
identifying efficient methods of processing offenders, testing 
effective alcohol beverage control programs, and identifying more 
effective prevention programs. There will be an increased emphasis on 
cooperative activities with partners such as NETS, TEAM, with the 3D 
Prevention Month Coalition, and with health care and advocacy partners.
    NHTSA will also build collaborative partnerships with other Federal 
agencies, such as youth enforcement activities with the Department of 
Justice; a zero tolerance educational campaign with the Department of 
Education; and research activities with the National Institute on 
Alcohol Abuse and Alcoholism and Center for Substance Abuse Prevention.
    Question. In Senate Report 104-325, the Committee encouraged NHTSA 
to maintain a focused youth-oriented initiative under the 403 program, 
and recommended $1,772,000 for public education and enforcement under 
this program. Please specify in detail how these funds have been spent, 
what the continued activities are, and what the new components of this 
program are.
    Answer. NHTSA continues to maintain a focused youth-oriented 
initiative across the entire 403 program. On-going alcohol programs 
include a National Zero Tolerance Education Initiative in which NHTSA 
is forming partnerships with other Federal Agencies (e.g., with DOEd 
and with HHS' Secretary's Initiative on Youth Substance Abuse 
Prevention) and with the private sector to develop a national awareness 
campaign. Resources have been provided to the ``youth enforcement 
training traffic workshops'' to enhance zero tolerance enforcement. A 
youth traffic safety state assessment program is being developed to 
assist states in assessing, among other issues, their youth enforcement 
and adjudication activities.
     New initiatives will include a combination of zero-tolerance law 
enforcement, education and public awareness efforts. Resources will be 
provided to enforcement organizations to enhance local activities. 
Resources will also be provided to prevention groups, national 
organizations and other efforts to form partnerships with a variety of 
state and local enforcement agencies, local police departments, 
educators, etc. NHTSA has also provided resources for the development 
of new interactive technology to reach youth, and the agency is 
assisting Students Against Driving Drunk (SADD) to demonstrate, train, 
and implement this technology at the local level.
                   drug evaluation and classification
    Question. Please provide an update on any studies that NHTSA has 
underway or planned, that will help the criminal justice system deal 
with drug-impaired drivers.
    Answer. This fall NHTSA, with the International Association of 
Chiefs of Police, will convene a panel of experts on the Drug 
Evaluation and Classification (DEC) Program to discuss the results of 
recent research activities and determine future efforts. Specific 
research activities include the following:
    Joint NHTSA/NIDA laboratory research to validate and improve DEC 
procedures is nearing completion. Research is also underway to identify 
the strengths and weaknesses of the DEC program in different 
enforcement contexts, and to determine the relative importance of the 
various types of information available to DEC officers in those 
different contexts.
    Also underway is research to determine the accuracy of relatively 
inexpensive drug screening kits that could be used by both DEC and non-
DEC officers. A field test of these devices will be initiated this year 
and a follow-up field application study will be conducted to determine 
the usefulness of the devices in actual law enforcement settings.
    Question. What would be the effect of further reducing the Federal 
role in DEC? What data exist that show the specific benefits that have 
resulted from NHTSA's research in this area over the last several 
years?
    Answer. NHTSA's role in DEC has gradually reduced since fiscal year 
1994, when the last funding was committed to provide DEC training 
instructors to jurisdictions and states without this advanced impaired 
driving program. The agency has continued limited technical support and 
training materials through the International Association of Chiefs of 
Police to the thirty-two states that are currently participating in the 
DEC program.
    In fiscal year 1998, the agency will reduce funding that supports 
legal research and DEC training to judges and prosecutors through the 
National Traffic Law Center (NTLC).
    As indicated in the 1996 Report to Congress on the Drug Evaluation 
and Classification Program, the program was found to be an effective 
method for detecting, apprehending and removing drug impaired drivers 
from our highways.
    Recent research is focusing on new technology that may allow 
officers in post-arrest situations to use testing devices to confirm 
the presence of drugs. A field test of the devices is expected to start 
by the end of fiscal year 1997.
    Question. How much of the DEC training provided to enforcement 
officers is being paid for by NHTSA? Please specify the funds used, and 
how these monies were spent during fiscal year 1996 and fiscal year 
1997. If training is still paid for by NHTSA, how is this reflected in 
the fiscal year 1998 request?
    Answer. The last year that the agency used Section 403 dollars to 
fund DEC instructor services to train law enforcement officers was 
fiscal year 1994.
    Question. If funding for DEC was eliminated, would IACP and others 
continue to improve this program?
    Answer. IACP is a non-profit, international law enforcement 
membership organization that depends on grants and membership fees to 
support its program technical assistance role. It is important for the 
IACP to continue its national leadership role in the DEC program to 
ensure that standards are strictly followed and accepted by the courts 
as valid. If the program is modified or improved, it must be done on a 
national level. This will ensure that the protocol is conducted in a 
systematic and standardized manner across the country in order to 
maintain the program's validity and integrity. Without federal support, 
IACP could not accomplish this task.
    Some states have institutionalized the DEC program in selected 
communities while others are still struggling. Further expansion to 
additional communities and states would be difficult without the 
assistance of the IACP and NHTSA.
    Question. Please outline specific advances and benefits that have 
resulted from NHTSA's research on DEC during the last two years? What 
specific changes in the DEC protocol have resulted from this research?
    Answer. Several research studies conducted over the past two years 
will soon be completed and recommendations from them presented to the 
DEC Technical Advisory Panel. Joint NHTSA/NIDA laboratory research to 
validate and improve the DEC procedures used by police officers to 
examine a suspect for drug impairment has already shown that the DEC 
procedures are valid. The report will make recommendations to improve 
and streamline them. A study is underway that could improve the 
standardized DEC officer interview procedures. A third study is 
identifying the strengths and weaknesses of the DEC program in 
different enforcement contexts and determining the relative importance 
of the various types of information available to DEC officers in those 
different contexts. Finally, a study is analyzing blood specimens from 
drivers injured in crashes and assessing the causal role of drugs in 
those crashes.
    In addition, the agency recently completed a research study to 
determine the accuracy of relatively inexpensive drug screening kits 
that could be used by both DEC and non-DEC officers and will be 
initiating a field test of these devices this year. A follow-up field 
application study will be conducted to determine the usefulness of the 
devices in actual law enforcement settings.
                        pedestrian and bicycles
    Question. What would be the effect of restricting funding to 
current levels? Why is the requested increase needed at this time?
    Answer. Restricting funding to the current levels would severely 
hinder the agency's ability to continue strengthening programs to 
decrease pedestrian, bicycle, and school bus related injuries and 
fatalities. An estimated 131 million Americans regularly bicycle or 
walk for exercise, sport, and recreation and an estimated 20 million 
children are transported by school bus each school day.
    Pedestrian and bicycle fatalities make up about 16 percent of 
traffic fatalities annually. For each fatality, there are about twenty-
four serious injuries. Economic costs to society due to pedestrian 
fatalities and injuries total more than $13 billion.
    The fiscal year 1998 request reflects the Secretary's focus on 
pedestrian, bicycle, and school bus safety programs. FHWA and NHTSA 
jointly promote walking and biking as alternative forms of 
transportation and important forms of exercise. NHTSA also emphasizes 
the safety aspects of the increased walking and biking to reduce 
injuries and fatalities.
    NHTSA will continue initiatives such as the Partnership for a 
Walkable America; development of a pedestrian program targeted to 
Hispanic children and bicycle programs targeting at-risk urban youth. 
New initiatives will be developed with Cops on Bikes, the National 
Association of City and County Health Officials, and other health, 
medical and business partners. The funding request also reflects needed 
resources initiated in response to a series of prominent school bus 
crashes and safety issues, including clothing drawstrings snagging on 
school bus handrails that require immediate attention and corrective 
action.
    Requested funding will complete development of an in-service 
training module on key school bus safety issues, initiate development 
of a school bus hazard routing system, and develop approaches to reduce 
the incidence of illegally passing stopped school buses.
    Question. How does this program relate to FHWA's Bicycle and 
Pedestrian activity and program?
    Answer. Several years ago, NHTSA and FHWA recognized the importance 
of a cooperative pedestrian and bicycle safety program. Both agencies 
agree that enforcement, education and engineering approaches work best 
together, as part of a total system. As a result, the two agencies have 
been pursuing a joint multi-year bicycle and pedestrian program plan.
    Each agency has taken primary responsibility for specific 
activities within the joint program. FHWA has the responsibility for 
pedestrian and bicycle pathways, including facility design, 
construction, signal timing and related roadway issues. NHTSA deals 
with the behavioral aspects of the programs, such as educating youth on 
how to cross the street safely, proper selection and use of bicycle 
helmets, and bicycle rules of the road. Activities listed in the fiscal 
year 1998 NHTSA budget request reflect those joint activities NHTSA is 
responsible for. These activities are coordinated with and complement 
the FHWA programs.
    Question. How much of this account is spent on safety involving 
school buses?
    Answer. School bus safety receives approximately $170,000. The 
funds are used to address the serious problem of motorists illegally 
passing school buses stopped to load and unload students. The funding 
is used to develop and distribute a one day in-service school bus 
driver training program (covering the issues of highway-rail grade 
crossings, route hazards, handrail snagging, etc.), and develop and 
distribute a school bus routing and hazards marking system for school 
district use.
                  youth, drugs and driving initiative
    Question. Please further justify the request for $2 million for the 
Youth, Drugs and Driving initiative. How will these new funds augment 
the current efforts to deal with the challenges of the younger driver?
    Answer. While still well below peak levels attained in the late 
1970's, and after a decade of declining use during the 1980's, drug use 
by youth has risen steadily in the 1990's. Marijuana use has shown the 
sharpest increase. For example, the 1996 Monitoring the Future Study 
found that 18 percent of 8th graders had used marijuana in the past 
year, compared to 6 percent in 1991. Among 12th graders, marijuana use 
in the past increased from 24 percent in 1991 to 36 percent in 1996.
    In response to this startling increase in drug use by American 
youth, President Clinton has urged stronger measures to reduce the 
incidence of drug use by teens and to reduce driving under the 
influence of drugs. A report entitled Presidential Initiative on Drugs, 
Driving and Youth recommended concerted efforts to improve the DUID 
(Driving Under the Influence of Drugs) system. This means stronger laws 
and more consistency in enforcement, prosecution, adjudication, 
prevention, education, drug testing, and treatment. A similar approach 
has reduced the incidence of driving under the influence of alcohol, 
especially for youth, and could do the same for other drugs.
    A key part of a four-part strategy to assist states in implementing 
a systematic and comprehensive state DUID system is a new federally-
funded demonstration program, to be conducted by 2-4 states over a two-
year period. This program will provide necessary resources to these 
states to develop and test essential core elements of pre-driver 
licensure drug testing. Because the driver's license is an effective 
motivator for youth, this pre-driver licensure drug testing program has 
great potential for impact. In 1995 there were 21.95 million young 
people aged 15-20 in the U.S. Of these, 11.92 million were licensed 
drivers. Pre-licensure drug testing would send an important message to 
America's youth that drugs and driving don't mix. Instituted as part of 
a systematic strategy to deter drug use and drugged driving it should 
result in reduced drug use and drug-related driving by youth. If 
combined with some form of unscheduled testing, after crashes or 
driving violations, its effects should be even greater.
    To learn the views of youth regarding drug testing, informal 
nationwide focus groups and discussions with almost 6,000 teenagers 
were conducted. Almost two-thirds favored requiring a drug test before 
a young person could receive a drivers license. About half felt that 
greater enforcement of drugged driving laws combined with pre-licensure 
testing would change drug use behavior.
    Question. What is the likelihood that any state could afford pre-
license drug screening or would require applicants to pay for youthful 
drivers? What do States do now in this area?
    Answer. Using Department of Transportation (DOT) and Department of 
Health and Human Services (DHHS) approved procedures for collecting, 
testing, and reporting, it is estimated that pre-licensure screening 
tests would cost $35 to $45 per test. These procedures require 
standardized collection steps (currently in use in over 10,000 sites 
across the U.S.); analysis at DHHS-certified laboratories (currently 71 
laboratories in place); and review of positive results by qualified 
physicians. Less stringent testing procedures would likely reduce the 
per test cost. While states possibly could assume the cost of pre-
license testing, it is more likely they would require the applicant to 
bear the expense, as a requirement for obtaining a license. Under this 
scenario, license applicants would be required to present a certified 
test result obtained within a specified time period (probably 30 or 60 
days), indicating no recent drug use.
    No state currently conducts pre-licensure drug tests. However, 
testing license applicants in other areas is a routine part of the 
process of granting licenses. For example, all states test for 
knowledge of the rules of the road and for visual acuity. Some states 
also require certain categories of drivers to obtain medical 
certificates prior to licensure (e.g., epileptics). In addition, drug 
testing programs are already conducted in other contexts, such as for 
high school athletes and employers.
    Question. Where is it legal to conduct pre-licensure drug testing 
on youth? How would this testing be useful in deterring drug use?
    Answer. States have generally delegated to their licensing agencies 
authority to establish necessary rules and regulations to ensure that 
only safe drivers are licensed. Testing licensed applicants is a 
routine part of the process. For example, all states test for knowledge 
of the rules of the road and for visual acuity. A licensing test 
procedure could be considered unconstitutional or otherwise contrary to 
law if it were deemed to be discriminatory or not adequately supported 
by public safety or other important government interests. NHTSA and the 
Department of Justice believe that reducing drug-impaired driving would 
be considered a legitimate exercise of governmental authority and could 
adequately support a reasonably designed drug-testing program.
    Pre-driver licensure drug testing is likely to be effective in 
deterring drug use among new license applicants because, for most young 
applicants, the ability to drive a motor vehicle is an important step 
into adulthood. Most would not want to lose their opportunity to obtain 
a driver's license by failing a drug test. Pre-licensure testing (like 
zero tolerance of alcohol) would send an important message to America's 
youth that drugs and driving don't mix and that there are immediate and 
tangible consequences of using drugs. Instituted as part of a 
systematic strategy to deter drug use and drug-related driving, such 
measures will reduce the incidence of drug-related driving, at least 
among some youth. If combined with some form of unscheduled testing, 
after crashes or driving violations, its effects should be even greater 
and will promote public safety.
    Question. Won't the youth applicant know that he or she will be 
tested prior to receiving an operator's license?
    Answer. In order to deter drug use, it is vitally important that 
applicants know that they will be tested prior to receiving an 
operator's license. There are few, if any, better motivators for youth 
than the driver's license. Many youth will refrain from drug use rather 
than risk not being able to obtain a license when eligible. NHTSA hopes 
that the pre-license drug testing programs will be instituted as part 
of a systematic strategy to deter drug use and drugged driving. 
Combined with some form of unscheduled testing, e.g., after crashes or 
driving violations, the deterrent effects will be even greater.
    Question. What are the expected total costs of this demonstration? 
What are NHTSA's costs projected to be for each of the next four years?
    Answer. The total cost of this demonstration program is expected to 
be $16 million. NHTSA is requesting $2 million in fiscal years 1998, 
and will request $2 million in fiscal year 1999 and 2000. The Office of 
National Drug Control Policy (ONDCP) is providing $2 million in fiscal 
year 1997, and will request $4 million in fiscal years 1999 and 2000.
    Question. Other than the demonstration project, what specific 
portions of the fiscal year 1997 and the proposed fiscal year 1998 
budget address the issue of youth driving and impairment by controlled 
substances? Please indicate specific activities and associated funding 
amounts.
    Answer. In fiscal year 1997, $599 thousand was appropriated to 
support education and technical assistance activities for law 
enforcement, prosecution, adjudication, and the general public. In 
fiscal year 1998, the budget request includes $476 thousand to continue 
such education and technical assistance. These funds are used for 
programs such as the Drug Evaluation and Classification (DEC) program 
that supports law enforcement officers trained to detect persons 
impaired by drugs, and for providing up-to-date information and 
training on drugged driving to judges and prosecutors. Both of these 
activities increase the risk of detection, arrest, and punishment for 
drug use and drugged driving by youth. Finally, a research study to 
determine the incidence of drugs in non-fatal serious injury crashes 
will be completed in fiscal year 1997 and will provide up-to-date 
information on drug use by young, injured crash involved drivers.
    Question. If monies for the demonstration program were denied, what 
else could NHTSA do to address this issue? What activities does NHTSA 
have planned for fiscal year 1998? What is the associated funding 
level?
    Answer. NHTSA will continue its efforts to strengthen and improve 
the enforcement, prosecution, adjudication, prevention, education and 
treatment of young drugged drivers. However, it is unlikely that other 
efforts will have as strong an impact on youth as the proposed pre-
license drug testing program. One reason this pre-driver licensure drug 
testing program is likely to be effective is that the driver's license 
is a strong motivator for youth. Pre-license testing would send an 
important message to America's youth that drugs and driving don't mix. 
Instituted as part of a systematic strategy to deter drug use and 
drugged driving, it should by itself, reduce drug use and drugged 
driving by some youth. If combined with some form of unscheduled 
testing after crashes or driving violations, its effects should be even 
greater and will promote public safety.
    NHTSA has requested $476 thousand in the fiscal year 1998 budget to 
support current education and technical assistance activities for law 
enforcement, prosecution, and adjudication of drugged drivers including 
youth. These funds are used for a variety of programs, including the 
Department's Drug Evaluation and Classification (DEC) program, that 
supports law enforcement officers trained to detect persons impaired by 
drugs, and for providing up-to-date information and training on drugged 
driving to judges and prosecutors. Both of these activities increase 
the risk of detection, arrest, and punishment for drug use and drugged 
driving by youth.
    Question. Are there any data specific to youth (15 to 20) that 
indicates a strong relationship between drugs and youth driving 
problems? Please cite specific publications and their findings.
    Answer. The evidence is clear that drug use among American youth is 
increasing. The 1996 Monitoring the Future Study, a self-reported 
survey of 49,000 students in the 8th, 10th and 12th grades revealed 
that, since 1991, the use of illicit drugs nearly doubled for 8th 
graders (i.e., it increased from 11 percent to 21 percent). This report 
also indicated that, since 1992, illicit drug use increased by nearly 
50 percent for 12th graders (i.e., from 27 percent to 39 percent use). 
Marijuana use showed the sharpest increase.
    Other studies have reported similar findings. Studies of drivers 
involved in crashes indicate that many have used drugs. NHTSA currently 
estimates that drugs are used by approximately 10-22 percent of crash 
involved drivers, often in combination with alcohol. NHTSA's most 
recent study of fatally injured drivers found evidence of drug use in 
17.8 percent of these drivers (evidence of alcohol use was found among 
51.5 percent). Drug use rates among younger drivers tend to be higher 
than for any other age group.
    An ongoing NHTSA study of non-fatally injured drivers has found 
that 12 percent of all drivers tested positive for drugs other than 
alcohol, while 23.3 percent of drivers under 21 years of age tested 
positive. The National Parents Resource Institute for Drug Education 
(PRIDE) 9th Annual Survey of Students (an annual self-administered 
questionnaire) recently found that, among 12th grade students, 
marijuana is more likely to be used in a car than alcoholic beverages. 
Twenty percent reported that they smoked marijuana in a car, compared 
with 16.3 percent who reported drinking beer in a car, and 9.5 percent 
who reported drinking wine coolers in a car.
    The available evidence clearly points to the fact that youth are 
increasing their use of drugs and often drive in conjunction with drug 
use. While the precise nature and extent of the youth drugged driving 
problem can not be specified with any single estimate at this time, 
there is ample evidence the problem is growing and presents a serious 
threat to public safety.
    Question. Since last year, please specify how many States have 
adopted graduated licensing provisions, open container laws, and those 
that have lowered alcohol thresholds limits for convictions of impaired 
driving laws for youth.
    Answer. Georgia, North Carolina, and New Hampshire have enacted 
Graduated Driver licensing legislation this term. In Illinois, a 
Graduated Driver Licensing bill has passed the legislature and is 
currently awaiting the Governor's signature. Hawaii has enacted some 
provisions of a Graduated Driver Licensing system.
    Colorado, Georgia, Hawaii, North Carolina, and North Dakota have 
enacted lower alcohol threshold limits for impaired driving convictions 
among youth. In Vermont, a bill lowering the alcohol threshold for 
youth is awaiting the Governor's signature. Montana passed legislation 
revising its sanctions for violation of its lower threshold law.
    The agency is unaware of any state which has passed or modified an 
open container law this legislative session.
    Question. What have been some of the challenges facing States when 
implementing or adopting such laws? How does your 1998 budget request 
address these challenges? Please indicate funding amounts.
    Answer. Graduated licensing requires states to pass legislation 
changing the manner in which young persons can obtain a driver's 
license. Additional issues arise over the states capabilities to 
administer a graduated licensing system. Because it is a more complex 
system, it can require additional administrative expenses for the 
licensing authority.
    Another challenge concerns the specific provisions, or components, 
of a graduated system. For example, a night time curfew is a 
recommended part of the system. Some legislators are concerned that 
this will cause problems for those young people engaged in school, 
religious, work or family activities that cause the young person to be 
out late at night.
    There has been little, if any, resistance to the passage of lower 
alcohol threshold limits for young drivers. As of June 23, 1997, forty-
one states (and the District of Columbia) have set their BAC threshold 
at .02 BAC for youthful DWI offenders under age 21. All states are 
expected to enact zero tolerance laws by October 1, 1998, so that they 
will not be subject to having funds withheld.
    The requested fiscal year 1998 funding would provide incremental 
support for a graduated driver licensing system evaluations in Michigan 
($100,000). An additional evaluation (currently funded) will also be 
conducted in North Carolina. These evaluations include an assessment of 
administrative procedures by the states. Information, as it becomes 
available, will be shared with other states interested in graduated 
licensing.
    Question. What is NHTSA doing to improve the enforcement of drunk 
driving laws affecting youth? How does NHTSA's fiscal year 1997 budget 
and the fiscal year 1998 budget request address this issue?
    Answer. To improve the enforcement of drunk driving laws affecting 
youth, NHTSA has undertaken activities in four major areas: provision 
of technical assistance materials, conducting training, implementing 
demonstration projects and promoting innovative strategies.
    Manuals and video tapes have been developed to assist enforcement, 
Alcohol Beverage Control agencies, and other organizations to implement 
new strategies and programs. Training has been, and will continue to 
be, provided to improve youth enforcement techniques and adjudication 
strategies (e.g., use of ``teen courts''). Ten community demonstration 
programs have been initiated to encourage comprehensive enforcement 
activity. Innovative concepts, such as youth offender ``visitation'' to 
trauma units and ``holdover'' facilities to temporarily detain youthful 
alcohol offenders are being tested. All of these activities, in 
addition to programs specifically focused on ``zero tolerance'' 
enforcement, are being funded in the fiscal year 1997 and fiscal year 
1998 budget.
    Question. Please specify the nature and total amount of all youth-
oriented activities for fiscal year 1996; fiscal year 1997, and planned 
for fiscal year 1998, separately.
    Answer. NHTSA has initiated a wide variety of youth projects, some 
of which are multi-year efforts. Attached is a table listing on-going 
or planned projects. Many of these projects have had previous years 
funding or will use multi-year funding.
    See list of projects below.

                          NHTSA YOUTH PROJECTS                          
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                      Fiscal years--    
                     Project                     -----------------------
                                                   1996    1997    1998 
------------------------------------------------------------------------
BACCHUS Awareness Program.......................      30  ......  ......
Graduated Licensing.............................      50  ......  ......
RID Underage Drinking Workshops.................      45  ......  ......
Messages for School Children....................     100  ......  ......
Evaluate Magnetic Stripe for ID.................      60  ......  ......
DC Model Underage Drinking Program..............     191     200  ......
Scholastic Magazine Messages....................      75  ......  ......
State Youth Assessment..........................      25  ......  ......
Alcohol Beverage Control Project................      75  ......  ......
SADD ``Strides for Safety''.....................      67  ......  ......
FHA Awareness Campaign..........................      30  ......  ......
National Organization Support...................     215  ......  ......
Parents as Role Models..........................      50  ......  ......
``Teen Courts''.................................     110     100  ......
Evaluate MI Graduated Licensing.................  ......     100  ......
ATS Juvenile Visitation Program.................      45  ......  ......
National Zero Tolerance Campaign................  ......     200     200
BACCHUS/SADD Zero Tolerance.....................  ......      96  ......
Peer Helpers Zero Tolerance.....................  ......      93  ......
Enforcement of zero tolerance laws..............  ......     140     200
Evaluation of Zero Tolerance Laws...............  ......     150  ......
MADD Training of Student Activists..............      50     118      30
Strides for Safety--NSC.........................  ......      81  ......
Juvenile ``Holdover'' Project...................  ......     100     100
NOYS meeting support............................      45     150  ......
National Organization Project Support...........  ......     200  ......
NOYS Youth Summit...............................      69  ......  ......
Cross Age Peer Mentoring Program................      25  ......  ......
Nat'l Science Teachers Curr.....................  ......      50  ......
Youth Sanctions Guide...........................      75  ......  ......
Outdoor Billboard Campaign......................      50  ......  ......
Youth Urban Diversity project...................      50      50  ......
Evaluation of youth projects....................      25      25  ......
Guidelines for age-appropriate ed materials.....  ......     150  ......
Strategies to increase safety belt use by youth.      40      50  ......
Decisionmaking skills of young drivers..........     256  ......  ......
Community Compliance With ABC Laws..............     150  ......  ......
SADD National Conference........................      50  ......  ......
``Traffic Safety Box''..........................      50      50  ......
Drinking and Impaired Driving-College...........     100     100  ......
Matching Strategies to Youth Characteristics....      28  ......  ......
Determine Reasons for Reduced Youth DWI.........     100      50  ......
Bicycle Programs................................      80     100  ......
Pedestrian/Diversity Programs...................  ......     200  ......
------------------------------------------------------------------------

    Question. How many States are now receiving grant funds to carry 
out graduated licensing systems? What have been the results? Are any 
new States considering them? How does the fiscal year 1998 budget 
request and the fiscal year 1997 budget address this matter? Please 
indicate funding amounts.
    Answer. In fiscal year 1995 the Agency awarded grants to five 
states to demonstrate and evaluate components of a graduated licensing 
system: Alaska ($77,000), Florida ($225,000), North Carolina 
($397,000), Tennessee ($317,700), and Vermont ($183,000). All of these 
states needed to pass legislation when the grants were awarded. Florida 
and North Carolina have since passed graduated licensing legislation. 
Evaluation data are not yet available. A number of states introduced 
related legislation this calender year. For example, Vermont 
legislation to create a new system did not get out of Committee; 
California legislation to improve their current system is still being 
considered; Maryland also introduced legislation to improve their 
current system but the legislature requested additional information.
    The fiscal year 1997 budget included funds ($100,000) to evaluate 
Michigan's graduated system. These funds being provided to the 
University of Michigan which is conducting an evaluation of the 
program. Incremental funds ($100,000) are being requested in fiscal 
year 1998 for this effort.
    The fiscal year 1998 request also includes a proposed incentive 
grant program designed to encourage states to implement laws and 
programs to combat alcohol-impaired driving. One of the qualifying 
criteria for a basic grant is the enactment of a graduated driver 
licensing law with nighttime driving restrictions and 0.02 BAC for 
persons under age 21.
    Question. Please prepare a table indicating the amount requested 
and the amount actually appropriated for each of the five subprograms 
of the National Occupant Protection Program in fiscal years 1995, 1996, 
and 1997.
    Answer. See table below.

----------------------------------------------------------------------------------------------------------------
                                                                Fiscal years--                                  
                             -----------------------------------------------------------------------------------
           Program                       1995                        1996                        1997           
                             -----------------------------------------------------------------------------------
                                Request    Appropriation    Request    Appropriation    Request    Appropriation
----------------------------------------------------------------------------------------------------------------
PI & E......................       $2,213        $2,450        $2,414        $2,314        $2,364        $2,360 
Belt Law....................        1,704         1,676         1,904         1,886         1,674         1,670 
Target Pop..................        1,321         1,296         1,635         1,253         1,637         1,498 
Eval and Tech...............          451           444           447           439           538           537 
Patterns....................  ...........  .............        1,600           952           745           744 
----------------------------------------------------------------------------------------------------------------

    Question. Please prepare a table for each of the five subprograms 
in the National Occupant Protection Program, showing how all of the 
funds requested for fiscal year 1998 are intended to be spent, and 
please include in that table a comparison with the amount provided for 
each of those activities for fiscal year 1997. On a separate page, 
please justify the need for the requested increases.
    Answer. The information follows.

                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                         Fiscal years-- 
         National Occupant Protection Program          -----------------
                                                          1997     1998 
------------------------------------------------------------------------
Public Information & Education........................    2,360    2,263
Belt Law Compliance...................................    1,671    1,594
Target Population Education...........................    1,498    1,540
Evaluation and Technology Sharing.....................      537      498
Patterns for Life.....................................      744      715
                                                       -----------------
      Total...........................................    6,810    6,610
------------------------------------------------------------------------

Justification
    Overall, the fiscal year 1998 request represents a decrease of 
$200,000. Target Population Education includes an increase of $42,000 
which will be used to bring air bag information to Hispanic populations 
to reduce the risk of air-bag related injuries to children channels 
will be supported and utilized to ons.
                    public information and education
    Question. How do the activities conducted under this program which 
relate to child safety seats and air bag use differ from the agency's 
activities in these areas in other NHTSA programs?
    Answer. The public information and education activities funded 
under this program are all related to educating the public on safety 
belts, child safety seats, and air bags. They include developing, 
producing, marketing and distributing educational materials used by 
national, state and community programs and a public service campaign 
conducted through the Advertising Council. Child safety seat and air 
bag activities in other NHTSA programs including research, training 
programs, demonstration programs, and outreach.
    Question. Please describe all agency activities related to child 
safety seat use and from which program they are funded.
    Answer. The following child safety seat use activities are funded 
under Occupant Protection Public Information and Education: Developing, 
producing, marketing, and distributing brochures, posters, videos, 
manuals, certain pieces in the Campaign Safe & Sober Quarterly 
Planners, and video news releases for Child Passenger Safety Week. The 
1997 Safety Belt Education Campaign public service announcements 
produced with the Advertising Council sent the message that children 
belong in the back seat of air bag cars. The ``Protecting Your 
Newborn'' video and child passenger safety training programs are funded 
under the Patterns for Life Program. This video is being distributed by 
Ford Motor Company to over 100,000 medical and health professionals to 
educate parents of new babies on how to transport their children 
safely, especially in cars equipped with passenger side air bags. The 
Patterns for Life Program is also funding the development of ``Your 
Child, Your Car, Your Choices,'' the interactive CD-ROM program that 
shows which seating positions in a specific vehicle are safe for 
installing a specific child safety seat. Cooperative agreements and 
grants with national organizations that partner with NHTSA to deliver 
the child safety seat messages and materials to the public are funded 
under the Occupant Protection Target Populations Program. State 
demonstration programs that focus on enforcing the State's child 
passenger safety law are funded under the Occupant Protection Belt Law 
Compliance program. Research on behavioral questions that affect proper 
use of child safety seat questions are funded under the Traffic Safety 
Programs Research Program.
    Although the Agency does not contribute money to the Air Bag Safety 
Campaign, it is a major partner and participates in the Campaign's 
decisions and activities. This $14 million Campaign supports the 
Agency's messages that children should sit in the back seat and be 
properly retrained. The Campaign also helps enact and enforce child 
passenger safety laws. Thus, the Campaign leverages NHTSA's dollars to 
achieve a greater impact on the problem of unrestrained children than 
would otherwise be possible.
    Question. Please describe all agency activities related to air bags 
and specify which program they are funded from.
    Answer. Developing, producing, marketing, and distributing 
educational materials to educate the public on the benefits and risks 
of air bags are currently being funded as part of the National Occupant 
Protection Public Information and Education Program. All of NHTSA's 
outreach programs funded under the National Occupant Protection Target 
Populations now include air bag issues. Campaign Safe & Sober Quarterly 
Planners include air bag information and are funded out of the Alcohol, 
Occupant Protection, and Enforcement Programs. NHTSA's participation in 
the Air Bag Safety Campaign (ABSC) leverages the agency's dollars to 
achieve a greater impact than would be possible otherwise. While the 
agency does not contribute money to the ABSC, it is a major partner and 
the principal designer of the Campaign's strategy for addressing the 
problem of air bag related injuries: educate the public on how to 
eliminate or reduce the risks associated with air bags, enact stronger 
belt and child seat laws, and enforce the laws.
                          belt law compliance
    Question. Please explain how the efforts and activities to be 
conducted using the requested $2 million on page HS-46 for an Air Bag 
Safety program are different than efforts and activities outlined on 
page HS-34 for an Occupant Protection program. Why can't these 
activities be combined? Please break down the expected uses of these 
funds.
    Answer. The $2 million initiative focuses specifically on the 
interaction of the airbag with occupants. The program will educate the 
public about air bag safety issues and the associated need to increase 
the national safety belt use rate. These funds will be used to (1) 
enhance public education on airbag, safety belts and child safety 
seats, (2) enhance the enforcement of existing laws for safety belts 
and child safety seats, and (3) evaluate the enforcement efforts 
implemented to reduce airbag induced deaths and injuries.
    Combining these efforts with the overall Occupant Protection 
program would de-emphasize the important message and specific program 
elements that NHTSA is trying to accomplish. Many people transporting 
children in cars do not understand the importance of proper restraint 
use, the need for using age-appropriate restraint devices, and how air 
bags work both for themselves and with children. There have been over 
1.5 million air bag deployments, saving over 2,000 lives. In 1996 
alone, over 700 lives were saved by air bags.
    This initiative will accelerate the public's understanding that: 
(1) the rear seat is the safest place for children of any age to ride, 
(2) that all occupants, children and adults, must be buckled no matter 
where they sit, and (3) rear-facing child seats must never be placed in 
front of an air bag.
                           target populations
    Question. How do the activities in this program overlap with 
activities being conducted elsewhere within NHTSA?
    Answer. Target Populations is a budget line item under Occupant 
Protection. Therefore, the activities in target populations focus on 
increasing use and correct use of seat belts and child safety seats by 
networking with national organizations capable of delivering programs 
and messages to target populations whose restraint use is below 
average. The program is designed to generate a critical mass of 
activity and information at the state and local level to assist the 
State in meeting its safety belt and child passenger safety goals. This 
is the only program in NHTSA that conducts activities of this nature. 
Thus, there is no overlap.
    Question. The budget for this program was increased by $245,000 
from fiscal year 1996 to fiscal year 1997. What was this increase used 
for?
    Answer. The increased monies were used to fund a competitive grant 
program for national organizations to develop and implement programs 
designed to educate constituents and communities on the risk of air 
bag-related injuries to children. Funds for up to five organizations 
were made available. We are in the process of reviewing the grant 
applications. Grant awards should be made in August 1997.
    Question. Please justify the $42,000 requested increase in this 
program.
    Answer. The resources will be used to bring air bag information to 
Hispanic populations to reduce the risk of air-bag related injuries to 
children. Hispanic media and information channels will be supported and 
utilized to deliver messages, materials and information to Hispanic 
populations.
    Question. Please list the 21 states which will participate in this 
program?
    Answer. To date, the following 19 states have been identified to 
participate in the program in fiscal year 1998: Colorado, Connecticut, 
Florida, Georgia, Indiana, Iowa, Michigan, Minnesota, Mississippi, New 
Jersey, New Mexico, North Carolina, Oregon, South Carolina, Texas, 
Utah, Virginia, Washington, Wisconsin.
                      evaluation of state programs
    Question. Why does the federal government need to subsidize 
evaluation of state programs?
    Answer. Future progress in reducing highway safety crashes requires 
effective programs that successfully target high risk groups, 
situations, and behaviors. It is critical that scarce resources be used 
on programs with demonstrated benefits. While the states and local 
communities have developed and implemented many programs that appear 
promising in reducing crashes, in many cases their effectiveness has 
not been determined or documented. Most States and communities do not 
have sufficient capabilities or resources to conduct scientifically 
sound studies of their countermeasure programs--they turn to NHTSA for 
guidance in evaluating their programs.
                   evaluation and technology sharing
    Question. How much money is being proposed to be spent in fiscal 
year 1998 on disseminating information and educational materials for 
influencing the public's knowledge and attitudes toward air bags?
    Answer. The agency has requested $2,000,000 in fiscal year 1998, to 
address the problem of air bag related injuries. Of that amount, 
$650,000 is proposed for developing, producing and disseminating 
information and educational materials. The balance of the request will 
be used to enhance the enforcement of existing laws for safety belts 
and child safety seats, and to evaluate the enforcement efforts 
implemented to reduce air bag induced deaths and injuries.
    Question. How has NHTSA worked with the states of Alabama and 
Alaska in this area?
    Answer. NHTSA is working closely with Alaska and Alabama to provide 
them with up to date information and assistance in the area of air bag 
safety. In Alaska, NHTSA Regional staff have provided information and 
technical assistance to several groups, including the Alaska Highway 
Safety Planning Agency, Emergency Medical Services, Alaska State 
Troopers, and the Anchorage Safe Communities program. Technical 
assistance was also provided for three Air Bag Safety Campaign press 
events, held in November 1996, February and over the recent Memorial 
Day holiday. Information and technical assistance was made available to 
federal agencies and military bases throughout Alaska, through the 
Alaska Federal Safety & Health Council.
    In Alabama, Regional personnel worked with the Alabama Governor's 
Safety Coordinating Committee and Alabama representatives of Highway 
Safety Advocates and the National Safety Council. NHTSA provided an air 
bag safety information booth at a three day conference of the Alabama 
Association of Educators. NHTSA also initiated talks with the State 
Department of Education and the U.S. Department of Education to urge 
them to write letters to educators and parent-teacher groups, 
emphasizing the importance of air bag safety.
    In addition to the above activities, NHTSA has responded to 
numerous requests in each state, providing technical assistance and 
information on air bag and occupant protection issues.
    Question. Please summarize the agency's efforts to address the 
adverse effects of air bag deployment, specifically as related to 
serious injuries and fatalities.
    Answer. On May 23, 1995, the agency published a final rule to 
permit vehicle manufacturers to offer manual cutoff switches for the 
passenger air bag for new vehicles without rear seats or with rear 
seats that are too small to accommodate rear-facing child restraints, 
until as late as September 1, 1998. On January 6, 1997, the agency 
extended the expiration date of this cutoff switch rule until September 
1, 2000. The agency is optimistic that advanced, automatic, air bag 
technologies will be available after this date, to replace manual 
systems.
    On November 22, 1996, the agency published a final rule amending 
both Standard No. 208, Occupant Crash Protection and Standard 213, 
Child Restraint Systems, to require improved labeling on new vehicles 
and child restraints to better ensure that drivers and other occupants 
are aware of the danger posed by passenger air bags to children. The 
labeling emphasizes the placement of rear-facing child restraints in 
the rear seats of vehicles with operational passenger air bags. These 
requirements are in place now.
    On March 19, 1997, the agency issued a final rule to permit 
manufacturers to depower air bags by 25-30 percent, and adopted 
different test protocols that make this conversion quick to implement 
for the vehicle manufacturers.
    On January 6, 1997, the agency published a proposed rule to allow 
auto dealers and repair businesses to deactivate air bags, after 
receiving written authorization from vehicle owners. Final decisions on 
this proposal will be made soon.
    The agency has developed a comprehensive and high priority Advanced 
Air Bag Technology program plan to expedite achieving the goal of 
introducing advanced air bag systems. Advanced air bag systems are 
expected to remove many of the disbenefits apparent in current air bag 
designs, while providing optimum protection for belted occupants as 
well as occupants who do not wear belts. This program plan for Advanced 
Air Bag Technology specifies the necessary tasks that must be 
undertaken to achieve the objective of installing advanced air bag 
systems in future vehicles.
    The plan specifically includes tasks to ensure that future crash 
testing is responsive to the needs of children and small statured 
adults. The agency has granted petitions for rulemaking to include the 
5th percentile female dummy as part of the new crash test protocols. 
The agency expects to complete the technical evaluation of the 5th 
percentile Hybrid III female dummy, the 3-year-old and the 6-year-old 
Hybrid III dummies by December 1997. Thus, by the end of this year, the 
agency will be in a position to include any or all of these test 
dummies in test protocols dealing with out of position occupants and/or 
combinations with pre-crash braking or other considerations.
    NHTSA along with an independent effort by NASA, will carefully 
assess the emerging new air bag technologies. The agency has conducted 
testing in a program to assess the injury causing potential of air bag 
systems when occupants are out of position relative to the air bag 
deployment. These baseline air bag systems have been compared to 
depowered (reduced inflator output) and new air bag designs provided by 
auto manufacturers and air bag suppliers to determine the effectiveness 
of the air bags in preventing injuries to out of position occupants, in 
addition to providing adequate protection to normally seated occupants.
    The agency intends to test any additional advanced technologies 
that are close to production and determine if these technologies can 
provide benefit to the out of position child and provide protection in 
high speed crashes where depowered air bags may lose some of their 
restraint capacity. As part of the Advanced Air Bag Technology program 
plan, the agency will develop and conduct performance testing of 
advanced air bag inflator technologies. These performance tests will 
focus on the capabilities of advanced inflators to tailor air bag 
output based on the crash severity, belt-use status, and/or other 
occupant and vehicle parameters. A series of static and dynamic sled 
and crash tests to evaluate the state of this technology has been 
planned for the near future.
    Based on the results of this test program and other research 
information, the agency plans to issue an NPRM on advanced air bags, 
including test procedures, by the end of calendar year 1997.
    In addition, NHTSA has been pro-active in educating the public, 
promoting state and local legislation, and encouraging active 
enforcement of occupant protection laws to address the adverse effects 
of air bag deployment. Efforts include hosting a national ``Call to 
Action'' conference, producing an Air Bag alert folio which was 
distributed to over 500,000 organizations, and assisting in the 
establishment of the Air Bag Safety Campaign (ABSC), which is alerting 
the public to the dangers of air bag deployments to unrestrained and 
improperly restrained children. NHTSA is an active member of the 
coalition and supports its efforts.
    The agency has also prepared informational air bag facts sheets, 
published informative articles in various media and research 
publications, and developed and distributed 40,000 quarterly Safe & 
Sober Planners containing air bag safety information. These planners 
went to state highway safety offices as well as national safety, 
health, medical, and enforcement organizations.
    The agency is providing funding demonstrations in 21 states to 
conduct highly visible occupant protection law enforcement programs and 
to provide education on air bags and adult and child occupant 
protection laws. NHTSA has also developed a brochure emphasizing the 
correct positioning of child car seats in air bag-equipped vehicles.
                         air bag safety program
    Question. Please provide in detail the amount spent on this area 
during fiscal year 1996, fiscal year 1997, and planned for fiscal year 
1998, being certain to identify purposes and objectives of these 
expenditures.
    Answer. In fiscal year 1996 and fiscal year 1997 the Air Bag Safety 
Program did not formally exist as a budget line item in the Highway 
Safety Program, and there were no specific program expenditures. 
However, in fiscal year 1997, Highway Safety Programs allocated 
approximately $3 million for air bag efforts. This included specific 
projects dedicated to the air bag issue such as the Ad Council public 
information campaign and outreach efforts directed at various target 
populations. Nearly every other aspect of the Occupant Protection 
Program, including Technology Sharing, Belt Law Compliance, and 
Patterns for Life programs supported the Air Bag Safety Program. Most 
of the material development and delivery for outreach programs, for 
example, include air bag information.
    Additionally, a portion of the agency's Section 403 Special Traffic 
Enforcement grant program (fiscal years 1995-1997 budget $4.6 million) 
is used to improve both child passenger safety and air bag safety. In 
addition, all states have directed a portion of their Section 402 
funding at the state and community levels on strategies to address this 
issue.
    In fiscal year 1998, $2,000,000 will support three major 
initiatives: (1) continuation of high visibility, statewide enforcement 
and education campaigns in 21 states to increase seat belt and child 
safety seat use and reduce air bag injuries ($1,050,000); (2) 
monitoring of public awareness of various belt law enforcement and 
education efforts and measuring the associated changes in occupant 
restraint use ($300,000); and (3) development and distribution of 
public information materials on the correct use of seat belts and child 
safety seats in air bag-equipped vehicles. This effort will include the 
distribution of 30,000 ``Protecting Your Newborn'' videos, posters and 
brochures with the new attention-getting air bag warning labels. It 
will also include other targeted materials, including a Spanish 
language brochure ($650,000).
    In addition, in the Research and Analysis program, air bag safety 
was also addressed through ongoing programs in the safety systems, 
biomechanics, and real-world crash investigation and analysis programs. 
Because these programs provide information and support a wide range of 
safety issues in addition to the air bag safety issues, it is not 
possible to provide a specific dollar amount. In fiscal year 1997, 
specific budget devoted to air bag research is approximately $1.311 
million. In addition, the agency has proposed to reprogram $2.8 million 
to support fiscal year 1997 high priority air bag projects. Work in 
fiscal year 1997 continued on laboratory testing and real-world crash 
analyses aimed at identifying technical approaches to address inflation 
caused injuries. Research efforts were geared to assessing near-term 
mitigation concepts primarily related to depowering air bag systems. 
The proposed reprogrammed funding will be used to support high priority 
biomechanics, air bag research, and real-world crash investigation of 
air bag-equipped vehicles. Projects will include the validation of 
child and adult dummies to be utilized in air bag research, joint 
research with Transport Canada, and the collection of additional 
detailed crash investigations within the agency's Special Crash 
Investigation program.
    In fiscal year 1998, $6.331 million in additional funding has been 
requested for air bag research, which is directed toward collecting 
additional real-world crashes involving air bag-equipped vehicles and 
to expanding the biomechanics and vehicle and air bag research and 
testing programs. The following provides brief descriptions:
    Special Crash Investigation (SCI) Program ($1.031 million). SCI 
data are critical to understanding real-world air bag performance. The 
SCI is a quick reaction crash investigation activity in which an 
investigator is sent to the crash site when the agency learns of 
unusual or special interest crashes. Virtually all funds are being 
directed toward air bag investigations.
    Biomechanics Program ($3.15 million). Design of less aggressive air 
bags requires a better understanding of injury mechanisms and 
tolerances of the human body to air bag loading. This is especially 
true for children and small females. This research will allow the 
generation of sufficient biomechanical data and provide necessary 
physical and analytical tools to address this issue.
    Safety Systems Program ($1.85 million). Research will continue to 
focus on the development, performance, and monitoring of advanced air 
bag systems to find solutions to the air bag problems identified in the 
field experience, including those injuries resulting from aggressive 
air bag deployments. For the advanced air bag systems under 
development, research will identify the better performing systems, 
evaluate their best features, and determine the need for performance 
requirements.
    The Consumer Product Safety Commission's (CPSC) National Electronic 
Injury Surveillance System (NEISS) collects information from a sample 
of hospital emergency rooms across the country. NHTSA has worked with 
NEISS data, collecting specific types of motor vehicle injury 
mechanisms. This effort will provide additional information on air bag-
related injuries. ($.3 million).
    Question. What is the agency doing to monitor the adverse effects 
of air bags? How is this reflected in the fiscal year 1998 budget 
request?
    Answer. The agency has a number of programs directed at monitoring 
real-world crashes and identifying adverse effects of air bags. The 
following describe programs that are included in the fiscal year 1998 
budget request:
    The Special Crash Investigation (SCI) program data are critical to 
understanding real-world air bag performance. The SCI is a quick 
reaction crash investigation activity in which an investigator is sent 
to the crash site when the agency learns of unusual or special interest 
crashes. Virtually all funds are being directed toward air bag 
investigations. ($1.031 million)
    The National Automotive Sampling System (NASS) is a database 
containing a random sample of crashes representative of all police-
reported towaway crashes occurring in the United States. The focus of 
the NASS investigations is on the last four model year vehicles. As a 
result of the Agency's air bag regulation, this means virtually every 
investigation will contain at least one air bag equipped vehicle. ($9.7 
million)
    The Fatal Analysis Reporting System (FARS) is a census of all fatal 
crashes in the United States. FARS is an essential resource that 
permits the agency and the traffic and highway safety community to 
quantify and describe the national traffic safety environment. As with 
NASS, studies utilizing this file will continue to analyze specific air 
bag issues and evaluate the effectiveness of air bags in fatal crashes. 
Currently, the FARS files contain approximately 45 percent of crashes 
involving air bag equipped vehicles. (i.e., $2.3 million of $5.2 
million)
    The Crash Injury Research and Engineering Network (CIREN) database 
is being implemented to improve the prevention, treatment, and 
rehabilitation of motor vehicle crash injuries through an integrated 
national network of physicians and engineers. Detailed crash 
investigations will be conducted and results entered into a uniform 
format, single database to allow for studies of air bag-related and 
other types of crashes. Current ``CIREN'' case inclusion criteria 
direct approximately 40 percent of the total effort toward 
investigation of air bag related cases, (i.e., $480 thousand of $1.2 
million)
    The Consumer Product Safety Commission's (CPSC) National Electronic 
Injury Surveillance System (NEISS) collects information from a sample 
of hospital emergency rooms across the country. NHTSA has worked with 
NEISS data, collecting specific types of motor vehicle injury 
mechanisms. This effort will provide additional information on air bag-
related injuries. ($.3 million)
    Question. What are the near-term actions to be taken by the agency 
that may reduce or eliminate these problems? How is this reflected in 
the fiscal year 1998 budget request?
    Answer. The agency has developed a comprehensive, high priority 
Advanced Air Bag Technology program plan to expedite achieving the goal 
of introducing advanced air bag systems. Our comprehensive plan 
contains both near- and long-term efforts.
    Advanced air bag systems are expected to remove many of the 
disbenefits apparent in current air bag designs while providing optimum 
protection for belted occupants as well as occupants who do not wear 
belts. This program plan for Advanced Air Bag Technology specifies the 
necessary tasks that must be undertaken to achieve the objective of 
installing advanced air bag systems in future vehicles.
    The plan specifically includes tasks to ensure that future crash 
testing is responsive to the needs of children and small statured 
adults. The agency has granted petitions for rulemaking to include the 
5th-percentile female dummy as part of the new crash test protocols. 
The agency expects to complete the technical evaluation of the 5th-
percentile Hybrid III female dummy, the 3-year-old and the 6-year-old 
Hybrid III dummies by December 1997. Thus, by the end of this year, the 
agency will be in a position to include any or all of these test 
dummies in test protocols dealing with out-of-position occupants and/or 
combinations with precrash braking or other considerations.
    In addition, the agency along with an independent effort by the 
National Aeronautics and Space Administration, will carefully assess 
the emerging new air bag technologies. The agency has conducted testing 
in a program to assess the injury causing potential of air bag systems 
when occupants are out of position relative to the air bag deployment. 
These baseline air bag systems have been compared to depowered (reduced 
inflator output) and new air bag designs provided by auto manufacturers 
and air bag suppliers to determine the effectiveness of air bags in 
preventing injuries to out of position occupants, in addition to 
providing adequate protection to normally seated occupants.
    The agency intends to test the additional advanced technologies 
that are closest to production and determine if these technologies can 
provide benefit to the out-of-position child and provide protection in 
high speed crashes where depowered air bags may lose some of their 
restraint capacity. As part of the Advanced Air Bag Technology program 
plan, the agency will develop and conduct performance testing of 
advanced air bag inflator technologies. These performance tests will 
focus on the capabilities of advanced inflators to tailor air bag 
output based on the crash severity, belt-use status, and/or other 
occupant and vehicle parameters. A series of static and dynamic sled 
and crash tests to evaluate the state of this technology has been 
planned for the near future. Based on the results of this test program 
and other research information, the agency plans to issue a Notice of 
Proposed Rulemaking on advanced air bags, including test procedures, by 
the end of calendar year 1997.
    This work is reflected in the fiscal year 1998 budget request for 
$6.331 million of additional funding.
    Other near term actions that will help eliminate these problems are 
(1) increasing the use of occupant protection restraints by all 
occupants; and (2) educating the driving public about the proper use 
and placement of occupants in air bag equipped vehicles.
    Conducting high visibility enforcement programs and enacting 
primary enforcement legislative provisions in states and communities 
nationwide, provides much potential for significantly increasing 
occupant protection use rates.
    Question. What are the longer term actions by the agency that may 
reduce or eliminate these problems? How is this reflected in the fiscal 
year 1998 budget request?
    Answer. The agency has developed a comprehensive and high priority 
Advanced Air Bag Technology program plan to expedite achieving the goal 
of introducing advanced air bag systems. Our comprehensive plan 
contains both near- and long-term efforts. Advanced air bag systems are 
expected to remove many of the disbenefits apparent in current air bag 
designs while providing optimum protection for belted occupants as well 
as occupants who do not wear belts. This program plan for Advanced Air 
Bag Technology specifies the necessary tasks that must be undertaken to 
achieve the objective of installing advanced air bag systems in future 
vehicles.
    The plan specifically includes tasks to ensure that future crash 
testing is responsive to the needs of children and small statured 
adults. The agency has granted petitions for rulemaking to include the 
5th-percentile-female dummy as part of the new crash test protocols. 
The agency expects to complete the technical evaluation of the 5th-
percentile Hybrid III female dummy, the 3-year-old and the 6-year-old 
Hybrid III dummies by December 1997. Thus, by the end of this year, the 
agency will be in a position to include any or all of these test 
dummies in test protocols dealing with out-of-position occupants and/or 
combinations with precrash braking or other considerations.
    In addition, the agency along with an independent effort by the 
National Aeronautics and Space Administration, will carefully assess 
the emerging new air bag technologies.
    The agency has conducted testing in a program to assess the injury 
causing potential of air bag systems when occupants are out of position 
relative to the air bag deployment. These baseline air bag systems have 
been compared to depowered (reduced inflator output) and new air bag 
designs provided by auto manufacturers and air bag suppliers to 
determine the effectiveness of the air bags in preventing injuries to 
out of position occupants, in addition to providing adequate protection 
to normally seated occupants.
    The agency intends to test the additional advanced technologies 
that are closest to production and determine if these technologies can 
provide benefit to the out-of-position child and provide protection in 
high speed crashes where depowered air bags may lose some of their 
restraint capacity. As part of the Advanced Air Bag Technology program 
plan, the agency will develop and conduct performance testing of 
advanced air bag inflator technologies. These performance tests will 
focus on the capabilities of advanced inflators to tailor air bag 
output based on the crash severity, belt-use status, and/or other 
occupant and vehicle parameters. A series of static and dynamic sled 
and crash tests to evaluate the state of this technology has been 
planned for the near future.
    Based on the results of this test program and other research 
information, the agency plans to issue a Notice of Proposed Rulemaking 
on advanced air bags, including test procedures, by the end of calendar 
year 1997. Work will continue after this on safety performance and air 
bag safety monitoring. This work described above is reflected in the 
fiscal year 1998 budget request for $6.331 million of additional 
funding.
    Beginning in fiscal year 1998 Highway Safety Programs will conduct 
information and education programs to support this rulemaking, as well 
as support the overall occupant protection program. These efforts will 
include widespread distribution of posters and brochures, including 
Hispanic versions, with air bag warning labels and the production and 
distribution of newborn and other child passenger videos. Additional 
educational materials will be developed and distributed which focus on 
securing children under age 13 in the back seat.
    NHTSA will continue to provide funding, combined with matching 
funds from the states, to reinforce high visibility enforcement and 
education efforts. Other long term actions planned include support of 
the Air Bag Safety Campaign's (ABSC) enforcement and public education 
grants program.
    This partnership of NHTSA, the private sector, and the state 
highway safety offices will encourage the adoption of primary 
legislation and maintain the enforcement of occupant restraint laws. 
Over time, these efforts will result in major increases in seat belt 
use rates, as they have in other nations and in some high use states. 
Increasing the seat belt use rate will, in turn, significantly reduce 
the problems associated with air bag deployments.
    Question. Please prepare a table indicating the amount requested 
and the amount actually appropriated for the two programs in the 
Enforcement and Emergency Services Program for fiscal years 1995, 1996, 
and 1997.
    Answer. The information follows.
    See table below:

                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                Fiscal years--                                  
                             -----------------------------------------------------------------------------------
           Program                       1995                        1996                        1997           
                             -----------------------------------------------------------------------------------
                                Request    Appropriation    Request    Appropriation    Request    Appropriation
----------------------------------------------------------------------------------------------------------------
PTS.........................        1,209         1,187         1,606         1,286         1,209         1,207 
EMS.........................          769           655         1,122         1,122         1,180         1,178 
----------------------------------------------------------------------------------------------------------------

               enforcement and emergency services program
    Question. Please prepare a table for both of the programs in the 
Enforcement and Emergency Services Program, showing how all the funds 
requested for fiscal year 1998 are intended to be spent, and please 
include in that table a comparison with the amount provided for each of 
these activities for fiscal year 1997. On a separate page, please 
justify the need for the requested increases.
    Answer. The information follows.

------------------------------------------------------------------------
                                                  Fiscal years--        
                Activity                 -------------------------------
                                               1997            1998     
------------------------------------------------------------------------
Police Traffic Services:                                                
    Traffic Law Enforcement Projects....        $328,000        $797,000
    Technology Transfer.................         240,000         300,000
    Public Information and Education....         210,000         290,000
    Training and Technical Assistance...         170,000         168,280
    National Organizations..............         259,000         294,720
                                         -------------------------------
      Total.............................       1,207,000       1,850,000
                                         ===============================
Emergency Medical Services:                                             
    Leadership..........................         290,691         295,000
    Injury Prevention/Control, PIER.....         307,061         369,000
    National Standard Curricula.........          81,919          391,00
    EMS System Component Support........         198,757         421,000
    EMS Information, Technologies and                                   
     Dissemination......................         299,572          74,000
                                         -------------------------------
      Total.............................       1,178,000       1,550,000
------------------------------------------------------------------------

    Additional funding for Police Traffic Services is needed to develop 
effective programs and strategies, using state of the art technology to 
combat the aggressive driver and speeding problem. Funds will be used 
to develop model specifications and training for automated enforcement 
devices and for the implementation of a large scale countermeasure 
program to combat aggressive driving behaviors.
    Additional funding for the Emergency Medical Services program is 
needed to support revision and updating of the National Standard 
Curricula, additional technical assistance to State EMS programs and 
completion of the Bystander Care program.
                        police traffic services
    Question. How much money is planned to be spent in fiscal year 1998 
on efforts to demonstrate the link between traffic enforcement and the 
detection of criminal activity.
    Answer. NHTSA plans to spend $204,000 on efforts to demonstrate the 
link between traffic enforcement and its positive impact on the 
reduction of criminal activity.
    Question. How much was spent on this in fiscal year 1997?
    Answer. In fiscal year 1997 $160,000 was spent on efforts to 
demonstrate the link between traffic enforcement and its positive 
impact on criminal activity.
    Question. What is the compelling reason why such a large increase 
in PTS activity is justified in fiscal year 1998?
    Answer. The problem of the aggressive driver has emerged as one of 
the most serious traffic safety problems in our nation. The Police 
Traffic Services (PTS) budget has increased to address this problem. 
PTS will develop a comprehensive program to combat aggressive driver 
behaviors and its consequences by increasing awareness of the problem 
using a public information and education campaign. The agency will 
build coalitions to combat aggressive driving and unsafe driving 
behaviors and develop a technology-based model enforcement program.
    NHTSA will also develop model legislation to assist states and 
communities in dealing with the problem as well as provide technical 
assistance and technology transfer to states and communities interested 
in setting up programs to combat the aggressive driver.
                       emergency medical services
    Question. Please discuss what NHTSA is doing to further the use of 
cellular 911 numbers. How is this reflected in your fiscal year 1998 
budget request? What could be done to expedite the use of a uniform 
system anywhere in the nation?
    Answer. NHTSA is working with the Federal Communications Commission 
(FCC), the Cellular Telephone Industry Association (CTIA) and the major 
professional organizations representing public safety answering points 
to facilitate implementation of the FCC rule that requires cellular 
providers to implement automatic caller location technology by the year 
2001. The lack of automatic caller location capability is currently the 
major obstacle to effective use of cellular 911. In May 1997, NHTSA and 
these organizations cosponsored a ``call to action'' meeting to solicit 
support for implementation of the FCC rule from national safety and 
health organizations.
    NHTSA plans to continue working with these partners to facilitate 
implementation of the FCC rule, which provides the best mechanism for 
nationwide implementation of a uniform cellular 911 system. This is 
reflected in the fiscal year 1998 budget request as technical 
assistance for state emergency communication needs.
    Question. Please further justify the request for an additional 
$372,000 over last year's request. Is this request needed simply to 
follow through on the recently completed EMS Agenda? Exactly how will 
these additional monies be used.
    Answer. The additional funds will support implementation of the EMS 
Agenda for the Future, which continues to be a major component of both 
program development and outreach activities in the EMS area. Among the 
funded activities will be a national conference focusing on 
implementation of the visions in the EMS Agenda, revision of the 
Blueprint for EMS Education and Practice, and implementation of the 
model EMS quality improvement program.
    Question. Please provide dollar amounts of resources NHTSA received 
from other Federal agencies in fiscal year 1996 and 1997. Are there any 
Federal agencies planning on providing funds in fiscal year 1998?
    Answer. The Department of Health and Human Services, Emergency 
Medical Services for Children Program (EMSC) of the Health Resources 
and Services Administration, contributed $387,000 during fiscal year 
1996 and is planning to contribute $325,000 in fiscal year 1997 toward 
EMS projects being administered by NHTSA. No specific plans for funding 
by other agencies in fiscal year 1998 have been made known to the 
agency.
    Question. What evaluations, if any, have been conducted on the 
effectiveness and value of the NHTSA EMS program? What were the 
results?
    Answer. A formal evaluation was conducted on the NHTSA State 
Technical Assessment program in 1995. This evaluation included NHTSA 
technical assessments that had been completed in 40 states between 1988 
and 1994. This evaluation found that significant accomplishments were 
made in state EMS systems following delivery of the technical 
assessment efforts. These accomplishments included: enactment of 
comprehensive enabling legislation in 8 states; development of trauma 
system legislation in 11 states; development of statewide EMS plans in 
9 states; establishment of EMS Advisory Councils in 9 states; support 
for consistent medical direction in 10 states; and initiation of 
statewide EMS data collection in 5 states.
    An evaluation of NHTSA involvement in EMS education was conducted 
as part of the December, 1996 National Conference on EMS Training. At 
this conference, NHTSA solicited input from about 30 national EMS 
organizations concerning future agency involvement in EMS education. 
The resulting consensus statement recommended that the agency continue 
its support for the development and maintenance of the National 
Standard Curricula for Emergency Medical Providers. The consensus 
statement also recommends that NHTSA support the update and revision of 
the Blueprint for EMS Education and Practice.
       state motor vehicle services program records and licensing
    Question. Please prepare a table indicating the amount requested 
and the amount actually appropriated for fiscal years 1995, 1996, and 
1997.
    Answer. The information follows.

                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                Fiscal years--                                  
                             -----------------------------------------------------------------------------------
           Program                       1995                        1996                        1997           
                             -----------------------------------------------------------------------------------
                                Request    Appropriation    Request    Appropriation    Request    Appropriation
----------------------------------------------------------------------------------------------------------------
R&L.........................        1,330         1,319         1,284         1,284         1,330         1,329 
----------------------------------------------------------------------------------------------------------------

    Question. Please prepare a table showing how all of the funds 
requested for fiscal year 1998 are intended to be spent, and please 
include in that table a comparison with the amount provided for each of 
those activities for fiscal year 1997. On a separate page, please 
justify the need for the requested increases.
    Answer. See table below.

                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                  Fiscal years--        
               Activities                -------------------------------
                                               1997            1998     
------------------------------------------------------------------------
Technology Clearinghouse................          80,000          80,000
Traffic Safety Manager Quantitative                                     
 Analysis Training......................          60,000          60,000
Traffic Safety Manager Training in Use                                  
 of Analytical Software.................  ..............          44,000
Intermediate Data Analysis Training.....          58,000          50,000
Minimum Crash Data Set..................          60,000          60,000
Traffic Records Forum...................          60,000          60,000
Population Data Base....................          60,000          55,000
Traffic Records Technology Grants.......  ..............          302,00
AAMVA MYPLAN............................          100,00          50,000
NCUTLO Marketing Plan...................          50,000          50,000
SCS Transfer--Technical Assistance to                                   
 States (data linkage/program                                           
 evaluation)............................         800,000         768,000
                                         -------------------------------
      Total.............................       1,328,000       1,579,000
------------------------------------------------------------------------

Traffic safety manager training
    Traffic Safety Managers lack the necessary skills to use analytical 
software for analysis of traffic records licensing data. Training in 
analytical software use will increase their capability to effectively 
use traffic records data for decision-making purposes.
Traffic records technology grants
    A number of states have completed assessments of their traffic 
records systems and are now ready to initiate recommended system 
improvements. Technology grants would enable three to four of these 
states to test existing and emerging technologies that can be used to 
collect, store, manage, retrieve and analyze traffic records data more 
efficiently and effectively. The experience of these states in the use 
and application of new technologies will provide valuable information 
to other states considering similar applications.
    Question. How much money was spent in fiscal year 1997 on 
activities related to the Technology Clearinghouse? How much is 
proposed for this activity in fiscal year 1998?
    Answer. The amount of money spent in fiscal year 1997 for 
activities related to the Technology Clearinghouse was $80,000. The 
amount of money proposed for this activity in fiscal year 1998 is 
$80,000.
    Question. How much money does FHWA spend on this program?
    Answer. FHWA will spend $195,000 on this program from fiscal year 
1996 through fiscal year 1998.
    Question. What is the scope and nature on the older driver program 
mentioned on page HS-59?
    Answer. This program refers to efforts to have the AAMVA working 
group of Public Affairs and Consumer Education educate the public about 
older driver issues. It provides an information kit to states and 
Canadian provinces dealing with correct communication about older 
driver issues for both the general public and older drivers themselves.
                    highway safety research program
    Question. Please prepare a table indicating the amount requested 
and the amount actually appropriated for the nine subprograms in the 
Highway Safety Research Program for fiscal years 1995, 1996, and 1997.
    Answer. See table below.

                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                  Fiscal years--                                
                                --------------------------------------------------------------------------------
            Program                         1995                       1996                       1997          
                                --------------------------------------------------------------------------------
                                   Request   Appropriation    Request   Appropriation    Request   Appropriation
----------------------------------------------------------------------------------------------------------------
Alcohol and Drugs..............       2,006         1,960        1,802         1,772        1,606         1,603 
Occupant Protection............         670           655          645           635          575           574 
Older Driver...................         444           500          390           490          444           543 
Ped and Bicyl..................         355           252          302           302          302           301 
Speed and Unsafe...............         620           366          615           615          556           655 
Driver Education...............  ..........  .............         350           255          350           349 
Driver Fatigue.................  ..........  .............  ..........         1,000            0           980 
Evaluation.....................  ..........  .............  ..........  .............       1,000           100 
EMS............................  ..........  .............  ..........  .............  ..........  .............
----------------------------------------------------------------------------------------------------------------

          fiscal year 1997 and 1998 research budgets compared
    Question. Please prepare a table for each of the nine subprograms 
in the Highway Safety Research Program, showing how all of the funds 
requested for fiscal year 1998 are intended to be spent, and please 
include in that table a comparison with the amount provided for each of 
those activities for fiscal year 1997. On a separate page, please 
justify the need for the requested increases.
    Answer. See tables below and additional information on the need for 
the requested increases.

                         ALCOHOL & DRUG RESEARCH                        
------------------------------------------------------------------------
                                                  Fiscal years--        
                Activity                 -------------------------------
                                               1997            1998     
------------------------------------------------------------------------
Identify Target Groups and Situations...        $400,000        $550,000
Develop Enforcement Improvements........         350,000         450,000
Develop Traffic Law System Improvements.         205,000         200,000
Develop Programs To Change Driver                                       
 Attitudes..............................         150,000         150,000
Evaluate Injury Control Programs........         108,000         100,000
Develop Programs to Reduce Repeat                                       
 Offenders..............................         125,000         100,000
Improved Methods for Police Enforcement                                 
 of Drugged Driving.....................         275,000         100,000
                                         -------------------------------
      Total.............................       1,603,000       1,600,000
------------------------------------------------------------------------

    No increase in funding is requested for fiscal year 1998.

                           OCCUPANT PROTECTION                          
------------------------------------------------------------------------
                                                  Fiscal years--        
                Activity                 -------------------------------
                                               1997            1998     
------------------------------------------------------------------------
Strategies for Increasing Belt Use By                                   
 Teenagers..............................         $50,000        $100,000
Field Test Strategies to Increase                                       
 Enforcement............................          50,000         100,000
Target Group Identification.............         200,000         224,000
Strategies for Specific Target Groups...         224,000         250,000
Develop and Test Methods to Increase                                    
 Proper Use of Child Safety Seats.......          50,000         100,000
                                         -------------------------------
      Total.............................         574,000         774,000
------------------------------------------------------------------------


                          OLDER DRIVER RESEARCH                         
------------------------------------------------------------------------
                                                  Fiscal years--        
                Activity                 -------------------------------
                                               1997            1998     
------------------------------------------------------------------------
Develop Model Screening and Assessment                                  
 Procedures.............................        $100,000        $100,000
Guidelines for Family and Friends.......         100,000         100,000
Improved Intersection Negotiation.......          25,000         100,000
Develop Driving Decision Guidelines.....         275,000         150,000
Validate Statistical Models of                                          
 Functional Limitations.................          43,000         100,000
                                         -------------------------------
      Total.............................         543,000         550,000
------------------------------------------------------------------------


                      SPEED AND AGGRESSIVE DRIVING                      
------------------------------------------------------------------------
                                                  Fiscal years--        
                Activity                 -------------------------------
                                               1997            1998     
------------------------------------------------------------------------
Determine the Magnitude of the Speeding                                 
 Problem................................        $400,000        $350,000
Guidelines for Setting and Enforcing                                    
 Speed Limits...........................         100,000          50,000
Develop And Test Counter-measures for                                   
 Selected Targets.......................          56,000          99,000
Fleet Study of Crash Risk...............  ..............         200,000
                                         -------------------------------
      Total.............................         556,000         699,000
------------------------------------------------------------------------


                    PEDESTRIAN AND BICYCLIST RESEARCH                   
------------------------------------------------------------------------
                                                  Fiscal years--        
                Activity                 -------------------------------
                                               1997            1998     
------------------------------------------------------------------------
Develop and Test Programs for Target                                    
 Groups.................................        $200,000        $125,000
Develop Crash Type Software.............         101,000          25,000
Large City Demonstration Program........  ..............         225,000
                                         -------------------------------
      Total.............................         301,000         375,000
------------------------------------------------------------------------


                             DRIVER FATIGUE                             
------------------------------------------------------------------------
                                                  Fiscal years--        
                Activity                 -------------------------------
                                               1997            1998     
------------------------------------------------------------------------
Analyze role of fatigue, sleep in                                       
 highway crashes........................         200,000  ..............
Develop and Test Educational Programs...         780,000  ..............
                                         -------------------------------
      Total.............................         980,000  ..............
------------------------------------------------------------------------


                            DRIVER EDUCATION                            
------------------------------------------------------------------------
                                                  Fiscal years--        
                Activity                 -------------------------------
                                               1997            1998     
------------------------------------------------------------------------
Improve Decision Making of Novice                                       
 Drivers................................        $100,000         $50,000
Develop Two-Phase Driver Education                                      
 Program................................          25,000         300,000
Pilot Test Materials to Support Parent                                  
 Participation..........................         150,000  ..............
Use of Simulation in Novice Driver                                      
 Education..............................          50,000          50,000
                                         -------------------------------
      Total.............................         349,000         400,000
------------------------------------------------------------------------


                       EMERGENCY MEDICAL SERVICES                       
------------------------------------------------------------------------
                                                  Fiscal years--        
                Activity                 -------------------------------
                                               1997            1998     
------------------------------------------------------------------------
EMS Outcomes Evaluation.................         ( \1\ )        $125,000
Rural Preventable Mortality Follow-on...         ( \1\ )         100,000
                                         -------------------------------
      Total.............................         ( \1\ )         225,000
------------------------------------------------------------------------
\1\ Not funded out of research.                                         


                        SAFETY PROGRAM EVALUATION                       
------------------------------------------------------------------------
                                                  Fiscal years--        
                Activity                 -------------------------------
                                               1997            1998     
------------------------------------------------------------------------
Ignition Interlock Program Evaluation...        $100,000  ..............
Evaluate Air Bag Safety Campaign........  ..............        $500,000
                                         -------------------------------
      Total.............................         100,000         500,000
------------------------------------------------------------------------

Justification for Increases
    Additional funding for Occupant Protection Research is needed to 
support the President's Belt Use Plan and will be used to develop and 
test ways of reaching low use target groups and identifying more 
effective ways to upgrade, enforce, and publicize occupant protection 
laws. It will also be used for developing methods for increasing proper 
use of child safety seats.
    Additional funding for Speed and Aggressive Driving Research is 
needed to initiate a study of the increased crash risk associated with 
specific types of speeding. A fleet of vehicles will be equipped with 
low cost data recorders that will measure when, and under what 
circumstances, the vehicles are driven above the posted limit. This 
project will provide critical information on the situations and 
circumstances in which speeding elevates crash risk and will allow the 
development of targeted enforcement focused on the situations where 
speeding is most likely to cause crashes.
    Additional funding for Pedestrian and Bicycle Research will be used 
to initiate a large city demonstration program to determine the 
combined effectiveness of pedestrian safety countermeasures directed at 
all ages of pedestrians (young to old). This demonstration program 
should provide convincing evidence to other cities of the cost 
effectiveness of reducing their pedestrian crash problem.
    Additional funding for Driver Education Research will focus on the 
development of a two-phase driver education program designed to 
complement graduated licensing programs currently being implemented by 
the states. The two-phase driver education program will provide the 
young novice driver with opportunity to acquire more supervised driving 
experience, with gradually increasing responsibility.
    New funding for Emergency Medical Services Research is needed to 
reduce rural preventable mortality and to evaluate pre-hospital care to 
ensure that it is delivered efficiently and effectively. Funding for 
Emergency Medical Services Research has been moved to the research 
office to take advantage of the greater research and evaluation 
expertise and experience so that only research of the highest quality 
is produced.
    Additional funding for Program Evaluation is will evaluate major 
activities resulting from the agency's efforts to increase safety belt 
and child safety seat use, the Air Bag Safety Campaign (ABSC), and the 
Partners in Progress program. Special emphasis will be placed on 
evaluating the impact of the legislative and enforcement efforts.
    Question. In Senate Report 104-325, the Committee encouraged NHTSA 
to work with several private sector organizations to ensure a smooth 
transition away from dependence on Federal funding for highway traffic 
safety programs. Please provide detailed information on how this has 
been accomplished.
    Answer. The National Traffic Law Center (NTLC), a component of the 
American Prosecutors Research Institute, was started with funds from 
NHTSA. After several years of funding, NHTSA is currently phasing out 
its direct support of the Law Center. The NTLC is currently seeking 
private sector funds to continue their service to the prosecutorial 
community.
    A number of programs that were nurtured during their infancy with 
NHTSA funds, such as the Network of Employers in Traffic Safety (NETS), 
have been taken over by coalitions of public and private sector groups 
that have raised sufficient funds to sustain their programs independent 
of the government. NHTSA still participates in these activities, but as 
a coalition member rather than its sole source of funding. NHTSA has 
helped create several valuable organizations and programs, including 
those cited above. These organizations can, however, compete for NHTSA 
funding to provide specific products and needs. In some cases, they may 
be the best source for specific products or services.
                      occupant protection research
    Question. How does this program differ with the National Occupant 
Protection Program?
    Answer. This program provides research and evaluation support for 
the National Occupant Protection Program. The research program provides 
basic and applied research in such areas as risk taking, general 
deterrence, behavior modification, obstacles to enforcement, effect of 
public information, etc. It also provides evaluation support for the 
National Program by documenting program implementation activities in 
states and localities. In addition, the research program monitors 
public attitudes, knowledge, and reported behaviors related to seat 
belts and child safety seats.
    Information from the Research Program is applied by the National 
Occupant Protection Program in its development of program plans and 
strategies to increase occupant restraint usage nationwide. Large scale 
examples have included the development of the Operation Buckle Down 
Program and Campaign Safe and Sober. These programs operationalized the 
results of findings from both the occupant protection and the impaired 
driver research efforts.
                         older driver research
    Question. Last year, in Senate Report 104-325 the Committee 
indicated that NHTSA should continue its work on demonstration 
activities for technologies and practices intended to improve driver 
performance of older drivers at risk of losing their licenses. How is 
it reflected in the fiscal year 1998 budget request and in the fiscal 
year 1997 spending plan for TSP? Please be certain to break out 
activities and specific funding levels for each activity.
    Answer. In fiscal year 1997, the agency has included a project 
($298 thousand) to complete the development of a model system to screen 
and assess older drivers and to develop a plan for demonstrating the 
acceptability and effectiveness of the model system. To improve our 
understanding of what the general public, older people and their care 
givers know and think should be done about licensing and mobility of 
older people we will conduct a nationally representative survey ($321 
thousand). The latter is needed to see what support there is for 
different activities surrounding the licensing issues of seniors, such 
as paying for alternative transportation, need and payment for more 
extensive assessment, and issuance of limited or graded licenses.
    The fiscal year 1998 budget includes a project ($200 thousand to 
initiate a demonstration of this model system. This field test will 
determine whether evaluating functionally impaired individuals can be 
effective in enabling these individuals to drive safely within their 
capabilities. It is expected to continue into fiscal year 2001. Further 
analyses of the relationships between medical conditions, functional 
disabilities and crash risk will be done to further refine which groups 
of older drivers pose an unacceptable risk ($100 thousand). Work to 
reduce the potential for losing mobility research on training 
functionally disabled drivers to overcome their weakness will continue 
($100 thousand).
    Question. What have been the continuing efforts of NHTSA to improve 
the safe mobility of older drivers? What are the results achieved 
during the last year?
    Answer. NHTSA staff have been at the forefront of activities to 
improve the safe mobility of older drivers. The agency's research 
program has had a major role in developing the Secretarial initiative 
on ``Improving Transportation for a Maturing Society;'' it has affected 
the restructuring of research needs of the Transportation Research 
Board's (TRB) Committee on the Safe Mobility of Older Persons; and it 
has conducted several research activities dealing with safe mobility of 
older persons.
    Studies completed in the last year include: ``Improving 
Transportation for a Maturing Society'' (Secretarial initiative to 
appraise the current status and future needs for transportation in our 
maturing society); ``Safety Wheel Program'' (developed guidelines for 
individuals and social service agencies to assist older drivers); 
``Development of Statistical Relationships Between Vehicle Crash Rates, 
Moving Violations and Age-related Physical and Mental Limitations'' 
(analyzed selected data bases and developed a model establishing the 
relationships needed to identify older driver groups that are at an 
unacceptable risk); ``Family and Friends Concerned About an Older 
Driver'' (identified what role families and friends have in dealing 
with older, functionally disabled drivers and provides guidance to 
these individuals); ``Mobility Consequences of the Reduction or 
Cessation of Driving by Older Persons (determined how people reduced or 
stopped driving and what the consequences were of these changes); and 
``A Combined Study: Improving the Safe Mobility of Older Persons and 
Measures for Increasing the Mobility of Aging Commonwealth Citizens.'' 
(identified what needs to be done to keep older persons safe as drivers 
and to provide mobility to the aging population).
    Question. What is NHTSA doing to demonstrate new approaches in the 
licensing of older drivers in fiscal year 1997? During fiscal year 
1998? What is the status of research being conducted and is it behind 
schedule? How have these demonstrations of improved screening been 
effective?
    Answer. During fiscal year 1997, NHTSA is completing a series of 
studies that will develop a model screening and evaluation system for 
older drivers. The model system brings together all the earlier studies 
conducted to identify at-risk older drivers and assess their driving 
performance. NHTSA is also developing the field test plan to evaluate 
the model system. These activities are currently on schedule.
    During fiscal year 1998 a field test of the model system will begin 
in one or more states. This effort will be designed to determine if a 
graded license system is effective in providing safe mobility for 
older, functionally limited people. Until such field tests are 
complete, NHTSA will not know whether such activities are effective or 
feasible.
    Question. Please discuss how you used the GM settlement monies to 
supplement appropriated older driver research monies? How much did you 
allocate for this purpose?
    Answer. The GM settlement monies on older driver research are being 
used to fund a new program to assist and encourage self regulation 
activities of older drivers. One of the studies will determine whether 
the risk associated with older drivers is primarily to themselves to 
others. Where appropriate, it will deal with ways to reduce premature 
driving cessation which can best be handled by the private sector 
versus driver licensing groups. GM is funding the program for $5 
million over a five-year period of time.
                            driver education
    Question. What activities would cease if this program was held to 
the 1997 level?
    Answer. The agency requested level funding for driver education for 
fiscal year 1998 ($400,000). These funds would continue to support the 
development of a risk management training module and parent 
participation materials for novice drivers, and provide incremental 
funding for Michigan's graduated licensing system evaluation.
    Without these funds it will be difficult to support driver 
education as an element of a graduated licensing system.
                  emergency medical services research
    Question. Why is this program being funded as a separate research 
item, instead of out of the program budget?
    Answer. EMS research is being funded from the Office of Research 
and Traffic Records. Directing the EMS research program from this 
office enhances the program by utilizing staff with specialized 
research skills and background. The research office and the program 
office work closely on these projects, sharing progress reports, 
interpretations and insights, and developing joint plans for follow-on 
activities.
    Question. Did the program budget take a $225,000 cut to reflect 
this transfer?
    Answer. The EMS program did not take a cut. The research was 
covered within the Office of Research and Traffic Records budget, 
allowing the EMS budget to be directed to other program activities, 
including revision of the EMS Blueprint for Education and Practice, 
development of additional technical assistance programs for emergency 
communications issues, and conducting a national conference for the EMS 
Agenda for the Future.
                       safety program evaluation
    Question. Why can't this program be conducted as part of your new 
initiative under air bags or under other Section 403 activities?
    Answer. The safety program evaluation effort has been created in 
response to an increase in major legislative and program events 
currently being implemented either by the states or by the agency.
    This effort focuses on events or programs which have the potential 
for nationwide or statewide impact. Examples include special traffic 
enforcement program (STEP) demonstrations, public information and 
enforcement efforts implemented in the states as part of the Air Bag 
Safety Campaign, the passage of primary laws and the repeal of 
motorcycle helmet laws in various states, implementation of a multitude 
of efforts within the President's Initiative to Increase Safety Belt 
Usage and within the Partners for Progress Program, the graduated 
licensing movement, etc.
    Some program areas have provided funds to help evaluate initiatives 
within their domain. However, most programs do not have sufficient 
resources to fund all of the desired implementation efforts, much less 
program implementation and evaluations. This is particularly true in 
the occupant protection area where the President's Plan requires a 
significant increase in program and outreach activity. It is also true 
of smaller program areas, such as in motorcycle safety, where resources 
are constrained but where major changes are occurring (e.g. repeal of 
motorcycle helmet laws).
    The unpredictability of many major events provides additional need 
for resources dedicated to program evaluation. The passage of primary 
laws and repeal of motorcycle helmet laws are examples of such events, 
but there are many more. They include zero tolerance for youth, upgrade 
of child passenger safety laws, graduated licensing, statewide roadside 
sobriety checkpoints, child passenger safety ``correct use'' clinics, 
statewide implementation of increased sanctions for repeat offenders, 
etc.
    In order to measure impact, an evaluation effort must be 
implemented very quickly following the occurrence of an events. This 
immediacy adds to the need for funds available specifically for 
evaluation purposes.
                     driver fatigue and inattention
    Question. Senate Report 104-325 directed NHTSA to prepare a report 
on driver fatigue and inattention, describing the collaborative efforts 
and funding activities between NHTSA and the National Center on Sleep 
Disorders Research. Please provide the status and findings of this 
report, and whether it is on schedule.
    Answer. The report is being prepared. It was delayed briefly by the 
initial need for major collaborative efforts between the two agencies. 
In August 1996, NHTSA and the National Center on Sleep Disorders 
Research (NCSDR) signed an interagency agreement.
    One of the first actions initiated by this cooperative agreement 
provided funds for NCSDR to convene a panel of experts to establish 
guidelines, boundaries, and oversight for NHTSA's program development 
projects. The NCSDR recruited a chairperson and ten members from highly 
regarded professionals in sleep research and highway safety.
    Panel meetings included NCSDR and NHTSA staff, as well as a project 
contractors' staff. The Panel has now reviewed information in four 
areas: mechanisms of human sleep and sleepiness, characteristics of 
drowsy driving crashes, population groups at highest risk, and 
effective drowsy driving countermeasures. The Panel recently made 
targeting recommendations to the NHTSA contractor and is completing its 
written report.
    NCSDR and NHTSA are negotiating a new interagency agreement, funded 
at about $200,000. These funds would support the NCSDR's effort to 
create and disseminate drowsy-driving information to school age drivers 
in cooperation with private-sector partners.
    The forthcoming report will list panel members, the panel's 
recommendations to NHTSA, and details of NCSDR's fiscal year 1997 
program.
    Question. Please present an updated chart showing which projects 
have been funded, their purposes, amounts and participants. Please 
present a similar updated chart showing a schedule of anticipated 
projects. When were these contracts signed? What are the challenges 
that remain in developing this program?
    Answer. All the components of the development program are currently 
in place and the evaluation and implementation components are in the 
final phases of award, as summarized in the tables below. The primary 
challenge will be to keep the projects on schedule in order to meet the 
Summer 1998 deadline.

                                                 FUNDED PROJECTS                                                
----------------------------------------------------------------------------------------------------------------
                                                                          Amount and                            
                Project                             Purpose                  date             Participants      
----------------------------------------------------------------------------------------------------------------
Analyze role of fatigue, sleep          Describe characteristics of           $130,000  National Center on Sleep
 disorders, & inattention (FSDI) in      FSDI crashes.                         8/14/96   Disorders Research.    
 highway crashes.                       Identify subgroups most at                                              
                                         risk.                                                                  
Investigate instances of fatigue-       Observe drivers during fatigue-        100,000  NHTSA Vehicle Research  
 related events in motor-vehicle         related inattention incidents.        9/23/96   and Test Center.       
 operation.                             Establish characteristics of                                            
                                         inattention.                                                           
Develop and test educational            Specify target populations....         175,000  Harvard Univ. School of 
 countermeasures for fatigue-related    Determine message themes               6/26/96   Public Health.         
 highway crashes.                        (content).                                                             
                                        Establish motivational                                                  
                                         approaches.                                                            
                                        Establish dissemination                                                 
                                         strategies.                                                            
Develop strategy and lay foundation     Determine campaign objectives          325,000  Global Exchange, Inc.   
 for education and information           & target audience.                    9/20/96                          
 campaign.                              Determine content, strategy, &                                          
                                         media mix.                                                             
                                        Prepare and test draft                                                  
                                         materials.                                                             
                                        Refine materials.                                                       
----------------------------------------------------------------------------------------------------------------


                                              ANTICIPATED PROJECTS                                              
----------------------------------------------------------------------------------------------------------------
                                                                           Expedted                             
                Project                             Purpose                 amount            Participants      
----------------------------------------------------------------------------------------------------------------
Evaluate information and education      Determine appropriate outcome         $500,000  Systems Assessment and  
 campaign to combat fatigue-related      measures & evaluation design.                   Research, Inc.         
 highway crashes.                       Choose evaluation sites                                                 
                                        Collect pre- and post-campaign                                          
                                         data.                                                                  
                                        Evaluate campaign.                                                      
                                        Recommend revisions.                                                    
Promulgate the educational program to   Identify communities,              \1\ 370,000  To be arranged.         
 implementation sites.                   organizations and                 \2\ 200,000                          
                                         associations that serve                                                
                                         appropriate target group                                               
                                         constituencies.                                                        
                                        Create interest in program                                              
                                         implementation.                                                        
                                        Award competitive grants to                                             
                                         support implementation                                                 
                                         activities.                                                            
                                        Provide program materials to                                            
                                         implementors.                                                          
Conduct supplementary implementation    Adapt campaign themes for use          200,000  National Center on Sleep
 activities.                             in ongoing educational                          Disorders Research     
                                         programs for target audiences.                                         
                                        Produce and disseminate                                                 
                                         supplementary materials                                                
                                         through appropriate channels                                           
                                         to reach target audience.                                              
----------------------------------------------------------------------------------------------------------------
\1\ Materials production & program management costs.                                                            
\2\ Grants to implementing organizations.                                                                       

    Question. What new findings have resulted from research to 
determine the role of sleep disorders or fatigue as a causal factor in 
traffic crashes?
    Answer. The objective of NHTSA's research efforts has been to 
develop an education program to reduce driving while fatigued. At the 
present time, there is no known way to measure the presence of fatigue 
among drivers. Thus experts differ in their assessments of the role of 
fatigue in crashes. NHTSA and NCSDR have agreed not to dwell on the 
differing estimates of the magnitude of the problem.
    Rather, the two agencies have agreed to conduct research to 
identify the most likely targets of fatigue-related driving, develop 
messages appropriate for such targets, and develop and demonstrate 
educational programs incorporating such messages.
    Members of the NCSDR panel concur with the view that more extensive 
knowledge about the role of fatigue in crashes will require some yet 
undiscovered method for reliably assessing the level of fatigue of 
crash-involved drivers.
    Question. What progress has been made in the development and 
implementation of public education programs?
    Answer. The contractors responsible for the development of the 
education program have actively participated with NCSDR's expert panel, 
developed preliminary definitions of target groups, and have recently 
received the panel's recommendations for refinement of these groups.
    Selection and interview protocols for discussions with members of 
potential target groups are under development. Focus groups are planned 
for late summer or early fall. Although there was some delay due to the 
initial collaboration effort, the contractors remain optimistic that 
they will meet the original goal for completing program development by 
summer, 1998.
    The basic strategy for implementing the educational program has 
been established and a contract is about to be awarded for marketing 
the demonstration effort and for supporting program implementation in 
the communities and organizations selected for the demonstration 
effort.
    Question. What is planned for fiscal year 1998, and how is this 
reflected in the budget request?
    Answer. The fiscal year 1996 and 1997 appropriations fully support 
the development and implementation of the educational program and the 
evaluation of its effectiveness. NHTSA's fiscal year 1998 budget 
request does not contain any funds for drowsy-driver education. The 
agency will establish plans for funding future efforts in this area 
after reviewing results of the evaluation of the program currently 
under development. The results and recommendations of the evaluation 
are expected by summer of 1999.
         research and analysis crashworthiness research program
    Question. Please prepare a table indicating the amount requested 
and the amount actually appropriated for the two programs in the 
Crashworthiness Research Budget for fiscal years 1995, 1996, and 1997.
    Answer. The table summarizing the fiscal year 1995-1997 budget 
requests and the amounts enacted is shown below for the Safety Systems 
and Biomechanics programs of the agency's Crashworthiness Research 
Program.

                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                                          Fiscal years--        
                 Research area                               Action             --------------------------------
                                                                                    1995       1996       1997  
----------------------------------------------------------------------------------------------------------------
Safety Systems.................................  Request.......................      6,050      6,000      6,500
                                                 Enacted.......................      7,050      5,910      6,488
Biomechanics...................................  Request.......................      4,500      7,450      7,450
                                                 Enacted.......................      5,600      5,890      7,437
----------------------------------------------------------------------------------------------------------------

    Question. Please prepare a table for both of the programs in the 
Crashworthiness Research Program, showing how all of the funds 
requested for fiscal year 1998 are intended to be spent, and please 
include in that table a comparison with the amount provided for each of 
those activities for fiscal year 1997. On a separate page, please 
justify the need for the requested increases.
    Answer. The following table provides a comparison of the Safety 
Systems program expenditures, by activities, for the fiscal year 1997 
program to the proposed funding level for the fiscal year 1998 program.

                             SAFETY SYSTEMS                             
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                         Fiscal years-- 
                       Activity                        -----------------
                                                          1997     1998 
------------------------------------------------------------------------
Upgrade Frontal Crash Protection......................    1,888    1,365
Upgrade Rollover Crash Protection.....................    1,000    1,100
Vehicle Aggressiveness and Compatibility..............    1,000    1,300
Upgrade Side Crash Protection.........................    1,500    1,338
Upgrade Seat and Restraint Systems....................      700    1,385
Electric/Alternatively Fueled Vehicles................      400  .......
Advanced Air Bag Research.............................  .......    1,850
                                                       -----------------
      Totals..........................................    6,488    8,338
------------------------------------------------------------------------

    The additional funds requested for the Advanced Air Bag Research 
($1.85 million) are for continuing research that will focus on the 
development, performance, and monitoring of advanced air bag systems 
that build upon the short-term technological solutions to air bag 
problems identified in the field experience, including those of 
injuries resulting from aggressive air bag deployments (especially to 
children). For the advanced air bag systems under development, research 
will be conducted to identify the better performing systems, evaluate 
their best features, and determine the need for performance 
requirements regarding these systems. The research will identify the 
necessary performance characteristics of an advanced air bag system so 
that it will reduce or prevent air bag induced injuries. Based on these 
characteristics, a comprehensive set of tests will be defined to ensure 
the advanced air bag system will not cause injury. Further, these tests 
will ensure the air bag system provides effective restraint for 
normally seated occupants over the range of occupant sizes, while 
mitigating inflation injuries to out-of-position occupants. Finally, 
laboratory test procedures will be defined. The following table 
provides a comparison of the Biomechanics program expenditures, by 
activities, for the fiscal year 1997 program to the proposed funding 
level for the fiscal year 1998 program.

                              BIOMECHANICS                              
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                         Fiscal years-- 
                       Activity                        -----------------
                                                          1997     1998 
------------------------------------------------------------------------
Highway Traffic Injury Studies........................  .......    1,200
Impact Injury Research................................  .......    2,200
Human Injury Simulation and Analysis..................  .......    1,937
Crash Test Dummy Component Development................  .......    2,100
Biomechanics of Air Bag Injuries......................  .......    3,150
                                                       -----------------
      Total...........................................  .......   10,587
------------------------------------------------------------------------

    The additional funds requested for Biomechanics of Air Bag Injuries 
($3.15 million) will be directed toward efforts that will: (1) upgrade 
the capabilities and specificity of various sized, currently available 
test dummy systems to allow their near-term use as regulatory 
instruments in out-of-position testing, (2) continue efforts to develop 
and provide the best current injury criteria for evaluating safety 
system performance and initiate new research efforts to improve or 
address gaps in injury mechanism knowledge for critical body regions 
such as the head, neck, and chest, and (3) initiate necessary 
modifications and improvements to the various sized dummies that will 
increase their capabilities to accurately evaluate inflation related 
injury risks.
                             safety systems
    Question. Please break down in extensive detail on a project-by-
project basis the amount of funding requested for Safety Systems in the 
fiscal year 1998 request, and compare these expenditures, by 
activities, to the fiscal year 1996 and the fiscal year 1997 program. 
Please demonstrate the continuity or completion of research in your 
answer.
    Answer. The following table provides a breakdown of the funding for 
the projects during fiscal year 1996 and fiscal year 1997 along with 
the funding request for fiscal year 1998:

                             SAFETY SYSTEMS                             
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                     Fiscal years--     
                   Activity                   --------------------------
                                                 1996     1997     1998 
------------------------------------------------------------------------
Upgrade Frontal Crash Protection.............    1,810    1,888    1,365
Upgrade Rollover Crash Protection............    1,000    1,000    1,100
Vehicle Aggressiveness and Compatibility.....      500    1,000    1,300
Upgrade Side Crash Protection................    1,500    1,500    1,338
Upgrade Seat and Restraint Systems...........      700      700    1,385
Electric/Alternatively Fueled Vehicles.......      400      400  .......
Advanced Air Bag Research....................  .......  .......    1,850
                                              --------------------------
      Totals.................................    5,910    6,488    8,338
------------------------------------------------------------------------

    As can be seen in the table, funding adjustments have been made in 
each of the continued activities for fiscal year 1998. These 
adjustments reflect the particular requirements for fiscal year 1998. 
In each of the activities, continuity has been preserved. Due to the 
scope of the research required to address the problem of the fatalities 
and injuries that current aggressive air bag designs are causing in 
relatively low speed crashes to a small, but growing, number of 
children, and occasionally to adult occupants, the funding for the 
supporting efforts has been requested in the newly added activity, 
Advanced Air Bag Research. Again, the research planned for fiscal year 
1998 builds upon the results achieved during fiscal year 1997.
    Question. What new research has been performed with the additional 
funds allocated last year?
    Answer. The additional allocated funds last year were used in the 
Vehicle Aggressivity and Compatibility Program. However, the emphasis 
within this program was redirected to focus on providing an immediate, 
but interim, solution to the problem of the fatalities and injuries 
that current aggressive air bag designs are causing in relatively low 
speed crashes to a small, but growing, number of children, and 
occasionally to adult occupants. This effort led to the Final Rule 
announced on March 19, 1997, that allows manufacturers to provide 
depowered air bag systems that will inflate less aggressively.
    Question. Please provide an updated discussion on the progress made 
in implementing the strategic plan for heavy truck research.
    Answer. In June 1995, NHTSA developed a strategic plan outlining 
the future direction of the Heavy Truck Safety Research Program. The 
proposed implementation plan for the research was based on the 
assumption that sufficient funding would be available for the research 
projects. A brief discussion of ongoing research projects is given 
below:
    The trucking industry has identified driver fatigue as their number 
one safety issue. In cooperation with the FHWA's Office of Motor 
Carriers, the trucking industry, and various other research entities, a 
major program is underway to address this issue. NHTSA's portion of 
that program is focused on developing and facilitating deployment of 
high-technology in-vehicle systems that will be capable of detecting 
the onset of drowsiness and providing warning to the driver. Prototype 
systems have been developed, and a long-term on-road test of these 
systems in actual service is just beginning. That research is expected 
to determine how effective, reliable, and durable such devices are, and 
it will identify areas where additional development is needed.
    A major stumbling block to the deployment of high-technology safety 
systems on heavy combination vehicles is a means for providing reliable 
electrical powering and communication between truck tractors and the 
trailers they pull. The agency has two cooperative research agreements 
under which prototype high-technology tractor-trailer units have been 
built, each using somewhat different approaches to address the same 
problem. Two of these combinations are now in actual revenue service, 
one in the Eastern United States, and one on the West Coast. This field 
test will continue for 18 months.
    Research is also underway to develop on-board sensors to detect 
incipient rollover, and for wheel-by-wheel brake performance 
monitoring. These sensors hold promise for possible future interaction 
with infrastructure-based systems and electronic braking to reduce the 
incidence of heavy truck rollovers, particularly on expressway exit 
ramps.
    In addition to research directed at future high-technology safety 
improvements, the agency has ongoing research projects to support the 
promulgation and enforcement of its Federal motor vehicle safety 
standards. The agency is conducting research on truck brake performance 
testing, truck tire performance, and truck cab integrity in support of 
the agency's regulatory efforts.
    Question. Many of the activities being conducted in this area could 
also be conducted by the private sector. Please define the public 
purposes being served, the scope and the nature of any cost sharing, 
and the amounts received from the private sector.
    Please describe how NHTSA's research does not overlap that 
conducted by the private sector.
    Answer. The agency is concerned with the approximately 40,000 
fatalities and the millions of injuries that occur each year on the 
nation's highways. The focus of the industry has been on two issues. 
The first is committing substantial resources for ensuring that 
manufacturers' fleets meet the requirements of the Federal motor 
vehicle safety standards. Their immediate concern is to provide 
depowered air bag systems as quickly as possible to address the problem 
of the fatalities and injuries that current aggressive air bag designs 
are causing in relatively low speed crashes. Second, the industry has 
focused its energy on reducing the costs of the current safety systems 
in order to remain competitive, both domestically and abroad. 
Conversely, NHTSA's efforts are directed at expanding the performance 
envelope of the vehicle safety systems. The agency develops test 
procedures and demonstrates advanced safety systems, including advanced 
air bag and occupant restraint designs, thus advancing the safety 
technology and crash performance of these systems. As part of this 
activity, the agency has entered into cooperative agreements with the 
industry to utilize the advanced technology that the industry is 
developing and to encourage activity in areas in which the industry is 
not involved. To date, the agency has been successful in not 
overlapping the research being conducted by the private sector.
                              biomechanics
    Question. In Senate Report 104-325, NHTSA was urged to redouble its 
efforts to obtain cost-sharing commitments with other organizations 
which benefit from the center. What progress has been made in that 
area?
    Answer. In spite of the fact that the National Transportation 
Biomechanics Research Center (NTBRC) allocated significant time and 
resources to address urgent air bag issues, it still made significant 
progress in its efforts to obtain cooperation commitments from other 
organizations. NTBRC engaged several organizations in an effort to 
increase interagency and interorganization cooperation in biomechanics 
research. The following list gives some of the principal cooperative 
efforts between NTBRC and outside organizations:
    U.S. Army's Walter Reed Institute of Research.--Collaboration to 
study head impact biomechanics.
    Occupant Safety Restraint Panel, Honda R&D, Volvo, Transport 
Research Laboratory of the United Kingdom, Japan Automotive Research 
Institute/Japan Automobile Manufacturers Association, Insurance 
Institute for Highway Safety.--NTBRC cooperation on advanced dummy test 
and evaluation efforts. Further cooperative advanced dummy test and 
evaluation efforts are planned this year with Japan Automotive Research 
Institute/Japan Automobile Manufacturers Association, Volvo, Autoliv 
(Sweden), ADRIA Consortium (TNO, University of Madrid, Transport 
Research Laboratory of the United Kingdom), Occupant Safety Restraint 
Panel, Federal Office of Road Safety (Australia), Autoliv (Australia), 
New Car Assessment Program of Australia.
    Transport Canada.--Cooperative efforts on small female dummies.
    American Automobile Manufacturers Association, Association of 
International Automotive Manufacturers, and American Occupant Restraint 
Council.--Cooperation on advanced air bag technology assessment 
methodologies.
    U.S. Air Force Armstrong Laboratory.--Collaboration on development 
of system for sharing biomechanics data.
    Society of Automotive Engineers and the International Standards 
Organization.--Cooperation on 5th-percentile female, 3- and 6-year-old 
child Hybrid III dummies for air bag assessment.
    Department of Justice, National Institute of Justice, U.S. Army.--
Collaboration for the development of impulsive thoracic injury 
criteria.
    Johns Hopkins University Applied Physics Laboratory.--Collaboration 
on the development of advanced instrumentation for the detection of 
fast chest deflections.
    U.S. Navy.--Collaboration on impact injury research, sharing of the 
biomechanics data, and in development of small stature dummies.
    NASA Jet Propulsion Laboratory.--Cooperation regarding biomechanics 
related to smart air bag technologies.
                    crash avoidance research program
    Question. Please prepare a table indicating the amount requested 
and the amount actually appropriated for the two subprograms of the 
Crash Avoidance Research Program for fiscal years 1995, 1996, and 1997.
    Answer. The information follows.

                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                  Amount       Amount   
                                                requested   appropriated
------------------------------------------------------------------------
Driver/Vehicle Performance:                                             
    Fiscal year:                                                        
        1995.................................  ...........  ............
        1996.................................  ...........  ............
        1997.................................        4,000         1,000
Heavy Vehicles:                                                         
    Fiscal year:                                                        
        1995.................................          597           597
        1996.................................          597           517
        1997.................................          597           595
------------------------------------------------------------------------

    Question. Please prepare a table for each of the two subprograms in 
the Crash Avoidance Research Program, showing how all of the funds 
requested for fiscal year 1998 are intended to be spent, and please 
include in that table a comparison with the amount provided for each of 
those activities for fiscal year 1997. On a separate page, please 
justify the need for the requested increases.
    Answer. The information follows.

                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                     Fiscal years--     
                                              --------------------------
                                                   1998         1997    
                                                requested   appropriated
------------------------------------------------------------------------
Driver/Vehicle Performance:                                             
    ABS Driver/Vehicle Performance...........          800           700
    Light Vehicle Rollover Propensity........          200           250
    Non-planar Mirror Driver Performance.....  ...........            50
                                              --------------------------
      Total..................................        1,000         1,000
                                              ==========================
Heavy Vehicles:                                                         
    Brake Test Instrumentation & Procedures..          495           374
    Crashworthiness Test Procedures..........          100           200
    Update Tire Performance Database.........  ...........            21
                                              --------------------------
      Total..................................          595           595
------------------------------------------------------------------------

    Justification of the need for increased funding: The fiscal year 
1998 request represents the same funding levels for each of the 
subprograms; namely, the driver/vehicle performance and heavy vehicles 
research. Thus, no overall increase is requested. Within each of the 
subprograms, there will be some shift of emphasis. The research 
programs within both of these subprograms are primarily for the purpose 
of supporting the agency's efforts to develop motor vehicle safety 
standards and consumer information, and as such are typically ongoing, 
multi-year efforts. However, different aspects of a particular problem 
may be studied in different years, as the needs of the Safety 
Performance Standards of the agency dictate.
                       driver/vehicle performance
    Question. This program was initiated in 1997; when will it be 
completed? Do you anticipate that it will be a permanent program?
    Answer. It is not really correct to say that this program was 
initiated in 1997. Throughout the history of the agency, there has 
always been a program of research in the area of driver/vehicle 
performance. With the advent of the Intelligent Transportation Systems 
(ITS) program, all of the agency's crash avoidance research was 
directed toward development of countermeasures for collision 
prevention, using intelligent technologies. The budget for this NHTSA 
research has been part of the ITS budget for the past several years. 
However, there is an ongoing need for crash avoidance research to 
support NHTSA's regulatory responsibilities, such as braking, lighting, 
visibility, controls and displays. By reinstating driver/vehicle 
performance as a separate, non-ITS line item in fiscal year 1997 in the 
NHTSA budget, the agency has been able to initiate research on two 
critical current safety issues--light vehicle ABS and rollover 
propensity. Work on these two areas will continue in fiscal year 1998, 
and the ABS research is expected to be completed in fiscal year 1999. 
However, there is a backlog of other safety issues relating to 
lighting, mirrors, etc., that need to be studied. This program is 
expected to continue as long as the agency continues its activities in 
promulgating motor vehicle safety standards, in providing consumer 
information, and its enforcement efforts. There will always be new 
technologies and products that are introduced by manufacturers which 
will present new challenges in vehicle safety performance. Without 
ongoing research to understand how new technologies affect driver and 
safety performance, products that are intended to make driving easier 
and vehicles safer could actually have adverse effects on highway 
safety. It is therefore important that NHTSA continue its research 
activities in conventional collision avoidance technologies.
    Question. How is NHTSA merging the AVCS program with the AHS 
initiative? What cost savings can be realized and how is this reflected 
in the fiscal year 1998 request?
    Answer. The relationship between all vehicle-related ITS programs 
within DOT is currently being reviewed. This review includes the NHTSA 
collision avoidance and post-crash activities, as well as the work of 
the National Automated Highway System Consortium. The review has not 
yet been completed and no recommendations have yet been made that would 
result in changes in funding for either program.
                             heavy vehicles
    Question. Heavy Vehicles--How does this research overlap with motor 
carrier research in federal highways, and with the MCSAP?
    Answer. The NHTSA Heavy Vehicle research program complements, but 
does not overlap, the research being done by the FHWA's Office of Motor 
Carrier (OMC). NHTSA's research is directed toward the development of 
test equipment and procedure to evaluate the safety performance of new 
vehicles, in areas such as braking performance, stability, visibility, 
crashworthiness, etc. The program of the OMC concentrate on operational 
issues such as maintenance, inspection, driver fitness for duty, etc. 
NHTSA and FHWA/OMC work very closely together, and often coordinate 
their activities when the needs of both agencies can be met by 
cooperative on-road test programs that will serve both purposes.
           national center for statistics and analysis (ncsa)
    Question. Please prepare a table indicating the amount requested 
and the amount actually appropriated for the six programs in the NCSA 
Budget for fiscal years 1995, 1996, and 1997.
    Answer. See table below.

                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                   Fiscal years--                               
                                   -----------------------------------------------------------------------------
                                              1995                      1996                      1997          
                                   -----------------------------------------------------------------------------
                                      Request   Appropriated    Request   Appropriated    Request   Appropriated
----------------------------------------------------------------------------------------------------------------
FARS..............................       4,338        4,251        5,000        4,585        5,251        5,242 
NASS..............................       8,359        9,086        9,500        9,200        9,675        9,658 
Data Analysis.....................       1,824        1,479        2,000        1,414        2,100        1,635 
State Data Program................       1,436        1,397        2,000        1,550        3,850        3,041 
Restraint Usage Data..............  ..........  ............  ..........  ............         300          300 
Special Crash Investigations......         315          310          315          315          331          331 
----------------------------------------------------------------------------------------------------------------

    Question. Please prepare a table for each of the six programs in 
the NCSA Program, showing how all of the funds requested for fiscal 
year 1998 are intended to be spent, and please include in that table a 
comparison with the amount provided for each of those activities for 
fiscal year 1997. On a separate page, please justify the need for the 
requested increases.
    Answer. See table below.

                   FATALITY ANALYSIS REPORTING SYSTEM                   
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                         Fiscal year    
                    Description                    ---------------------
                                                       1997       1998  
------------------------------------------------------------------------
52 Cooperative Agreements with States, DC, and                          
 Puerto Rico......................................      4,102      4,102
Quality Control...................................         25         25
Analyst Training..................................        225        225
Data Processing...................................        890        890
                                                   ---------------------
      Total.......................................      5,242      5,242
------------------------------------------------------------------------


                   NATIONAL AUTOMOTIVE SAMPLING SYSTEM                  
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                         Fiscal year    
                    Description                    ---------------------
                                                       1997       1998  
------------------------------------------------------------------------
Field Data Collection and QC: 24 Teams and 2                            
 Quality Control Units............................      6,254      6,318
Contract Closeouts: Payments of Post Contract                           
 Audits...........................................         60        100
CDS Data Revision: Changes and modifications for                        
 new and revised data collec-  tion...............  .........         50
Field Training: NASS researchers and other                              
 Federal, State and Local government employees....        330        330
Maintenance and enhancements to the crash                               
 reconstruction program...........................         75         50
Field Systems Oversight and Support...............        303        328
NASS CDS ADP, File Storage and Distribution.......      1,391      1,270
NASS GES ADP......................................        660        675
Converting from Paper to Electronic Data                                
 Collection.......................................        585        537
                                                   ---------------------
      Total.......................................      9,658      9,658
------------------------------------------------------------------------


                          DATA ANALYSIS PROGRAM                         
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                       Fiscal years--   
                                                  ----------------------
             Products and activities                  1997       1998   
                                                     budget     request 
------------------------------------------------------------------------
Analytic Support.................................        500        500 
Database Augmentation............................        125        125 
Sampling Support and Quality Control.............        660        660 
Customer Service Support.........................        350        350 
Clinical Study of Injuries Associated with Air                          
 Bag Deployment..................................  .........        289 
(Exposure Data Collection--Pilot Test)...........  .........     (1,000)
                                                  ----------------------
      Total......................................      1,635      1,924 
------------------------------------------------------------------------

                             data analysis
Justification for increase
    The proposed increase for the Data Analysis program is to support 
the clinical study of injuries associated with air bag deployment as 
part of the Agency's efforts to obtain detailed information on the 
critical aspects of these injuries. This funding will support an 
interagency agreement with the Consumer Product Safety Commission 
(CPSC) to obtain data on a sample of cases of injuries treated in 
hospital emergency rooms through CPSC's National Electronic Injury 
Surveillance System (NEISS).

                           STATE DATA PROGRAM                           
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                        Fiscal year--   
                                                   ---------------------
              Products and activities                  1997       1998  
                                                      budget    request 
------------------------------------------------------------------------
Data Acquisition and Processing...................        658        700
State Data Enhancement and Technical/Analytical                         
 Assistance.......................................        150        250
Research New Data Linking Strategies and Evaluate                       
 Linked Medical Outcome and Crash Databases.......  .........         75
Promote Linked Medical Outcome and Crash Data                           
 among State and Local Agen-  cies................        310        206
Assist State and Local Agencies in Data Linkage...        323        310
Data Linkage Grant Program for New States.........      1,600      1,500
                                                   ---------------------
      Total.......................................      3,041      3,041
------------------------------------------------------------------------


                       OCCUPANT PROTECTION PROGRAM                      
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                        Fiscal year--   
                                                   ---------------------
              Products and activities                  1997       1998  
                                                      budget    request 
------------------------------------------------------------------------
Survey and Sample Design Revisions and Other                            
 Survey Preparations..............................  .........         70
Conduct a National Occupant Protection Use Survey.        100        200
Tabulate, Analyze, and Publish Survey Results.....        200         30
                                                   ---------------------
      Total.......................................        300        300
------------------------------------------------------------------------


                      SPECIAL CRASH INVESTIGATIONS                      
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                       Fiscal years--   
                    Description                    ---------------------
                                                       1997       1998  
------------------------------------------------------------------------
Investigations of Special Crashes of Interest to                        
 NHTSA............................................        264        964
Quality Control and Data Management...............         58         58
File Storage and Distribution.....................          9          9
                                                   ---------------------
      Total.......................................        331      1,031
------------------------------------------------------------------------

                      special crash investigations
Justification for increase
    This increase in data collection is an essential part of the 
Department's Air Bag Assessment Program. The Special Crash 
Investigations (SCI) program provides detailed information about 
crashes of special interest that are not included in the NASS CDS 
program. The NASS CDS is a probability sample of all motor vehicle 
crashes, thus it cannot provide information on all air bag crashes 
involving serious or fatal injuries. The SCI is a quick reaction crash 
investigation activity in which an investigator is sent to the crash 
site when we learn of serious air bag crashes. It is a small program 
currently operating at about $0.3 million per year. Additional funds 
were requested in fiscal year 1998 to increase the number of field 
investigators in this program. This increase in investigators will 
result in more than 175 real-world crash investigations per year, 
including ``depowered'' air bag equipped vehicles and all passenger 
side air bag related child injury cases that NHTSA discovers. The cost 
of the increased operations is $1.03 million per year.
                         data analysis program
    Question. Please further explain the need for an additional 
$300,000 in fiscal year 1998. Why can't the study on air bag deployment 
injuries be conducted within the base program or at the injury trauma 
centers within the base amount?
    Answer. The additional $300,000 requested in the fiscal year 1998 
funding for the Data Analysis Program will provide for collection of a 
sample of cases on injuries related to air bag deployment in the 
Consumer Product Safety Commission's (CPSC) National Electronic Injury 
Surveillance System (NEISS). NEISS, a three (3)-level system consisting 
of surveillance of emergency room injuries; follow-back telephone 
interviews with injured persons or witnesses; and comprehensive 
investigations with injured persons and/or witnesses, obtains data from 
a sample of 91 of the 6,127 hospitals nationwide with at least six beds 
that provide emergency care on a continuing 24-hour basis. The agency 
used NEISS in the past as a cost-effective way to obtain data on 
injuries associated with motor vehicle hazards that are non-crash 
related (e.g., injuries associated with the inadvertent closing/
malfunctioning power windows; battery explosions) as a basis for 
developing national estimates of the injuries associated with these 
hazards.
    Question. What are the implications of holding Data Analysis to the 
fiscal year 1997 level?
    Answer. Holding the fiscal year 1998 Data Analysis budget to the 
fiscal year 1997 level will impact two critical areas; in providing 
support to the agency's air bag research initiative and in the ability 
to meet the agency's analytical needs in general. Collection of data on 
a larger sample of injuries associated with air bag deployment via the 
Consumer Product Safety Commission's (CPSC) National Electronic Injury 
Surveillance System (NEISS) will not be possible at the fiscal year 
1997 funding level, thus limiting the amount of valuable data available 
to the agency on this critical issue. Data analysis activities provide 
a great deal of leverage on highway safety activities for a very modest 
investment. Analysis is used in NHTSA to help support state efforts to 
pass tougher alcohol, safety belt use, and traffic enforcement laws. 
Analysis also supports wide ranging rulemaking and enforcement 
activities in the agency. During fiscal year 1997, analytical support 
is being provided to study the impact of a wide range of safety issues, 
e.g., increased speed limits, effects of specific alcohol legislation, 
injuries associated with specific motor vehicle hazards, etc.
                     occupant protection use survey
    Question. Why did the program receive no money in 1996 if a survey 
was conducted that year?
    Answer. Data collection for the 1996 National Occupant Protection 
Use Survey was conducted during the months of October, November and 
part of December, 1996. fiscal year 1997 funds were available for this 
period.
          partnership for a new generation of vehicles (pngv)
    Question. How have NHTSA's efforts been coordinated with those of 
DOE and DOC?
    Answer. The agency has provided frequent input to DOC regarding its 
activities and budget requests for NHTSA's PNGV program support. 
Furthermore, the agency has given a formal briefing in Detroit to DOC, 
DOE, and USCAR regarding the specific details of the efforts both 
underway as well as planned.
    Question. Please rank the various PNGV activities in order of 
importance. Please identify activities which absolutely must be funded 
during fiscal year 1998, and the ones that were funded in fiscal year 
1997.
    Answer. For fiscal year 1997, funds were requested for 
crashworthiness and other safety related research ($3.5 million), 
infrastructure analysis ($1.2 million), and peer review of the PNGV 
program ($0.3 million). Funds were approved only for the 
crashworthiness and other safety related research ($2.496 million). The 
fiscal year 1998 budget request ($2.496) is to provide for the 
continuation of the crashworthiness and other safety related research 
that was approved for the previous fiscal year. This must be funded in 
order for the agency to achieve its goal to ensure that the PNGV 
developed vehicles will meet existing and anticipated safety standards 
and that the overall crash and other safety attributes are not 
compromised by their light weight and the use of new advanced materials 
used in the production of the vehicles. This is important as the latest 
projections indicate that the PNGV developed vehicles may be ``down 
weighted'' by approximately 40 percent in order to achieve the fuel 
economy goals of the program. NHTSA recently released a summary report 
backed by six technical studies describing how a vehicle's size affects 
the safety of its occupants and the safety of those sharing the road. 
One of the six studies found that the fatal crash rate for passenger 
cars increased by 1.1 percent for each 100-pound decrease in passenger 
car weight. The injury crash rate for these vehicles increased by 1.6 
percent for each such reduction. These findings suggest that a future 
100-pound reduction in passenger car weight, unless offset by safety 
improvements, could result in an estimated 302 additional fatalities 
and 1,823 moderate-to-critical injuries per year.
    Question. What funds has the NHTSA spent, or plan to spend on non-
safety aspects of PNGV? How much has been spent on economic analysis, 
market-penetration studies, industry impact, and regulatory impact 
evaluations?
    Answer. NHTSA has not spent any money during fiscal year 1997 nor 
has planned to spend any money during fiscal year 1998 on the non-
safety aspects of PNGV. For fiscal year 1998, NHTSA plans to continue 
the crashworthiness and other safety related research begun in fiscal 
year 1997.
    Question. Please prepare a table indicating the amount requested 
and the amount actually appropriated for the three subcomponent of the 
General Administration budget for fiscal years 1995, 1996, and 1997.
    Answer. The information follows.

                                         GENERAL ADMINISTRATION FUNDING                                         
                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                            Fiscal years--                      
                                                     -----------------------------------------------------------
                       Program                               1995                1996                1997       
                                                     -----------------------------------------------------------
                                                       Request   Enacted   Request   Enacted   Request   Enacted
----------------------------------------------------------------------------------------------------------------
Program evaluation..................................       489       475       489       480       475       474
Strategic planning..................................       200       100       200  ........       325        75
Economic analysis...................................       100       100        75        75       175        75
                                                     -----------------------------------------------------------
      Total.........................................       789       675       764       555       975       624
----------------------------------------------------------------------------------------------------------------

    Question. Please prepare a table for each of the three 
subcomponents in the General Administration budget showing how all of 
the funds requested for fiscal year 1998 are intended to be spent, and 
please include in that table a comparison with the amount provided for 
each of those activities for fiscal year 1997. On a separate page, 
please justify the need for the requested increases.
    Answer. The fiscal year 1998 funding request for each of the three 
subcomponents of General Administration are the same as the fiscal year 
1997 enacted level. Within the Program Evaluation subcomponent there 
are differences in funding amounts for each activity between 1997 and 
1998 because projects for a particular evaluation may be different in 
scope.

                           PROGRAM EVALUATION                           
------------------------------------------------------------------------
                                                  Fiscal years--        
                                         -------------------------------
       Program evaluation project          1998 planned                 
                                              funding      1997 funding 
------------------------------------------------------------------------
Heavy Truck Conspicuity (Standard 108)                                  
 Evaluation.............................         $75,000        $150,000
Support National Occupant Protection Use                                
 Survey (Standard 208)..................          50,000          50,000
Improved Air Bag Technology (Standard                                   
 208)...................................         100,000  ..............
Cost Study of Latest Airbag Technology                                  
 (Standard 208).........................          50,000          30,000
Child Safety Seat Registration Survey                                   
 (Standard 208).........................          79,000          34,000
Cost Studies of other safety standards                                  
 (fiscal year 1998--Standards 214 cars,                                 
 201, 202, 203, 204 light trucks. Fiscal                                
 year 1997--214 cars, 208 cars and light                                
 trucks.)...............................         120,000          80,000
Domestic content Labeling (49 CFR Part                                  
 583)...................................  ..............         130,000
                                         -------------------------------
      Total.............................         474,000         474,000
------------------------------------------------------------------------


                     STRATEGIC AND PROGRAM PLANNING                     
------------------------------------------------------------------------
                                                  Fiscal years--        
                                         -------------------------------
 Strategic and program planning project    1998 planned                 
                                              funding      1997 funding 
------------------------------------------------------------------------
Environmental scan and future plausible                                 
 events.................................  ..............         $60,000
Develop revised SEP.....................         $50,000  ..............
Council for Continuous Improvement                                      
 membership fee.........................          15,000          15,000
Continuous improvement materials,                                       
 equipment and conference fees..........          10,000  ..............
                                         -------------------------------
      Total.............................          75,000          75,000
------------------------------------------------------------------------


                            ECONOMIC ANALYSIS                           
------------------------------------------------------------------------
                                                  Fiscal years--        
                                         -------------------------------
        Economic analysis project          1998 planned                 
                                              funding      1997 funding 
------------------------------------------------------------------------
Development of pediatric derivative of                                  
 Functional Capacity Index continued in                                 
 fiscal year 1997 and published in                                      
 fiscal year 1998, literature survey                                    
 published in fiscal year 1997,                                         
 application of Functional Capacity                                     
 Index continued........................         $75,000         $75,000
------------------------------------------------------------------------

                       strategic planning program
    Question. Please state the reasons for hiring an outside contractor 
for $75,000 to improve the agency's strategic planning.
    Answer. During fiscal year 1997 the agency used contractor support 
to complete an environmental scan that identifies the changes in 
external factors and future plausible events most likely to affect 
highway safety to the year 2010. Included in the scan were general 
demographic, lifestyle, and transportation issues.
    Fiscal year 1998 funding will be used for the development of a 
revised Strategic Execution Plan (SEP) in response to the Departmental 
Strategic Plan, which will be completed in September, 1997. Contractor 
facilitation and publication support will be used for the development 
of the revised SEP. Fiscal year 1998 funding will also be used to move 
forward the process improvements currently underway in the agency. This 
includes membership in the Council for Continuous Improvement, which 
provides access to a multitude of continuous improvement information, 
documents, and techniques, and access to bench marking information. 
Continuous improvement funding is also used for materials for in-house 
support and training of process improvement teams and staff. If this 
support were provided directly to agency staff by outside contractors, 
the cost to the government would be at least 10 fold.
    Question. For fiscal year 1996, fiscal year 1997 and planned for 
fiscal year 1998, please provide a table similar to that found in last 
year's Senate hearing record, showing the amount of funds spent or 
allocated for non-mandatory awards and bonuses, PCS and overtime pay.
    Answer. The information follows.

                FUNDING FOR OVERTIME, BONUSES, AND AWARDS               
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                  Fiscal years--        
                                        --------------------------------
                                            1996       1997       1998  
                                          enacted    enacted    request 
------------------------------------------------------------------------
Safety Performance:                                                     
    PCS................................  .........  .........  .........
    Overtime...........................  .........          1          2
    Bonuses/Awards.....................         80         61         68
                                        --------------------------------
      Subtotal.........................         80         62         70
                                        ================================
Safety Assurance:                                                       
    PCS................................  .........  .........  .........
    Overtime...........................         24         25         26
    Bonuses/Awards.....................         84         86         95
                                        --------------------------------
      Subtotal.........................        108        111        121
                                        ================================
Highway Safety Program:                                                 
    PCS \1\............................         88         88         88
    Overtime...........................          5          6          6
    Bonuses/Awards.....................        182        172        190
                                        --------------------------------
      Subtotal.........................        275        266        284
                                        ================================
Research and Analysis:                                                  
    PCS................................  .........  .........  .........
    Overtime...........................  .........  .........  .........
    Bonuses/Awards.....................         94        110        121
                                        --------------------------------
      Subtotal.........................         94        110        121
                                        ================================
Office of the Administrator:                                            
    PCS................................  .........  .........  .........
    Overtime...........................          4          4          5
    Bonuses/Awards.....................         58         56         62
                                        --------------------------------
      Subtotal.........................         62         60         67
                                        ================================
General Administration:                                                 
    PCS................................  .........  .........  .........
    Overtime...........................         33         34         36
    Bonuses/Awards.....................        113        104        115
                                        --------------------------------
      Subtotal.........................        146        138        151
                                        ================================
Grand Total:                                                            
    PCS................................         88         88         88
    Overtime...........................         66         70         75
    Bonuses/Awards.....................        611        589        650
                                        --------------------------------
      Total............................        765        747        813
------------------------------------------------------------------------
\1\ AII PCS funds are allocated to the Highway Safety Program as the    
  predominant use is the transfer of field personnel to headquarters.   

    Question. Please prepare an updated table similar to last year's 
Senate hearing record indicating the amount of funds for computer 
support. Also provide a separate chart for communication systems for 
each of the last three fiscal years and proposed for fiscal year 1998.
    Answer. The following tables show the funding for computer support 
and communication systems for the last three fiscal years and proposed 
for fiscal year 1998.

                                                COMPUTER SUPPORT                                                
                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                          Fiscal years--                        
                                                ----------------------------------------------------------------
                                                                                                         1998   
                                                     1974         1995         1996         1997      (proposed)
----------------------------------------------------------------------------------------------------------------
Computer Support...............................        2,042        2,552        2,711        2,711        3,000
----------------------------------------------------------------------------------------------------------------

    Question. Please provide updated tables similar to those in last 
year's Senate hearing record on operating expenses, personnel 
compensation, and benefits combined with operating expenses for each 
major NHTSA program. Please compare the fiscal year 1997 appropriation 
with the fiscal year 1998 request.
    Answer. The information follows.

                                              SALARIES AND EXPENSES                                             
                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                          Fiscal years--                        
                                                                 --------------------------------               
                                                                       1997                           Change    
                                                                   appropriation   1998  request                
----------------------------------------------------------------------------------------------------------------
Use of Funds:                                                                                                   
    Personnel Compensation:                                                                                     
        Permanent positions.....................................          38,567          38,979            412 
        Other than permanent positions..........................           1,226           1,227              1 
        Other...................................................             676             695             19 
                                                                 -----------------------------------------------
          Total, Salaries.......................................          40,469          40,901            432 
        Personnel Benefits......................................           7,463           7,503             40 
                                                                 -----------------------------------------------
          Total, Salaries and Benefits..........................          47,932          48,404            472 
        Travel..................................................           1,082           1,082  ..............
                                                                 -----------------------------------------------
          Total, Salaries and Expenses..........................          49,014          49,486            472 
                                                                 ===============================================
Allocation to Programs:                                                                                         
    Safety Performance:                                                                                         
        Salaries and Benefits...................................           6,862           6,938             76 
        Travel..................................................              60              60  ..............
                                                                 -----------------------------------------------
          Subtotal..............................................           6,922           6,998             76 
                                                                 ===============================================
    Safety Assurance:                                                                                           
        Salaries and Benefits...................................           7,440           7,523             83 
        Travel..................................................              95              95  ..............
                                                                 -----------------------------------------------
          Subtotal..............................................           7,535           7,618             83 
                                                                 ===============================================
    Highway Safety Programs:                                                                                    
        Salaries and Benefits...................................          14,634          14,735            101 
        Travel..................................................             616             616  ..............
                                                                 -----------------------------------------------
          Subtotal..............................................          15,250          15,351            101 
                                                                 ===============================================
    Research and Analysis:                                                                                      
        Salaries and Benefits...................................           9,534           9,641            107 
        Travel..................................................             140             140  ..............
                                                                 -----------------------------------------------
          Subtotal..............................................           9,674           9,781            107 
                                                                 ===============================================
    Office of the Administrator/Staff Offices:                                                                  
        Salaries and Benefits...................................           2,961           2,994             33 
        Travel..................................................             129             129  ..............
                                                                 -----------------------------------------------
          Subtotal..............................................           3,090           3,123             33 
                                                                 ===============================================
    General Administration:                                                                                     
        Salaries and Benefits...................................           6,501           6,573             72 
        Travel..................................................              42              42  ..............
                                                                 -----------------------------------------------
          Subtotal..............................................           6,543           6,615             72 
                                                                 ===============================================
    NHTSA:                                                                                                      
        Salaries and Benefits...................................          47,932          48,404            472 
        Travel..................................................           1,082           1,082  ..............
                                                                 -----------------------------------------------
          Total.................................................          49,014          49,486            472 
                                                                 ===============================================
Use of Funds:                                                                                                   
    Headquarters operating expenses:                                                                            
        Personnel-related costs.................................             325             305            (20)
        Administrative services.................................           2,790           2,791              1 
        Rent....................................................  ..............           4,593          4,593 
        WCF/TASC................................................           2,894           3,451            557 
        Computer support........................................           2,711           2,426           (285)
                                                                 -----------------------------------------------
          Subtotal, headquarters................................           8,720          13,566          4,846 
    Field operating expenses....................................             482             482  ..............
                                                                 -----------------------------------------------
      Total, operating expenses.................................           9,202          14,048          4,846 
                                                                 ===============================================
Allocation to Programs:                                                                                         
    Safety Performance: Headquarters expenses...................           1,479           2,301            822 
    Safety Assurance: Headquarters expenses.....................           1,573           2,447            874 
    Highway Safety Programs:                                                                                    
        Headquarters expenses...................................           2,085           3,184          1,099 
        Field expenses (Regions)................................             375             375  ..............
                                                                 -----------------------------------------------
          Subtotal..............................................           2,460           3,559          1,099 
                                                                 ===============================================
    Research and Analysis: Headquarters expenses................           1,651           2,568            917 
    Office of the Administrator/Staff Offices: Headquarters                                                     
     expenses...................................................             638             993            355 
    General Administration: Headquarters expenses...............           1,401           2,180            779 
    NHTSA:                                                                                                      
        Headquarters expenses...................................           8,827          13,673          4,846 
        Field expenses..........................................             375             375  ..............
                                                                 -----------------------------------------------
          Total.................................................           9,202          14,048          4,846 
----------------------------------------------------------------------------------------------------------------

    Question. Please provide a listing of Schedule C employees 
currently on board, by Title, Salary, Office and Location.
    Answer. There are two Schedule C employees on board as of June 
1997: Special Assistant to the Deputy Administrator, $78,466, Office of 
the Deputy Administrator, Washington, DC; Chief, Consumer Information 
Division, $83,528, Office of Public and Consumer Affairs, Washington, 
DC.
    Question. Please prepare a table, similar to last year's Senate 
hearing record regarding positions and funding for the Office of the 
Administrator and staff offices.
    Answer. The information follows:

    OFFICE OF THE ADMINISTRATOR AND STAFF OFFICES FULL TIME POSITIONS \1\ AND FUNDING, FISCAL YEARS 1996-1998   
                                             [Dollars in thousands]                                             
----------------------------------------------------------------------------------------------------------------
                                                                         Fiscal years--                         
                                               -----------------------------------------------------------------
                                                      1996 \2\              1997 \2\                1998        
                                               -----------------------------------------------------------------
                                                 Position   Funding    Position   Funding    Position   Funding 
----------------------------------------------------------------------------------------------------------------
Office of the Administrator...................         4       $353          4       $358          4       $396 
Deputy Administrator..........................         2        176          2        179          2        198 
Executive Director............................         2        176          2        179          2        198 
Intergovernmental Affairs.....................         1         88          1         89          1         99 
International Harmonization...................         2        176          2        239          3        357 
Executive Secretariat.........................         6        529          6        537          5        495 
Civil Rights..................................         4        353          4        358          3        297 
Public and Consumer Affairs...................        12      1,059         12      1,074         13      1,286 
Chief Counsel.................................        30      2,647         30      2,684         30      2,968 
Less: Mission Support.........................       (22)    (1,941)       (22)    (1,968)       (22)    (2,176)
                                               -----------------------------------------------------------------
      Total...................................        41      3,618         41      3,728         41      4,116 
----------------------------------------------------------------------------------------------------------------
\1\ Positions are rounded for display purposes.                                                                 
\2\ Enacted levels.                                                                                             

    Question. Please display the amount and nature of reprogramming 
that occurred during fiscal year 1996, or fiscal year 1997 in any of 
the NHTSA accounts. Also in a separate table, please show any 
unobligated funds or carryover for these years.
    Answer. In fiscal year 1996, there were no reprogramming actions 
that required advance notification of the Congressional Appropriations 
Committees, including shifts of funds that affected activities 
considered to be Congressional earmarks or identified as areas of ``key 
Congressional interest'' in the Quarterly Reports of Reprogramming 
Actions. No transfers of funds occurred between accounts other than 
minor shifts of funds among object classes within an account. These 
shifts have resulted from account-wide reductions which were allocated 
to the individual program offices and from necessary fine-tuning which 
typically takes place when the agency implements its budget.
    In fiscal year 1997, NHTSA requested Congressional approval to 
reallocate $2.86 million of fiscal year 1996 carryover funds for 
additional airbag safety research. Of this amount $1.660 million will 
be shifted from Research and Development carryover, representing 
contract program savings from fiscal year 1996 and prior years in the 
areas of Motor Vehicle Research and the National Center for Statistics 
and Analysis. An additional $1.2 million will be reallocated from 
fiscal year 1996 salaries and benefits carryover. These carryover funds 
are a one-time savings resulting from a reduced Full-Time Equivalent 
usage rate in fiscal year 1996. The $2.860 million will be distributed 
among the National Transportation Biomechanics Research Center ($1.350 
million), Safety Systems and Air Bag Research ($.8 million), and 
Special Crash Investigations ($.710 million). The following table 
represents the fiscal year 1995 and fiscal year 1996 carryover into 
fiscal year 1996 and fiscal year 1997:

             FISCAL YEAR 1995 AND FISCAL YEAR 1996 CARRYOVER            
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                  Fiscal years--        
                                         -------------------------------
                                          1995 into 1996  1996 into 1997
                                              actuals         actuals   
------------------------------------------------------------------------
Contract Program:                                                       
    Safety Performance..................              60              84
    Safety Assurance....................             166             404
    Highway Safety......................             175             549
    Research and Development............           8,724           8,378
    General Administration..............             792             261
Salaries and Benefits...................           1,595           1,287
                                                                        
Miscellaneous operating expenses........           1,111             610
Recoveries and Other Deobligations......           1,005           1,863
                                         -------------------------------
      Total.............................          13,628           13436
------------------------------------------------------------------------

                        national driver register
    Question. Please provide an updated status report of NHTSA's review 
of state driver licensing systems. How have the states progressed in 
this area?
    Answer. The study of the current driver licensing information 
systems, the Commercial Driver License Information System (CDLIS), the 
National Driver Register's Problem Driver Pointer System (PDPS), and 
Driver License Reciprocity is scheduled for completion in August 1997. 
The American Association of Motor Vehicle Administrators, Federal 
Highway Administration, and NHTSA have been partners in this 
cooperative effort.
    The states appear willing to take the next step that is suggested 
by the report (i.e., combining the best features of the three systems 
into an integrated driver licensing system) but most are concerned 
about the significant cost and technological problems associated with 
such an endeavor.
    Question. How have the results of this review provided guidance on 
managing the National Driver Register?
    Answer. The review has brought to the surface a number of issues 
that must to be resolved to improve the service provided by the 
National Driver Register (NDR). These issues include: dual reporting of 
actions (by the state where the offense occurred and the state where 
the individual is licensed, when they are different); non-highway 
safety related suspensions being reported; the use of clearance letters 
with an electronic system; and how to handle actions that are on the 
system and more than seven years old.
    To develop consensus on these and other issues the agency plans to 
publish a Notice of Proposed Rulemaking. The Notice will be used to 
update the list of violation exchange codes that are required to be 
reported to the NDR. Additionally, the Proposed Rulemaking will discuss 
the agency's views on these issues and will request the opinions of 
interested parties. Based on this input the agency will determine how 
best to address the issues.
    Question. How have the data that are received by the NDR been 
improved? How are further improvements reflected in the fiscal year 
1998 budget request?
    Answer. NDR data are now more accurate and current than previously. 
The states maintain the conviction, suspension, and revocation data and 
the NDR only contains an indicator (pointer) that points to the state 
holding the information. Because the NDR no longer duplicates what the 
state has on its file, the NDR is no longer in the position of trying 
to ``catch up'' with the data on the states' files.
    The fiscal year 1998 budget request will cover operating costs for 
the NDR. Software and hardware upgrades will come out of these funds. 
No significant upgrades are planned.
    Question. Please provide an update on the PDPS. What has NHTSA done 
to encourage all States to use this system? How many states are 
actively using this system?
    Answer. NHTSA has provided grants to the states to assist in their 
conversion to the PDPS. In addition, the agency funds a help desk to 
assist them in the conversion process by testing their programs before 
they go on-line. The agency also funds user workshops that allow states 
to discuss problems of mutual interest and suggest possible solutions.
    To date, 49 states have converted to the PDPS. Oregon and the 
District of Columbia are scheduled to convert in the fall of 1997.
    Most importantly, all states are connected electronically and 
participate in the National Driver Register (NDR). The best indicator 
of the success of the program is a comparison of operational statistics 
from 1993, the last full year under the old system, and 1996. In 1993, 
the NDR processed 25.3 million inquiries, 8.5 million of which were 
interactive (immediate) inquiries. In 1996, the NDR processed 31.9 
million inquiries, 26.7 million of which were interactive inquiries.
    Question. How many states are not able to use PDPS? How is NHTSA 
assisting these States and how is it reflected in the fiscal year 1998 
and fiscal year 1997 budgets?
    Answer. All states are able to electronically exchange information. 
Budget and system problems have prevented the District of Columbia and 
Oregon from converting to the PDPS. In the meantime, they are still 
able to send and receive information electronically from the NDR. The 
agency has maintained a help desk staffed by system professionals to 
assist states in the conversion process. Help desk assistance includes 
answering questions, testing state systems prior to implementing the 
system changes, participation in a users workshop to share experiences, 
and site visits. Funding for the help desk is included in the fiscal 
year 1998 and fiscal year 1997 budgets.
                             air bag safety
    Question. Will attempts by NHTSA to ``fix'' airbags divert NHTSA 
resources to solving problems at the expense of studying and 
encouraging new technologies that could be a more effective replacement 
for airbags?
    Answer. The agency actions to provide an immediate, but interim, 
solution to the problem of the fatalities and injuries that current 
aggressive air bag designs are causing in relatively low speed crashes 
to a small, but growing, number of children, and occasionally to adult 
occupants required redirecting funds from existing research programs. 
However, this has not been at the expense of studying and encouraging 
new technologies. Furthermore, the new technologies that are emerging 
have largely been based on improving current air bag systems by having 
the improved system automatically adapt its deployment characteristics 
according to the crash environment, to the size and/or weight of the 
occupant, and/or to the proximity of the occupant to the air bag 
module. Inflatable technologies remain among the most practical and 
effective ways to mitigate crash injuries and fatalities while not 
encroaching on critical occupant space in the vehicle.
    Question. Would a focus by NHTSA on ``fixing'' air bags be 
inconsistent with NHTSA's approach of identifying a problem, 
establishing a desired result and the means of testing performance? Is 
NHTSA committed to a performance-based criteria as a regulatory 
philosophy? Does NHTSA believe that performance-based criteria create a 
level playing field that allows competition and encourages technology 
and innovation?
    Answer. The National Highway Traffic Safety Administration is 
dedicated to the goal of encouraging and facilitating the advent of 
advanced air bags through performance-based safety standards. As part 
of this process, the agency has identified specific problems with 
current-design air bags. The desired outcome is quite apparent: no 
adverse affects of air bags. Therefore, the remaining agency effort is 
and will be to establish a performance-based test program and 
regulation which will ensure systems that will mitigate the negative 
effects of current-design air bags. Only through measuring occupant 
restraint system performance, including the air bag, can vehicle and 
equipment manufacturers have design incentives and flexibility. Even 
with performance-based tests, safety regulations have to be updated as 
technology advances. For example, several occupant-presence-sensing 
systems being developed rely on measuring human-like characteristics, 
such as body heat, which is not currently part of the design 
characteristics of the current crash test dummies. Therefore, the 
agency is dedicated not only to performance-based safety standards, but 
intends to update these requirements to remove regulatory barriers to 
technological advances as needed. As in any regulatory action by the 
agency, the best available scientific approaches will be utilized to 
identify the problem and to establish requirements to reach the desired 
outcome.
    In working on the Advanced Air Bag program with the automobile 
manufacturers' associations, air bag suppliers, the insurance 
institutions, and academia, through the Advanced Air Bag Technology 
Working Group of the Motor Vehicle Safety Research Advisory Committee, 
the agency intends to maintain a partnership with the companies 
responsible for developing advanced systems. This partnership will help 
the agency clearly define the current and future safety needs and 
develop a performance-based test protocol, which will assure a level 
playing field that allows competition and encourages technology and 
innovation.
    Question. Is it the position of NHTSA that ``smart'' airbags are 
the best means for preventing airbag deaths? If so, how was this 
conclusion reached?
    Answer. During the time leading up to the announcement of the Final 
Rule amending Federal Motor Vehicle Safety Standard No. 208 to ensure 
that vehicle manufacturers can quickly depower all air bags so that 
they inflate less aggressively, the agency met frequently with vehicle 
and restraint system manufacturers to discuss the technologies 
available in both the near term and the long term that would provide a 
solution to the problem of fatalities and injuries. While the consensus 
was that depowered air bags could provide an immediate solution toward 
addressing part of this safety problem, it became apparent during these 
discussions that ``smart'' or advanced air bag technology would be 
required to address eliminating the problem altogether. Hence, the 
agency has established its research program for Advanced Air Bag 
Technology so as to continue to work toward eliminating this safety 
problem.
    Question. If NHTSA defines ``smart air bags'' through a regulation, 
would NHTSA be setting the basis for regulations that require one 
specific approach and thereby exclude all other ``smart solutions?''
    Answer. The purpose for the comprehensive review and comment 
process for the implementation of a safety standard is to minimize or 
eliminate regulatory barriers in order to permit innovation in the 
future. In the area of advanced air bag rulemaking, as in all other 
regulatory actions, the agency's goal is to develop and select 
performance-based requirements and test procedures that will not 
exclude any innovative safety technology.
    Question. Certain industry leaders have stated that smart airbag 
technology may be up to five years away from commercial availability 
because of their technological complexity. Is NHTSA exploring short-
term available solutions, aside from a public awareness campaign, which 
would not require new technology, such as variable sizes of air bags, 
variable deployment speeds for airbags, variable reaction time for 
airbags depending on the vehicle speed? Are any of these approaches 
currently available?
    Answer. An outcome of the February 11-12, 1997, NHTSA workshop, 
``Smart Air Bag Public Meeting,'' was a proposal by the American 
Automobile Manufacturers Association (AAMA) to work with NHTSA to 
establish a process for defining the issues to be addressed by advanced 
technology restraint systems. In reviewing the AAMA proposal, the 
agency agreed that industry cooperation would be essential for meeting 
the objectives of the agency's research program, particularly since the 
industry would be the source for the advanced technologies to be 
evaluated. Hence, the agency has established the Advanced Air Bag 
Technology Working Group under the Motor Vehicle Safety Research 
Advisory Committee's Crashworthiness Subcommittee. Members for this 
working group have been solicited to represent the domestic and foreign 
automobile manufacturers, the restraint system suppliers, the insurance 
industry, academia, and the medical community. This Working Group will 
serve as an active participant by undertaking efforts that lead to the 
completion of the research tasks.
    As part of this undertaking, a comprehensive crash investigation 
program to evaluate the effectiveness of air bags is underway. To help 
the agency with its ongoing Special Crash Investigations, the 
automobile industry has committed to identifying the vehicles equipped 
with depowered air bag systems as the vehicles enter the fleet. NHTSA 
is working with the industry to establish the effectiveness of these 
systems. Additionally, a Memorandum of Understanding (MOU) has been 
signed with the National Aeronautics and Space Administration for a 
joint research program to contribute to the agency's effort for 
understanding and defining critical parameters affecting air bag 
performance, assessing air bag technology state-of-the-art and its 
future potential, and identifying new concepts for air bags. Also, 
under an MOU with Transport Canada, joint research will be conducted to 
establish cooperation in the test procedure development for advanced 
air bags and development of improvements for anthropomorphic dummies 
and associated injury criteria.
    This overall program should provide for long-term and short-term 
evaluation of variations in air bag designs, advanced air bag 
technologies, and various methods to suppress air bag deployment.

              Research and Special Programs Administration

            Questions Submitted by Senator Richard C. Shelby
                       office of pipeline safety
    Question. Please prepare a table indicating the amount appropriated 
and the amount actually obligated for the different major categories 
and sub-components of the pipeline safety budget for each of the last 
three years, as well as the fiscal year 1998 request levels.
    Answer. The following information is provided:

------------------------------------------------------------------------
                 Program                   Appropriated      Obligated  
------------------------------------------------------------------------
            FISCAL YEAR 1995                                            
                                                                        
Information and analysis................          $1,752          $1,751
Risk assessment and technical studies...           2,250           2,245
Compliance..............................           4,875           4,866
Training and information dissemination..             925             925
Emergency notification..................             100             100
OPA:                                                                    
    Derived from OSLTF..................           2,267           2,257
    Derived from pipeline safety user                                   
     fees...............................             252             252
R&D:                                                                    
    Information systems.................             665             665
    Risk assessment.....................             318             330
    Compliance..........................             150             150
    Mapping.............................           1,200         \1\ 650
    Non-destructive testing.............           1,742           1,742
Grants..................................          12,000          11,900
                                                                        
            FISCAL YEAR 1996                                            
                                                                        
Information and analysis................           1,200           1,194
Risk assessment and technical studies...           1,750           1,747
Compliance..............................             300             300
Training and information dissemination..             850             850
Emergency notification..................             100             100
Damage prevention (Natl Pub Ed).........             500             500
Environmental indexing..................             500             500
OPA: Derived from OSLTF                            2,520           2,520
R&D:                                                                    
    Information systems.................             400             400
    Risk assessment.....................             300             300
    Mapping.............................           1,200              58
    Non-destructive testing.............             100             100
Grants..................................          12,000      \2\ 12,354
                                                                        
          FISCAL YEAR 1997 \1\                                          
                                                                        
Information and analysis................           1,200           1,143
Risk assessment and technical studies...           1,800           1,494
Compliance..............................             300             106
Training and information dissemination..             860             860
Emergency notification..................             100             100
Damage prevention (Nat Pub Ed)..........             200  ..............
OPA: Derived from OSLTF.................           2,336             445
R&D:                                                                    
    Information systems.................             400             400
    Risk assessment.....................             300              25
    Mapping.............................             400  ..............
    Non-destructive testing.............             400              17
Grants..................................          13,200      \1\ 13,000
------------------------------------------------------------------------
\1\ Obligations thru 6/13/97.                                           
\2\ Includes carryover.                                                 


------------------------------------------------------------------------
                                                                 Fiscal 
                           Program                             year 1998
                                                                 request
------------------------------------------------------------------------
Information and analysis.....................................     $1,200
Risk assess and tech studies.................................      1,200
Compliance...................................................        300
Training and information dissemination.......................        821
Emergency notification.......................................        100
Damage prevention (Natl Pub Ed)..............................        200
OPA:                                                                    
    Copy derived from OSLTF..................................      2,127
    Derived from pipeline safety user fees...................        200
R&D:                                                                    
    Information systems......................................        400
    Risk assessment..........................................        300
    Mapping..................................................        400
    Non-destructive testing..................................        239
Grants.......................................................     13,500
------------------------------------------------------------------------

    Question. Please explain any deviation or reallocation of funds (of 
more than 10 percent) between the fiscal year 1997 appropriation and 
estimated obligations.
    Answer. We have not reallocated contract or R&D funding from what 
was enacted. We do not reallocate personnel compensation and benefits 
or administrative expenses more than five percent.
    Question. What are the current unobligated balances in the Office 
of Pipeline Safety? What is anticipated to be unobligated at the end of 
fiscal year 1997? Will unobligated ``one-year'' funds be returned to 
the pipeline safety fund?
    Answer. As of May 20, the unobligated balance for Operation 
expenses was $4,325,000; Contract program activities (1 year funds) was 
$758,000; R&D program activities (3 year funds) was $1,057,000 and 
Grants was $12,200,000. We plan to obligate all Contract Program 
funding by close of fiscal year 1997. We estimate that our 3-year 
funding for R&D will have an unobligated balance of approximately 
$1,800,000 at the end of fiscal year 1997. At this time, we are 
estimating a lapse of approximately $100,000 (less than 1 percent) of 1 
year Operating Expenses. We plan to transfer 5 percent of our PC&B to 
equipment. Those funds will be used to purchase enhanced computer 
equipment for OPS inspectors that will allow them to access information 
currently being developed in the Integrated Operator Compliance System 
(IOCS). IOCS is the first step in our transition from mainframe-based 
data technology to client-server type computers. The IOCS will maintain 
a sizable data base and requires more processing power to assess each 
operator's risk data and better link OPS Headquarters and Regions. In 
addition, it consolidates several existing data sets and will better 
support inspector's work in their integrity management-based 
inspections.
    By law, unobligated ``one-year'' funds for a given fiscal year are 
returned to the Pipeline Safety Fund 5 years after the close of the 
fiscal year in which they were appropriated.
             government performance and results act (gpra)
    Question. Please summarize the steps OPS has taken to implement the 
Government Performance and Results Act.
    Answer. We have taken steps to prepare for requirements of the GPRA 
and have developed performance measures and a strategic plan. One of 
our first steps was to establish our Risk Assessment Prioritization 
program, (RAP). All pipeline stakeholders were surveyed to establish a 
set of pipeline safety issues and to determine if there were cost 
effective solutions to those issues. This program guides our allocation 
of resources and we plan to update the survey next year.
    We have revised our mission statement, identified two performance 
goals supporting that mission, and have organized our fiscal year 1998 
budget around them. Within the risk management initiative, we produced 
a guidance document on how to develop and use performance measures and 
we are beginning to test that guidance this summer in our consulting 
with candidate operators. We have data analysis improvement initiatives 
and are carefully validating data entry from accident reports and other 
sources. Our mapping project will also help us relate accident history 
with data on consequences in populated and environmentally sensitive 
areas.
    We have worked in the Departmental effort to create a strategic 
plan and are adapting departmental measures that will be appropriate to 
pipeline safety. We also are working with state agencies on a 
consistent set of performance measures. We are cooperating with 
industry trade associations to survey their members to evaluate our 
customer service.
    Question. Which performance-based regulations have been issued 
during the last year?
    Answer. The following are the regulatory accomplishments for the 
year ending June 1997. All final rules are performance-based.
    Final Rules/Direct Final Rules:
  --05/24/96.--Periodic Updates to the Pipeline Safety Regulations.
  --06/03/96.--Pipeline Safety Program Procedures, Reporting 
        Requirements, Gas Pipeline Safety Standards, and Liquefied 
        Natural Gas Facilities Standards.
  --06/06/96.--Regulatory Review: Gas Pipeline Safety Standards.
  --06/20/96.--Excess Flow Valves--Performance Standards.
  --02/25/97.--Liquefied Natural Gas Regulations, Miscellaneous 
        Amendments.
  --06/09/97.--Low-Stress Hazardous Liquid Pipelines Serving Plants and 
        Terminals.
                          authorization issues
    Question. Please prepare a table summarizing each of the new 
responsibilities specified in the Accountable Pipeline Safety and 
Partnership Act of 1996 and indicate how and when you will complete 
these items. Be certain to summarize the specific components of your 
budget request that are necessary to implement each of these specific 
tasks?
    Answer. The following table is provided:

----------------------------------------------------------------------------------------------------------------
        Public Law 104-304               Requirement(s)            OPS response(s)        Components of budget  
----------------------------------------------------------------------------------------------------------------
Section 3(b).....................  Changes requirement to     Now preparing SNPRM in    Risk Assessment &       
                                    define ``regulated         Docket No. PS-122,        Technical Studies      
                                    gathering line'' from      ``Gas Gathering Line      (fiscal year 1998).    
                                    ``the Secretary shall''    Definition'' for                                 
                                    to ``the Secretary         Federal Register                                 
                                    shall, if appropriate''.   publication in July                              
                                                               1997.                                            
Section 4(a).....................  Emphasizes requirement to  The Secretary has         PC&B (fiscal year 1998).
                                    ensure that individuals    convened a Negotiated                            
                                    performing O&M on          Rulemaking (RegNeg)                              
                                    pipelines be qualified.    committee on                                     
                                    Main change here is in     qualification of                                 
                                    Sec.  60102 (a)(1)(C)      pipeline personnel                               
                                    and Sec.  60102 (a)(2);    performing operations &                          
                                    requirement to ``test      maintenance and                                  
                                    and certify'' becomes      emergency response                               
                                    ``qualified''.             functions. It is                                 
                                                               expected that the                                
                                                               committee will reach a                           
                                                               consensus on a proposed                          
                                                               rule on operator                                 
                                                               qualification. A                                 
                                                               proposed rule could be                           
                                                               published in early 1998.                         
Section 4(b).....................  Adds new language to       OPS' cost/benefit         PC&B (fiscal year 1997  
                                    clarify requirements for   analyses already comply   and fiscal year 1998). 
                                    consideration of risk      with this requirement.                           
                                    assessment, environment,   Further work is being                            
                                    cost/benefit analysis,     performed to address                             
                                    and recommendations of     environmental costs.                             
                                    advisory committees.                                                        
Section 4(b).....................  Requires consideration of  Most of the specific      PC&B (All future fiscal 
                                    costs and benefits;        items required for        years).                
                                    exploration of             consideration under                              
                                    regulatory and             ``risk assessment'' are                          
                                    nonregulatory options;     already required by                              
                                    explanation of             E.O. 12866 (October 4,                           
                                    selection;                 1993), Regulatory                                
                                    identification of          Planning and Review.                             
                                    information on which       All new cost/benefit                             
                                    risk assessment is based.  studies will be in                               
                                                               compliance with this                             
                                                               requirement.                                     
Section 4(b).....................  Requires submission of     All risk assessments      PC&B (All future fiscal 
                                    any risk assessment        supporting cost/benefit   years).                
                                    supporting cost/benefit    analyses are being                               
                                    analysis to the pipeline   submitted to the                                 
                                    safety advisory            pipeline safety                                  
                                    committee(s). Risk         advisory committees and                          
                                    assessment information     are being docketed for                           
                                    must be available to the   public comment.                                  
                                    public.                                                                     
Section 4(b).....................  Requires advisory          OPS is providing risk     PC&B (All future fiscal 
                                    committees to function     assessment and cost/      years).                
                                    as ``peer review           benefit analysis                                 
                                    panels'' for risk          information on proposed                          
                                    assessment information;    rules to the pipeline                            
                                    must submit this           safety advisory                                  
                                    information to advisory    committee(s) for review                          
                                    committees; advisory       in their role as ``peer                          
                                    committee reviewing risk   review panels''.                                 
                                    assessment information                                                      
                                    has 90 days to submit a                                                     
                                    report on risk                                                              
                                    assessment evaluation                                                       
                                    and recommendations on                                                      
                                    associated rulemaking.                                                      
Section 4(b).....................  Requires Secretary to      OPS will respond to each  PC&B (All future fiscal 
                                    respond to advisory        peer review report on     years).                
                                    committee(s) regarding     the risk assessment and                          
                                    their peer review report   the features of the                              
                                    and their advice on the    rulemaking before                                
                                    proposed rule.             issuing any final rule.                          
Section 4(b).....................  Provides an exception to   Will implement            PC&B (None).            
                                    risk assessment            exceptions as                                    
                                    requirement for rules      appropriate.                                     
                                    that are the product of                                                     
                                    a negotiated rulemaking                                                     
                                    or a rule, such as a                                                        
                                    Direct Final Rule                                                           
                                    adopting updated                                                            
                                    industry standards, that                                                    
                                    receives no adverse                                                         
                                    comments; for a                                                             
                                    recommendation by a \3/                                                     
                                    4\ths vote of the                                                           
                                    advisory committee(s);                                                      
                                    or for rules that the                                                       
                                    Secretary determines do                                                     
                                    not require a public                                                        
                                    procedure.                                                                  
Section 4(b).....................  Report on risk assessment  Will prepare report to    PC&B (fiscal year 1998; 
                                    and rulemaking program     Congress on risk          fiscal year 1999;      
                                    by March 31, 2000;         assessment, regulatory,   fiscal year 2000).     
                                    include suggestions for    and nonregulatory                                
                                    making risk assessment a   approaches by March 31,                          
                                    useful means of            2000.                                            
                                    assessing benefits and                                                      
                                    costs of regulatory and                                                     
                                    nonregulatory options.                                                      
Section 4(e).....................  Requires new and           The final rule in Docket  PC&B (fiscal year 1998).
                                    replacement natural gas    No. PS-126 directed                              
                                    transmission and           that all new lines be                            
                                    hazardous liquid           built to accommodate                             
                                    pipelines to accommodate   ``smart pigs''; a final                          
                                    ``smart pigs''; allows     rule in response to the                          
                                    extension of such          petitions for                                    
                                    standards to require       reconsideration from                             
                                    accommodation in           AGA and INGAA is being                           
                                    existing pipelines.        prepared.                                        
Section 4(e).....................  Allows Secretary to        OPS is cooperating with   R&D (fiscal year 1998). 
                                    determine if periodic      industry groups on                               
                                    inspections using          advanced ``smart pig''                           
                                    ``smart pigs'' are         research to determine                            
                                    necessary.                 if a requirement for                             
                                                               periodic inspections                             
                                                               using ``smart pigs''                             
                                                               can be justified; a                              
                                                               rulemaking may be                                
                                                               forthcoming in late                              
                                                               1998.                                            
Section 4(f).....................  Directs the Secretary, as  An annual process to      Operations (fiscal year 
                                    necessary, to update       update industry           1998).                 
                                    industry standards that    standards that are                               
                                    are incorporated by        incorporated by                                  
                                    reference in the           reference in the                                 
                                    pipeline safety            pipeline safety                                  
                                    regulations.               regulations was                                  
                                                               established in 1996;                             
                                                               the 1997 update is                               
                                                               being drafted in Docket                          
                                                               RSPA-97-2251 for Fall                            
                                                               1997 publication.                                
Section 4(g).....................  Requires interstate gas    OPS is working with       National Public         
                                    pipelines to provide all   industry, professional    Education Campaign     
                                    ``municipalit(ies)''       associations, and the     (fiscal year 1998).    
                                    (defined as any            public to evaluate                               
                                    political subdivision of   existing public                                  
                                    a state per Sec.           education programs to                            
                                    60101(a)(15)) through      determine which are                              
                                    which it passes with a     most effective in                                
                                    map showing the location   reaching excavators,                             
                                    of the pipeline            operators, the public,                           
                                    facilit(ies); requires     and local communities.                           
                                    by June 1, 1998, to        A survey is now                                  
                                    survey and assess the      underway. OPS' Damage                            
                                    public education           Prevention Quality                               
                                    programs under section     Action Team (DAMQAT)                             
                                    60116 and the public       will design nationwide                           
                                    safety programs under      campaign using                                   
                                    section 60102(c) and       appropriations and                               
                                    determine their            industry resources.                              
                                    effectiveness and          After the survey is                              
                                    applicability as           completed, a rulemaking                          
                                    components of a model      may be instituted to                             
                                    program; not later than    promulgate new                                   
                                    one year after the         regulations to promote                           
                                    survey (<6/1/99) must      public awareness of                              
                                    initiate a rulemaking to   excavation damage and                            
                                    determine effective        one call systems.                                
                                    public education program                                                    
                                    and, if appropriate,                                                        
                                    must amend regulations;                                                     
                                    if regulations not                                                          
                                    needed, send report to                                                      
                                    congress with reasons.                                                      
Section 4(h).....................  By June 1, 1998, prepare   A public workshop on the  Operations (fiscal year 
                                    a report on remote         application of remote     1998).                 
                                    control valves on an       control valves in                                
                                    interstate gas pipeline;   interstate natural gas                           
                                    include determination on   pipelines will be held                           
                                    whether remote valves      in early 1998. By June                           
                                    are technically and        1, 1998, OPS will                                
                                    economically feasible to   complete an assessment                           
                                    reduce risks after a       of the appropriateness                           
                                    rupture.                   of the expanded use of                           
                                   By June 1, 1999 (one year   remote control valves                            
                                    after this report), if     in interstate natural                            
                                    remote valves are          gas pipelines. If this                           
                                    determined to be useful,   assessment indicates                             
                                    the Secretary shall        that the use of remote                           
                                    prescribe regulations      control valves is                                
                                    for their use on           technically and                                  
                                    interstate natural gas     economically feasible,                           
                                    pipelines.                 OPS will propose                                 
                                                               regulations specifying                           
                                                               the conditions under                             
                                                               which interstate                                 
                                                               natural gas pipelines                            
                                                               must use such valves.                            
Section 5(a).....................  Authority to establish     OPS' Notice of Request    Risk Assessment &       
                                    risk management            for Letters of Intent     Technical Studies      
                                    demonstration projects.    (3/27/97) requested       (fiscal year 1998).    
                                   Authority to exempt owner   eligible operators to                            
                                    or operator of             express their interest                           
                                    demonstration facilities   in participating in the                          
                                    from regulations that      risk management                                  
                                    would otherwise apply.     demonstration program.                           
                                   New regulations do not      OPS has issued a Risk                            
                                    apply to the               Management Program                               
                                    demonstration facilities   Framework, a Program                             
                                    during period of           Standard, a                                      
                                    demonstration.             Communications Plan,                             
                                                               and a Training                                   
                                                               Curricula to assist                              
                                                               operators in preparing                           
                                                               their risk management                            
                                                               demonstrations.                                  
Section 5(b).....................  Risk management            OPS is complying with     Risk Assessment &       
                                    demonstrations must        these requirements in     Technical Studies      
                                    exhibit ``equivalent or    preparing for its risk    (fiscal year 1998).    
                                    greater overall level of   management                                       
                                    safety''; President's      demonstration programs.                          
                                    October 12, 1996, memo                                                      
                                    requires only ``superior                                                    
                                    levels of safety'' and                                                      
                                    only participants with a                                                    
                                    ``clear and                                                                 
                                    established'' safety and                                                    
                                    environmental record.                                                       
Section 5(b).....................  Secretary may revoke or    OPS will comply with      Risk Assessment &       
                                    amend any exemption        these requirements in     Technical Studies      
                                    granted in a RM plan for   the individual risk       (fiscal year 1998).    
                                    noncompliance with terms   management                                       
                                    or failure to achieve      demonstrations.                                  
                                    greater safety.                                                             
                                   RM demonstrations must                                                       
                                    provide for public                                                          
                                    comment in the approval                                                     
                                    process.                                                                    
                                   Must take into                                                               
                                    consideration the ``past                                                    
                                    safety and regulatory                                                       
                                    performance'' of all                                                        
                                    applicants.                                                                 
Section 5(b).....................  Any exemption may be       This will be an explicit  Risk Assessment &       
                                    revoked for substantial    requirement for the       Technical Studies      
                                    noncompliance with an      approval of any risk      (fiscal year 1998).    
                                    approved risk management   management                                       
                                    plan.                      demonstration program.                           
Section 5(d).....................  Secretary may consult      OPS is closely            Risk Management Grants  
                                    with states with           coordinating with the     (fiscal year 1998).    
                                    certifications and may     state pipeline safety                            
                                    make an agreement with a   representatives in                               
                                    state to carry out a       implementing risk                                
                                    risk management program    management                                       
                                    on intrastate pipelines.   demonstration programs.                          
Section 5(e).....................  Report on risk management  A report will be          Risk Assessment &       
                                    demonstration projects     prepared before March     Technical Studies      
                                    by March 31, 2000.         31, 2000.                 (fiscal year 1998).    
Section 6........................  Eliminates requirement     OPS' inspection program   PC&B (fiscal year 1998).
                                    for two-year mandatory     is in compliance with                            
                                    inspection cycle; also     this requirement.                                
                                    eliminates ``navigable                                                      
                                    waters (as defined by                                                       
                                    the Secretary)'' and                                                        
                                    replaces it with a                                                          
                                    ``substantial likelihood                                                    
                                    of commercial                                                               
                                    navigation'' standard.                                                      
Section 7........................  Eliminates ``shall         Considering definition    Environmental Indexing; 
                                    include'' language in      of areas unusually        OPA (fiscal year 1998).
                                    favor of ``shall           sensitive to                                     
                                    consider'' under AREAS     environmental damage                             
                                    TO BE INCLUDED AS          through public process                           
                                    UNUSUALLY SENSITIVE;       in Docket No. PS-140,                            
                                    adds drinking water        Areas Unusually                                  
                                    resources as a             Sensitive to                                     
                                    consideration; deletes     Environmental Damage.                            
                                    earthquakes and other                                                       
                                    ground movement.                                                            
Section 8........................  Requires that excess flow  A final rule on EFV       PC&B (fiscal year 1998).
                                    valve (EFV) rules          performance standards                            
                                    consider not just          was adopted in Docket                            
                                    installation, but also     No. PS-118 (61 FR                                
                                    maintenance and            31449; June 20, 1996);                           
                                    replacement costs;         industry standards will                          
                                    provides authority to      likely be adopted as                             
                                    adopt industry standards   they are developed.                              
                                    for EFV performance.       Comments have been                               
                                                               received in response to                          
                                                               an NPRM in Docket No.                            
                                                               PS-118A (EFV Customer                            
                                                               Notification) (61 FR                             
                                                               33476; June 27, 1996);                           
                                                               although this proposed                           
                                                               rule considers only                              
                                                               installation costs, the                          
                                                               final rule will                                  
                                                               consider EFV                                     
                                                               installation,                                    
                                                               maintenance, and                                 
                                                               replacement costs.                               
Section 9........................  Drops requirement to take  OPS has already taken     PC&B (fiscal year 1998).
                                    action to promote the      action in Docket No. PS-                         
                                    adoption of measures to    135 to require                                   
                                    improve the safety of      notification of                                  
                                    customer-owned service     customers owning their                           
                                    lines.                     own service lines.                               
Section 10                         Advisory committees are    OPS will submit risk      Risk Assessment &       
                                    the peer review            assessments and cost/     Technical Studies      
                                    committees for risk        benefit analyses to the   (fiscal year 1998).    
                                    assessment and cost/       advisory committee(s)                            
                                    benefit analyses.          as required.                                     
Section 10.......................  Requires the membership    Committee appointments    Risk Assessment &       
                                    of each advisory           will be designed to       Technical Studies      
                                    committee to be one-       maintain the broadest     (fiscal year 1998).    
                                    third industry, one-       possible representation                          
                                    third public, and one-     consistent with the                              
                                    third government;          required composition.                            
                                    requires at least one of                                                    
                                    the public and one of                                                       
                                    the industry members to                                                     
                                    have risk assessment and/                                                   
                                    or cost/benefit analysis                                                    
                                    background.                                                                 
Section 10.......................  Advisory committees can    OPS will maintain twice   Operations (fiscal year 
                                    meet up to four times a    a year meetings and to    1998).                 
                                    year.                      keep advisory                                    
                                                               committees informed                              
                                                               between meetings                                 
                                                               through newsletters,                             
                                                               mailings, and informal                           
                                                               working groups.                                  
                                                               Additional meetings of                           
                                                               the advisory committees                          
                                                               will be held as                                  
                                                               necessary.                                       
Section 12.......................  Establishes ``cooperative  OPS requested, and will   R&P (fiscal year 1998). 
                                    agreement authority''.     make use of this                                 
                                                               authority to expand                              
                                                               cooperation with                                 
                                                               industry, the states,                            
                                                               and others in the                                
                                                               advancement of pipeline                          
                                                               safety.                                          
Section 15.......................  Requires that OPS issue    OPS will publish the      Operating Expenses      
                                    an annual report           first biennial report     (fiscal year 1998).    
                                    biennially, beginning      (1995-1996) by August                            
                                    August 15, 1997.           1997.                                            
Section 16.......................  Requires OPS to make       TRB Special Report 219    Risk Assessment &       
                                    available Transportation   is being made available   Technical Studies      
                                    Research Board (TRB)       to appropriate            (fiscal year 1998).    
                                    Special Report 219 to      officials in all                                 
                                    appropriate official(s)    states. A public                                 
                                    in each state; requires    workshop on population                           
                                    an evaluation of the       encroachment will be                             
                                    recommendations in the     held in early 1998.                              
                                    report, especially to      Feedback from the                                
                                    what extent they are       states will assist in                            
                                    being implemented, ways    OPS' evaluation of                               
                                    to improve                 population encroachment                          
                                    implementation, and        issues. A report on                              
                                    other initiatives to       OPS' evaluation of                               
                                    further awareness of       population encroachment                          
                                    local planning and         issues will be                                   
                                    zoning entities            completed in late 1998.                          
                                    regarding population                                                        
                                    encroachment on pipeline                                                    
                                    rights-of-way.                                                              
Section 17.......................  Report to Congress by      A draft report was        Operating Expenses      
                                    October 12, 1997, on       presented to the          (fiscal year 1998).    
                                    user fee assessment        pipeline safety                                  
                                    measures, bases, and       advisory committees in                           
                                    appropriateness;           May 1997. Advisory                               
                                    consider wide range of     committee comments and                           
                                    assessment factors and     comments by the general                          
                                    comments from public.      public will be                                   
                                                               carefully considered in                          
                                                               preparing a final                                
                                                               report for submission                            
                                                               to Congress by October                           
                                                               12, 1997.                                        
Section 19.......................  Establishes specific       OPS is working with       National Public         
                                    authority to engage in     industry to evaluate      Education Campaign     
                                    promotional activities     existing public           (fiscal year 1998).    
                                    relating to the            education programs to                            
                                    underground damage         determine which are                              
                                    prevention.                most effective in                                
                                                               reaching excavators,                             
                                                               operators, the public,                           
                                                               and local communities.                           
                                                               A survey is now                                  
                                                               underway. OPS'                                   
                                                               Excavation Damage                                
                                                               Prevention Quality                               
                                                               Action Team (DAMQAT)                             
                                                               will design nationwide                           
                                                               campaign using                                   
                                                               appropriations and                               
                                                               industry resources.                              
----------------------------------------------------------------------------------------------------------------

    Question. What is the status of the proposed new national one-call 
program authorizing legislation?
    Answer. The one-call program authorizing legislation is part of the 
Department's safety bill. Congressman Dingell, by request, introduced 
the Administration's NEXTEA safety titles as H.R. 1720. The one-call 
proposal is in Title XI, Underground Damage Prevention.
                               user fees
    Question. Please prepare a comparative historical table displaying 
the per mile user fee assessed to gas transmission and liquid pipeline 
operators, and the total collected in user fees from each industry in 
fiscal years 1994 through 1997 and anticipated for fiscal year 1998.
    Answer. Below is a table which shows the per mile rate and the 
total collections for fiscal years 1994 through 1996. We are in the 
process of collecting for fiscal year 1997 now, so the amount shown is 
what we assessed from gas and liquid operators. We estimated the fiscal 
year 1998 figures based on the amount of $32,171,020. This includes the 
President's Budget Request for the Pipeline Safety Program of 
$32,988,000, less OPA funding of $2,328,000 from the Oil Spill 
Liability Trust Fund, plus an offset to the Research and Special 
Programs Appropriation for labor costs to support the Pipeline Safety 
Program. Other variables include the offset from previous year 
collections, the allowance by law to collect 105 percent of the 
appropriation, and pipeline mileage, are subject to change prior to the 
December 1997 assessment date.

----------------------------------------------------------------------------------------------------------------
                                                                  Gas transmission               Liquid         
                                                             ---------------------------------------------------
                                                              Per mile       Total      Per mile       Total    
                                                                rate       collected      rate       collected  
----------------------------------------------------------------------------------------------------------------
Fiscal year:                                                                                                    
    1994....................................................   $44.49      $13,000,000   $32.33       $5,008,000
    1995....................................................    95.57       27,830,000    47.03        7,215,000
    1996....................................................    77.49       22,475,000    49.67        7,683,000
    1997....................................................    67.46   \1\ 19,914,000    61.27    \1\ 9,508,000
    1998....................................................    72.91   \2\ 21,362,000    67.90   \2\ 10,527,000
                                                                                                                
----------------------------------------------------------------------------------------------------------------
\1\ Fiscal year 1997 based on assessment.                                                                       
\2\ Fiscal year 1998 anticipated assessment.                                                                    

    Question. Please describe the billing cycle for industry user fees. 
What changes in this procedure are being considered? What has been 
industry's reaction to these proposals.
    Answer. We assess user fees during the first quarter of our fiscal 
year (October-December time frame). In fiscal year 1997, the user fee 
assessments were issued on December 10. This date was selected in 
response to discussions with our customers and their fiscal concerns. 
Since Treasury regulations require payments within 30 days, and since 
the industry's fiscal year is not concurrent with the Federal fiscal 
year, issuing the assessments in mid-December gave our customers the 
flexibility industry wanted to either pay at the end and/or beginning 
of its fiscal year. We have had a favorable response from industry and 
have no immediate plans to change the billing cycle.
    Question. How did you allocate the user fee between gas 
transmission lines and product lines for fiscal year 1997? Does this 
accurately reflect the true allocation of your efforts and resources? 
How is this allocation determined every year?
    Answer. In fiscal year 1997, gas operators paid 55 percent of 
program costs and 88 percent of grants. Liquid operators paid 45 
percent of program costs and 13 percent grants. Although we feel 
additional focus has been given to liquid program activities, these 
percentages closely reflect the allocation of our efforts and 
resources.
    The allocation is determined through analysis of our planned 
expenditures for the year. This includes Personnel Compensation & 
Benefits (PC&B) for inspectors, administrative expenses, information 
systems, compliance, training, risk assessment, research and 
development. Consideration is also given to apportionments in previous 
years and comments filed in user fee dockets.
                          pipeline safety fund
    Question. What is the current balance in the pipeline safety 
reserve fund? Please provide a historical table displaying the annual 
unappropriated balance in the fund from the end of fiscal year 1987 
through 1996, with an estimated level for 1997.
    Answer. The following table is provided.

Pipeline safety fund

Fiscal year:       [Year end unappropriated balances]
    1986......................................................$7,848,270
    1987......................................................17,060,016
    1988......................................................17,672,184
    1989......................................................17,179,509
    1990......................................................17,982,653
    1991......................................................17,469,218
    1992......................................................17,694,592
    1993......................................................16,971,943
    1994......................................................18,684,690
    1995......................................................18,485,209
    1996......................................................20,291,839
    1997 \1\..................................................19,291,839

\1\ Estimated.

    Question. Are the funds in the Pipeline Safety Fund reserve 
invested in an interest-bearing account? If not, has there been an 
analysis of the potential for such investment? Would legislation be 
required to invest these funds? (If so, please provide sample 
legislation.) To your knowledge, are there currently any plans to enact 
such legislation.
    Answer. The money in the Pipeline Safety Fund is not invested in an 
interest-bearing account. Legislation would have to be enacted to allow 
RSPA to invest the funds. We are not aware of the introduction of any 
such legislation.
    Question. What is the minimum dollar amount that should be retained 
in the pipeline safety fund balance in order to maintain the integrity 
of the pipeline safety program? What is the justification for this 
amount?
    Answer. We believe a fund balance of not less than $11 million 
would be sufficient to maintain the integrity of the pipeline safety 
program, based on an internal review of our options.
                           ops oil pollution
    Question. Please cost allocate and describe all OPS costs 
associated with Oil pollution Act (OPA) requirements in fiscal year 
1997, and anticipated in fiscal year 1998. How does this compare in 
each fiscal year with the amount derived from the Oil Spill Liability 
Trust Fund? In each fiscal year, what was the OSLTF level requested by 
RSPA prior to the OMB passback?
    Answer. Allocations for fiscal year 1997 and fiscal year 1998 are 
provided on the following table:

------------------------------------------------------------------------
                                                  Fiscal years--        
                   OPA                   -------------------------------
                                           1997 enacted    1998 request 
------------------------------------------------------------------------
PC&B                                            $147,000        $156,000
Administrative expenses.................          45,000          45,000
Contracts...............................       2,336,000  \1\ 2,327,000 
------------------------------------------------------------------------
\1\ $200,000 to be derived from user fees.                              

    The following table provides request levels before and after the 
OMB Passback for fiscal year 1997 and fiscal year 1998:

------------------------------------------------------------------------
                                           Request prior   Request after
                                              to OMB         passback   
------------------------------------------------------------------------
Fiscal year:                                                            
    1997................................      $2,528,000      $2,528,000
    1998................................       2,528,000   \1\ 2,328,000
------------------------------------------------------------------------
\1\ 200,000 to be derived from user fees.                               


Positions and FTE.............................................  $500,000
    7 FTE address environmental policy, regulatory 
      development, spill response plan review & exercise, 
      pipeline inspection & spill response technical 
      monitoring; special task force/studies of oil pipeline 
      company risk management programs & operations
Data analysis.................................................   500,000
    Over half the incident reporting, data collection, 
      analysis & trending labor.
    Identifying accident cause & consequence, evaluating & 
      acting on environmental impacts, particularly related to 
      protecting drinking water sources.
Compliance & spill response monitoring........................   150,000
    Technical field engineering support for monitoring major 
      spills & remediation.
    Dedicated personnel for integrating public & private 
      sector OPA response activities, communications 
      coordination & decision support for protective actions.
National pipeline mapping systems operations & maintenance....   400,000
    Collecting & digitizing more accurate liquid pipeline 
      location information as it becomes available.
    To be used in conjunction with data on population, 
      drinking water intakes, terrain. Needed to set 
      priorities for prevention & response actions.
Environmental Index...........................................   250,000
    Work with state agencies to identify & categorize 
      information on unusably sensitive environmental areas. 
      Establish central repository in each state to be focal 
      point for exchange of data.
State grants for hazardous liquid programs.................... 1,500,000
    Fund 13 states oversight of intrastate pipelines 
      operations & maintenance, construction, repairs.
                    --------------------------------------------------------------
                    ____________________________________________________

        Total................................................. 3,300,000

    Question. Do you consider the environmental indexing effort 
complete? What was accomplished with funding provided in fiscal year 
1996? How much is being obligated in fiscal year 1997 for this 
activity, and for what purpose? What will be done during fiscal year 
1998 and how much will this cost? When will this activity be completed?
    Answer. The environmental indexing effort is well under way but not 
complete. RSPA has been working with other Federal agencies, the 
environmental community, and the liquid pipeline industry to identify 
the resources, and their supporting areas, that are unusually sensitive 
to environmental damage from a hazardous liquid release, including 
drinking water, ecological, and cultural resources, which might include 
archeological sites. RSPA is also working with these groups and state 
government agencies to identify the location and attribute information 
that is available on these resources.
    RSPA has used the funding provided in 1996 to determine the 
location and relevant information of some of the nation's unusually 
sensitive resources. In June of 1996, RSPA held a public meeting to 
discuss drinking water resources that could be considered unusually 
sensitive, and to determine what available data could be used to 
identify and locate these resources. Participants at that meeting 
included the Environmental Protection Agency, the American Water Works 
Association, the liquid pipeline industry, and the public. Major issues 
were discussed and resolved, and RSPA is attempting to locate the 
unusually sensitive resources identified in the meeting.
    Almost all drinking water resource data is created and maintained 
by state government agencies. Because the data is not created and 
maintained by a single government agency, the data varies in format, 
completeness, and accuracy. Extra work is therefore required to collect 
the data and to put it in a common format. RSPA is requesting relevant 
data from each of the states that have information, and is merging the 
location information into an electronic database that will include the 
location of the unusually sensitive drinking water resources. This 
database will be part of the environmental index and a layer in our 
national pipeline mapping system. To date, RSPA has collected partial 
information from nearly all the states.
    RSPA is also collecting information on possible unusually sensitive 
ecological and cultural resources. RSPA has met with the federal 
agencies responsible for these resources and has begun to collect the 
data they believe will be needed to identify and locate the unusually 
sensitive ecological and cultural resources. Like the drinking water 
resource data, ecological resource data is primarily maintained within 
the states. RSPA believes that most of the data that will be needed to 
identify unusually sensitive cultural resources has been collected by 
the Department of Interior and entered into an electronic database. 
This will minimize the burden of collecting the data and putting it 
into the environmental index. A public workshop on unusually sensitive 
ecological resources will be held in July of 1997 and a public workshop 
on unusually sensitive cultural resources will be held this fall.
    RSPA will use the remainder of the money allotted to this project 
to finalize a catalog of data available to help identify and locate 
unusually sensitive areas and, to the extent possible, collect the data 
and create an electronic data layer on the unusually sensitive areas. 
RSPA expects to have collected representative data from most states and 
will continue to update and maintain in the future with funding 
requested under OPA.
    Question. Please provide the committee with the results of last 
year's review of the pipeline operators' emergency response plans. 
Include the number of plans reviewed, the number accepted, and the 
number of plans that required corrective measures. How do you ensure 
that your suggestions are incorporated into the plans?
    Answer. More than 1,252 facility response plans have been submitted 
to RSPA/OPS, and over 850 of which were designated by operators as 
posing a risk of ``significant and substantial harm'' to the 
environment. All operators with ``significant and substantial'' plans 
received approval letters from RSPA/OPS by the February 1995 statutory 
deadline, following a rigorous plan review process. In the two years 
since February 1995, RSPA/OPS has continued to review revised and newly 
submitted plans.

October 1, 1997-September 31, 1996:
    Number of new sig & sub plan reviews..........................    62
    Number of new sig & sub plans requiring revisions after 
      initial re- view............................................    62
    Number of new sig & sub plan approved.........................    17
    Number of plan revisions reviewed.............................    78
    Number of plan revisions accepted.............................    78

October 1, 1996-May 31, 1997:
    Number of new sig & sub plan reviews..........................    52
    Number of new sig & sub plans requiring revisions after 
      initial re- view............................................    52
    Number of new sig & sub plans approved........................    18
    Number of plan revisions reviewed.............................   136
    Number of plan revisions accepted.............................   136

    RSPA/OPS receives several plan revisions or newly submitted plans 
each week. Most of the plan revisions are minor (e.g., changing 
telephone number listings) and do not necessitate a full review. Of 
those plans which required review, two thirds of them required 
significant refinement before RSPA/OPS was able to approve them. RSPA/
OPS works closely with the operators, over the phone and fax, to 
provide advice and technical assistance to them as they revise their 
response plans. Because of our commitment to assisting operators in 
compliance with our requirements, RSPA/OPS has been able to approve all 
of the ``significant and substantial'' plans we have received.
    RSPA/OPS uses several methods to ensure that our suggestions are 
incorporated into operators' facility response plans. Before approving 
a revised response plan, RSPA/OPS checks the newly revised sections to 
ensure that the operator has adequately addressed our plan review 
comments. Also, RSPA/OPS has had its technical support contractor take 
a sample of response plans and verify the data (names, phone numbers, 
response contracts, etc.) contained in them. In the sample group, only 
a very small percentage of the plans contained outdated or inaccurate 
information. Another way RSPA/OPS ensures that operators incorporate 
our suggestions for improvement is through our exercise program, in 
which we observe the operators' ability to implement their response 
plan.
    Question. Please discuss the amount of funds obligated on spill 
response exercises during each of the last three years. How much do you 
expect to spend during fiscal year 1998?
    Answer. In fiscal year 1995, OPS focused on response plans and made 
some initial preparation for exercises. In fiscal year 1996, RSPA/OPS 
obligated $530,000 to conduct both tabletop and area exercises. In 
fiscal year 1997, the figure was $548,000. Our projected exercise 
program budget for fiscal year 1998 is $612,000. This includes the 
costs of developing, conducting, and evaluating 20 tabletop exercises 
and two area exercises annually, and for disseminating the lessons 
learned also. (This does not include travel costs for RSPA/OPS staff to 
participate in exercises.)
    Question. In view of the substantial experience acquired from past 
exercises, why are you convinced that continued testing at this 
sustained level is necessary? Why are 20 or so tabletop exercises each 
year still necessary?
    Answer. RSPA/OPS is committed to continually improving the pipeline 
industry's ability to respond rapidly and effectively to oil spills. 
Our exercise program, combined with a rigorous plan review process, is 
vitally important to accomplish this.
    There are several examples of cases in which our oil spill response 
exercises have been very effective in improving the overall level of 
emergency response capability of oil pipeline operators. Three weeks 
before a major gasoline spill in Gramercy, Louisiana in late May 1996, 
Marathon Pipeline Company conducted a large-scale spill response 
exercise. Marathon's performance in the actual spill response was 
greatly improved because of their holding an exercise beforehand. A few 
months before their major diesel fuel spill in Simpsonville, South 
Carolina in June 1996, Colonial Pipeline Company participated in a 
RSPA/OPS tabletop exercise which tested their ability to respond to a 
worst case discharge, and prepared them for an actual spill several 
months later. Similarly, the successful response to the catastrophic 
pipeline spill in the San Jacinto River in October 1994 was directly 
attributed to the responders' participation in a spill response 
exercise seven months before the actual spill. The designation of a 
facility in Baytown, Texas to serve as a unified command post in the 
San Jacinto spill was a result of successfully using the facility for 
an exercise seven months before.
    Exercises are a vital component of our OPA 90 program, and provide 
one of the best ways to measure pipeline operators' capabilities to 
respond to oil spills. RSPA/OPS believes that the twenty tabletop 
exercises per year is the minimum number which still allows us to 
verify that oil pipeline operators are capable of implementing their 
facility response plans.
    RSPA/OPS has received universally positive comments from pipeline 
operators who have participated in our exercises. Operators indicate 
that the exercises bring attention to weaknesses in their response 
plans that need to be addressed, such as increasing their spill 
management teams' awareness of the incident command system, fine tuning 
their notification procedures to ensure timely notification, and 
working on ways to improve their, coordination with Federal, state and 
local responders. Some operators have discovered the need to combine 
their training efforts with local and state response personnel. RSPA/
OPS magnifies the benefits of its exercises by sharing the lessons 
learned in a quarterly newsletter that we distribute to pipeline 
operators and exercise participants so other operators and emergency 
responders can benefit from them.
                           operating expenses
    Question. RSPA is proposing about a $1.1 million net increase in 
the total pipeline safety budget. Please prepare a table showing the 
growth of this program during the last five years (both in funding 
levels and personnel).
    Answer. The requested table follows:

                                             [Dollars in thousands]                                             
----------------------------------------------------------------------------------------------------------------
                                                                               Fiscal years--                   
                                                          ------------------------------------------------------
                     Program activity                         1993       1994       1995       1996       1997  
                                                            enacted    enacted    enacted    enacted    enacted 
----------------------------------------------------------------------------------------------------------------
Appropriation............................................    $15,050    $19,376    $37,340    $31,448    $31,886
Personnel:                                                                                                      
    FTP..................................................         72         72        105        105        105
    FTE..................................................         72         72         90        105        105
----------------------------------------------------------------------------------------------------------------

    Question. Please further justify the request for an additional 
$383,000 for travel and transportation as indicated on page 129?
    Answer. Our request provides for increased travel in the field 
including compliance/inspection and state liaison activities, as well 
as continued risk management and other OPS public outreach programs. 
The field component covers travel for training and full deployment of 
our increased inspection force. As we implement a more risk-based 
compliance process we will be emphasizing multi-region inspections 
focusing on facilities. In fiscal year 1998, up to 10 risk management 
demonstration projects will be in progress throughout the country. 
Under the Presidents directive which accompanied the Accountable 
Pipeline Safety and Partnership Act of 1996, and the directions of the 
National Performance Review, OPS will be getting out of Washington to 
involve the public in risk management and other pipeline safety 
initiatives.
    Question. For fiscal year 1995, 1996, 1997 and budgeted for fiscal 
year 1998, please prepare separate expense charts for resources 
obligated on overtime, bonuses, travel, permanent change of station, 
and communications.
    Answer. The following table is provided:

                                             OBLIGATIONS BY CATEGORY                                            
----------------------------------------------------------------------------------------------------------------
                                                                          Fiscal years--                        
                                                 ---------------------------------------------------------------
                                                    1995 actual     1996 actual   1997 estimated  1998 estimated
----------------------------------------------------------------------------------------------------------------
Overtime........................................          $7,318          $4,191          $4,200          $4,200
Bonuses \1\.....................................          20,350          36,400          42,000          42,000
Travel \2\......................................         770,000         820,000       1,139,000       1,242,000
Permanent change of station.....................          21,010          25,210          50,000         100,000
Communications..................................             430             452             470             470
----------------------------------------------------------------------------------------------------------------
\1\ RSPA budgets do not include funding for bonuses. If available, funding from unoccupied positions is used    
  within a modest internal administrative limit.                                                                
\2\ Fiscal year 1997 includes $300,000 of operating expenses carryover funding from fiscal year 1996.           

    Question. How many staff does OPS have in the Anchorage Joint 
Pipeline Office? What are their responsibilities?
    Answer. OPS has three inspectors in Alaska. One person is assigned 
full time to monitoring the Alyeska Pipeline and represents OPS in the 
Joint Pipeline Office. The second person is tasked with monitoring all 
other pipelines in Alaska. The third person, a junior inspector, 
assists the other two inspectors as needed.
    Question. Please discuss the Alyeska memorandum of agreement 
regarding valves and corrosion.
    Answer. The corrosion program was initiated in November of 1992 
based on a ``Memorandum of Agreement for a Task Force on Oversight of 
the Trans-Alaska Pipeline System (TAPS),'' executed by the State of 
Alaska, U.S. Department of the Interior, and U.S. Department of 
Transportation on November 21, 1990. A November, 1992, Task Force 
report outlined the corrosion prevention program for TAPS and the 
parameters necessary to determine the adequacy of cathodic protection 
on the pipeline.
    Alyeska agreed to attempt to determine better ways to monitor 
cathodic protection (corrosion prevention) levels because traditional 
monitoring methods are not always effective for a variety of Alyeska 
specific conditions including the impact of the Northern Lights 
phenomenon and under film corrosion caused by disbonded coating. One 
method Alyeska is trying is a corrosion coupon program where pieces of 
steel are installed at one (1) mile intervals on the pipeline and 
periodically checked for corrosion levels. To date Alyeska has 
installed 400 coupons and will test all 400 in the summer of 1997.
    Attempts are being made to correlate internal inspection tool (pig) 
runs and ongoing corrosion prevention activity. In 1996, the NKK (a 
Japan-based company) pig was run twice from pump station 1 to pump 
station 4 to see if correlation was possible. Initial indications are 
promising and OPS anticipates data evaluation will be completed by 
September of 1997.
    OPS is overseeing all facets of the corrosion program and 
anticipates closure to this issue in January of 1998.
    On January of 1997, the Alyeska Pipeline Service Company (APSC) and 
the Joint Pipeline Office (JPO) entered into a Memorandum of Agreement 
in the matter of the assessment of valves on the Trans-Alaska Pipeline 
System (TAPS).
    Alyeska agreed to identify which valves are most critical to the 
overall system safety, determine how to test them to ensure their 
integrity and prioritize which valves should be tested first. In 
addition, Alyeska will propose precautionary measures for valves of 
unknown condition. Alyeska is also developing performance criteria to 
evaluate in-service valves(s) and means of determining their overall 
risk factors. APSC will evaluate the results of the risk assessment 
within 30 days of its completion.
    APSC will initiate repair procedures promptly if the parties 
determine that a condition exists at any given valve(s) that presents 
an unacceptable risk. A final valve testing plan will be based upon the 
results of the risk assessment and initial testing, and submitted by 
June 30, 1997 to JPO for review.
    APSC will perform valve tests by December 31, 1997 on all valves 
designated with the highest testing priority in the final plan. The 
agreement does not modify the requirement that APSC comply with 49 CFR 
Part 195 and does not preclude DOT from taking action to address any 
violation or hazardous condition that may arise with respect to the 
valves covered in the agreement.
                          information systems
    Question. Please prepare a table showing the amount of funding used 
to improve your information systems during each of the last three 
years.
    Answer. The following table is provided.

Pipeline safety information systems expenditures

1995:   Budget item                                              Funding
    Hardware/software for increased staff.....................  $325,000
    Drug/Alcohol System and Risk Based Planning computer model   100,000
    Contractor support for Hazardous Materials Information 
      System..................................................   270,000
    Transportation Safety Institute Training Initiative.......   180,000
    Vax Maintenance...........................................   115,000
    Baseline Data Study.......................................   510,000
    Software, hardware, and training support to State pipeline 
      safety programs.........................................   250,000
                    --------------------------------------------------------------
                    ____________________________________________________

        Total 1995 Information Systems and Analysis........... 1,750,000
                    ==============================================================
                    ____________________________________________________
1996:
    Upgrade regions to Wide Area network......................   160,000
    Equipment costs: Desktop and notebook computers to meet 
      expanding staff needs...................................   110,000
    Contractor support for Hazardous Materials Information 
      System..................................................   340,000
    VAX maintenance costs.....................................   150,000
    Site license costs for software...........................    40,000
    Data Baseline Project: Establish performance measures, 
      support risk based planning, G.P.R.A, identify outside 
      sources of data.........................................   400,000
                    --------------------------------------------------------------
                    ____________________________________________________

        Total 1996 Information Systems and Analysis........... 1,200,000
                    ==============================================================
                    ____________________________________________________
1997:
    Hardware/Software for increased staff.....................   110,000
    Contractor support for Hazardous Materials Information 
      System..................................................   500,000
    VAX maintenance costs.....................................   140,000
    Site license costs for software...........................    45,000
    Data Baseline Project: Establish performance measures, 
      support risk based planning, G.P.R.A, identify outside 
      sources of data.........................................   330,000
    Software, hardware, and training support to State pipeline 
      safety programs.........................................    75,000
                    --------------------------------------------------------------
                    ____________________________________________________

        Total 1997 Information Systems and Analysis........... 1,200,000

    Question. What specific improvements have been made in your 
information systems and analytical capabilities since last year? Break 
down how you obligated the relevant fiscal year 1996 and fiscal year 
1997 fund and what specific benefits to your overall program were 
realized. How do you expect the relevant fiscal year 1998 requested 
funds will further improve these capabilities?
    Answer: OPS has been addressing improvements to our analytical 
capabilities as well as improvements to the information systems 
hardware and software which support them. We have studied our data 
bases and worked with national standards organizations to revise 
instructions to our accident report forms to improve consistency and 
thoroughness in data collection. We instituted new procedures to audit 
accident reports to ensure completeness and accuracy. We have begun 
contacting operators when inadequate outside force damage information 
has been provided. To improve our ability to access externally caused 
corrosion, we have begun work with the hazardous liquid industry to 
access information that could help normalize data and evaluate the 
miles of pipelines that are coated or cathodically protected. We have 
requested supplemental reports from operators who indicated selected 
``other'' as a cause of an accident. We are providing for electronic 
reporting through our work with contractors. We are evaluating Federal 
Energy Regulatory Commission data from their Form 6 for information on 
liquid operators mileage and throughput. We are adding county data to 
inspection unit definitions to provide linkage between inspection and 
incident data. We are building a national pipeline mapping system to 
locate pipelines with reasonable accuracy in relation to population, 
water, environment, jurisdiction borders, transportation and 
topography.
    A breakdown of expenditures includes $370,000 for maintaining 
computer hardware on personal computers in a wide area network and on a 
mainframe which links OPS, States and the Volpe National Transportation 
Systems; $350,000 for entering reported information in the database and 
disseminating data to the public; and $480,000 for analyzing incident, 
pipeline inventory and operator data.
    Fiscal year 1998 funding will further improve these capabilities 
through actual deployment and further development of our Integrated 
Operator Compliance System. Preliminary design and testing of this 
system occurred in 1997. This system is being designed for data entry 
and access on-site during inspections on notebook computers. Existing 
systems will be converted to improved software which will allow 
linkages among all operator data bases, including the National pipeline 
mapping system, incident, inspection and annual report data. This will 
enable us to improve our data usefulness and accuracy. Improved 
computer modeling will help integrate all available data pertaining to 
operators, providing for a variety of analytical needs. We will also 
improve data availability through electronic media and OPS's world-wide 
web page. The web page will provide a useful feedback mechanism 
allowing public comment on all our activities, rulemakings, and access 
to pipeline statistics.
    Additionally, we will work toward a standard for data operators to 
maintain on site. A comprehensive understanding of operations and 
maintenance history, valve locations, inspection findings, pipe 
manufacture and installation would focus our inspection attention on 
the most important integrity management issues. We are working with 
industry on innovative ways of accessing this kind of information 
without burdensome collection processes.
                    risk assessment and performance
    Question. OPS is proposing a one-third decrease in funding for risk 
assessment and related technical studies ($1.8 million in fiscal year 
1997; $1.2 million requested for fiscal year 1998). Please summarize 
the reasons that OPS is able to make this adjustment. How will this 
proposed decrease affect your ability to implement relevant provisions 
of the Accountable Pipeline Safety and Partnership Act?
    Answer. OPS, working through joint government/industry quality 
teams, has completed the planning for the Risk Management Demonstration 
Program. OPS created a new oversight approach to use to evaluate 
pipelines with more flexibly but with some uniformity and fairness 
across the country. We received public input through numerous public 
meetings, conferences and via Internet. OPS created (1) a Program 
Framework to instruct pipeline operators on how to participate in the 
program and to identify the steps we will use to approve and monitor 
their proposals; (2) a Program Standard to describe the necessary 
elements in a company's risk management program; (3) Performance 
Measures Guidance to provide a way of knowing if we are accomplishing 
what we set out to do; (4) a Communications Plan to help get meaningful 
community involvement; and (5) a Training Curriculum to continue to 
prepare us for our new roles during the Program. Additionally, we 
evaluated other federal, State and industry uses of risk management. We 
also created protocols to standardize our actions in implementing new 
procedures for each of the demonstration projects that may be staffed 
with different OPS personnel from around the country.
    With this planning completed, in fiscal year 1998 we will continue 
to require contractor support to assist with the new feasibility study 
by a quality team focusing on application of risk management at the 
distribution. This study will take several years to complete. We will 
require consultative and monitoring support during the project 
implementation. We require assistance with an extensive communications 
and outreach effort for each of the projects. We will continue to 
provide training to ourselves, States and operators in the Program. The 
fiscal year 1998 requirements are estimated to cost considerably less 
than the support required for the conceptual and planning phase of the 
Program. Since the Program is entirely new and without precedent, it is 
hard to gauge precise requirements. OPS believes, however, with the 
experience and training gained in fiscal year 1997, that we can 
implement the program using more in-house staff and less contractor 
support.
                     compliance and state programs
    Question. In your budget justification on page 132, OPS states that 
by working cooperatively with industry, ``we have maintained complete 
compliance.'' What does this mean?
    Answer. Under the Oil Pollution Act of 1990, all onshore oil 
pipelines must have approved facility response plans in order to 
continue to transport and store oil. RSPA/OPS has ``maintained complete 
compliance'' in that there has never been a case of a pipeline operator 
having to shut down its facility because of non-compliance with our 
facility response planning requirements. The rigorous process that is 
used to review operators' response plans often reveals deficiencies in 
the plans which must be corrected before RSPA/OPS can approve the plan. 
RSPA/OPS provides operators with guidance and technical assistance to 
improve the plans and bring them into compliance.
    While working to bring the plan to acceptable status, the operator 
is allowed to continue to operate the facility by providing written 
documentation that they have obtained sufficient resources to respond 
to a worst-case discharge.
    Question. Please provide fiscal year 1996 and fiscal year 1997 
program goals for the risk-based Pipeline Inspection Priority Program 
(PIPP) and specify which regions were unable to meet these goals, and 
please explain why?
    Answer. In the last quarter of 1996 and 1997, OPS began 
implementing changes to provide greater public safety and protection of 
the environment by enhancing its current risk-based inspection program. 
This is done by concentrating the deployment of our inspection 
resources to the areas of greatest safety and environmental risk. To do 
this, we are performing more system-wide engineering-based integrity 
evaluations and shifting away from ``checklist'' standard inspections. 
Additionally, we are performing more inter-regional inspections that 
provide a comprehensive review of operator procedures and allow more 
time for performing independent field verifications and evaluating 
possible problem areas. This change is reflected in a slight decrease 
in the number of planned standard inspections in CY 1997. Furthermore, 
because the integrity evaluations are more resource intensive than 
standard inspections, we expect the overall number of inspections to 
decrease and the overall number of days per inspection to increase.
    Those regions that were unable to meet the inspection goals are as 
follows:
    Eastern Region: The Eastern Region was unable to meet its 1996 PIPP 
standard inspection goals due to special assignments including the 
Colonial Task Force investigation and projects to streamline compliance 
activity.
    Western Region: The Western Region was unable to meet its 1996 
standard inspection goals due to long-term illness of one employee and 
redirection of resources to pipeline construction inspection.
    Question. Please provide a table by region identifying the number 
of inspections called for under the PIPP and the actual number of 
inspections conducted.
    Answer. Inspection goals are planned by calendar year. The number 
of actual inspections for CY 1997 will not be available until CY 1998.

----------------------------------------------------------------------------------------------------------------
                                                                              CY 1996                           
                                                                 --------------------------------     CY 1997   
                             Region                                  Number of       Number of       number of  
                                                                      planned         actual          planned   
                                                                    inspections     inspections     inspections 
----------------------------------------------------------------------------------------------------------------
Eastern.........................................................             103              74              81
Southern........................................................             120             121             100
Central.........................................................             113             114              99
Southwest.......................................................             161             163             158
Western.........................................................             120              94             100
                                                                 -----------------------------------------------
      Total.....................................................             617             566             538
----------------------------------------------------------------------------------------------------------------

    Question. How does the PIPP relate to your current risk-based 
objectives?
    Answer. PIPP is an important inspection prioritization tool which 
helps OPS identify high-risk pipeline units based on a variety of risk 
factors. OPS will continue to perform standard inspections on PIPP 
identified high risk units, but will slightly reduce the number of 
lower risk standard inspections in favor of system-wide integrity-based 
inspections.
    Question. OPS has stated in the budget justification that it will 
report changes resulting from Federal assessment of operations, without 
formal compliance action. What does this mean? Under what conditions 
will you bring enforcement actions?
    Answer. Rather than simply notifying operators of noncompliance, we 
have been trying to encourage them to address problems system-wide. 
During an interview following each inspection, the operator is advised 
of the areas that need improvement. When given this chance, operators 
often voluntarily undertake actions that address problems on a system-
wide basis. Following an accident, pipeline operators often work with 
OPS to identify problems with their pipeline system and commit to 
significant and costly rehabilitation projects without the necessity of 
initiating compliance action. Of course, if the noncompliance is 
serious or an operator has a history of noncompliance in this area, or 
will not cooperate, OPS does not hesitate to initiate enforcement 
action.
    Question. Please bring us up to date on the enforcement activities 
of OPS. For each of the last three fiscal years, please provide data on 
all enforcement actions taken by OPS, including the number of 
enforcement cases opened, closed, and the amount of civil penalty 
assessments collected. Please compare these data with the number of 
reportable events, number of deaths and injuries, and any other 
measures of pipeline safety for both hazardous liquids and gases.
    Answer. The following table is provided:

                                                   ENFORCEMENT                                                  
----------------------------------------------------------------------------------------------------------------
                                                                                        CY                      
                            Measures                             -----------------------------------------------
                                                                       1994            1995            1996     
----------------------------------------------------------------------------------------------------------------
Cases opened \1\................................................             165             132             190
Cases closed \1\................................................             130             107             167
Civil penalty assessment........................................        $607,000        $339,666         $97,975
Reportable events:                                                                                              
    Incidents reported..........................................             465             350             374
    Deaths......................................................              22              19              20
    Injuries....................................................         \2\ 120              64              85
    Property damage (in millions)...............................            $154             $54             $64
----------------------------------------------------------------------------------------------------------------
\1\ Includes Warning Letters.                                                                                   
\2\ During the 1994 Texas flooding, several pipelines failed and ignited. The accident reports received from    
  impacted pipeline operators stated that 1,851 claims were received. It is unknown how many of these claims    
  have been validated.                                                                                          

    Question. What non-regulatory approaches to improve ``pipeline 
integrity'' are you exploring?
    Answer. OPS is focusing on the best ways of accomplishing 
improvements to pipeline integrity, rather than simply devoting 
additional resources to enforcement of regulations and exacting 
penalties. Two new priorities are of special significance in 
accomplishing program improvements--integrating risk management 
concepts into our compliance program, and increasing our attention to 
investigation and study of major pipelines. Industry and State pipeline 
programs has responded very favorably to these approaches by 
demonstrating willingness to undertake more activities to address 
pipeline integrity in a partnership environment and by cooperating 
fully in major investigations. Together, we are developing new 
performance measures to validate our belief that it is at least as 
important to monitor improvements to the integrity of pipelines as to 
track compliance.
    Question. How many companies were inspected during fiscal year 1996 
that did not have enforcement actions taken against them? How many were 
provided technical education on how to come into compliance with the 
regulations, when enforcement action could have been taken?
    Answer. OPS issued enforcement actions to approximately one-half of 
all operators inspected during CY 1996. During every inspection, 
pipeline operators are advised of methods to improve compliance with 
the Federal pipeline safety requirements and industry practices. The 
issues discussed involve minor problems not warranting enforcement 
action, such as a single missing pipeline marker, or industry best 
practice policies. We issue warnings with respect to noncompliance. 
However, no record is currently maintained of the various items 
discussed because they are not considered enforcement actions. However, 
OPS is developing performance measures to track these items.
    OPS will undertake enforcement action against any operator found to 
be in violation of the pipeline safety regulations. However, if minor 
improvements can be made to an operator's procedures, record keeping or 
operations, OPS may provide the operator the opportunity to correct the 
circumstances before taking enforcement action.
    Question. How many of these companies provided with technical 
education were reinspected? Did you find these companies still out of 
compliance? If so, how many enforcement actions were taken against 
these companies?
    Answer. While no record is currently maintained of the various 
items discussed we see value in the information and are developing 
performance measures to track these items. In the future these 
situations will be noted at reinspection to determine if there has been 
proper handling of suggested items and, if not, enforcement action will 
be taken where appropriate as part of that enforcement process.
    Question. Please prepare an updated table indicating the number of 
pipeline safety inspectors on board and the number of pipeline safety 
inspector positions authorized for each of the last three fiscal years. 
Please explain whether the number of authorized positions has or has 
not increased relative to Congressional directives. If not, why not?
    Answer. The total number of filled inspector positions varies 
during the year due to personnel turnover and hiring of new inspectors. 
OPS is in the process of hiring additional inspectors in the Eastern 
and Central Regions.

                                          NUMBER OF INSPECTORS ONBOARD                                          
----------------------------------------------------------------------------------------------------------------
                                                                Fiscal years--                                  
                             -----------------------------------------------------------------------------------
           Region                      1997 \1\                    1996 \1\                      1995           
                             -----------------------------------------------------------------------------------
                               Authorized      Onboard     Authorized      Onboard     Authorized      Onboard  
----------------------------------------------------------------------------------------------------------------
Eastern.....................            7             5             9             7             9             6 
Southern....................            8             8             8             8             8             8 
Central.....................           12            11            11             9             7             5 
Southwest...................           11            11            11             9             8             8 
Western.....................           13            13            12             8             9             6 
                             -----------------------------------------------------------------------------------
      Total.................           51            48            51            49            41            33 
----------------------------------------------------------------------------------------------------------------
\1\ These numbers do not include headquarters inspector positions that supply technical support.                

    Question. How many accident investigations were conducted during 
each of the last three fiscal years? Please include information on the 
number of follow-up accident investigations and the results.
    Answer. The following table is provided:

                       ACCIDENT INVESTIGATIONS \1\                      
------------------------------------------------------------------------
                                                 1994     1995     1996 
------------------------------------------------------------------------
Number of investigations.....................       39       21       64
Follow-up investigations.....................       33       60       58
Accident reports generated...................       11        6    \2\ 2
------------------------------------------------------------------------
\1\ There may be several follow-up investigations/inspections from each 
  accident investigation. These are not included in the number of       
  accident investigations.                                              
\2\ Additional reports are forthcoming.                                 

                 training and information dissemination
    Question. Please list the companies with technical education and 
training in fiscal years 1996 and thus far 1997?
    Answer. The training program has been active in an effort to 
provide technical material/education and training to industry, i.e., 
the American Gas Association (AGA), the Midwest Gas Association (MGA), 
the Southern Gas Association (SGA), Pacific Gas Association (PGA), 
American Petroleum Institute (API), Interstate Natural Gas Association 
of America (INGAA), etc., concerning the federal minimum safety 
requirements. The Pipeline Employee Performance Group (PEPG) has been 
established by OPS, industry, and our State partners to exchange 
information on pipeline safety training. The training division at 
Transportation Safety Institute (TSI) is developing a database to track 
industry training needs and employee-specific information, and should 
be active by fiscal year 1998.
    Question. Please discuss the changing emphasis of the training 
program from ``recognizing threats to [pipeline structural] integrity'' 
to the new focus on ``preparing regulators to consider various 
alternatives * * * as the most effective course of action''.
    Answer. Training courses at Transportation Safety Institute (TSI) 
are being structured around risk management and prioritizing the 
evaluation of operator facilities. The highly technical block of 
instruction, presently taught by TSI, will be continued with a risk 
management approach. Courses are becoming more involved in the 
operation, maintenance, and emergency response areas. The courses 
emphasize a rational, and thorough basis for determining safe operating 
practices and safe operating systems. Risk management courses, such as 
Risk Management Fundamentals, and more specific training modules are 
being developed to aid Federal and State pipeline safety inspectors. 
All courses are designed to reflect industry standards and current 
technology in an effort to better prepare inspectors to advise and 
evaluate small gas and liquid systems. Performance-based training, 
through the use of computer-based training, (CBT), is also being 
implemented in an effort to keep all inspectors competent in their 
areas of expertise. The training section also utilizes internet 
technology to facilitate current practices to all pipeline employees. 
Hands-on programs are being developed where performance in a given 
application is paramount in the proper operation, maintenance, and 
emergency response areas. Long-range planning will examine the 
possibility of using video conferencing, CBT, internet and other cost-
effective measures that would facilitate, training needs. Updates of 
job task analyses, lesson plans, class design documents, etc., are also 
under scrutiny for utilizing new technology and accuracy.
                        research and development
    Question. What technical advances have resulted from research 
sponsored during the last three fiscal years by the OPS?
    Answer. Technical advances that have resulted from research 
sponsored by OPS during the last three fiscal years include a study on 
Supervisory Control and Data Acquisition (SCADA) methods which is used 
to monitor pipeline operations. The SCADA study determines the 
feasibility and costs of requiring pipeline operators to install a leak 
detection system, which would allow for the detection of impediments or 
needed system improvements.
    Future technical studies that should result in technical advances 
include an investigation into criteria for establishing leak-before-
rupture criteria for pipelines. This will establish pipeline design and 
operations conditions to limit catastrophic failures. In addition, 
technical advances should result from two ongoing studies on mechanical 
damage. One study examines analytical and experimental research into 
fatigue behavior of pipelines that have mechanical damage, such as 
dents and gouges. This will help operators decide when to repair 
pipelines by establishing damage acceptance or rejection criteria. The 
other study is being conducted in collaboration with the Gas Research 
Institute on detection of pipeline mechanical damage by in-line 
inspection equipment, or ``smart pigs.'' The study, which was started 
in 1996, will facilitate the design of smart pigs that can be used for 
in-line inspection of pipelines to detect cracks, dents, gouges, and 
stress corrosion cracking. All of these conditions are potentially 
detrimental to the safe operation of pipelines. The research will 
specify sensor technologies and data evaluation methods to reliably 
distinguish between various types of mechanical damage.
    Question. Please list all of the reports that you issued as a 
result of your R&D program during the last few years and the NTIS 
number for each report?
    Answer. Following is a list of the R&D reports issued by OPS in 
recent years. None of the reports are presently in the NTIS system. 
However, the reports issued in 1966 and after will be placed in the 
NTIS system:
  --An Examination of the Feasibility of Regulating Excavators, October 
        1990
  --Emergency Flow Restricting Devices Study, March 1991
  --Instrumented Internal Inspection Devices, November 1992
  --Improving the Safety of Marine Pipelines, 1994
  --Remote Control Spill Reduction Technology: A Survey & Analysis of 
        Applications for Liquid Pipeline Systems, September 1995
  --Natural Disaster Study Prototype (Task 1), September 1995
  --Comparison of U.S. with Foreign Pipeline Land Use and Siting 
        Standards and Maintenance, Rehabilitation and Retrofitting 
        Policies and Practices, April 1996
  --Natural Disaster Study, National Pipeline Risk Index Technical 
        Report (Task 2), July 1996
  --Natural Disaster Study, National Pipeline Consequences Index 
        Technical Report (Task 3), July 1996
  --Natural Disaster Study, High Hazard, High Consequence Pipelines 
        Technical Report (Task 4), July 1996
  --Pipeline Accident Effects for Natural Gas Transmission Pipelines, 
        August 1996
  --Pipeline Accident Effects for Hazardous Liquid Pipelines, August 
        1996
  --Pipeline Accident Consequences for Natural Gas and Hazardous 
        Liquids Pipelines and Pipeline Accident Consequences Analysis 
        Using GIS for Natural Gas and Hazardous Liquids Pipelines, 
        August 1996
    Question. Please update the Committee on the status of your mapping 
initiative. When will the project be completed. How much was 
appropriated and obligated on this effort in fiscal years 1995, 1996, 
1997 and planned for 1998.
    Answer. The Joint Government-Industry Mapping Quality Action Team 
completed its work last June with the publication of the team's report. 
The team researched existing pipeline locational data and mapping 
initiatives that companies, states, private industry, pipeline 
companies and one-call systems have developed. The team created 
criteria for evaluating data sources and concluded that no available 
data source met the specified criteria for data quality, usability, 
maintenance, and implementation. The team recommended the building of a 
national system for efficient data exchange, creation of pipeline data 
standards, collection of data from sources willing to meet the 
standard, acceptance of the data in paper and electronic format, and 
extensive communication to promote the standards and the program. A 
second team was formed to complete the implementation of the 
recommendations. This team recently presented, at a public meeting, 
draft standards and a concept for a decentralized repository system in 
which states would be encouraged to play the major data collection and 
maintenance role. They also presented criteria for the selection of the 
repositories that would link to a national repository.
    The team has begun pilot testing the standards at the Department of 
Energy/Argonne National Laboratory and at the Texas Railroad 
Commission. This summer, numerous companies will be solicited to 
participate in pilot testing of the standards. At the same time, OPS 
will prepare cooperative agreements with state agencies that plan to be 
repositories for the collection of data. We will begin funding these 
agreements this summer so that operations can accelerate in fiscal year 
1998. Evaluations and revisions to the standards will follow the pilot 
testing and will be completed in Spring of fiscal year 1998. This 
project is expected to achieve comprehensive collection of transmission 
and hazardous liquid pipeline data within three to five years.
    Maintenance of data will be an ongoing cost. It is difficult to 
estimate the cost at this time because the mapping system will be built 
through partnerships that leverage voluntary participation by states 
and industry. The costs of the system at the state level is expected to 
be shared with other users of the information outside the pipeline 
industry, including various state and local agencies such as 
departments of natural resources, public works, environmental 
protection, tax collection, etc.
    Expenditures to date have totaled $678,000. The following table 
shows the amounts appropriated and obligated in fiscal years 1995, 
1996, 1997, and planned for 1998.

------------------------------------------------------------------------
                                           Appropriated      Obligated  
------------------------------------------------------------------------
Fiscal year:                                                            
    1995................................      $1,200,000        $650,000
    1996................................       1,200,000          58,000
    1997 \1\............................         400,000  ..............
    1998 (request)......................         400,000  ..............
------------------------------------------------------------------------
\1\ As of June 13, 1997.                                                

    We expect to utilize a majority of the funding in cooperative 
agreements that we will begin executing by the end of fiscal year 1997.
    Question. Generally, what is the reaction of hazardous liquid and 
natural gas transmission companies to the national pipeline mapping 
initiative? Are there concerns about the potential for industrial 
sabotage, or inappropriate information sharing?
    Answer. The pipeline companies are supportive of the approach OPS 
and the team have taken because it allows for flexibility in format and 
scheduling collection of the data. Voluntary participation allows 
industry to meet the needs of the government in a manner consistent 
with their own ongoing business needs. OPS is optimistic about company 
participation as the cost of more accurate data collection using Global 
Positioning Systems (GPS) is rapidly decreasing. GPS data collection 
can be accomplished along with other field activities like corrosion 
monitoring. While questions about security have been raised, the 
information we are collecting is already available on an individualized 
basis from various sources. Nevertheless, we continue to work with 
states, industry, and national security agencies to address this 
important issue.
    Question. Please provide an update of research and development 
initiatives that support your risk-based priority program, specifically 
addressing cost-effective smart in-line inspection tools, leak 
detection systems, line location technology, state and regional cost-
effective training, and higher quality incident data base.
    Answer. An in-line inspection or ``smart pig'' research initiative 
is being conducted in collaboration with the Gas Research Institute to 
improve the ability of smart pigs to detect pipeline mechanical damage. 
The study, which was started in 1996, will facilitate the design of 
smart pigs that can be used for in-line inspection of pipelines to 
detect cracks, dents, gouges, and stress corrosion cracking. All these 
conditions are potentially detrimental to the safe operation of 
pipelines. The consortium conducting the study is investigating the 
sources of magnetic flux leakage from these conditions, are determining 
the magnetic effects of stress and deformation from these conditions, 
and have determined multi-levels of magnetic signals are necessary to 
characterize these conditions and are presently evaluating methods to 
achieve this on a single pig, both in pig sensor design and the 
computer analysis of data stored during a pig run.
    A leak detection research initiative was conducted by the Volpe 
National Transportation Systems Center (Volpe). On September 29, 1996, 
Volpe released a report entitled ``Remote Control Spill Reduction 
Technology: A Survey and Analysis of Applications for Liquid Pipeline 
Systems.'' The study examined the pipeline industry's use of 
application of Supervisory Control and Data Acquisition (SCADA) systems 
and leak detection systems. The report evaluated several leak detection 
performance measures, including response time, false alarms, 
sensitivity, and leak location accuracy. Volpe is enhancing the 
findings of this report by developing and analyzing several leak 
detection system scenarios on actual pipelines in cooperation with the 
American Petroleum Institute.
    Although OPS has not sponsored any research on line location 
technology, various industry groups and universities have ongoing 
programs in this area.
    OPS is working with two joint Federal/industry teams, one for 
liquid pipeline data issues and one for natural gas pipeline data 
issues. The teams are working to identify data shortcomings and 
efficient solutions to data needs.
    Through TSI, a computer-based training initiative will incorporate 
functions of risk management to reduce travel and administrative costs. 
Lessons learned associated with CBT and Internet will be incorporated 
to provide easier access to training materials.
    A group of educational and technical trainers was formed at TSI in 
fiscal year 1997 to exchange ideas and provide recommendations to the 
pipeline industry on employee performance issues such as what 
constitutes the ``best practices.'' The group plans to develop 
``recommended guidelines'' for evaluating the technical skills of 
pipeline employees and provide opportunities for information or data 
exchange. The group will promote consistency in training throughout the 
industry by providing state-of-the-art techniques. This in turn will 
provide cost savings through unified development of technical training.
    Question. What progress has been made on the memorandum of 
understanding (MOU) with the Gas Research Institute on non-destructive 
evaluation technology? What are the accomplishments to date of this 
partnership? How does your request for a decrease in funding for this 
activity relate to the MOU?
    Answer. The first study under the MOU to be conducted in 
collaboration with the Gas Research Institute regards non-destructive 
testing by in-line inspection tools or ``smart pigs.'' This study 
commenced in June 1996. The study will improve the analytical ability 
to detect pipe wall cracks, dents, gouges, and stress corrosion 
cracking, mechanical damage which may lead to pipe failure if not 
detected. The research will determine sensor technologies to utilize, 
and then to adapt the sensor to a test vehicle so that non-damaging 
metallurgical inclusions in pipe and the more serious mechanical damage 
can be distinguished. The request for a decrease in funding does not 
relate to the MOU but will affect the timetable for completion of 
testing with the test vehicle in the 4700 foot flow loop used to 
simulate actual pipeline operations.
                          state grant program
    Question. What are the eligibility criteria for states to receive 
pipeline safety grants? What states are not currently eligible to 
participate?
    Answer. Performance factors used by OPS to allocate grant funds to 
a State agency are:
  --Field Evaluation of State Pipeline Program (50 points)
  --Extent of Intrastate Safety Jurisdiction (12 points)
  --Inspector Qualifications (8 points)
  --Number of Inspection Person-Days (9 points)
  --State Adoption of Maximum Civil Penalty Requirement (2 points)
  --State Adoption of Applicable Federal Regulations (8 points)
  --One-Call System Minimum Requirements (8 points)
  --State Attendance at National Association of Pipeline Safety 
        Representatives Regional Meeting (3 points)
  --Penalty Points for untimely submittal of documentation to OPS (up 
        to 4 points to be deducted)
    Many performance factors used by OPS were derived from a long-
standing use of such standards in our Federal/State partnership. OPS, 
in conjunction with the National Association of Pipeline Safety 
Representatives, formed committees to maintain this close working 
relationship. These committees allow States to participate in OPS 
activities and decision-making that affects the programs. These 
committees' efforts previously provided criteria used by OPS to qualify 
inspectors and the performance factors used by OPS to evaluate the 
States.
    Four states do not participate in the State Gas Pipeline Safety 
Program. These states are Alaska, Hawaii, Idaho, and Maine.
    Question. For fiscal years 1996 and 1997, please list the states 
that participated in your hazardous liquids and hazardous gas state 
grants programs. For each participating state, display the amount 
requested by the state, the amount of federal grant funds received, and 
the percentage of federal contribution total costs represented by that 
grant.
    Answer. The information for fiscal year 1996 follows. The 
information for fiscal year 1997 should be available after July 1, 
1997.

            1996 NATURAL GAS PIPELINE SAFETY GRANT ALLOCATION           
------------------------------------------------------------------------
                                            State                Percent
            State               Request     points   Allocation   funded
------------------------------------------------------------------------
Alabama.....................     $373,897      100     $323,007       43
Arizona.....................      381,100      100      329,229       43
Arkansas....................      165,478      100      142,955       43
California..................    1,143,469      100      987,834       43
Colorado....................      171,358      100      148,035       43
Connecticut.................      150,000       95      123,105       41
Delaware....................       19,069       95       15,650       41
Florida.....................       53,000      100       45,786       43
Georgia.....................      202,827       95      166,460       41
Illinois....................      248,937      100      215,055       43
Indiana.....................      147,439      100      127,371       43
Iowa........................      142,050      100      122,716       43
Kansas......................      329,034       95      270,037       41
Kentucky....................      218,045      100      188,367       43
Louisiana...................      343,920       95      282,254       41
Maryland....................      151,792      100      131,132       43
Massachusetts...............      291,550       95      239,274       41
Michigan....................      213,385       95      175,125       41
Minnesota...................      511,770      100      442,114       43
Mississippi.................      123,950      100      107,079       43
Missouri....................      237,875       90      184,948       39
Montana.....................       29,602       95       24,294       41
Nebraska....................       78,528       95       64,448       41
Nevada......................      123,401      100      106,605       43
New Hampshire...............       82,362       95       67,594       41
New Jersey..................      333,838      100      288,400       43
New Mexico..................      161,678       80      111,738       35
New York....................    1,271,347      100    1,098,307       43
North Carolina..............      177,342      100      153,204       43
North Dakota................       38,471      100       33,235       43
Ohio........................      419,500      100      362,403       43
Oklahoma....................      208,320      100      179,966       43
Oregon......................      124,750      100      107,771       43
Pennsylvania................      276,936       95      227,281       41
Puerto Rico.................       31,777       85       23,334       37
Rhode Island................       61,382       95       50,376       41
South Dakota................       46,975       90       36,523       39
Tennessee...................      217,425       95      178,440       41
Texas.......................    1,021,077       95      837,995       41
Utah........................      135,150       95      110,917       41
Vermont.....................       44,973      100       38,852       43
Virginia....................      250,000      100      215,973       43
Washington, DC..............       60,694       95       49,811       41
Washington..................      121,500      100      104,963       43
West Virginia...............      140,000       95      114,898       41
Wisconsin...................      172,100       85      126,374       37
Wyoming.....................      123,850       90       96,294       39
                             -------------------------------------------
      Total.................   11,372,923  .......    9,577,530       42
------------------------------------------------------------------------
Note.--The ``request'' represents 50 percent of the States estimated    
  budget. The percent of fund is the percentage of the budget           
  represented by the allocation.                                        


                             1996 HAZARDOUS LIQUID PIPELINE SAFETY GRANT ALLOCATION                             
----------------------------------------------------------------------------------------------------------------
                                                                                 State                   Percent
                             State                                  Request      points    Allocation     funded
----------------------------------------------------------------------------------------------------------------
Alabama.......................................................         $22,600      100         $19,524       43
Arizona.......................................................          40,025      100          34,577       43
California....................................................         991,856      100         856,857       43
Louisiana.....................................................          83,615      100          72,234       43
Minnesota.....................................................         125,200      100         108,159       43
Mississippi...................................................           4,888      100           4,222       43
New Mexico....................................................           9,250       90           7,192       39
New York......................................................          42,060      100          36,335       43
Oklahoma......................................................         151,585       95         124,406       41
Texas.........................................................         180,189       95         147,880       41
Virginia......................................................          42,482       90          33,030       39
Washington....................................................          53,090       90          41,277       39
West Virginia.................................................          37,500       95          30,776       41
                                                               -------------------------------------------------
      Total...................................................       1,784,339  .......       1,516,470       42
----------------------------------------------------------------------------------------------------------------

    Question. RSPA and the states have agreed to attempt to provide 50 
percent of the states' pipeline safety program funding from the federal 
government. As aggregate, what percent of the states' pipeline safety 
program funds were appropriated through the OPS state grant program in 
fiscal years 1996 and 1997? Is the total national program level 
increasing due to more active pipeline safety programs at the state 
levels? Please discuss.
    Answer. The percent of the states' pipeline safety grant funding in 
fiscal year 1996 was 42 percent compared to an estimated 44 percent in 
1997. The states for some time have been assigned additional tasks and 
jurisdiction without an increase in grant funds. Some additional 
efforts undertaken by the states are drug and alcohol inspections and a 
larger percentage of intrastate jurisdiction such as master meter and 
offshore (state waters) inspections.
    Question. Part of the original justification for the increase in 
the pipeline grant program was that with increased funds the states 
would be encouraged to expand their enforcement responsibilities. 
Please provide quantitative data on a state-by-state basis indicating 
whether this has happened.
    Answer. OPS has encouraged states to expand their enforcement 
jurisdiction in the past few years by adding seven new gas and liquid 
programs and eleven new areas of Municipal, liquefied petroleum gas or 
master meter operator jurisdiction in their states. This information 
will be provided within 30 days of reviewing the 1997 state 
certification documents.
    Question. Please provide an assessment of your monitoring of the 
state grant program. How has OPS improved various state programs?
    Answer. Over the last four years, OPS has taken steps to improve 
our oversight of the state pipeline safety programs including the full 
time designation of an inspector in each region office to monitor and 
evaluate activities.
    These inspectors, the state liaison representatives, have worked 
together to improve the monitoring and evaluation process so that areas 
of needed improvement can be more readily identified and corrected. 
When OPS identifies a potential weakness in a state pipeline program, 
we work with the program manager to correct the circumstances and 
provide technical support.
    The following is a summary of the field evaluation scores and other 
performance factors that are used in our certification of the state 
pipeline programs. The total maximum score is the score used for 
allocating grant funds.

                                                                            1996 GRANT ALLOCATION--STATE POINTS (GAS)                                                                           
                                                                           [From certification/agreement attachments]                                                                           
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                  State adoption  State adoption                                                                
                                                                     Inspector       Number of      of maximum     of applicable     One-call      Attendance at                                
                    Gas State                      Jurisdiction    qualification    inspection     civil penalty      Federal      notification    Federal/State      Penalty     Total  maximum
                                                       (12)             (8)         person days     regulations     regulations    requirements      Mtg.  (3)      points  (-)         (50)    
                                                                                        (9)             (2)             (8)             (8)                                                     
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Alabama.........................................              12               8               9               2               8               8               3  ..............              50
Arizona.........................................              12               8               9               2               8               8               3  ..............              50
Arkansas........................................              12               8               9               2               8               8               3  ..............              50
California......................................               9               8               9               2               8               8               3  ..............              47
Colorado........................................              12               8               9               2               5               8               3  ..............              47
Connecticut.....................................              12               4               9               2               8               8               3  ..............              46
Delaware........................................               6               8               9             N/A             N/A               8               3  ..............              44
Florida LPG.....................................              12               8               9  ..............               8               6               3  ..............              46
Georgia.........................................              10               8               9  ..............               8               8               3  ..............              46
Illinois........................................              12               8               9               2               8               7               3  ..............              49
Indiana.........................................              12               8               9               2               8               8               3  ..............              50
Iowa............................................              12               8               9               2               8               8               3  ..............              50
Kansas..........................................              12               8               9               2               5               8               3  ..............              47
Kentucky........................................              12               8               9               2               8               8               3  ..............              50
Louisiana.......................................              12               8               9               2               8               7               3  ..............              49
Maryland........................................              12               4               9               2               8               8               3  ..............              46
Massachusetts...................................               9               8               9               1               8               6               3  ..............              44
Michigan........................................              12               8               5               2               8               8               3              -4              42
Minnesota.......................................              12               8               9               2               8               8               3  ..............              50
Mississippi.....................................              12               8               9               2               8               6               3  ..............              48
Missouri........................................              10               8               9  ..............               8               8               3  ..............              46
Montana.........................................              12               8               5               2               3               7               3  ..............              40
Nebraska........................................              12               8               5               2               8               8               3  ..............              46
Nevada..........................................              12               8               9               2               8               8               3  ..............              50
New Hampshire...................................              10               8               5               2               8               8               3  ..............              44
New Jersey......................................              12               8               9               2               8               8               3  ..............              50
New Mexico......................................              12               8               3               2               8               0               3  ..............              36
New York........................................              12               8               9               2               8               8               3  ..............              50
North Carolina..................................              12               8               9               2               8               7               3  ..............              49
North Dakota....................................              12               8               9               2               8               7               3  ..............              49
Ohio............................................              12               8               9               2               8               6               3  ..............              48
Oklahoma........................................              12               8               9               2               8               6               3  ..............              48
Oregon..........................................              12               8               9               2               8               7               3  ..............              49
Pennsylvania....................................               5               8               9               2               8               6               3  ..............              41
Puerto Rico.....................................              12               8               3               2               8  ..............               3              -2              34
Rhode Island....................................              12               4               9               2               8               8               3  ..............              46
South Dakota....................................              12               4               3               2               8               7               3  ..............              39
Tennessee.......................................              12               8               5               2               8               6               3  ..............              44
Texas...........................................              12               8               9               2               8  ..............               3  ..............              42
Utah............................................              12               4               9               2               8               6               3  ..............              44
Vermont.........................................              12               8               9               2               8               8               3  ..............              50
Virginia........................................              10               8               9               2               8               8               3  ..............              48
Washington, DC..................................              12               4               9               2               8               8               3              -2              44
Washington......................................              12               8               9               2               8               7               3  ..............              49
West Virginia...................................              12               8               9               1               8  ..............               3  ..............              41
Wisconsin.......................................               8               8  ..............               2               5               8               3  ..............              34
Wyoming.........................................              12               8               5               2               8               4               3  ..............             42 
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Note.--No rating--Did not participate in the program in 1995.                                                                                                                                   

    Question. For each participating state, indicate the number of 
times during each of the last three years that OPS conducted an audit, 
a joint inspection, a training activity.
    Answer. The following chart illustrates the number of times OPS has 
conducted an audit, a joint inspection, and seminar or training 
activity in each state participating in an OPS pipeline safety program.
    The number of joint inspections include the number of joint 
accident response investigations in which OPS has participated. The 
relatively high number of joint inspections for New Jersey, New York, 
and Texas in 1994 was due to the accident in Edison, New Jersey; 
preparation for New York to become an interstate agent; and the floods 
in Houston, Texas. The high number of joint inspections for Puerto Rico 
in 1996 was due to the incident in San Juan.
    OPS has given state inspectors training required for certifying a 
pipeline safety program. The numbers of students trained are 315, 279 
and 355 for 1994, 1995 and 1996 respectively.

----------------------------------------------------------------------------------------------------------------
                                                    Number of  audits     Number of joint     Training/ seminars
                                                  ---------------------     inspections     --------------------
                   State total                                         ---------------------                    
                                                    1994   1995   1996   1994   1995   1996   1994   1995   1996
----------------------------------------------------------------------------------------------------------------
Alabama..........................................      2      2      2      2      2      2      3      1      1
Arizona..........................................      2      2      2      2      3      3  .....      2      1
Arkansas.........................................      1      1      1      1      1      1      1      1      1
California.......................................      2      2      2      2      2      2      2      5      6
Colorado.........................................      1      1      1      1      1      1      1      3      1
Connecticut......................................      1      1      1      1      2      2  .....  .....  .....
Delaware.........................................      1      1      1      1      1      1  .....  .....  .....
Washington, DC...................................      1      1      1      1      1      1  .....  .....  .....
Florida..........................................      2      2      2      2      2      2      2      1      2
Georgia..........................................      1      1      1      2      1      1      1      1  .....
Illinois.........................................      1      1      1      1      1      1      1  .....      1
Indiana..........................................      1      1      1      1      1      1  .....  .....  .....
Iowa.............................................      1      1      1      1      1      1  .....      1  .....
Kansas...........................................      1      1      1      2      1      2      3      1      1
Kentucky.........................................      1      1      1      1      2      1  .....      1      1
Louisiana........................................      2      2      2      2      2      2      1      2      5
Maryland.........................................      1      1      1      1      1      1  .....  .....      1
Massachusetts....................................      1      1      1      1      1      1  .....      1  .....
Michigan.........................................      1      1      1      1      3      1      1  .....  .....
Minnesota........................................      2      2      2      3      5      2      2      2  .....
Mississippi......................................      2      2      2      2      2      2  .....      1  .....
Missouri.........................................      1      1      1      1      1      1      1  .....      1
Montana..........................................      1      1      1      1      1      1      1  .....      1
Nebraska.........................................      1      1      1      1      2      1  .....      2  .....
Nevada...........................................      1      1      1      1      1      1  .....  .....      1
New Hampshire....................................      1      1      1      1      1      1  .....  .....      1
New Jersey.......................................      1      1      1      7      1      1      1  .....  .....
New Mexico.......................................      1      1      1      1      1      2  .....      3      1
New York.........................................      2      2      2      5      7      3      5  .....  .....
North Carolina...................................      1      1      1      1      1      1      2      1  .....
North Dakota.....................................      1      1      1      1      1      1      1  .....      1
Ohio.............................................      1      1      1      2      1      1  .....      3      2
Oklahoma.........................................      2      2      2      2      2      2      3      3      1
Oregon...........................................      1      1      1      1      1      1      2  .....  .....
Pennsylvania.....................................      1      1      1      1      2      1  .....      2  .....
Puerto Rico......................................      1      1      1      1      1  \2\ 4                     
                                                                                          9  .....  .....  .....
Rhode Island.....................................      1      1      1      1      1      1  .....  .....  .....
South Carolina...................................      1      1      1      1      1      1  .....      3  .....
South Dakota.....................................  .....      1      1  .....      1      1      1      2  .....
Tennessee........................................      1      1      1      1      1      1  .....      1  .....
Texas............................................      2      2      2  \1\ 4                                   
                                                                            4      2      3  .....      1      5
Utah.............................................      1      1      1      1      1      1      2  .....      2
Vermont..........................................      1      1      1      1      1      1  .....  .....  .....
Virginia.........................................      1      1      2      1      3      3  .....      1  .....
Washington.......................................      1      1      2      1      1      2      1      2  .....
West Virginia....................................      2      2      2      2      2      2      1  .....      2
Wisconsin........................................      1      1      1      1      1      1  .....      1  .....
Wyoming..........................................      1      1      1      1      1      1      3  .....      1
----------------------------------------------------------------------------------------------------------------
\1\ This substantial increase was due to a major flood in October 1994.                                         
\2\ This increase was due to the major incident in San Juan in 1996.                                            

                         risk management grants
    Question. Eight risk management demonstration projects were 
authorized in the Accountable Pipeline Safety and Partnership Act. Who 
are the participants in these demonstration projects? Is funding for 
these demos provided through the risk assessment/technical studies 
contract program, or through the risk management grants program? How 
much funding was associated with these demonstration projects in fiscal 
year 1997, and how much is requested for fiscal year 1998?
    Answer. To clarify the question, the APS&P act does not limit the 
number of risk management demonstration projects, but the Presidential 
Directive limits the number to 10, to ensure appropriate monitoring and 
oversight.
    To date, we have received five Letters of Intent from companies 
wishing to conduct demonstration projects. They are Northwest Pipeline, 
Tennessee Gas, and Shell Pipeline. We believe the following states may 
be affected: Alabama, Arkansas, Colorado, Connecticut, Florida, 
Kentucky, Louisiana, Maryland, Massachusetts, Mississippi, Montana, 
Texas, New Hampshire, New Jersey, New Mexico, New York, Oregon, 
Pennsylvania, Rhode Island, Tennessee, Utah, Virginia, Washington, West 
Virginia, and Wyoming.
    Funding will be provided through both the Risk Assessment/Technical 
Studies contract and the risk management grants program.
    Funding associated with demonstrations projects in fiscal year 1997 
was $1.8 million and $1.2 million is requested for fiscal year 1998 for 
the Risk Assessment/Technical Studies contract. This funds the 
development of the Demonstration Program ``building blocks'' (the 
Program Framework, the Program Standard, Performance Measures Guidance, 
a Communications Plan, and Training), delivery of training, evaluation, 
approval, and auditing of demonstration projects, development of a 
database to support project reviews, communication with stakeholders 
through internet, electronic town meetings, public meetings and other 
mechanisms, status reports on the existing demonstration program, and a 
quality team investigating the feasibility of risk management for local 
distribution companies.
    Additionally, $200,000 of funding in fiscal year 1997 and $500,000 
requested in fiscal year 1998 is for State Risk Management Grants. The 
grants fund travel for states participating in risk management training 
and the consultative reviews of candidate demonstration projects.
    Question. How will the OPS ensure that equal or greater levels of 
safety are achieved by companies that are participating in the 
demonstration projects? How will the safety performance of these 
companies be evaluated?
    Answer. Although the statute requires ``equal or greater'' safety, 
the Demonstration Program developed by OPS and its stakeholders is 
consistent with a Presidential Directive that each project achieve 
``superior levels of public safety and environmental protection when 
compared with regulatory requirements that otherwise would apply.''
    OPS has designed several mechanisms into the review and approval of 
demonstration projects that will ensure their superior performance. For 
example, each project must have built-in and predefined accountability 
mechanisms--called performance measures--that ensure the expected 
results are achieved. The performance measures will be part of a 
company's project proposal, will be specific to each project, and will 
be used by OPS to monitor companies' safety. Companies must define and 
achieve safety goals, rather than simply comply with regulations.
    During the review of demonstration projects, OPS will see if 
companies are employing the new process described in the Program 
Standard and Program Framework. These new processes result in a 
comprehensive, systematic, and integrated approach to assessing and 
addressing pipeline risks. The processes also ensure that the most 
broad based input possible--from throughout the company, from State and 
Federal government agencies, and from affected communities--can be 
factored into the provisions of a demonstration project.
    Finally, the risk reduction activities companies implement--some of 
which may conflict with a regulation--must also lead to superior 
safety. OPS will follow its review protocols in determining if a 
demonstration project proposal can lead to superior safety.
                                one call
    Question. What percentage of natural gas and liquid pipeline 
releases and accidents can be attributed to 3rd party damage?
    Answer. For 1996, 17 percent of all incidents involving hazardous 
liquid lines was attributable to third party damage. For natural gas, 
39 percent of transmission line incidents and 40 percent of 
distribution line incidents were caused by third party damage. Third 
party damage was the cause for 28 percent of all pipeline incidents.
    Question. OPS is requesting to use $1 million of funds from the 
reserves of the Pipeline Safety Fund to pay for grants to States for 
setting up and improving the efficiency of one-call systems. How did 
you determine that this was an appropriate amount?
    Answer. OPS based the $1 million on States' requests for one-call 
funds.
    Question. Did you try to get OMB or OST to allow you to draw down 
more of the balance in the pipeline safety fund for this purpose? How 
much did you originally ask OST as well as OMB for?
    Answer. RSPA requested $1 million for one-call systems.
    Question. What would an additional $500,000 for the state grant 
one-call program obtain?
    Answer. In 1997, with restricted grant application amounts (no 
state more than $50,000) we were able to only fund at an average level 
of 61 percent of the request. All applying states requested funding of 
$1,643,200.
    Question. Please update past data on the status of one-call 
systems, their completeness, effectiveness, legislative status, and 
enforcement capabilities of the States. How many, and which, States 
have utilized one-call grant funds to establish one-call programs? Have 
any States established one-call programs without the use of federal 
grant funds?
    Answer. Within the past three years, thirteen States have passed or 
improved one-call legislation: Alabama, Kentucky, Montana, North 
Dakota, Nebraska, New Jersey, New Mexico, New York, South Dakota, Utah, 
Virginia, West Virginia, and Wyoming. Texas has made strong attempts to 
pass legislation for many years but failed. This year, their attempt is 
promising. Their bill has passed the State House and Senate, which has 
never been done before, and is awaiting the Governor's signature.
    Since the incident in San Juan, Puerto Rico, last year, we have 
been working closely with Puerto Rico (PR) to seek legislative 
authority to create a one-call center. The governor of PR has recently 
issued a provision for a one-call damage prevention system to be 
operated by the PR Public Service Commission, with legislation expected 
to be enacted later this year. These significant increases in one-call 
activities have been evident in these past few years, and OPS played a 
major role in supporting States to pass or improve on one-call 
legislation.
    There is also a growing number of states with a strong one-call 
enforcement mechanism (Arizona, Connecticut, Massachusetts, Minnesota, 
New Hampshire, New Jersey, Virginia) that includes:
  --A specific agency with jurisdiction over excavators and facility 
        operators.
  --Authority to issue immediate citations and the power to collect 
        penalties.
  --Administrative encouragement and staff assigned to enforce the law.
    Fewer than 20 States do not require all underground facility 
operators to belong to one-call organizations. We expect several state 
legislatures to enact or modify one-call legislation for this purpose.
    About half of the States have emergency service available on a 24-
hour basis. In States without 24-hour emergency service, excavators 
have to notify operators of impending excavation after business hours.
    OPS also utilizes one-call grant funds to support States to 
establish one-call programs. This year, 37 States have requested one-
call grants to further their efforts with one-call activities. These 
are: Alabama, Arizona, California, Colorado, Connecticut, Delaware, 
Georgia, Kansas, Kentucky, Louisiana, Michigan, Minnesota, Mississippi, 
Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New 
York, North Carolina, Ohio, Oregon, Pennsylvania, Rhode Island, South 
Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, 
Washington, West Virginia, Wyoming, Puerto Rico and the District of 
Columbia.
    The one call grant funds that have been available the past three 
years have been used mostly for enhancement of one call systems. During 
that period there have been three states that have adopted one call 
programs with the assistance of grants funds and one other is pending.
    Question. How will you be using your new authorities provided in 
the Accountable Pipeline Safety and Partnership Act to improve one-call 
systems?
    Answer. 49 U.S.C. 60114 directs the Secretary to prescribe 
regulations providing for establishing and operating one-call 
notification systems. These regulations would set certain minimum 
requirements, including the following: one-call systems would have to 
provide state-wide coverage; all excavators would be required to call 
prior to digging; all underground facility operators would have to 
belong to one call systems; qualifications for operation of a one-call 
system; and enforcement procedures.
    We will use our cooperative agreement authority to partner with the 
state pipeline agencies, other state mapping agencies and one call 
centers to upgrade the one call locating systems to the more accurate, 
geographically-based National Pipeline Mapping System.
    Question. Please update the Committee on the status of RSPA's one-
call damage prevention team, and highlight any recommendations that 
have been made.
    Answer. The Damage Prevention Quality Action Team was formed to 
conduct a national campaign on excavation damage prevention. This issue 
affects all underground utilities, not just pipelines. The composition 
of the team reflects the breadth of this problem. The team includes 
representatives from the Office of Pipeline Safety, the hazardous 
liquid and natural gas industries, telecommunications, one-call 
systems, insurance, excavators, the National Association of State 
Pipeline Safety Representatives, and the National Association of 
Regulatory Utility Commissioners.
    The Team recommended that, prior to undertaking a campaign, it 
would be necessary to: (1) discern the level of awareness among the 
public and critical groups, excavators, facility operators, state and 
local highway and public works departments; and (2) determine the most 
effective means of communicating the damage prevention message. The 
Team commissioned a survey to gather this data. The survey is almost 
complete and the Team will meet in July to proceed to design the 
campaign and educational programs based on the findings.
    Question. In terms of improving the enforcement process related to 
one call, what else could be done by the one-call damage prevention 
team? What about judicial outreach or prosecutorial training? What is 
OPS doing in these areas.
    Answer. The Damage Prevention Quality Team is not addressing 
enforcement issues. The team was formed to address the issue of damage 
prevention education. OPS believes it is important to address public 
education and the promotion of best one-call program practices before 
improving the enforcement process. In our work with programs at the 
state level, we strive to get better legislation with sanctions. In our 
experience, the weakness in enforcing one-call legislation would best 
be addressed through administrative enforcement remedies. Historically, 
prosecutors and courts have shown little interest in devoting their 
resources to excavation damage.
    Question. Please specify all activities relevant to the one-call 
challenge or damage prevention/public education, and indicate how much 
you are spending for each activity during fiscal years 1996 and 1997, 
and proposed for fiscal year 1998.
    Answer. The Department has transmitted a safety bill to Congress 
which was introduced in the House on May 22, 1997. This bill specifies 
minimum requirements for one-call systems, grants for establishment or 
support of one-call systems and enforcement provisions. A staff member 
from the Office of Pipeline Safety has been working with the Facilities 
Solution Team, a group chartered by the Federal Communications 
Commission, to further address third party damage. Last year, the 
Research and Special Program Administration's Office of Pipeline Safety 
established a Damage Prevention Quality Action Team, to undertake the 
congressional mandate for a damage prevention campaign. OPS staff has 
recently made presentations at annual meetings for the one-call and 
excavator industries to promote the Team's work and damage prevention 
efforts.
    Our budget is $500,000 for fiscal year 1996 and $200,000 for fiscal 
year 1997. About one fifth of the fiscal year 1996 funds are being 
obligated on surveys to collect data on current levels of awareness of 
damage prevention efforts and the most effective methods of educating 
select groups about damage prevention on a national level. The majority 
of these funds will contribute to the design and implementation of the 
national public education campaign.
    Our proposed budget for fiscal year 1998 is $200,000, which will 
support plans for a comprehensive assessment of the effectiveness of 
the national education campaign and for expanded damage prevention 
efforts, such as working with other Federal agencies to leverage 
municipal government and utility participation in one-call and other 
damage prevention activities.
    Question. If the damage prevention/public education activity 
received an additional $200,00 in fiscal year 1998 (for a total of 
$400,000), what specific additional outreach activities could be 
accomplished?
    Answer. The funds would be used to produce and broadcast public 
service announcements (PSA's) on third party damage. While the 
broadcast and cable industry may be willing to underwrite the expense 
of running some of these announcements, indications are that PSA's run 
during peak times have much greater impact. Funds would probably be 
used to underwrite advertising in print media and production of 
materials for school programs.
    Question. What specific commitments for cost sharing have you 
gotten from the private sector to help pay the one-call damage 
prevention outreach effort? Please quantify cash and in-kind 
contributions.
    Answer. In terms of participation on the Damage Prevention Team, 
the private sector participants, both pipeline and other industries, 
have absorbed the costs of salaries and travel, as well as providing 
meeting space, staff support and essential supplies for Team meetings. 
It would be very difficult to quantify these outlays. According to one 
estimate, the cost of underwriting participation in each meeting is 
$2,500. This is based upon an estimate of two days of meetings, one day 
of preparation and one day of travel at annual salary of $90,000 for a 
pipeline engineer, plus airfare and hotel. OPS does not receive any 
direct cash contributions.
    For example, the American Petroleum Institute has an annual budget 
of $300,000 for damage prevention public education that it undertakes 
directly. API and other trade associations and companies expect to pool 
their resources in support of the campaign developed by the Team.
                         regulatory activities
    Question. Please specify the nature of any National Transportation 
Safety Board pipeline safety recommendations that remain open or have 
been closed because of an unsatisfactory response. What is OPS doing 
about each of them?
    Answer. OPS currently has 29 NTSB recommendations classified as 
open. Open NTSB recommendations and OPS' actions are outlined by 
category below. In addition, OPS is having discussions with NTSB 
regarding closing several of recommendations listed below.
Inspection/testing requirements
    P-87-4.--Require periodic testing and inspections to identify 
corrosion and other time-dependent damages.
    Current technical and economic data do not support the 
establishment of an arbitrary period to retest or conduct instrumented 
pig surveys. OPS is taking a risk-based approach to the testing and 
inspection needed to identify corrosion-caused and other time-dependent 
damages.
    P-87-5.--Establish criteria to determine appropriate intervals for 
inspections and tests.
    OPS believes the development of such criteria is beyond the current 
state-of-the-art because criteria to determine what intervals are 
appropriate for inspections and tests would have to account for all 
flaw-growth mechanisms and growth rates. Many flaw-growth mechanisms, 
such as stress corrosion cracking, depend on environmental and 
metallurgical conditions about which operators have little knowledge. 
In an upcoming NPRM, OPS intends to propose that operators judge what 
inspections and testing are needed based on operational and 
geographical factors that indicate the level of risk a pipeline poses.
    P-87-23.--Establish criteria for determining safe service intervals 
between hydrostatic retests.
    OPS believes that hydrostatic retests should be performed on a 
case-by-case, based on leak history and other relevant operational 
factors. This approach is in keeping with Sections 108 and 207 of the 
Pipeline Safety Reauthoriziation Act of 1988, which directed OPS to 
determine the frequency and type of mandatory pipeline tests on a case-
by-case basis. OPS is evaluating this recommendation based on a risk-
based approach to regulation.
Hydrogen sulfide pipelines
    P-88-1.--Establish maximum allowable concentration of 
H2S in gas pipelines.
    P-88-2.--Require reporting of all incidents where concentration of 
H2S is in excess of maximum allowable concentrations.
    P-88-3.--Require installation of equipment to detect excess 
concentrations of H2S.
    In March 1996, OPS withdrew an NPRM that proposed changes in the 
Pipeline Safety regulations to address the hazard of excessive levels 
of hydrogen sulfide in natural gas transmission pipelines. A review of 
information and comment from many sources, including advice from the 
Technical Pipeline Safety Standards Committee (TPSSC), indicated that a 
regulation to address hydrogen sulfide in transmission lines is not 
warranted. Instead, OPS believes that regulatory attention to hydrogen 
sulfide issues should be limited to gathering lines.
Recommendations from the Edison, NJ incident
    P-95-4.--Expedite the completion of the study on methods to reduce 
public safety risks in the siting and proximity of pipelines.
    OPS recently completed a two-year contract with the New Jersey 
Institute of Technology (NJIT) to study the probability and 
consequences of pipeline failures on gas and hazardous liquid pipeline 
facilities located in high risk areas. Because OPS has no authority 
regarding the siting of pipelines, the NJIT analysis was limited to 
identifying methods to reduce public safety risks in relation to the 
proximity of pipelines to public facilities and high population density 
areas. OPS is currently reviewing the NJIT report.
    P-91-1.--Establish standards for detecting leaks.
    OPS sponsored a study by the Volpe National Transportation Systems 
Center (VNTSC) on the potential of leak-detection systems to reduce the 
risks from hazardous liquid pipeline leaks. The report, entitled 
``Remote Control Spill Reduction Technology: A Survey and Analysis of 
Applications for Liquid Pipeline Systems,'' was issued by VNTSC in 
September 1995. OPS intends to publish an NPRM to establish standards 
for leak detection on hazardous liquid pipelines.
    P-95-2.--Develop toughness standards for new pipe installed in gas 
and hazardous liquid pipelines.
    OPS will increase the incorporation by reference of industry 
standards in the pipeline safety regulations and will increase OPS' 
participation on national consensus standard committees. Specifically, 
OPS is working with the pipeline industry on the API 5L standards 
committee to establish pipe toughness requirements and expects to adopt 
the latest standard accepted by the API committee.
    In addition, OPS funded the Texas Transportation Institute, College 
Station, Texas for research into the fatigue and fracture behavior of 
dented pipelines, and research into the application of leak-before-
rupture concept to determine the conditions that a small crack causing 
product leak may grow to critical size resulting in unstable crack 
propagation and a large spill.
    P-95-1.--Expedite requirements for installing automatic or remote-
operated mainline valves on high pressure pipelines.
    OPS developed an action plan to address the recommendations that 
were conducted by a Joint Inspection Task Force comprised of OPS and 
the New Jersey Public Utilities Board, as outlined in the New Jersey 
Comprehensive Inspection Report. OPS is acting on the report 
recommendation that a new technical study be initiated to establish 
criteria for the installation of automatic or remote valves on gas 
transmission pipelines. OPS is proposing to work with the Interstate 
Natural Gas Association of America (INGAA) on this issue.
    In addition, OPS has been monitoring the valving study of INGAA's 
Valve Task Group, and has reviewed a final report sponsored by the Gas 
Research Institute (GRI) entitled ``Remote and Automatic Main Line 
Valve Technology Assessment.'' The results from this study, although 
focussed on gas transmission pipelines, will provide information for 
the development of an NPRM that will specify those circumstances under 
which operators of hazardous liquid pipelines are required to use 
remote-operated mainline valves. OPS has also requested the Gas Piping 
Technology Committee, which produces the Guide for Gas Transmission and 
Distribution Piping Systems, to develop guidance for the placement of 
automatic and remote-controlled valves.
Relationship w/MMS and other Federal agencies
    P-90-29.--Require inspection, burial, and protection of submerged 
pipelines.
    OPS has contracted with Texas A&M University to conduct a study of 
underwater inspection of offshore pipelines. This study will determine 
if pipeline depth and condition constitute a hazard to navigation. In 
addition, the study will recommend methods and intervals for periodic 
inspections of any offshore pipelines. The results of the study will be 
used to issue regulations to identify what constitutes a hazard to 
navigation with respect to underwater abandoned pipeline facilities as 
required by the Pipeline Safety Act of 1992.
    P-90-31.--Evaluate need for emergency planning and coordination 
between offshore pipeline operators and producers.
    OPS issued an Advisory Bulletin (ADB-94-04) on April 5, 1994, 
regarding the need for emergency planning and coordination between 
pipeline operators and offshore producers. OPS is increasing its 
efforts with the Coast Guard, the Environmental Protection Agency, the 
Minerals Management Service (MMS) and others to clarify jurisdiction 
and authorities. In addition, OPS has signed a Memorandum of 
Understanding to clarify agency responsibilities for offshore pipeline 
safety and inspection.
Leak detection/one-call--public education & performance standards
    P-90-21.--Assess industry programs for educating public on dangers 
of gas leaks.
    OPS, industry, states, and local government representatives 
recently formed a Damage Prevention Quality Action Team to identify the 
audiences most in need of education about excavation damage prevention 
and gas leaks, and to find the most effective ways to reach each 
audience. The team is evaluating damage prevention and public education 
materials used by industry and the states. In addition, OPS is 
advocating enactment or strengthening of Federal and state one-call 
legislation.
Guidance in the pipeline safety regulations
    P-84-26.--Require level of safety for HVL pipelines comparable to 
natural gas pipelines.
    OPS issued a Final Rule (Docket PS-113; 59 FR 6579, February 11, 
1994) on ``Operation & Maintenance Procedures for Pipelines,'' which 
requires greater consistency of operation & maintenance procedures for 
natural gas and hazardous liquid pipelines. The rule also requires that 
operators update their Operations and Maintenance manuals each calendar 
year. Currently, OPS and NTSB are discussing similar measures that may 
be needed for other areas such as establishing criteria for the 
performance of systems used to monitor the operation of pipelines.
    P-87-2.--Require operators to annually qualify employees.
    OPS established a Negotiated Rulemaking Committee to develop a 
proposed rule on the qualification of personnel to perform certain 
safety-related functions for pipelines subject to 49 CFR Parts 192 and 
195. The committee will make its recommendations after a negotiation 
process and is composed of persons who represent the interests affected 
by the rule. It will also recommend a proposed final rule after 
reviewing comments.
    P-87-3.--Require operators to examine exposed pipelines for 
external corrosion.
    Although pipeline companies already examine exposed pipelines for 
external corrosion, OPS will adopt consistent requirements for both 
natural gas and hazardous liquid pipelines.
    P-87-26.--Obtain data on ERW pipe to determine hazard to public 
safety.
    As a consequence of the unique safety problems with longitudinal 
seams on certain Electronic Resistance Welded (ERW) pipe manufactured 
before 1970, OPS published a Final Rule (Docket PS-121; 59 FR 29370; 
June 7, 1994) on Pressure Testing Older Hazardous Liquid and Carbon 
Dioxide Pipelines. The final rule provides that operators may not 
transport a hazardous liquid in a steel interstate pipeline constructed 
before January 8, 1971, a steel interstate offshore gathering line 
constructed before August 1, 1977, or a steel intrastate pipeline 
constructed before October 21, 1985, unless the pipeline has been 
pressure tested hydrostatically according to current standards or 
operates at 80 percent or less of a qualified prior test or operating 
pressure. In addition, OPS is developing a proposed rule on risk-based 
alternatives to pressure testing that may result in further decrease of 
the risks posed by pre-1970 ERW pipe.
    P-87-34.--Require operators to maintain maps and records.
    OPS co-sponsors a joint Government/Industry Pipeline Mapping 
Quality Action Team (MAQAT) which has analyzed various mapping 
alternatives and determined a cost-effective strategy for creating an 
accurate depiction of natural gas and hazardous liquid transmission 
pipelines and LNG facilities in the United States. The team's report, 
which OPS is reviewing, included:
  --Investigating the pipeline mapping issues in detail and identifying 
        the challenges of creating a National Pipeline Mapping System 
        (NPMS);
  --Determining the status of mapping today and understanding current 
        mapping practices and specific mapping products;
  --Evaluating various mapping alternatives and their cost 
        effectiveness;
  --Identifying the U.S. Geological Survey's 1:100,000 scale map series 
        as the appropriate base map for the NPMS;
  --Developing a strategic plan for a NPMS; and
  --Agreeing on evaluation criteria; in particular, agreeing that 
        pipeline coverage and integration with other data is more 
        important than positional accuracy.
    P-89-6.--Establish requirements to maintain proper functioning of 
check valves.
    P-90-24.--Define various terms used for valves.
    Through its risk-based efforts, OPS is supporting installation of 
check valves or remote-operated valves on liquid pipelines in all high 
risk areas to provide for rapid isolation of failed pipeline segments. 
In addition, OPS is completing a check valve study that addresses the 
issues outlined in the two recommendations. OPS will take follow-up 
action when the report is finalized.
    P-90-15.--Identify regulations not containing explicit objectives/
criteria.
    P-90-16.--Develop guidance for operator compliance with regulations 
not containing explicit objectives/criteria.
    OPS is presently undergoing extensive regulatory reform efforts 
resulting from the President's ``Regulatory Reinvention Initiative'' 
(RRI) that focus on reducing the burden of government regulations and 
requires that agencies review all regulations and eliminate or revise 
those that are outdated or in need of reform. OPS has reviewed the 
pipeline safety regulations and has published four regulatory actions 
that will lessen unnecessary burdens on the pipeline industry by 
revising or updating areas including gas pipeline and liquefied natural 
gas safety standards, administrative practices, and industry standards 
incorporated by reference. In keeping with RRI, these regulatory 
revisions are performance based; they provide much latitude for 
pipeline operators to address risks. The risk-based requirements 
contemplated for the future regulatory regime will develop risk-based 
guidance to assist operators in complying with regulations not 
containing explicit design requirements.
    P-90-19.--Extend regulations to cover buried lines from outlet of 
meter to customer building.
    OPS published a Final Rule, (60 FR 41821; August 14, 1996) on 
``Customer-Owned Service Lines,'' which addressed this recommendation 
consistent with a Congressional directive. In addition, OPS is 
completing a Congressionally directed study of these lines to determine 
if further action is warranted.
    P-90-20.--Require, by time certain, that unprotected gas piping be 
protected against corrosion or be replaced.
    OPS believes that a realistic cast iron pipe and ductile iron pipe 
replacement program should be conducted on a risk-based basis, 
recognizing the various pipeline characteristics and risks to public 
safety, and that replacement should be based on need rather than on an 
arbitrary date.
    P-93-9.--Develop safety requirements for underground highly 
volatile liquids and natural gas storage facilities.
    After completion of an ongoing study by the Interstate Oil and Gas 
Compact Commission (IOGCC) on standards for underground storage, OPS 
may recommend that the states take individual action based on local 
geologic and hydrologic conditions.
    P-96-2.--Require gas-distribution operators to notify all customers 
when excess flow valves are available.
    OPS published a Notice of Proposed Rulemaking (61 FR 33476; June 
27, 1996), titled ``Excess Flow Valves (EFV)-Customer Notification.'' 
The proposed rule would require operators of natural gas distribution 
systems to notify all customers in writing of the availability of EFV's 
that meet DOT-prescribed performance standards, the safety benefits of 
the valves, and the costs of installation. If a customer requests 
installation and pays the costs of installation, the operator would be 
required to install an EFV.
Enhancing pipeline accident databases
    P-96-1.--Develop and implement a comprehensive plan for collecting 
and using gas and hazardous liquid pipeline accident data.
    OPS recognizes the need for a comprehensive plan for identifying 
and obtaining adequate gas and hazardous liquid data to support our 
pipeline risk management demonstration program development. OPS is 
analyzing its current database capabilities and will develop within one 
year, a comprehensive plan for the improvement of its collection and 
use of gas and hazardous liquid pipeline accident data. In addition, 
within two years, OPS will implement the comprehensive database 
improvement plan.
    The following initiatives outline OPS' current efforts that address 
Recommendation P-96-1 requirements for improved pipeline accident 
databases:
            Developing new databases to support OPS operations
  --Cooperation with industry groups such as the Interstate Natural Gas 
        Association of America (INGAA) and the Gas Research Institute 
        (GRI) is the cornerstone of OPS' plans to identify and obtain 
        needed data. OPS is currently working with INGAA, GRI, AND API 
        to identify needed data. Two data issues workgroups have been 
        formed, one for liquid pipeline data issues and one for natural 
        gas data issues. The adequacy of existing data is being 
        reviewed. New needed data will be sought in efficient ways, 
        with emphasis on voluntary participation by operators and 
        industry cooperation. OPS also supports development of an 
        electronic reporting system to collect this data directly from 
        operators. GRI/INGAA will retain certain data that will be 
        shared with OPS. This electronic reporting system, the Incident 
        Reporting and Trending System (IRATS), is an INGAA/GRI 
        initiative based on voluntary participation, and is still in 
        the formative stage.
  --OPS is cooperating with INGAA to determine how two other proposed 
        electronic data systems, the Work History and Trending System 
        (WHATS) and the Integrated Spatial Analysis Techniques System 
        (ISATS), might provide needed data. WHATS will capture 
        comprehensive information about each segment of an operator's 
        pipeline, including inspection history, manufacturing 
        information, valve locations, pipeline installation dates, 
        compressor information, and repair history. ISATS will contain 
        geographical information, including latitude and longitude data 
        required for spatial analysis tasks such as assessing the risks 
        posed by pipelines to populated and environmentally sensitive 
        areas. ISATS will help standardize how the industry captures 
        and uses locational data and promote national standards for 
        geo-spatial data definitions and use.
            Improving OPS' current databases
  --OPS has been aggressively seeking supplemental reports for incident 
        and accident data by reviewing data collected, identifying 
        trends, and identifying areas in which more data is needed.
  --OPS is currently normalizing all databases and auditing historical 
        data systems and reports. Specifications for re-engineering 
        existing data systems have been developed. System and data 
        security features and rigorous edit features are being added. 
        FERC data is being considered that may be useful for 
        normalizing liquid pipeline data.
Substantial threats to pipelines
    P-96-21.--Require operators of liquid pipelines to address, in 
their Oil Pollution Act of 1990 spill response plans, identifying and 
responding to events that can pose a substantial threat of a worst-case 
product leak.
    On January 24, 1997, OPS issued an alert notice to remind operators 
to examine their facility response plans to ensure that the plans 
adequately address the actions that the operator would take to prevent 
or minimize substantial threats to hazardous liquid pipelines.
    Question. Please bring us up to date on your regulatory response to 
the Edison, New Jersey release.
    Answer. The 1994 gas transmission line incident in Edison, New 
Jersey resulted in three recommendations from the National 
Transportation Safety Board (NTSB). OPS has responded to each of the 
recommendations as follows:
    P-95-4.--Expedite the completion of the study on methods to reduce 
public safety risks in the siting and proximity of pipelines.
    OPS recently completed a two-year contract with the New Jersey 
Institute of Technology (NJIT) to study the probability and 
consequences of pipeline failures on gas and hazardous liquid pipeline 
facilities located in high risk areas. Because OPS has no authority 
regarding the siting of pipelines, the NJIT analysis was limited to 
identifying methods to reduce public safety risks in relation to the 
proximity of pipelines to public facilities and high population density 
areas. OPS is currently reviewing the NJIT report.
    P-91-1.--Establish standards for detecting leaks.
    OPS sponsored a study by the Volpe National Transportation Systems 
Center (VNTSC) on the potential of leak-detection systems to reduce the 
risks from hazardous liquid pipeline leaks. The report, entitled 
``Remote Control Spill Reduction Technology: A Survey and Analysis of 
Applications for Liquid Pipeline Systems,'' was issued by VNTSC in 
September 1995. OPS intends to publish an NPRM to establish standards 
for leak detection on hazardous liquid pipelines.
    P-95-2.--Develop toughness standards for new pipe installed in gas 
and hazardous liquid pipelines.
    OPS will increase the incorporation by reference of industry 
standards in the pipeline safety regulations and will increase OPS' 
participation on national consensus standard committees. Specifically, 
OPS is working with the pipeline industry on the API 5L standards 
committee to establish pipe toughness requirements and expects to adopt 
the latest standard accepted by the API committee.
    In addition, OPS funded the Texas Transportation Institute, College 
Station, Texas for research into the fatigue and fracture behavior of 
dented pipelines, and research into the application of leak-before-
rupture concept to determine the conditions that a small crack causing 
product leak may grow to critical size resulting in unstable crack 
propagation and a large spill.
    P-95-1.--Expedite requirements for installing automatic or remote-
operated mainline valves on high pressure pipelines.
    OPS developed an action plan to address the recommendations that 
were conducted by a Joint Inspection Task Force comprised of OPS and 
the New Jersey Public Utilities Board, as outlined in the New Jersey 
Comprehensive Inspection Report. OPS is acting on the report 
recommendation that a new technical study be initiated to establish 
criteria for the installation of automatic or remote valves on gas 
transmission pipelines. OPS is working with the Interstate Natural Gas 
Association of America (INGAA) on this issue.
    In addition, OPS has been monitoring the valving study of the Valve 
Task Group, Interstate Natural Gas Association of America (INGAA) and 
has reviewed a final report sponsored by the Gas Research Institute 
(GRI) entitled ``Remote and Automatic Main Line Valve Technology 
Assessment.'' The results from this study, although focussed on gas 
transmission pipelines, will provide information for the development of 
an NPRM that will specify those circumstances under which operators of 
hazardous liquid pipelines are required to use remote-operated mainline 
valves. OPS has also requested the Gas Piping Technology Committee, 
which produces the Guide for Gas Transmission and Distribution Piping 
Systems, to develop guidance for the placement of automatic and remote-
controlled valves.
    Question. Please prepare a table listing all current rulemakings, 
indicating the date the rulemaking was started, its current status, 
topic, expected completion date, and statutorily set deadline, if any.
    Answer. The following chart describes all outstanding pipeline 
safety rulemakings. See notes at bottom of the chart for identification 
of priority rulemakings, rulemakings in response to the Pipeline Safety 
Act of 1992, and rulemakings in response to the Regulatory Reinvention 
Initiative (RRI).

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                            Scheduled   
          Docket No.                         Title                                           Current phase                                 completion   
--------------------------------------------------------------------------------------------------------------------------------------------------------
PS-94 \1\ \6\.................  Qualification of Pipeline       Negotiated rulemaking underway; NPRM will be issued...................  02/98           
                                 Personnel.                                                                                                             
PS-101A \6\...................  Mandatory Participation in      Final Rule being prepared.............................................  06/97           
                                 Qualified One-Call Systems by                                                                                          
                                 Pipeline Operators.                                                                                                    
PS-102........................  Control of Drug Use and         Direct Final Rule being prepared......................................  06/97           
                                 Alcohol Misuse in Natural                                                                                              
                                 Gas, Liquefied Natural Gas,                                                                                            
                                 and Hazardous Liquid Pipeline                                                                                          
                                 Operations.                                                                                                            
PS-107........................  Determining the Extent of       Final Rule being prepared.............................................  09/97           
                                 Corrosion on Exposed Gas                                                                                               
                                 Pipelines.                                                                                                             
PS-117........................  Hazardous Liquid Pipelines      Direct Final Rule.....................................................  06/97           
                                 Operated at 20 percent or                                                                                              
                                 Less of Specified Minimum                                                                                              
                                 Yield Strength.                                                                                                        
PS-118 \1\ \6\................  Excess Flow Valve (EFV)         Response to Petition for Reconsideration..............................  01/17/97        
                                 Performance Standards.                                                                                                 
PS-118A \1\ \6\...............  Excess Flow Valve (EFV)         Final Rule being prepared.............................................  09/97           
                                 Customer Notification.                                                                                                 
PS-121........................  Pressure Testing of Older       Response to Petition for Reconsideration..............................  06/97           
                                 Hazardous Liquid Pipelines.                                                                                            
PS-122........................  Gas Gathering Line Definition.  Supplemental NPRM being prepared......................................  08/97 \2\       
PS-124 \5\ \6\................  Further Regulatory Review; Gas  NPRM being prepared...................................................  07/97           
                                 Pipeline Safety Standards.                                                                                             
PS-126........................  Passage of Instrumented         Response to Petitions for Reconsideration.............................  08/97           
                                 Internal Inspection Devices.                                                                                           
PS-128........................  Drug and Alcohol Testing:       NPRM being prepared...................................................  07/97           
                                 Substance Abuse Professional                                                                                           
                                 Evaluation for Drug Use.                                                                                               
PS-130........................  Response Plans for Onshore Oil  Interim Final Rule published 1/93; all plans filed; Final Rule being    10/97           
                                 Pipelines.                      prepared.                                                                              
PS-133 \1\....................  Emergency Flow Restricting      NPRM on leak detection being prepared; further action will follow.....  07/97 \4\       
                                 Devices (EFRD's).                                                                                                      
PS-140 \1\....................  Areas Unusually Sensitive to    Next in series of Public Workshops 05/97; NPRM to follow..............  11/97 \2\       
                                 Environmental Damage (USA's).                                                                                          
PS-141 \1\....................  Increased Inspection            Industry/public input being sought; NPRM to follow....................  06/98 \3\       
                                 Requirements.                                                                                                          
PS-144........................  Risk-based Alternative to       NPRM being prepared...................................................  07/97           
                                 Pressure Testing Rule.                                                                                                 
PS-151........................  Liquefied Natural Gas           Direct Final Rule.....................................................  02/25/97        
                                 Regulations; Miscellaneous                                                                                             
                                 Amendments.                                                                                                            
PS-153........................  Pipeline Safety: Metrication..  Public Comments requested; NPRM may follow............................  09/97           
RSPA-97--2094 \1\.............  Underwater Abandoned Pipeline   NPRM being prepared...................................................  11/97           
                                 Facilities.                                                                                                            
RSPA-97--2095.................  Pipeline Safety: Adoption of    Direct Final Rule being prepared......................................  08/97           
                                 Industry Standards for                                                                                                 
                                 Breakout Tanks.                                                                                                        
RSPA-97--2096.................  Pipeline Safety: Regulations    NPRM being prepared...................................................  09/97           
                                 Implementing Memorandum of                                                                                             
                                 Understanding with the Dept.                                                                                           
                                 of Interior.                                                                                                           
No Docket No \5\..............  Periodic Updates to Pipeline    Direct Final Rule being prepared......................................  07/97           
                                 Safety Regulations (1997).                                                                                             
    Do \1\....................  Regulated Gas and Hazardous     NPRM will be considered after gas gathering line is defined under PS-   n.a.            
                                 Liquid Gathering Lines.         122.                                                                                   
    Do........................  Maps and Records of Pipeline    Mapping Quality Action Team underway; draft data standards being        07/97           
                                 Location and Characteristics;   prepared.                                                                              
                                 Notification of State                                                                                                  
                                 Agencies; Pipe Inventory.                                                                                              
    Do \1\....................  Permanent Underwater            Study being conducted; NPRM may follow................................  12/97           
                                 Inspections.                                                                                                           
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Requirement of Pipeline Safety Act of 1992.                                                                                                         
\2\ Statutory deadline 10/94.                                                                                                                           
\3\ Statutory deadline 10/95.                                                                                                                           
\4\ Statutory deadline 10/96.                                                                                                                           
\5\ Response to Regulatory Reinvention Initiative (RRI).                                                                                                
\6\ `Priority' Rulemakings.                                                                                                                             

    Question. Please prepare a table listing all rulemakings that your 
are considering to initiate and expected date of ANPRM or NPRM.
    Answer. The table provided in response to the preceding question 
includes rulemaking activities that are set to be completed or 
initiated through 1998. In addition, a rulemaking to revise the 
pipeline corrosion regulations in 49 CFR Parts 192 (gas) and 195 
(hazardous liquids) is being considered. A public meeting is planned to 
be held in Chicago in September 1997 to explore how industry consensus 
standards on corrosion protection can be incorporated by reference into 
the pipeline safety regulations.
    Question. Has OPS followed through on each of the major 
recommendations or key findings resulting from your pipeline safety 
summit?
    Answer. RSPA's response to each of the key findings resulting from 
the National Pipeline Safety Summit in Newark, NJ on June 20, 1994 are 
as follows:
  --Finding 1.--The need for partnerships between pipeline operators, 
        regulators and the public (i.e. local officials, potential 
        impacted residents).
      Solutions/Directions: RSPA has begun a number of initiatives in 
        its pipeline safety regulatory program to foster cooperation, 
        collaboration and partnerships with the pipeline industry and 
        the public. The Pipeline Infrastructure Study conducted by the 
        New Jersey Institute of Technology (NJIT) includes two teams of 
        experts, one from industry and the other representing 
        environmental and public interest groups, which meet with the 
        NJIT staff to provide data for the study. As part of the 
        President's Regulatory Reinvention Initiative, OPS has 
        conducted grassroots partnership meetings in Houston, Dallas 
        and Denver to obtain local public participation in regulatory 
        reform and improved customer service for RSPA's pipeline safety 
        program. RSPA is planning a series of public workshops before 
        proposing new requirements on the placement of emergency 
        valves, leak detection systems, increased inspection by smart 
        pigs and the definition for environmentally sensitive areas to 
        assure that all the relevant issues are addressed. RSPA is 
        committed to moving toward risk-based principles in its 
        rulemaking process and to that end provides leadership on a gas 
        pipeline risk assessment quality team and a hazardous liquid 
        pipeline risk assessment quality team formed to develop 
        guidelines in formulating risk management programs which would 
        be used as alternatives to the present prescriptive federal 
        regulations. Additionally, we are using the quality team 
        approach to develop solutions to our national pipeline mapping 
        requirements. Membership of these quality teams are from 
        industry, other federal agencies, state agencies, and the 
        public.
  --Finding 2.--Minimizing of Third Party Damage with An Enhanced One-
        Call System.
      Solutions/Directions: RSPA issued a regulation on March 20, 1995 
        (60 FR 14646) extending the existing excavation damage 
        prevention requirements for gas pipelines in urban areas to gas 
        pipelines in rural areas, and established excavation damage 
        prevention requirements for hazardous liquid and carbon dioxide 
        pipelines. On the same day, RSPA issued a notice of proposed 
        rulemaking (60 FR 14714) proposing to require that operators of 
        onshore gas, hazardous liquid and carbon dioxide pipelines 
        participate in qualified one-call systems as part of the 
        required excavation damage prevention programs. In addition, 
        RSPA supports one-call legislation at the Federal and state 
        levels, especially Title XI (Underground Damage Prevention) in 
        the proposed NEXTEA legislation.
  --Finding 3.--Improved monitoring techniques to reduce potential pipe 
        failures.
      Solutions/Directions: RSPA, in collaboration with Advanced 
        Research Projects Agency (ARPA), Department of Defense, has 
        contracted with the consortium of OCA Applied Optics and Los 
        Alamos Science Inc. to develop a diagnostic tool using laser 
        technology which can be strapped on an aircraft to identify gas 
        and hazardous liquid leaks from pipelines. In addition, RSPA 
        plans to enter into a study in cooperation with the Gas 
        Research Institute to advance the state-of-the-art of smart pig 
        technology to assess pipe walls for mechanical damage and to 
        assess the existence of stress corrosion cracking which could 
        lead to failure.
  --Finding 4.--Need for a centralized comprehensive database related 
        to accidents and incidents in the pipeline industry.
      Solutions/Directions: The study with NJIT is taking a fresh look 
        at the accident, incident and annual data which RSPA has been 
        collecting for over 25 years to determine how it can be used in 
        risk assessment, to identify gaps in the data and what 
        additional data is necessary. In addition, RSPA is developing, 
        through a GIS system, the ability to depict the geographic 
        location of pipelines in relation to areas of high-density 
        population, environmental sensitivity, water intakes and other 
        areas of importance. This data is needed to assess pipeline 
        systems in determining appropriate responses to identified 
        risks, including the decisions of land use officials, and 
        emergency and environmental planners and responders.
  --Finding 5.--The pipeline transport industry is safer than other 
        means of transport (e.g., truck, rail) of natural gas or 
        hazardous liquids.
      Solutions/Directions: RSPA will continue to articulate the safety 
        of the pipeline mode of transportation through initiatives 
        leading to more openness with our stakeholders and customers 
        and closer cooperation and collaboration with each group. The 
        new emphasis on developing regulations using risk-based 
        principles will enable the pipeline industry to commit its 
        limited resources to those areas of highest risk to maintain 
        and improve on the already high level of safety in the 
        industry.
  --Finding 6.--Maintaining or restoring public confidence in light of 
        periodic catastrophic pipeline failures.
      Solutions/Directions: RSPA, in creating an atmosphere of greater 
        openness and participation with the public, industry, the 
        states and other customers will promote greater confidence in 
        the pipeline program through an awareness of the functioning of 
        the program. Through research into better leak detection, 
        enhanced pipe wall evaluation by smart pigs, and mapping, the 
        level of public confidence in the safety of pipeline systems 
        will be strengthened.
  --Finding 7.--Maintain Economic Viability of the Pipeline Industry.
      Solutions/Directions: The economic consequences of new 
        regulations have been considered by RSPA for some time. This 
        will become an overriding issue in the development of new 
        regulations to assure that regulations have a net positive 
        benefit. The greater use of risk management principles will 
        also provide the operator with a more cost effective method of 
        operating its pipeline systems.
  --Finding 8.--Need for new and improved technologies.
      Solutions/Directions: RSPA's response to this issue has been 
        addressed under earlier issues including greater use of 
        research, risk management assessment, and listening to our 
        customers.
        research and technology fiscal year 1997 omnibus funding
    Question. The Committee provided two earmarks to Research and 
Special Programs in the Fiscal Year 1997 Omnibus Consolidated 
Appropriations Act. $2,500,000 was provided for RSPA to conduct a 
transportation system vulnerability assessment. Is this assessment 
complete? Please summarize the findings (or include the executive 
summary verbatim if the report is complete.)
    Answer. The Transportation Vulnerability Assessment, which is being 
conducted jointly with the Department's Office of Intelligence and 
Security, is expected to be complete in March 1998. The scope of the 
study covers the entire U.S. surface transportation system: passenger 
and cargo, military and civilian, private and government owned and the 
domestic and international elements of the U.S. system. Proper 
coordination between other transportation infrastructure studies, such 
as the President's Commission on Critical Infrastructure Protection, 
has allowed us to tailor the use of these funds to address new issues 
or current issues at a more in-depth level.
    The last stage of the project will be to evaluate the 
vulnerabilities and threat to each mode and transportation system in 
order to understand the relative risks and priorities for establishing 
solutions. Best practices, lessons learned and pilot tests will be 
conducted to better understand the specifics of the vulnerabilities and 
identify possible solutions.
    Question. $500,000 was provided for a contract with the National 
Academy of Sciences for an advisory committee on surface transportation 
security. Has this advisory committee been established? Please detail 
the committee's actions, schedule, and any recommendations made thus 
far. What RSPA staff officials, if any, sit on the advisory committee?
    Answer. The National Advisory Committee on Surface Transportation 
Security will be established in July of 1997. The committee will be 
managed by the National Materials Advisory Board and include 
representation from other boards (e.g., Transportation Research Board, 
the Computer Science and Telecommunications Board, the Marine Board, 
Board on Infrastructure and the Constructed Environment, and Board on 
Manufacturing and Engineering Design). The committee is expected to 
hold its first public meeting in September 1997, have initial 
recommendations on promising technologies and processes to improve 
transportation-system security by December 1997, and issue a final 
report in July 1998 after the Department has completed its assessment. 
The Department's portion of the surface vulnerability study will help 
define the vulnerabilities and identify key areas for the committee to 
explore technology solutions. The RSPA Deputy Administrator and 
Associate Administrator for Research Technology and Analysis will sit 
on the committee.
                          two funding streams
    Question. For fiscal year 1998, the Office of Research and 
Technology is assuming a dual funding stream: $3,900,000 is requested 
in appropriated general funds, and the President's NEXTEA proposal 
assumes $10,000,000 in contract authority from the highway trust fund. 
How will the appropriated and contract authority dollars be spent? Are 
the two funding streams designed to serve distinctly different 
purposes, or is there overlap?
    Answer. The two funding streams are designed to serve different but 
inter-related purposes. The $3,900,000 would be used to fund RSPA's 
Research and Technology Office in its traditional role of strategic 
research planning and system assessment, coordinating and facilitating 
transportation research, technology and safety training, disseminating 
information on departmental, national and international transportation 
R&D, managing strategic (intermodal/multimodal) transportation 
research, and stimulating university research and education. These 
activities provide strategic planning support and guidance for R&D 
performed across the Federal government and the Department of 
Transportation, including those projects performed under the 
$10,000,000 contract authority.
    The $10,000,000 would fund the activities of the NEXTEA-proposed 
Intermodal Transportation Research and Development (ITRD) Program. The 
purposes of the ITRD Program in the NEXTEA proposal are as follows:
    ``(1) enhance the capabilities of Federal agencies in meeting 
national transportation needs as defined by their missions through 
support for basic and applied research and development impacting the 
various modes of transportation including research and development in 
safety, security, mobility, energy and environment, information and 
physical infrastructure, and industrial design;
    (2) identify and apply innovative research performed by the 
Government, academia and the private sector to the intermodal and 
multimodal transportation research, development, and deployment needs 
of the Department and the Nation's transportation enterprise;
    (3) identify and leverage research, technologies, and other 
information developed by the Government for national defense and non-
defense purposes for the benefit of public, commercial and defense 
transportation sectors; and
    (4) share information, analytical and research capabilities among 
Federal, state and local governments, colleges and universities, and 
private organizations to advance their transportation research, 
development and deployment needs.''
    (See Title VI of the Administration's bill introduced as H.R. 1720; 
This would be codified as 52 USC Sec. 5231(b)).
    If the ITRD Program is authorized and funded, a council comprised 
of representatives from the DOT modal administrations and other Federal 
departments supporting transportation-related research would direct the 
new contract authority program. The Program would conduct inter/multi-
modal innovative and applied research to meet transportation needs for 
the 21st century. This program would identify and fund innovative 
research, engineering concepts, technologies, and strategic 
opportunities in academia, Federal laboratories and industry for 
addressing critical crosscutting transportation issues pertaining to: 
safety; security; mobility; energy and environment; human behavior and 
physiology; and information/physical infrastructure. More specifically, 
activities would include: (1) reducing the transportation-related loss 
of life and property by first understanding human behavior, and then 
using ``human-centered'' approaches to make systems easier to use, and 
more forgiving of errors; (2) reducing the potential of disruptions 
from tampering or system failures by applying new sensor and 
information technologies; (3) developing new ways of managing and 
operating transportation systems to reduce transportation-related 
energy consumption and environmental pollution while sustaining 
economic growth; and (4) improving system planning by developing and 
using improved tools (e.g., models), knowledge, information and 
techniques.
             new nextea contract authority research program
    Question. Please display the NEXTEA contract authority request for 
Research and Technology over the six year authorization cycle, with a 
total.
    Answer. The contract authority requested in the NEXTEA proposal for 
the Intermodal Transportation Research and Development Program (Title 
VI of the Administration's bill introduced as H.R. 1720) is as follows:

                        [In millions of dollars]

        Fiscal year                                               Amount
1998..............................................................    10
1999..............................................................    15
2000..............................................................    20
2001..............................................................    25
2002..............................................................    30
2003..............................................................    35
                        -----------------------------------------------------------------
                        ________________________________________________
      Total.......................................................   135

NEXTEA gives the Secretary the authority to determine which office 
within the Department will manage the program.
    Question. What input will the other modes have in determining the 
allocation of the intermodal R&D contract funds requested under NEXTEA?
    Answer. If the Intermodal Transportation R&D Program is authorized 
and funded by Congress, we anticipate that a departmental council would 
provide program direction and management oversight. This council would 
be made up of representatives from the DOT modal administrations, and 
include representatives from other Federal agencies responsible for 
research important to national transportation needs. The council would 
provide the program with broad guidance on strategic research needs and 
approve projects based on a competitive, peer-reviewed selection 
process. An office, to be designated by the Secretary, would manage the 
program for the Secretary based on the guidance of the council.
    Question. If one assumes that the RSPA Research and Technology 
Office will be the coordinating point for all transportation research 
and development across the Federal Government, then please describe in 
detail the process of proposing, approving, planning and deploying 
research programs and projects, and disseminating the resulting 
knowledge to interested parties in the public and private sector.
    Answer. There are two parts to this question. (1) what does the 
RSPA strategic planning and coordination function for transportation 
research and development (R&D) provide to the Federal Government and 
the Department of Transportation (DOT); and (2) how would a project 
funded by the proposed Intermodal Transportation R&D Program be 
identified, approved, reviewed and results disseminated?
    (1) The $3,900,000 in the RSPA Research and Technology Office 
fiscal year 1998 budget would fund strategic planning and system 
assessment, coordinating development of partnerships in transportation 
research, technology and safety training, and disseminating information 
on departmental, national and international transportation R&D. 
Authorization has been sought under Title VI (Section 6001) of NEXTEA 
to help institutionalize the strategic planning process for 
transportation R&D.
    The following outlines the steps RSPA took in fiscal year 1997 and 
will take in fiscal year 1998 to help create a comprehensive strategic 
planning process for transportation R&D:
  --Strategic direction. In fiscal year 1997, RSPA lead the development 
        of the Federal Transportation Science and Technology Strategy 
        which: (1) takes a long-term and systemic view of the Nation's 
        transportation needs (e.g., safety, security, sustainability); 
        (2) forecasts trends; (3) provides strategic direction for 
        transportation R&D to address those needs; and (4) provides 
        meaningful and relevant indicators for measuring the impact of 
        R&D on the performance of the nation's transportation system.
  --A National Transportation S&T Strategy, proposed in the RSPA fiscal 
        year 1998 budget, will build on the first Strategy. This 
        effort, in addition to the individual Strategic Plans developed 
        by the Federal agencies in response to the Government 
        Performance and Results Act (GPRA), forms the basis for 
        planning, programming and budgeting guidance and decisions for 
        the individual agencies and DOT operating administrations.
  --Planning, Programming and Budgeting.--Interagency plans 
        (Transportation Technology Plan and Intermodal/Multimodal 
        Transportation Strategic Research Plan) identified in the RSPA 
        fiscal year 1998 budget will provide the vehicle to do systemic 
        R&D planning needed to achieve an intermodal transportation 
        system.
  --A DOT Transportation R&D Plan will expand on the ISTEA Surface 
        Transportation R&D Plans, to include all modes of civil and 
        commercial transportation. The DOT Transportation R&D Plan 
        replaces the Fifth Edition of the Surface Transportation R&D 
        Plan proposed in the fiscal year 1998 budget submission.
    These two planning efforts will be used by the agencies and DOT 
operating administrations to develop their own detailed plans, adjust 
their programs, and develop their budgets.
  --Program/Project Implementation. Each agency and DOT operating 
        administration is responsible for executing their programs. 
        Procedurally, this step is unchanged. Substantively, all 
        agencies and operating administrations are guided to identify 
        and develop partnerships, where appropriate, with other Federal 
        organizations, state and local governments, academia and 
        industry. This will help minimize duplication among Federal R&D 
        programs while fostering the dissemination of information and 
        technology.
  --Program/Project Evaluation. Each Federal agency and DOT operating 
        administration will conduct program and project evaluations, as 
        they currently do. Starting in the fiscal year 1999 budget 
        cycle, all Federal agencies and DOT operating administrations 
        are encouraged to perform self assessments of their 
        transportation R&D programs using recognized Federal (i.e., 
        President's Quality Award criteria) and industry (i.e., Malcolm 
        Baldrige criteria).
  --Transportation Assessments. In the past, DOT has had limited data 
        on the system-wide performance of the nation's transportation 
        system (e.g., safety, security, and efficiency) and the impact 
        transportation R&D has had on it. Furthermore, they have had 
        limited data on foreign R&D and its potential application to 
        U.S. transportation needs.
    The RSPA fiscal year 1998 budget funds the first-ever National 
Transportation System Assessment and International R&D Assessment to 
start gathering (Bureau of Transportation and Statistics function) and 
analyzing (RSPA function) this type of data. This data will be used 
extensively in strategy development and in planning, program and budget 
development.
    An example of this type of assessment is the comprehensive 
``Transportation System Vulnerability Assessment'' of the U.S. 
transportation system currently being performed by RSPA. This 
assessment will provide information necessary to recommend 
countermeasures to make the Nation's transportation system more secure 
from both physical and information-based threats.
  --Peer and Independent Reviews. In the past, the Federal Government 
        and DOT have not conducted peer and independent reviews of: (1) 
        its transportation R&D portfolio from a systemic perspective; 
        (2) the process used to define and manage the portfolio; and 
        (3) system-level assessments. An example of these types of 
        reviews would be the Congressionally directed National Academy 
        of Sciences (NAS) ``Advisory Committee on Surface 
        Transportation Security'' (ACSTS), a Committee of experts who 
        provide independent inputs to DOT on ways to improve the 
        security of the U.S. transportation system.
    The RSPA fiscal year 1998 budget funds the National Research 
Council (NRC) and the Transportation Research Board (TRB) to review the 
Transportation S&T Strategy, the Federal strategic planning process for 
transportation R&D and Federal transportation R&D priorities. In 
addition, they will be used to provide inputs into transportation 
system-level and program assessments.
  --Dissemination of Program/Project Results. The RSPA fiscal year 1998 
        funds would initiate the development of a DOT R&D Tracking 
        System to provide accurate information about R&D project status 
        and accomplishments. Currently, there is no such system. This 
        will enable the DOT to provide an input into the Federal-wide 
        R&D tracking system--Research and Development in the United 
        States (RaDiUS) database--and enable more informed decision 
        making on transportation R&D issues.
    In addition, a National Transportation S&T Homepage will be 
expanded in fiscal year 1998 to include information on private and 
public sector transportation R&D as well as provide an interactive 
forum for public involvement in the strategic planning process for 
transportation R&D. Other mechanisms for disseminating information will 
also continue to be encouraged (e.g., reports and other publications, 
conferences and seminars).
    (2) The $10,000,000 of contract authority in fiscal year 1998 would 
fund projects under the NEXTEA-proposed Intermodal Transportation 
Research and Development (ITRD) Program. Assuming the Secretary 
delegates the staff function for ITRD to RSPA, it would provide an 
Executive Director to manage the program on a day-to-day basis under 
the direction of a senior-level council. The council would ultimately 
approve research projects based on a competitive, peer-reviewed 
selection process. The council would be made up of representatives from 
the DOT modal administrations and could include representatives from 
other Federal agencies responsible for research important to national 
transportation needs. Projects in the program would go through the 
following process:
  --Identification. The Transportation S&T Strategy identifies areas of 
        enabling or long-term and high-risk transportation research. 
        Using the Strategy as a basis, a NSTC Transportation R&D 
        Committee interagency team, comprised of members from the DOT 
        operating administrations and Federal agencies (e.g., DOD, DOE, 
        NASA and NSF) who perform basic or advanced transportation-
        related R&D, will document ongoing research and identify future 
        research needs, priorities and potential project areas. The 
        team will develop a broad-gauged, forward-looking Strategic 
        Transportation Research Plan for the Federal Government; this 
        is the Research Plan identified under Planning, Programming and 
        Budgeting under Question (1). This Plan will help minimize 
        duplication and foster collaborative projects across the 
        Federal Government. In addition, it will identify opportunities 
        for either leveraging or filling major gaps in ongoing 
        research. The development of this Plan is not funded by the 
        ITRD.
  --Approval. We anticipate that the council would review the 
        interagency Strategic Transportation Research Plan and develop 
        broad program guidance that would be used in soliciting 
        proposals. Interagency research area working groups would 
        receive the proposals, review them for programmatic and 
        technical merit, and submit them for council consideration. 
        Prior to approval by the council, the guidance and the proposed 
        projects would be reviewed by an independent scientific 
        advisory board. Once completed, the council would approve the 
        projects and funding would be awarded.
  --Results Dissemination. Data would be collected and disseminated 
        continuously via INTERNET on the status and results of research 
        projects. Reports on individual projects would be published at 
        appropriate intervals.
    Question. How much authority will the R&T Office have to approve or 
disapprove research projects in other DOT agencies or other Executive 
Branch agencies?
    Answer. The R&T Office does not exercise authority to approve or 
disapprove research projects in other DOT administrations or Executive 
Branch agencies.
    Working with other Federal agencies and DOT administrations and 
secretarial officers, the R&T Office provides recommendations on 
program directions and priorities to the White House and Federal 
agencies, including DOT. Recommendations for government-wide research 
and development (R&D) activities are coordinated through the Office of 
Management and Budget and Office of Science and Technology Policy. 
Recommendations for DOT R&D activities are coordinated through the DOT 
R&T Coordinating Council and the Office of the Assistant Secretary for 
Budget and Programs.
    Question. Would the new contract authority program actually fund 
research projects, or is the Research and Technology Office's role 
still that of planning, coordination, and dissemination?
    Answer. The new contract authority proposed under the President's 
NEXTEA proposal would fund research projects. A council made up of 
representatives from the DOT modal administrations and other Federal 
agencies supporting transportation-related research would direct the 
new contract authority program. If assigned, RSPA's Research and 
Technology Office would manage the program for the Secretary based on 
the guidance of the council.
    The RSPA Research and Technology Office would also continue in its 
traditional role of research planning and coordination, as well as 
managing those inter/multimodal research coordination and training 
programs assigned to it by the Secretary (such as the University 
Transportation Centers and the University Research Institutes programs, 
and the Transportation Safety Institute).
    Question. If projects will actually be paid for from this account, 
please characterize the types of research programs the contract 
authority program would fund.
    Answer. The contract authority under this program would be used to 
fund long-term, innovative, multimodal research in seven broad 
categories: Human performance and behavior; advanced materials; 
computer, information, and communications systems; energy and 
environment; sensing and measurement; and tools for transportation 
modeling and design.
     This interagency/departmental program would identify and fund 
innovative research, engineering concepts, technologies, and strategic 
opportunities in academia, Federal laboratories and industry for 
addressing critical crosscutting transportation issues pertaining to: 
safety; security; mobility; energy and environment; human behavior and 
physiology; and information/physical infrastructure. It would enable 
the Department of Transportation to leverage the investments being made 
across the Government and to play a role in major interagency and 
intergovernmental research initiatives that have application to 
transportation in the categories listed above.
    Research areas of particular interest are: (1) reducing the 
transportation-related loss of life and property by first understanding 
human behavior, and then using ``human-centered'' approaches to make 
systems easier to use, and more forgiving of errors; (2) reducing the 
potential of disruptions from tampering or system failures by applying 
new sensor and information technologies; (3) improving the energy 
efficiency and environmental quality of motor vehicles and ships (e.g., 
fuel cells); (4) developing new ways of managing and operating 
transportation systems to reduce transportation-related energy 
consumption and environmental pollution while sustaining economic 
growth; and, (5) improve system planning by developing and using 
improved tools (e.g., models), knowledge, information and techniques.
    Question. How many positions are associated with the NEXTEA first-
year funding of $10,000,000? Are additional PC&B expenses in the RSPA 
R&T Office associated with the new program, or will the program be run 
by the existing staff? If there are new staffing requirements, how many 
new FTE's are anticipated in the first year of funding? Will these 
positions be paid for by the contract authority funds?
    Answer. If RSPA's Research and Technology Office is designated by 
the Secretary to manage the intermodal research program, we do not 
anticipate additional staffing requirements will be needed.
    Question. You have stated that RSPA needs to do cross-cutting and 
intermodal research. Please give specific examples of key needs in 
cross-cutting or intermodal research which are not being met.
    Answer. Based on a GAO Report: Surface Transportation: Research 
Funding, Federal Role and Emerging Issues, September 1996, DOT should 
perform cross-cutting, intermodal and long-term and high-risk research. 
The report states, ``Investment in surface transportation research is 
inadequate to build knowledge, either in three emerging areas--system 
assessment, policy research and intermodal research--or in basic, long-
term, high-risk research.'' ``Because about 80 percent of the projects 
are applied, short-term or low-risk, the officials were concerned that 
quantum leaps--generally credited to basic research--would not occur 
and users' needs would not be met.'' Because of RSPA's intermodal 
responsibilities, it has taken the lead to propose such a research 
program for the Department.
    Today, DOT's predominantly modal structure and Congress's focus on 
near-term transportation needs of specific modes (air, surface, 
maritime) provide no mechanism to fund innovative research aimed at: 
optimizing overall transportation system performance, making 
transportation systems more adaptable to human needs and safety, and 
reducing regulatory barriers; or long-term, high-risk, high-payoff 
research that has pervasive benefits to the transportation enterprise 
or could provide major breakthroughs in transportation. Most of the 
basic and applied transportation-related research in the United States 
is performed in its universities and Federal laboratories. Harnessing 
this capability and applying the best ideas from international R&D 
performers not only would save taxpayers' dollars, but would also open 
up the opportunity for major advances in all modes of civil and 
commercial transportation.
    In addition, transportation infrastructure lasts for generations 
and has many long-term effects, but the tools and methods for 
estimating these effects are inadequate and there is little incentive 
for the private sector to develop them. Underinvestment in long-term, 
inter/multi-modal transportation research limits the ability of the 
Department and the Federal Government to develop realistic national 
policies and to steer and advance the U.S. transportation enterprise.
    National transportation goals for safety, security, energy, 
environment, mobility, accessibility, and global competitiveness must 
ultimately be achieved over time periods measured in decades. This 
requires support from an aggressive strategic, interdisciplinary, 
inter/multi-modal, long-term research agenda. Its elements can start, 
for example, to:
  --reduce the cost for maintaining the nation's deteriorating 
        transportation infrastructure,
  --improve access to transportation services for an aging population,
  --decrease the vulnerability of the nation's transportation system to 
        natural disasters as well as terrorist attacks,
  --provide reliable service for both passenger and freight transport 
        (on time with no damage).
    Most of the potential cross-cutting transportation research topics 
are interdisciplinary and complex, such as:
  --human performance and behavior (e.g., fatigue research, research on 
        human-centered systems, use of simulator for driver training 
        and assessment);
  --advanced materials for infrastructure and vehicle application 
        (e.g., composites);
  --computer, information and communication systems (e.g., high-
        confidence systems, Next Generation Internet);
  --energy and environment (e.g., fuel cells);
  --sensing and measurement (e.g., structural monitoring, 
        instrumentation and repair);
  --tools for transportation modeling and design (e.g., industrial 
        design).
    Many involve aspects outside the traditional transportation 
mainstream research areas (e.g., computer sciences, industrial design, 
biotechnology). Achieving meaningful results will take a long-term 
commitment of resources and will require overcoming institutional 
barriers, including basic changes in the ``corporate culture'' of the 
Department and the transportation industry at large.
    Question. Please give specific examples of RSPA's successes in 
intermodal research or in cross-cutting research?
    Answer. RSPA has worked extensively to promote cross-cutting 
research and coordinate the Department's transportation research 
programs. As a result, DOT has been able to avoid duplicative projects 
among the research agendas of the various DOT operating 
administrations. In addition, research cost savings have resulted from 
more sophisticated program design, and multimodal applicability of 
modal-specific technologies. Specific examples of RSPA's successes 
include:
  --University Transportation Centers and University Research 
        Institutes Programs. The University Transportation Centers 
        (UTC) and University Research Institutes (URI) Programs are 
        managed by RSPA. The UTC Program has engaged research personnel 
        and facilities in more than 1,000 research projects with the 
        help of $187 million in Federal and non-Federal matching funds. 
        To date, the UTC Program supports 14 centers with 67 
        participating universities nationwide, has issued more than 
        1,000 reports and involved more than 3,200 university students 
        and faculty.
    The URI Program, established under the Intermodal Surface 
Transportation Efficiency Act of 1991, is similar in mission to the UTC 
Program but differs significantly in that all of the Institutes are 
located at named universities, and they address topics that were 
specified in the legislation, such as surface transportation policy, 
infrastructure technology, urban transit, and intelligent 
transportation systems.
    The URI Program has initiated and completed over 100 intermodal 
research projects and provided financial support to at least 70 
students in the transportation field. Both the UTC and URI Programs 
have: held several technology conferences and symposia on intermodal 
surface transportation topics; briefed thousands of transportation 
practitioners on new technologies and the latest research results; and 
developed and offered dozens of interdisciplinary transportation 
courses.
  --Small Business Innovation Research Program. RSPA has taken a 
        leadership role in promoting use of the Small Business 
        Innovation Research (SBIR) to develop multimodal technologies. 
        RSPA has already awarded one SBIR contract on use of natural 
        basalt to reinforce concrete, which has great potential for 
        markedly cutting transportation system installation. Proposals 
        for innovations in nanotechnology and transportation system 
        security were included in this year's solicitation, and are now 
        under evaluation.
  --Partnership with Advanced Research Projects Agency. RSPA also 
        served as the focal point for interactions with the Advanced 
        Research Projects Agency on its technology re-investment 
        program. Many of these projects are now completed: an 
        ultraviolet LIDAR system to measure air pollution, and an 
        uncooled infrared sensor for night security applications were 
        particularly successful. In addition, RSPA's Volpe National 
        Transportation Systems Center now performs cross-cutting 
        research for all modal administrations and other Federal 
        agencies, including the Department of Defense.
  --Surface Transportation Research and Development Plan. On a broader 
        basis, the Intermodal Surface Transportation Efficiency Act of 
        1991 requires DOT to annually update an integrated national 
        surface transportation R&D plan that focuses on research needed 
        over the next decade. RSPA's Volpe Center has completed the 
        text of the fourth edition of this plan, which is now being 
        prepared for distribution. RSPA released previous editions of 
        the plan in July 1993, March 1995, and March 1996.
    The fourth edition of the plan has been extensively revised to 
reflect the new government-wide National Science and Technology Council 
Transportation Science and Technology Strategy. Both in the Strategy 
and in the Plan, enabling research on six cross-cutting topics is 
highlighted: Human performance and behavior; advanced materials; 
computer, information, and communication systems; energy and 
environment; sensing and measurement; and tools for transportation 
modeling, design, and construction.
    RSPA has had successes in all of these areas, in terms of 
coordinating Departmental activities, actual conduct of needed 
research, and dissemination of promising research results beyond their 
initial modal audiences. For example, RSPA has led a Departmental 
initiative on advanced materials since the early 1990's. The RSPA 
report Materials Research and Technology Initiatives provides DOT's 
project managers, customers and prospective research partners with a 
consolidated summary of materials-related research projects for 
baseline use in research planning, thereby reducing the possibility of 
duplication.
    Question. Doesn't the Department's Research and Technology 
Coordinating Council already promote cross-cutting research? If so, 
what funds are used?
    Answer. The Council does promote cross-cutting research for the 
Department. Since the RSPA Associate Administrator for Research, 
Technology and Analysis has been assigned responsibility for managing 
the Council, funds for this function come from the RSPA Office of 
Research, Technology and Analysis budget. The Council is also starting 
to perform some cross-cutting policy research, such as in understanding 
the technological and behavioral implications of alternative 
transportation infrastructures and developmental patterns of long-term 
environmental sustainability, addressing intermodal freight issues and 
defining meaningful and relevant performance measures for 
transportation research and development. These activities require 
funding and are also included in the RSPA budget.
    Question. What are the recent specific accomplishments of the 
Research and Technology Coordinating Council?
    Answer. Over the last year, the Research and Technology 
Coordinating Council [R&T Council] has made improvements in several 
areas:
    DOT has implemented coordinated programs to high-potential 
technologies with applicability that spans modal lines. Within DOT 
cooperation and collaboration are particularly apparent on human 
factors and advanced materials research. Work is ongoing to develop a 
coordinated program for fuel cells for use in maritime applications and 
large-scale vehicles. The Departments of Defense and Energy and NASA 
are becoming involved in supporting several of these efforts.
    The linkages between DOT's R&T activities and the departmental 
priorities as outlined in the DOT Strategic Plan are more clearly 
defined, and explicitly stated in the NSTC Transportation Science and 
Technology Strategy.
    In response to the Government Performance and Results Act, DOT's 
research managers are developing a consensus on specific quantitative 
indicators to evaluate the impact of research and technology 
investments. Preliminary material on this topic will be included in the 
Fourth edition of the DOT Surface Transportation R&D plan, and an R&T 
Council working group is developing a more detailed document exploring 
this specific topic.
    The working relationships which resulted from developing the 
Surface Transportation R&D Plan are now facilitating DOT efforts to 
streamline and institutionalize a broader, formal strategic R&D 
planning process across all modes in the Department as well as lead 
government-wide efforts to create a strategic planning process for 
transportation R&D.
    The President's NEXTEA proposal includes a proposal for creating a 
strategic planning process for transportation research and development 
and an advanced intermodal transportation R&D program for the 
Department. This action occurred as a direct result of the Council's 
efforts to respond to the recommendations of the GAO report on Surface 
Transportation: Research Funding, Federal Role, and Emerging Issues, 
that the Department needed to a framework for establishing R&T 
priorities and more emphasis on high-risk, long-term research with 
broader applicability.
    The improved staff working relationships among the surface 
transportation elements of DOT facilitate cross-modal cooperation on 
individual research projects. For example, the Federal Highway 
Administration (FHWA) agreed to participate in RSPA's evaluations of 
advanced materials proposals received in response to last year's SBIR 
solicitation. FHWA ultimately funded one of the non-selected proposals 
itself in addition to the RSPA award. Similar cooperation has become 
evident between FHWA and the Federal Aviation Administration (FAA) on 
pavement research issues.
    Results of DOT research will soon be more accessible through a new, 
integrated transportation science and technology home page.
    The centralized DOT Technology Sharing program is now providing 
outreach services for a wider variety of operating administrations: in 
addition FHWA, FTA and FRA, the Maritime Administration and FAA now use 
this program to share information on their research activities.
    To support their R&D planning and reduce the possibility of 
duplicating initiatives undertaken in other Federal agencies, R&T 
Council representatives now have access to and are using the Research 
and Development in the United States (RaDiUS) data base operated by 
Rand's Critical Technologies Institute for the Office of Science and 
Technology Policy. RaDiUS describes ongoing research throughout the 
Federal Government, and is a particularly useful tool for preventing 
research duplication on an interagency basis.
    Question. You have stated that RSPA needs additional funds to help 
coordinate research in the Department. Isn't this a function of the 
Research and Technology Coordinating Council within the Department?
    Answer. The RSPA Associate Administrator for Research, Technology 
and Analysis manages the Research and Technology Coordinating Council 
for the Department. Since the Research and Technology Coordinating 
Council receives no funding from Congress and coordinates Department-
wide and inter-modal research and technology issues, RSPA's Office of 
Research, Technology and Analysis is responsible for funding its 
activities (e.g., developing the Surface Transportation R&D Plan), 
managing the Department-wide technology transfer and technology sharing 
programs, facilitating research and technology programs with other 
agencies (e.g., maritime applications of fuel cells), and performing 
analysis on performance measurement which impacts all modes of 
transportation.
                fiscal year 1998 appropriations request
    Question. The Research and Technology Office's budget justification 
is detailed, but does not indicate any program cost allocation. RSPA 
has requested $3,900,000 for the Research and Technology Office in 
appropriated funds for fiscal year 1998. Please display in tabular form 
the highlighted bullets on pages 70-75 of the budget justification, 
indicating the level of funding to be applied for each research area or 
activity.
    Answer. These are the funding levels anticipated for each research 
area and activity:

Strategic planning:                                     Fiscal year 1998
    Transportation Science and Technology Strategy Deployment.  $300,000
    Develop DOT Surface Transportation Research and 
      Development Plan........................................   150,000
    Publish Transportation Technology and Strategic Research 
      Plans...................................................   100,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Subtotal................................................   550,000
                    ==============================================================
                    ____________________________________________________
System assessment:
    Surface Transportation System Assessment..................   650,000
    International Surface Transportation System Assessment....   250,000
    Transportation System Vulnerability Assessment............
                    --------------------------------------------------------------
                    ____________________________________________________

      Subtotal................................................   900,000
                    ==============================================================
                    ____________________________________________________
Policy research: Sustainable Transportation...................   150,000
                    ==============================================================
                    ____________________________________________________
Research and technology coordination and facilitation:
    Interagency--NSTC.........................................   525,000
    Intragency--DOT...........................................    50,000
    National--Government, University, Industry................   425,000
    International.............................................   200,000
    Information Access........................................   375,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Subtotal................................................ 1,575,000
                    ==============================================================
                    ____________________________________________________
Intermodal and multi-modal research and education:
    Transportation Safety Institute...........................   100,000
    University Programs.......................................   275,000
    Strategic Transportation Research & Development programs:
        Human-Centered Transportation.........................    50,000
        Advanced Materials....................................    50,000
        Information Systems and Security......................   200,000
        Biomechanics & Micro/Nano Devices.....................    50,000
                    --------------------------------------------------------------
                    ____________________________________________________

          Subtotal............................................   725,000
                    --------------------------------------------------------------
                    ____________________________________________________

          Total............................................... 3,900,000

    Question. Please break down how the $5.2 million provided for the 
RSPA R&T Office in fiscal year 1997 (combined regular appropriations 
and Omnibus appropriations) is being allocated on a contract-by-
contract basis. Please do the same for the fiscal year 1996 monies.
    Answer. RSPA's research and development activities performed at 
Volpe for fiscal years 1996 and 1997 were funded as follows:

------------------------------------------------------------------------
                                                  Fiscal years--        
                Activity                 -------------------------------
                                               1996            1997     
------------------------------------------------------------------------
Strategic planning:                                                     
    Develop Transportation Science and                                  
     Technology Strategy and Deployment.        $200,000        $200,000
    Develop Surface Transportation                                      
     Research and Development Plan......          66,000         100,000
    Develop Transportation Technology                                   
     and Strategic Research Plans.......  ..............         200,000
                                         -------------------------------
      Subtotal..........................         266,000         500,000
                                         ===============================
System assessment:                                                      
    Surface Transportation System                                       
     Assessment.........................         100,000         100,000
    International Surface Transportation                                
     System Assessment..................  ..............         100,000
    Transportation System Vulnerability                                 
     Assessment.........................  ..............       2,275,000
                                         -------------------------------
      Subtotal..........................         100,000       2,475,000
                                         ===============================
Policy research: Sustainable                                            
 Transportation.........................  ..............          75,000
                                         ===============================
Research and technology coordination and                                
 facilitation:                                                          
    Interagency--NSTC...................         350,000         400,000
    Intragency--DOT.....................          50,000          50,000
    National--Government, University,                                   
     Industry...........................          45,000         145,000
    International.......................          30,000         100,000
    Information Access..................         219,000         100,000
                                         -------------------------------
      Subtotal..........................         694,000         795,000
                                         ===============================
Intermodal and multimodal research and                                  
 education:                                                             
    University Programs.................         192,000         100,000
    Strategic Transportation Research &                                 
     Development Programs...............         260,000         195,000
                                         -------------------------------
      Subtotal..........................         452,000         295,000
                                         -------------------------------
      Total.............................       1,512,000       4,140,000
                                         ===============================
Additional monies will be provided to                                   
 the following organizations/contractors                                
 for assisting RSPA in conducting the                                   
 Transportation System Vulnerability                                    
 Assessment, supporting the Department's                                
 Technology Transfer program, tapping                                   
 the National Academy of Sciences to                                    
 review the Federal and Departmental                                    
 transportation science and technology                                  
 strategic planning process, and in                                     
 representing the Department on various                                 
 National Research Council roundtables                                  
 and conferences:                                                       
    National Research Council/                                          
     Transportation Research Board......         100,000         200,000
    National Academy of Sciences........         125,000         625,000
    Sandia National Laboratories........  ..............          75,000
    San Jose State University...........          19,000          50,000
    Department of Justice...............  ..............         100,000
    Logistics Application Inc...........          40,000          40,000
    Critical Technologies Institute.....          70,000  ..............
                                         -------------------------------
      Subtotal..........................         354,000       1,090,000
                                         -------------------------------
      Grand total.......................       1,866,000       5,230,000
------------------------------------------------------------------------

    Question. How much is requested to prepare and distribute the 
Annual Surface Transportation R&D plan?
    Answer. RSPA has requested $150,000 in fiscal year 1998 to prepare 
and distribute the Department's annual Surface Transportation R&D plan.
    Question. Do you plan on spending monies to promote 
commercialization of research discoveries made by DOT in the private 
sector?
    Answer. RSPA plans to provide funding to develop mechanisms which 
promote commercialization of DOT research in the private sector, rather 
than funding individual commercialization efforts. For example, through 
the NSTC Transportation R&D Committee, National Academy of Sciences' 
Government-University-Industry Research Roundtable and DOT-wide Small 
Business Innovative Research and Technology Transfer and Sharing 
activities, RSPA will ensure quicker and broader access to information 
on new technologies by involving partners from government, industry and 
academia in the strategic planning and technology development process. 
This should improve the diffusion of these technologies into the 
market.
    RSPA is also facilitating and coordinating the following DOT-wide 
initiatives:
  --Promoting development, promulgation, and adoption of international 
        technical standards;
  --Identifying opportunities to reduce regulatory and institutional 
        barriers and, hence, the time and resources required to 
        establish partnerships, including state, local and tribal 
        governments and large, medium and small businesses; and
  --Creating a more flexible intellectual property regime and applying 
        ideas, knowledge and concepts rapidly, if not directly, to the 
        development of new products and services by industry.
    These initiatives will reduce the resources and time it takes for 
innovative transportation technology to reach the market. In addition, 
the proposed National Science and Technology Strategy, which RSPA 
played a leadership role in developing, puts particular emphasis on 
``partnership initiatives'' as a vehicle to move technologies from 
development to commercial applicability.
    Question. Please prepare a table indicating the amount appropriated 
and the amount actually spent for the different major categories and 
subcomponents of the Research and Technology budget for each of the 
last three years. Please explain any deviation or reallocation of 
funds.
    Answer. RSPA's research and development activities for fiscal year 
1995 were appropriated and obligated as follows:

------------------------------------------------------------------------
                                                 Fiscal year 1995       
            R&D program area             -------------------------------
                                           Appropriated      Obligated  
------------------------------------------------------------------------
Technology development..................      $1,061,000        $859,000
Technology dissemination................          50,000          50,000
Technology application..................  ..............         202,000
                                         -------------------------------
      Total.............................       1,111,000       1,111,000
------------------------------------------------------------------------

    In August 1996, the Deputy Secretary of Transportation and RSPA 
Administrator initiated a major restructuring of the Department's 
strategic planning and management process for research and development. 
As such, RSPA's fiscal year 1996 and 1997 budgets were restructured to 
provide needed funding to support this new approach which focuses on: 
strategic planning, systems assessment and policy research; research 
and development coordination and facilitation; and inter/multi-modal 
research and education programs. The following table indicates the 
allocation of funds for R&D activities in fiscal years 1996 and 1997:

----------------------------------------------------------------------------------------------------------------
                                                                  Fiscal year 1996          Fiscal year 1997    
                          Activity                           ---------------------------------------------------
                                                              Appropriated   Obligated  Appropriated   Obligated
----------------------------------------------------------------------------------------------------------------
Strategic planning, system assessment and policy research:                                                      
    Develop Transportation Science and Technology Strategy                                                      
     and Deployment.........................................     $250,000     $250,000     $200,000     $200,000
    Develop Surface Transportation Research and Development                                                     
     Plan...................................................       66,000       66,000      100,000      100,000
    Develop Transportation Technology and Strategic Research                                                    
     Plans..................................................  ............  ..........      200,000      200,000
    Surface Transportation System Assessment................      100,000      100,000      150,000      150,000
    International Surface Transportation System Assessment..  ............  ..........      100,000      100,000
    Transportation System Vulnerability Assessment/NAS......  ............  ..........    3,000,000    1,725,000
    Sustainable Transportation..............................  ............  ..........       75,000       75,000
Research and technology coordination and facilitation:                                                          
    Interagency--NSTC.......................................      400,000      400,000      550,000      535,000
    Intragency--DOT.........................................       50,000       50,000       50,000       50,000
    National--Government, University, Industry..............      210,000      210,000      310,000      270,000
    International...........................................       30,000       30,000      100,000      100,000
    Information Access......................................      289,000      289,000      100,000      100,000
Intermodal and multi-modal research and education:                                                              
    University Programs.....................................      192,000      192,000      100,000      100,000
    Strategic Transportation Research & Development Programs      279,000      279,000      195,000       95,000
                                                             ---------------------------------------------------
        Total...............................................    1,866,000    1,866,000    5,230,000    3,800,000
----------------------------------------------------------------------------------------------------------------

    Question. With a $10,000,000 contract authority research program 
assumed for fiscal year 1998, why does RSPA need an appropriated 
research and technology program at all?
    Answer. The appropriated research and technology program serves 
different but inter-related purpose. The $3,900,000 request is needed 
to fund the RSPA Office of Research and Technology in its role as the 
Department's and Federal Government's hub for strategic research 
planning and system assessment, coordination and facilitation of 
research, technology and safety training, and university research and 
education. In addition, the funding would be used to disseminate 
information on departmental, national and international transportation 
R&D, and to stimulate university research and education. These 
activities provide strategic planning support and guidance for R&D 
performed across the Federal government and the Department of 
Transportation, including those projects that will be performed under 
the $10,000,000 contract authority.
    The $10 million included in the Highway Trust Fund request responds 
to a specific recommendations from several GAO studies that DOT should 
perform more basic, long-term, high-risk and intermodal research. This 
funding would provide a means to leverage technology and research 
performed government-wide for civil and commercial transportation 
applications at the Federal, State and local level.
    In particular, the $10 million represents startup funding for an 
Inter/Multi-modal Advanced Research Program as proposed in the National 
Economic Crossroads Transportation Efficiency Act (NEXTEA). It will 
enable the Department of Transportation to leverage the investments 
being made across the Government and to play a role in major 
interagency and intergovernmental research initiatives that have 
application to transportation, specifically in areas such as: human 
performance and behavior; advanced materials; computer, information, 
and communication systems; energy and environment; sensing and 
measurement; and tools for transportation modeling and design.
    Potential areas for basic research or exploratory development of 
particular interest are: (1) reducing the transportation-related loss 
of life and property by first understanding human behavior, and then 
using ``human-centered'' approaches to make systems easier to use, and 
more forgiving of errors; (2) reducing the potential of disruptions 
from tampering or system failures by applying new sensor and 
information technologies; (3) developing new ways of managing and 
operating transportation systems to reduce transportation-related 
energy consumption and environmental pollution while sustaining 
economic growth; and, (4) improve system planning by developing and 
using improved tools (e.g., models), knowledge, information and 
techniques.
          surface transportation research and development plan
    Question. Pursuant to Section 6009(b) of ISTEA, the third edition 
of the DOT Surface Transportation R&D Plan was published in March 1996, 
outlining the Department's near-term research agenda for 1996-1998. How 
could the Surface Transportation Research and Development Plan be more 
beneficial to the Department?
    Answer. RSPA has undertaken a carefully planned program to upgrade 
and improve the utility and relevance of the Surface Transportation R&D 
Plan to research planners within and outside of DOT.
    In response to Congressional concerns, the Third Edition of the 
Plan placed much more emphasis on research to address longer-term (the 
next 10 years and beyond) transportation needs.
    The Fourth edition, which is now awaiting release, has been 
restructured to better link plans for DOT's surface transportation 
research with the top-level goals and directions established in 
documents like the DOT Strategic Plan and the proposed NSTC 
Transportation Science and Technology Strategy. Recognizing the need to 
evaluate the effectiveness of research, it also indicates the range of 
performance measures available for research, and explores how they 
might be applied.
    In the fiscal year 1998 budget request, we are recommending that 
the Surface Transportation R&D Plan be broadened to include all of 
DOT's research and development as well as private sector research 
investments in transportation. A DOT Transportation R&D Plan would help 
the Department and Congress get a better picture of national 
transportation R&D needs, trends, and opportunities. The broader-based 
Plan would provide an integrated, multimodal strategic vision and 
elaborate on the DOT R&D thrusts necessary to realize that vision. 
Emphasis will be on defining a national framework for capitalizing on 
Departmental and Government-wide transportation R&D investments for all 
modes and the system at large.
    Future editions will further expand in scope to consider 
Departmental, Government-wide, domestic and international surface 
transportation R&D investments.
    Question. What lessons have been learned about DOT's surface 
transportation research from preparing the initial plans?
    Answer. Based on experience with the Surface Transportation R&D 
plan and other research coordination activities, the following 
conclusions can be drawn:
  --DOT's R&D Plan should be fully multimodal--including aviation, 
        surface systems, and maritime systems--to assure no duplication 
        of research internal to DOT, except in special cases when 
        competitive approaches need to be considered. Also, there is a 
        need for the plan to include research performance measures, not 
        only to improve management of R&T programs, but also to measure 
        the effectiveness of R&T investments on the performance of the 
        national transportation system. This includes improvements in 
        safety, mobility, and environmental quality.
  --DOT's R&D budget is a relatively small component of all 
        transportation R&D conducted in the Federal government, and in 
        the U.S. private sector. DOT's research planners should 
        consider research being done by all DOT elements, other Federal 
        agencies, the private sector, and other non-transportation 
        advanced-technology fields.
  --DOT's R&D planning should consider information on foreign R&D, 
        including advanced systems work in Japan and Europe such as in 
        intelligent transportation systems, to assure competitiveness 
        of U.S. transportation products and services in world markets.
  --A coherent science and technology program should include enabling 
        research on a multimodal basis, partnership initiatives to 
        demonstrate potential and assure implementation of new 
        technologies, and educational programs to develop a cadre of 
        trained professionals as part of a coherent technology 
        development strategy.
  --The transportation system of the 21st century will require a new 
        mix of enabling and multidisciplinary research activities to 
        take advantage of breakthroughs expected in a variety of areas: 
        materials, human factors, computing and information systems, 
        planning techniques and industrial design, sensing, and system 
        sustainability. It will also require a new set of technical and 
        management skills for the Federal, state and local government 
        as well as the transportation industry to support it.
  --Because of increasingly complex and interdependent patterns in the 
        economy, communication systems, and the government, we need to 
        use new approaches to perform research and technology 
        development, and new mechanisms to move the technologies into 
        the marketplace.
    Question. What tangible results have been realized from efforts to 
coordinate research across surface transportation modes?
    Answer. Most of the efforts to coordinate surface transportation 
research within DOT have been focused by, or implemented through, the 
DOT Research and Technology Coordinating Council [R&T Council]. 
Interagency coordination efforts through the National Science and 
Technology Council (NSTC) Transportation R&D Committee have also helped 
forge a closer working relationship among the surface modes in the 
Department and with other Federal agencies that perform transportation-
related research, such as the Departments of Defense and Energy. The 
Deputy Secretary chairs the NSTC Transportation R&D Committee, and RSPA 
provides technical and analytical support.
    Results of these efforts include:
  --The DOT modal administrators have been added as ad hoc members of 
        the NSTC Transportation R&D Committee, increasing the 
        coordination among all transportation modes and other Federal 
        agencies. New planning activities resulting from a proposed 
        Transportation S&T Strategy are fostering teaming relationships 
        among the various modes to provide intermodal solutions to 
        national transportation needs, such as enhancing freight 
        movement through domestic and international gateways (e.g., 
        maritime terminals), improving access for aging and 
        transportation-disadvantaged Americans, and creating an 
        environmentally sustainable transportation system.
  --DOT is implementing more coordinated and intermodal R&T programs in 
        areas such as human factors and advanced materials research. In 
        energy and environmental technologies, the Department has 
        initiated an effort to develop a coordinated program for fuel 
        cells for use in maritime applications and large-scale 
        vehicles. Fuel cells offer the opportunity for energy savings 
        while improving air quality. The Departments of Defense and 
        Energy and NASA are becoming involved in supporting several of 
        these efforts.
  --The linkages between DOT's R&T activities and the departmental 
        priorities as outlined in the DOT Strategic Plan are more 
        clearly defined, and explicitly stated in the proposed NSTC 
        Transportation Science and Technology Strategy and other 
        Executive branch planning and budgeting documents.
  --In response to the Government Performance and Results Act, DOT's 
        research managers are developing a consensus on specific 
        quantitative indicators to evaluate the impact of research and 
        technology investments. Preliminary material on this topic will 
        be included in the Fourth edition of the DOT Surface 
        Transportation R&D plan, and an R&T Council working group is 
        developing a more detailed document exploring this specific 
        topic.
  --Working relationships which resulted from developing the Surface 
        Transportation R&D Plan are now facilitating DOT efforts to 
        create a broader strategic R&D planning process for the 
        Department and to lead government-wide efforts to create a 
        strategic planning process for transportation R&D.
  --The President's NEXTEA proposal includes a proposal for formalizing 
        strategic planning within the Department for R&D as well as 
        creating an advanced intermodal transportation R&D program for 
        the Department as a whole. This proposal is a direct result of 
        increased cooperation among the DOT operating administrations, 
        and their efforts to response to the GAO report, Surface 
        Transportation: Research Funding, Federal Role, and Emerging 
        Issues, which identified the need for: ``an integrated 
        framework for surface transportation research,'' ``a better 
        understanding of the transportation system's parts and their 
        interrelationships,'' and a more aggressive research program in 
        ``either in three emerging areas--systems assessment, policy 
        research and intermodal research--or in basic, long-term, high-
        risk research.''
  --The improved staff working relationships among the surface 
        transportation elements of DOT facilitate cross-modal 
        cooperation on individual research projects. For example, the 
        Federal Highway Administration (FHWA) agreed to participate in 
        RSPA's evaluations of advanced materials proposals received in 
        response to last year's SBIR solicitation. FHWA ultimately 
        funded one of the non-selected proposals itself in addition to 
        the RSPA award. Similar cooperation has become evident between 
        FHWA and the Federal Aviation Administration (FAA) on pavement 
        research issues.
  --Results of DOT research will soon be more accessible through a new, 
        integrated transportation science and technology home page 
        being developed by RSPA for the White House and the Department.
  --The centralized DOT Technology Transfer and Sharing programs are 
        now providing outreach services for a wider variety of 
        operating administrations beyond FHWA, FTA and FRA: new 
        publications from the Maritime Administration and FAA were 
        released this year through its distribution channels.
  --To support their R&D planning and reduce the possibility of 
        duplicating initiatives undertaken in other Federal agencies, 
        DOT operating administrations now have access to and are using 
        the Research and Development in the United States (RaDiUS) data 
        base operated by the Critical Technologies Institute for the 
        Office of Science and Technology Policy. RaDiUS describes 
        ongoing research throughout the Federal Government, and is a 
        particularly useful tool for preventing research duplication on 
        an interagency basis.
                          university research
    Question. How do you ensure that only high priority projects are 
funded at these institutions?
    Answer. RSPA requires each University Transportation Center and 
University Research Institute to devise and implement a project 
selection process that responds to criteria such as regional needs, 
national priorities, modal balance, availability of matching funds, and 
student and faculty involvement. Many of these criteria are statutorily 
mandated and require a balancing of priorities. Each year during the 
annual review, RSPA evaluates the effectiveness of the project 
selection process in the previous year and approves any changes to the 
process for the coming year. RSPA also requires that research projects 
undergo academic peer or expert review to ensure that they advance the 
body of knowledge in transportation. Note, RSPA does not directly 
manage project selection at University Transportation Centers and 
University Research Institutes.
    Question. Please bring us up to date on how RSPA has improved the 
management and oversight of the university centers and research 
institutes program.
    Answer. Since RSPA took over management of the program in 1992, 
each University Transportation Center and University Research Institute 
has been required annually to develop a strategic plan for the 
following year. This plan is review by DOT staff and discussed with the 
respective Center or Institute.
    Each Center and Institute submits an annual report describing how 
well they implemented their previous year's annual plan. This is also 
reviewed by DOT staff and discussed with the particular Center or 
Institute.
    These actions have resulted in a high level of confidence in the 
effectiveness and value of the University Transportation Centers and 
University Research Institutes programs.
    In 1996, RSPA conducted a program-level review of the Department's 
University Transportation Centers Program. The purpose of the review 
was to determine whether the program is meeting its statutory goals to 
promote transportation education, research and technology transfer. A 
final report was issued in February 1997, concluding that the program 
was successful in meeting its legislative mission and merits further 
consideration at the time of reauthorization under the Intermodal 
Surface Transportation Efficiency Act of 1991.
    Question. Please discuss how the DOT's surface transportation 
reauthorization bill will improve the Department's contribution to 
university research.
    Answer. The DOT's surface transportation reauthorization bill (the 
Administration's bill was introduced as H.R. 1720) will improve the 
Department's contribution to university research in several ways 
without requiring any additional Federal funding for the program. It 
would institutionalize the planning requirement by which each Center 
must produce an annual plan outlining how it proposes to meet the 
common mission and goals of the program. This approach has strengthened 
the program by providing the universities with maximum flexibility 
consistent with prudent oversight. Including it in the legislation will 
provide the constancy of purpose which is essential to effective 
management.
    The University Transportation Centers and University Research 
Institutes have been parallel but separate programs. Consolidating them 
into a single program of National University Transportation Centers 
will reduce the cost of program oversight. More importantly, it will 
facilitate the synergy that the Centers, but not the Institutes, have 
been able to achieve by virtue of their shared program structure and 
goals.
    The proposed legislation would also increase the amount of non-
Federal funding available for transit research by specifically allowing 
transit operators to use operating funds received from the Federal 
Transit Authority to support transit-related research at University 
Transportation Centers.
    Question. How much is spent on conducting numerous annual on-site 
evaluations? What are the benefits of these assessments and how does 
RSPA ensure that the university responds to its comments?
    Answer. Each year RSPA staff conduct an annual review of each 
University Transportation Center and University Research Institute. 
Whenever possible, that review entails a site visit. The cost of travel 
for two RSPA staffers to visit the 19 sites once a year is 
approximately $12,000.
    The site inspections serve many purposes, not least of which is 
providing the reviewers an opportunity to judge the quality of the 
facilities, equipment, and personnel associated with the program. Site 
inspections permit the reviewers to meet all of the people associated 
with the Center or Institute and to judge from their interaction the 
extent to which they comprise a unified center. Meeting the students is 
another way to assess the validity of the described education program. 
Finally, site visits far exceed written or telephonic exchanges as 
effective means to communicate a center's actual achievements.
    Annual site visits enable the reviewers to determine how effective 
a Center or Institute has been in the prior year; and they set the 
stage for negotiating the annual plan that will be the basis for the 
next year's award. Each approved annual plan is incorporated by 
reference in the grant awarded by RSPA. If the Center or Institute does 
not amend its plan or take a particular action to reflect RSPA's 
comments, then RSPA will suspend, reduce or disapprove the grant.
              office of hazardous materials safety (ohms)
    Question. Please prepare a table indicating the amount appropriated 
and the amount actually spent for the different categories and 
subcomponents of the Hazardous Materials Safety budget for each of the 
last three years. Please explain any deviation or reallocation of 
funds.
    Answer. The following table shows the appropriated & actual amounts 
obligated for the major categories and subcomponents of the Hazardous 
Materials Safety budget for each of the last three years.

                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                  Fiscal years--                                
                                --------------------------------------------------------------------------------
                                            1995                       1996                       1997          
                                --------------------------------------------------------------------------------
                                                                                                      Obligation
                                                                                                       projected
                                 Appropriation  Obligation  Appropriation  Obligation  Appropriation   to end of
                                                                                                         year   
----------------------------------------------------------------------------------------------------------------
Program funds:                                                                                                  
    Information Systems........           950          940           950          950         1,075        1,075
    Research & Analysis........           300          300           256          256           565          565
    Rulemaking Support.........           481          481           365          365           382          383
    Inspection & Enforcement...           220          220           180          180           260          260
    Registration...............         1,000        1,000           750          750           750          750
    HAZMAT Training............           350          350           350          350           475          475
    Information Dissemination..           170          170           170          170           485          485
    Emergency Preparedness.....           310          310           370          270           370          370
    International Standards....           140          140           140          140            80           80
R&D:                                                                                                            
    Information Systems........           300          300           300          300           300          300
    Regulation Compliance......           386      \1\ 623           386      \1\ 425           236          211
    Research & Analysis........           714      \1\ 775           699      \1\ 628           464          225
----------------------------------------------------------------------------------------------------------------
\1\ Obligations may include carryover funding from prior years.                                                 

    Question. Please identify the amount and nature of any 
reprogramming that occurred during the last two years.
    Answer. In fiscal year 1996, $20,000 was transferred from the 
Office of Hazardous Materials Safety's PC&B account to the equipment 
account to fund the purchase of computers to access DOT's new Docket 
Management System. The Office of the Secretary's goal was that each 
operating administration be on line by October 1, 1996. Because of the 
dollar amount involved and its source/destination (PC&B to equipment), 
that transfer was not considered a reprogramming action within 
Departmental definitions. No reprogramming is planned for fiscal year 
1997.
    Question. Why is the requested legislative language that includes 
``travel expenses incurred in performance of hazardous materials 
exemptions and approvals functions'' as an allowable cost necessary for 
RSPA this year?
    Answer. This is a technical correction to facilitate continued 
reimbursement of RSPA's costs to inspect the facilities of certain 
packaging manufacturers subject to RSPA's exemptions and approvals 
program. To ensure that safety standards are maintained regardless of 
product origin, RSPA conducts inspections at cylinder manufacturers, 
independent inspection agencies, and cylinder requalification 
facilities in foreign countries. This program permits foreign 
manufacturers access to the U.S. market while maintaining the same 
safety standards required of U.S. manufacturers.
                personnel issues and operating expenses
    Question. Please provide the Committee with the current on-board 
staff count, by position, for the regional OHMS enforcement offices. 
What is the grade level for the head of each regional office? How does 
this compare with the grade level of the supervisor for each OPS 
regional office? Is there a discrepancy between the grade levels of 
these two jobs?
    Answer. Each Hazardous Materials Enforcement regional office has a 
Grade 14 position, a Grade 13 position, and four journeymen positions. 
As of June 9, 1997, the following represents the staffing of the 
regional offices:

------------------------------------------------------------------------
                   OHME unit                     Authorized    On-board 
------------------------------------------------------------------------
Special investigations (HQ)...................            5            4
Eastern region................................            6            5
Central region................................            6            3
Southern region...............................            6            3
Southwest region..............................            6            5
Western region................................            6            6
                                               -------------------------
      Total...................................           39           29
------------------------------------------------------------------------

    The full performance level of each regional supervisor is Grade 14. 
The full performance level of each OPS regional supervisor is Grade 15.
    Question. Please prepare a table showing the authorized number of 
inspectors for each of the last three years, and the number of 
inspectors actually on-board during this period.
    Answer. The following table shows the authorized number of 
inspectors and the actual number of inspectors on-board for the last 
three years:

------------------------------------------------------------------------
                  Fiscal year                    Authorized    On-board 
------------------------------------------------------------------------
1995..........................................           23           21
1996..........................................           22           22
1997..........................................           37       \1\ 28
------------------------------------------------------------------------
\1\ RSPA was authorized to hire 15 new inspectors in fiscal year 1997.  
  Interviews for these positions were conducted in two phases, with five
  new inspectors hired following phase one. Phase two interviews were   
  completed in June 1997, and one inspector was hired in May and we     
  expect to have the remaining nine inspectors on board by August 1997. 

    Question. For each of the key offices under the Associate 
Administrator for Hazardous Materials Safety, please prepare a break 
out of the number of personnel assigned to each office for each of the 
last three years, the grade level, and number of current vacancies.
    Answer. The following table summarizes the on-board staff count, 
grade levels, and current vacancies in the Office of Hazardous 
Materials Safety for the last three years.

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Fiscal year 1995 as of 6/1/95              Fiscal year 1996 as of 6/10/96             Fiscal year 1997 as of 6/4/97      
                                                                --------------------------------------------------------------------------------------------------------------------------------
                             Office                              Full time                                  Full time                                  Full time                                
                                                                            Vacancies  Positions    Grade              Vacancies  Positions    Grade              Vacancies  Positions    Grade 
                                                                 positions                         levels   positions                         levels   positions                         levels 
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Associate Administration and International Standards...........          8          0          2       SES          8          0          2       SES          6          1          2       SES
                                                                                               2        15                                2        15                                1        15
                                                                                               1        14                                1        14                                1        14
                                                                                               1        13                                1        13                                1        13
                                                                                               1         8                                1        11                                1         7
                                                                                               1         6                                1         6                                           
Standards......................................................         17          1          1        15         18          1          1        15         16          4          1        15
                                                                                               3        14                                3        14                                3        14
                                                                                               3        13                                3        13                                1        13
                                                                                               7        12                                7        12                                4        12
                                                                                               2        11                                1        11                                1        11
                                                                                               1         7                                2         7                                3         9
                                                                                               1         6                                1         6                                2         7
                                                                                                                                                                                     1         6
Technology.....................................................         16          3          1        15         15          4          1        15         14          5          1        15
                                                                                               5        14                                4        14                                4        14
                                                                                               8        13                                8        13                                7        13
                                                                                               1         7                                1         7                                1         7
                                                                                               1         6                                1         6                                1         6
Exemptions and Approvals.......................................         14          1          2        14         15          0          1        15         15          2          1        15
                                                                                               4        13                                1        14                                1        14
                                                                                               3        12                                5        13                                5        13
                                                                                               1        11                                4        12                                4        12
                                                                                               1        10                                1        10                                1         9
                                                                                               2         7                                1         8                                2         7
                                                                                               1         6                                1         7                                1         6
                                                                                                                                          1         6                                           
Enforcement....................................................         21          4          1        15         23          1          1        15         29         10          1        15
                                                                                               2        14                                3        14                                6        14
                                                                                               4        13                                4        13                                6        13
                                                                                               7        12                                9        12                                8        12
                                                                                               2        11                                4        11                                6        11
                                                                                               2         9                                2         7                                1         9
                                                                                               1         7                                                                           1         7
                                                                                               1         6                                                                                      
                                                                                               1         5                                                                                      
Initiatives and Training.......................................         10          0          1        15         10          0          1        15          8          3          1        15
                                                                                               2        14                                2        14                                1        14
                                                                                               1        13                                1        13                                1        13
                                                                                               4        12                                4        12                                4        12
                                                                                               1         9                                1         9                                1         7
                                                                                               1         7                                1         7                                           
Planning and Analysis..........................................         13          4          2        15         14          2          2        15         14          2          2        15
                                                                                               1        14                                1        14                                1        14
                                                                                               3        13                                5        13                                5        13
                                                                                               1        12                                3        12                                3        12
                                                                                               4        11                                1        11                                1        11
                                                                                               1         7                                1         7                                1         7
                                                                                               1         6                                1         6                                1         6
                                                                --------------------------------------------------------------------------------------------------------------------------------
      Totals...................................................        100         13                             103          8                             101         28                     
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

    additional fiscal year 1997 funding for air transport hazardous 
                           materials efforts
    Question. In the wake of the May 1996 ValuJet crash, the Senate 
provided additional funding above the President's request, and directed 
RSPA to strengthen air transportation hazardous materials inspection, 
research, training, and rulemaking efforts. Please display how this 
additional funding above the fiscal year 1997 requested level has been 
distributed.
    Answer. Following the ValuJet incident, Congress provided twenty 
(20) additional positions, all of which have been filled. Congress also 
provided funds to support enhancements in the following four program 
areas:
Hazardous materials information system (HMIS) ($125,000)
    A contractor is designing and implementing an on-line document 
storage and retrieval system that will allow DOT intranet and Internet 
accessibility of OHMS documents to agency employees, other DOT 
administrations, Federal, State, and local agencies, and industry and 
the general public.
Hazardous materials information center (HMIC) ($315,000)
    RSPA anticipates that contract negotiations will be completed by 
the end of July and contractor service will be in place by the end of 
August. The services provided will: (1) continue and enhance the high 
standard of customer service provided by the HMIC; (2) maintain, 
update, and index the HMIC reference library which will provide sources 
of information to hotline inquiries; and (3) provide contractor support 
for the specialists in the office to allow them to devote more time to 
update, revise, and streamline the Hazardous Materials Regulations 
(HMR).
    A contractor is allowing greater access to current and updated 
information to agency employees, other DOT administrations, and 
Federal, State, and local agencies, as well as industry and the general 
public by placing the HMR, and active exemptions and letters of 
interpretation on OHMS' web page.
Hazardous materials training ($225,000)
    In fiscal year 1997, RSPA cooperated with the Federal Aviation 
Administration (FAA) to increase public and shipper carrier outreach 
and focus on air transportation issues involving hazardous materials; 
develop additional training materials and programs involving the air 
transportation of hazardous materials; and increase information 
dissemination on compliance with the HMR. To accomplish this, RSPA led 
a team composed of representatives from FAA, the Transportation Safety 
Institute (TSI), the air transport industry, and Federal & State 
enforcement officials who provided technical assistance in developing 
new training materials and informational brochures targeted to enhance 
the safe transportation of hazardous materials. Industry and State 
enforcement personnel/associations participated as distribution 
partners in distributing the training products to the targeted 
audiences.
    RSPA's CD-ROM modular training series were updated and revised to 
include a new module developed specifically for transportation of 
hazardous materials by air. This modular training series was 
distributed on CD-ROM at a nominal cost and is available for 
downloading free of charge from the OHMS website. Both distribution 
avenues are cost-effective for small businesses to train employees in 
compliance with the HMR. These training modules were developed as self-
paced tutorials which do not require an instructor, and RSPA used mass 
communications technology to reach a wider audience, especially among 
those smaller jurisdictions that cannot afford formal classroom safety 
training.
    RSPA developed and distributed an 18-minute awareness video that 
highlights the precautions that must be taken when transporting hazmat 
on passenger or cargo aircraft to ensure compliance with the Hazardous 
Materials/Dangerous Goods Regulations. The video, the second in the 
``ENSURING SAFETY'' series, was made available to air carriers and 
shippers throughout the country--literally to anyone involved in 
offering, accepting or transporting hazardous materials for shipment by 
air.
    RSPA continues to make compliance training available to FAA 
inspectors, logistic and depot staff, and State and local compliance 
personnel through the Transportation Safety Institute's (TSI) resident, 
train-the-trainer courses, and at RSPA-sponsored seminars and 
conferences. In addition, through TSI, RSPA is developing an 
interactive training course for both highway and air transportation to 
be made available on the Internet.
Hazardous materials technology ($315,000)
    This item is used to provide contractor support and additional 
technical expertise to conduct safety reviews, failure analyses and 
evaluate exemptions and approvals, particularly those relating to new 
technologies. The following are example of the ongoing activities under 
this item:
  --Risk assessment studies to quantitatively evaluate the inherent 
        risk of transporting hazardous materials in aircraft cargo 
        compartments with and without the presence of countermeasures.
  --Failure analysis and technical expertise to evaluate exemptions 
        involving advanced materials applications such as design, 
        testing and service life issues related to carbon fiber-
        reinforced pressure vessels and other high performance pressure 
        vessels. Work includes improving testing techniques for 
        periodic recertification of in service pressure vessels. 
        Support is being provided by the National Institute of 
        Standards and Technology.
  --Technical work on explosives and reactive materials, for example, 
        developing a test method to discriminate between explosive and 
        nonexplosive forms of ammonium nitrate. Support is being 
        provided by the National Institute of Occupational Safety and 
        Health.
  --Technical system evaluation of emergency product transfer shutdown 
        systems for cargo tanks transporting liquefied compressed 
        gases. This work supports RSPA's emergency rulemaking and 
        industry efforts to develop emergency product transfer shutdown 
        systems for cargo tanks transporting liquefied compressed 
        gases. Current systems installed on the national fleet of more 
        than 25,000 trucks have been shown not to function properly 
        when transfer hoses rupture. Technical support and expertise is 
        being provided by the Volpe National Transportation System 
        Center.
    Question. In the fiscal year 1997 appropriations bill, $1,111,000 
above the President's requested level was provided for additional 
hazardous materials inspectors. How many new positions are provided by 
this funding increase? When did these positions become available, and 
how many new inspectors have been hired to date? Will all the 
additional inspectors be hired by the end of this fiscal year?
    Answer. The additional funding provided for 15 new hazardous 
materials inspectors. These positions became available in October 1996. 
A first round of interviews was conducted in December 1996 and January 
1997, and five of the 15 inspectors were hired. A second round of 
interviews was conducted in April-June 1997 and the remaining ten 
inspectors were selected. We plan to have all of the inspectors on 
board by the end of fiscal year 1997.
    Question. Where have these additional inspectors been deployed? 
What is the rationale for these assignments?
    Answer. Fourteen inspectors will be deployed in the five regional 
offices to bring the staffing in each office to six inspectors. One 
inspector will be assigned to the Headquarters Special Investigations 
unit.
    RSPA believes that each regional office should have the same number 
of inspectors because we located each office in the heart of a center 
of hazardous materials manufacturing and shipping. The inspector 
assigned to the Headquarters unit is an explosives specialist who will 
provide a dedicated resource with this critical inspection function.
    Question. Has the OHMS requested that the RSPA Administrator 
exercise his discretionary authority to transfer up to two hazmat 
safety positions and $200,000 into program support? If so, which 
contract program(s) received the additional funds?
    Answer. RSPA's supplemental request for resources following the 
ValuJet accident included two attorney positions and associated PC&B to 
provide legal support to the new inspection personnel. These resources 
were deployed as requested following passage of the fiscal year 1997 
appropriations act.
                          ntsb recommendations
    Question. The NTSB recommended that the FHWA in cooperation with 
RSPA implement a program to collect information necessary to identify 
patterns of cargo tank equipment failure. What steps has RSPA taken to 
expand the 5800.1 incident reporting form, and what has been done to 
assist FHWA in accomplishing this recommendation? Will there be 
additional fiscal year 1998 costs associated with addressing this?
    Answer. The original recommendation by the NTSB was in response to 
the perceived inadequate reporting or recording of information. The 
responsibility for reporting was significantly increased by HM-200 
which expanded the scope of reportable accidents to include intrastate 
transportation as well as interstate movement of hazardous materials. 
In some markets this will impact reporting by more than 50 percent. 
Further, in conjunction with the expected expansion of the data 
collected, RSPA intends to conduct a complete review of the content, 
procedures, and data developed by the existing reporting system. We 
have not requested additional funding for this effort.
    Question. Please provide a detailed list of the hazmat 
recommendations made by the NTSB during the last three years. Also 
provide a status update for each recommendation that has been closed 
acceptable or closed unacceptable, and those that remain open. How were 
each of these addressed, and by which agency?
    Answer. In the last three years (1994, 1995, 1996) NTSB made four 
safety recommendations to RSPA involving the transportation of 
hazardous materials. They were: R-95-11, Periodic Inspections of Tank 
Car Linings and Coatings; H-95-37, Improve Crash-worthiness of the 
Front Ends of Cargo Tanks; A-96-29, Chemical Oxygen Generators as Cargo 
on Aircraft; and A-96-39, Oxidizers and Oxidizing Materials in Air 
Cargo Compartments.
    These Recommendations are summarized as follows:
    R-95-11.--In R-95-11, NTSB recommended that RSPA, in cooperation 
with the FRA, require that any party using a tank car to transport 
corrosive materials determine the periodic inspection interval and 
testing technique for linings and coatings, and require that this 
information be provided to parties responsible for the inspection and 
testing of tank cars. A final rule under Dockets HM-175A and HM-201, 
issued on June 26, 1996, requires the owner of a tank car lining or 
coating to inform the inspection parties of the interval, test 
technique, and acceptance criteria required to test the tank car 
integrity. This recommendation was ``Closed-Acceptable Action'' on 
February 10, 1997.
    H-95-37.--In H-95-37, NTSB recommended that RSPA, in cooperation 
with FHWA, study methods and develop standards to improve the crash-
worthiness on the front ends of cargo tanks used to transport liquefied 
flammable gases and potentially lethal nonflammable compressed gases. 
In response to NTSB Recommendation H-95-37, in July 1996 RSPA 
contracted with Pressure Sciences Incorporated for a feasibility study 
of enhanced protection of MC-331 cargo tanks in frontal collisions. It 
is expected that the contractor will provide RSPA with a draft report 
by July 1997. Based on the results of the feasibility study, additional 
work may be undertaken to fully evaluate the benefits and costs 
associated with design changes. To date, $30,000 has been spent on the 
feasibility study.
    A-96-29 and A-96-30.--As a result of the ValuJet aviation accident 
on May 11, 1996, NTSB issued two safety recommendations to RSPA (A-96-
29 and A-96-30). In A-96-29, NTSB recommended that RSPA, in cooperation 
with FAA, permanently prohibit the transportation of chemical oxygen 
generators as cargo on board any passenger or cargo aircraft when the 
generators have passed expirations dates, and the chemical cores have 
not been depleted. A Final Rule was published on December 30, 1996, 
prohibiting the transportation of all oxygen generators as cargo on 
passenger carrying aircraft. This is broader than NTSB's 
recommendations which applied only to oxygen generators which had 
passed their expiration dates. In A-96-30, NTSB recommended that RSPA, 
in cooperation with FAA, prohibit the transportation of oxidizers and 
oxidizing materials in cargo compartments that do not have fire or 
smoke detection systems. A Notice of Proposed Rulemaking was published 
on December 30, 1996, which will permit air transportation of oxidizers 
only in accessible locations on cargo aircraft. Further under a Final 
Rule published June 5, and effective July 7, if the oxygen generator is 
attached to any type of incitation mechanism its transportation must be 
specifically approved by RSPA's Associate Administrator for Hazardous 
Materials and the generator must be transported in a package prepared 
by the holder of the approval.
    In the last three years RSPA has closed eighteen safety 
recommendations from NTSB, while twenty-five remain open. RSPA is 
pursuing appropriate actions to address each of the remaining open 
recommendations. The disposition and status of these NTSB 
recommendations are summarized as follows:

----------------------------------------------------------------------------------------------------------------
          Record Number                   Date closed                               Subject                     
----------------------------------------------------------------------------------------------------------------
Recommendations closed                                                                                          
 acceptable or no longer                                                                                        
 applicable:                                                                                                    
    A-88-120....................  February 15, 1994.........  Restriction notices at all freight acceptance     
                                                               facilities ``Closed-Acceptable.''                
    H-91-034....................  November 8, 1996..........  Devices on manhole cover meet same standards as   
                                                               manhole ``Closed-Acceptable.''                   
    I-78-009....................  February 16, 1994.........  Develop a plan of analysis to control risks       
                                                               ``Closed-Acceptable.''                           
    I-81-003....................  May 3, 1994...............  Develop a common identifier in compliance records 
                                                               ``Closed-Acceptable.''                           
    I-87-005....................  May 3, 1994...............  Establish classification system for explosives    
                                                               ``Closed-Acceptable.''                           
    I-90-005....................  July 28, 1995.............  Procedure for test of containers that do not      
                                                               comply with standards ``Closed-Acceptable.''     
    I-90-006....................  July 28, 1995.............  Recall of containers not in compliance with DOT   
                                                               specifications or exemption packagings ``Closed- 
                                                               Acceptable.''                                    
    R-85-061....................  February 10, 1997.........  Tank-head protection of aluminum & nickel tank    
                                                               cars ``Closed-Acceptable.''                      
    R-91-011....................  June 28, 1994.............  RSPA and FRA develop and agree upon a list of     
                                                               hazardous materials to be transported in pressure
                                                               tanks ``Closed-No Longer Applicable.''           
    R-95-011....................  February 10, 1997.........  DOT and FRA to determine periodic inspection      
                                                               interval and testing techniques for linings and  
                                                               coatings and provide to responsible parties for  
                                                               inspection and testing of tank cars ``Closed-    
                                                               Acceptable.''                                    
Recommendations (closed--                                                                                       
 unacceptable):                                                                                                 
    H-83-029....................  February 16, 1994.........  HM-183C rulemaking failed to address the necessity
                                                               to inspect void space between compartments in    
                                                               multiple compartment cargo tank trailers ``Closed-
                                                               Unacceptable.''                                  
    H-85-034....................  December 12, 1995.........  Mandatory Routing of HazMat Vehicles on the       
                                                               Highway ``Closed Unacceptable.''                 
    H-88-026....................  March 7, 1994.............  Vacuum Protection of Cargo Tanks ``Closed-        
                                                               Unacceptable.''                                  
    H-88-027....................  March 7, 1994.............  Reporting Vacuum Failures of HazMat tanks ``Closed-
                                                               Unacceptable.''                                  
    I-78-012....................  July 7, 1994..............  Conflict between existing DOT and EPA regulations 
                                                               on shippers and carriers affecting transportation
                                                               of hazardous materials and hazardous wastes      
                                                               ``Closed-Unacceptable.''                         
    I-83-004....................  July 8, 1994..............  Preshipment Inspection Criteria for reused drums  
                                                               ``Closed-Unacceptable.''                         
    I-87-004....................  July 8, 1994..............  Thermal protection of explosives ``Closed-        
                                                               Unacceptable.''                                  
    I-90-011....................  October 4, 1995...........  Visibility of Hazard Placards after accident      
                                                               ``Closed-Unacceptable.''                         
Recommendations open:                                                                                           
    H-90-91.....................  Open acceptable...........  Remote shut-off valves.                           
    H-91-34.....................  Open acceptable...........  Manhole cover fittings and devices.               
    H-92-01.....................  Open acceptable...........  Rollover protection; guidance to manufacturers.   
    H-92-02.....................  Open acceptable...........  Rollover protection; evaluate design.             
    H-92-03.....................  Open acceptable...........  Rollover protection; modeling and analysis.       
    H-92-04.....................  Open acceptable...........  Rollover protection; develop standards.           
    H-92-05.....................  Open acceptable...........  Rollover protection; phase out older tanks.       
    H-92-06.....................  Open acceptable...........  Improve/expand information system for cargo tank  
                                                               accident reporting.                              
    H-93-34.....................  Open acceptable...........  Cargo tank emergency cut-off valves               
    H-95-14.....................  Open acceptable...........  Revise/test and inspect requirements for cargo    
                                                               tanks.                                           
    H-95-37.....................  Open acceptable...........  Improve crash worthiness of front end of cargo    
                                                               tanks.                                           
    I-80-1......................  Open Unacceptable.........  Volume and temperature at loading for tank car    
                                                               loading records.                                 
    I-90-8......................  Open unacceptable.........  Cylinders-cargo restraint systems.                
    I-90-9......................  Open unacceptable.........  New and reconditioned low pressure cylinders      
                                                               require independent inspection.                  
    I-90-10.....................  Open unacceptable.........  Amend inspect and test cylinder requirements.     
    I-92-01.....................  Open acceptable...........  Design of attachments to HazMat packagings.       
    I-92-02.....................  Open acceptable...........  Pressure relief venting for DOT 57 containers.    
    I-93-1......................  Open acceptable...........  Amend pamphlet C-6 (CGA). Thread gage for         
                                                               cylinders.                                       
    I-93-2......................  Open acceptable...........  Prohibit use of cylinders not meeting C-6 criteria
                                                               (noted above).                                   
    R-89-52.....................  Open unacceptable.........  Carriers should notify shippers of accident.      
    R-89-53.....................  Open acceptable...........  Tank car closure fitting design.                  
    R-89-83.....................  Open unacceptable.........  ``Life-threatening situations'' to update and     
                                                               correct the emergency response guide.            
    R-92-23.....................  Open acceptable...........  Periodic testing and inspection of tank cars.     
    A-96-29.....................  Open acceptable...........  Prohibit oxygen generators as cargo on passenger  
                                                               aircraft.                                        
    A-96-30.....................  Open acceptable...........  Prohibit the air transportation of oxidizers and  
                                                               oxidizing materials.                             
----------------------------------------------------------------------------------------------------------------

    Question. How have you responded to the 1995 recommendation on 
crash worthiness of front heads on MC 331 cargo tanks, and what have 
been the associated costs in providing resolution to this 
recommendation?
    Answer. In response to NTSB Recommendation H-95-37, in July 1996 
RSPA contracted with Pressure Sciences Incorporated for a feasibility 
study of enhanced protection of MC-331 cargo tanks in frontal 
collisions. It is expected that the contractor will provide RSPA with a 
draft report by July 1997. Based on the results of the feasibility 
study, additional work may be undertaken to fully evaluate the benefits 
and costs associated with design changes. To date, $30,000 has been 
spent on the feasibility study.
                         research and analysis
    Question. What technical advances have resulted from research 
sponsored during the last three fiscal years by the OHMS?
    Answer. Most of the OHMS-sponsored research is focused on the 
development of national and international standards, assessment of 
issues related to the issuance of rulemakings and exemptions, 
characterization of material hazards, assessment of risk, and the 
development of information on hazardous materials transportation. 
Research results in the technical basis to develop, assess, guide and 
support program activities. For example, in the past several years we 
have gained a better understanding of:
  --The factors influencing the choice of mode and route by shippers 
        and carriers of spent nuclear fuel.
  --The flows of selected hazardous materials by highway.
  --The quality of information obtained through Hazardous Materials 
        Information System (HMIS) release reports, and the implications 
        the report data have for targeting hazmat safety regulatory and 
        enforcement resources.
  --The ability of advanced communication technologies to improve 
        responder and community safety at hazardous materials incident 
        sites, as well as to help responders reduce the costs and 
        impacts associated with such incidents.
    In addition, research projects have resulted in technical advances. 
For example, work performed to support development of Initial Isolation 
and Protective Action Distances used in the 1996 North American 
Emergency Response Guidebook resulted in technical advances in 
techniques for dispersion modeling of toxic vapor plumes from hazardous 
material spills. That work introduced the use of probabilistic 
application of atmospheric data and advanced a technique for use of 
commonly available toxicological exposure guidelines where specific 
emergency exposure guidelines did not exist. This work demonstrated 
that spills at night could require much larger protective action zones 
than those required under typical day conditions. Work in support of 
the 1996 North American Emergency Response Guidebook yielded a list of 
materials that can produce large toxic vapor plumes when spilled into 
water.
    Question. What are the critical research activities that are being 
pursued by OHMS and how do these relate to open rulemakings?
    Answer. Most R&D is conducted to address current or future issues 
prior to opening a rulemaking action. Studies are used to assess if 
rulemaking action is warranted and to identify and evaluate potential 
rulemaking options. The following is a list of critical research 
activities that OHMS is pursuing:
  --``Design, Testing and Requalification Standards for Composite 
        Cylinders''--potential rulemaking to incorporate new composite 
        cylinder standards.
  --``Identification of Factors for Selecting Modes and Routes For 
        Shipping High-Level Radioactive Waste and Spent Nuclear 
        Fuel''--legislatively mandated report to increase information 
        base regarding mode/route selection process--potential 
        rulemaking.
  --``Information Technology and Emergency Response''--critical issue 
        that will guide further research and funding for technology 
        deployment at hazardous materials incident sites.
  --``Development of Improved Test Methods and Criteria for Ammonium 
        Nitrate Fertilizers.'' Project to determine if United Nations 
        Explosives Test Series 2 can distinguish between explosive and 
        nonexplosive forms of ammonium nitrate fertilizers--
        international standards issue and potential rulemaking.
  --``Evaluation of Small Explosive Devices''--potential rulemaking to 
        deregulate certain small explosive devices.
  --``Hazards Assessment of Lithium-Ion Batteries'' is an assessment to 
        support a decision on the proper level of regulation for this 
        new type of lithium battery--potential rulemaking.
  --``Hazardous Materials Risk Management Framework'' is a project to 
        develop a risk management framework to assist RSPA in the risk 
        management of hazardous materials transportation--critical 
        issue and potential rulemaking.
  --``National Assessment of Transportation Risk Posed by Poison 
        Inhalation Hazard Materials, Explosives, Flammable Liquids and 
        Gases'' is an assessment to determine the risk associated with 
        the transportation of highly toxic hazardous materials. The 
        study uses the risk of flammable liquid transportation as a 
        benchmark to assess and characterize high-probability low-
        consequence and low-probability high-consequence events for the 
        subject materials--critical issue and potential rulemaking.
  --``Development of Basis and Draft Guidance for Certification of 
        Cylinders Containing Nonfissile and Fissile Excepted Uranium 
        Hexafluoride'' will provide regulatory guidance and the basis 
        for adoption into the Hazardous Materials Regulations new 
        International Atomic Energy Agency transportation 
        requirements--planned rulemaking.
  --``Guidance for Implementing Revised Transportation Regulations for 
        Low Specific Activity Materials and Surface Contaminated 
        Objects''--planned for publication as a joint Nuclear 
        Regulatory Commission and RSPA regulatory guidance document 
        that will facilitate safe and efficient transportation and 
        regulatory compliance.
  --Development of Regulatory Guidance on Transportation of Very Large 
        Contaminated Equipment and Components''--based upon the results 
        of this work, the project will result in a joint Nuclear 
        Regulatory Commission and RSPA regulatory guidance document or 
        rulemaking proposal.
  --``Impact Resistance of Specification MC-330 and 331 Cargo Tank 
        Heads In Accidents''--in response to accident experience, a 
        National Transportation Safety Board (NTSB) Recommendation and 
        a potential rulemaking need.
  --``Analysis of Risks Associated With Transportation of Hazardous 
        Materials in Aircraft Cargo Compartments''--in response to 
        accident experience, NTSB Recommendation and potential 
        rulemaking need.
    Question. What have been the major technical reports that have 
resulted from research sponsored during the last two years by the OHMS? 
Which of these reports were entered into the National Technical 
Information Service? (Indicate NTIS numbers.) Which weren't and why?
    Answer. The following are the major final technical reports that 
resulted from research sponsored during the last two years.
  --``Technical Documentation in Support of the 1996 North American 
        Emergency Response Guidebook,''--NTIS-UILU-ENG-97-4001.
  --``Technical Documentation to Support `List of Dangerous Water-
        Reactive Materials,' 1996 North American Emergency Response 
        Guidebook,'' NTIS-UILU-ENG-97-4004.
  --``Exploration of the Global Positioning System and Related 
        Technologies to Enhance the Safe Transportation of Hazardous 
        Materials,'' Draft Final, will be sent to NTIS shortly.
  --``Information Technology and Emergency Response,'' Draft Final, 
        will be sent to NTIS shortly.
  --``Truck Transport of Hazardous Chemicals: Dodecene-1,'' DOT-VNTSC-
        RSPA-96-2.
  --``Truck Transport of Hazardous Chemicals: 1-Butanol,'' DOT-VNTSC-
        RSPA-95-4.
  --``Report on Identification of Factors for Selecting Modes and 
        Routes for Shipping High-Level Radioactive Waste and Spent 
        Nuclear Fuel,'' Draft Final, will be sent to NTIS shortly.
  --``Operation Respond: Lessons Learned--A Research and Development 
        Program to Promote Safe and Secure Transportation by Improving 
        Information Available to First Responders,'' Final Report, will 
        be sent to NTIS shortly.
    Question. Please describe how each component of your research 
request relates to pending or future rulemakings.
    Answer. The Office of Hazardous Materials Safety's (OHMS) Research 
and Development (R&D) Program provides the technical and analytical 
foundation necessary to support the hazardous materials program. The 
R&D Program is composed of three activity areas: Information Systems, 
Research and Analysis, and Regulations Compliance. The information, 
technical and analytical analyses, and data produced by the R&D Program 
support national and international standards development, exemptions, 
information dissemination, training, emergency response guidance, 
compliance, and the development of program strategies and their 
implementation.
    The three activity areas of the R&D Program support pending and 
future rulemaking in the following ways:
  --The Information Systems Activity Area directly supports studies, 
        software development, and maintenance to facilitate the 
        analysis and use, by Federal, State, and public users, of 
        information collected in the Hazardous Materials Information 
        System (HMIS). OHMS uses HMIS data to support its mission 
        activities; develop regulations; issue exemptions, approvals, 
        and interpretations; and promote compliance with safety 
        regulations. Information derived by analysis of hazardous 
        materials spill incident data in the HMIS is used to determine 
        the need for and justify rulemakings. Incident data are used in 
        risk and benefit/cost analyses by Federal, State and public 
        analysts to support rulemaking proposals and comments.
  --The Research Analysis Activity Area directly supports rulemaking 
        and is used to assess the need for new regulations and the 
        effectiveness of current regulations, and to perform studies 
        mandated by Congress. The knowledge gained is essential to 
        understand the risks associated with hazardous materials 
        transportation and to develop safety regulations both the risks 
        and the burdens on industry, allow maximum operational 
        flexibility, and enhance international competitiveness.
  --The Regulations Compliance (Testing) Activity Area provides for 
        compliance testing of Packagings used to transport hazardous 
        materials. Packaging performance is critical to the safe 
        transportation of hazardous materials. This work provides an 
        assessment of the level of compliance with packaging 
        specifications and performance standards. It also identifies 
        sections of packaging specifications and performance standards 
        where rulemaking revisions could improve compliance.
    Question. The FHWA is conducting and has planned research 
activities that will evaluate the real risks associated with hazardous 
materials transportation, their social impact, and the benefit of their 
mitigation. Does the OHMS agree that this is the type of research that 
is needed to mitigate the occurrence of hazardous materials incidents? 
Is this an idea that is worth pursuing?
    Answer. The Office of Motor Carriers (OMC) has undertaken a 
research project to assess the additional hazards posed by the 
transportation of hazardous materials by highway compared to non-
hazardous material shipments. RSPA supports research which will help 
both RSPA and OMC better understand and manage the risks of hazardous 
materials shipments by highway.
    Question. How much money did OHMS allocate for Operation Respond in 
fiscal year 1996? How much is planned for fiscal year 1997 and planned 
for fiscal year 1998?
    Answer. In fiscal year 1996, RSPA (OHMS) allocated $120,000 to 
Operation Respond. No OHMS funding has been allocated for Operation 
Respond activities in fiscal year 1997 or fiscal year 1998. RSPA has 
identified Operation Respond Institute's computer software and training 
courses as eligible uses of grant funds made available annually to the 
Department's Hazardous Materials Emergency Planning grant recipients.
    Question. Is DOT developing a coordinated approach to funding 
Operation Respond? Please comment on other agencies' support, and 
display the total coordinated fiscal year 1998 request for the program.
    Answer. FRA, FHWA, and RSPA have taken a coordinated approach to 
Operation Respond. With the transition of Operation Respond from its 
developmental and demonstration phase to an independent operated 
foundation, the modal administrations are reviewing the extent of their 
prior support and the potential for additional support of Operation 
Respond activities.
    At this time, it is our understanding that FRA is requesting 
$103,000 for Operation Respond in the fiscal year 1998 budget. RSPA has 
identified Operation Respond Institute's computer software and training 
courses as eligible uses of grant funds made available annually to the 
Department's Hazardous Materials Emergency Planning grant recipients.
                   inspection and enforcement program
    Question. Please present detailed data for the last three years on 
the number of HAZMAT inspectors and describe how OHMS measures 
productivity. Be certain to include average number of enforcement 
cases, warnings issued, amounts of civil penalties assessed, and the 
amounts collected. Please evaluate these data on a per inspector or 
similar normalized basis.
    Answer. The following table provides the requested information:

------------------------------------------------------------------------
                                       1994         1995       1996 \1\ 
------------------------------------------------------------------------
Cases initiated..................          262          246          239
Tickets initiated................  ...........  ...........           84
Cases closed.....................          177          189          189
Tickets closed...................  ...........  ...........           62
                                  ======================================
Case penalties collected.........     $964,040   $1,047,842     $902,438
Ticket penalties collected.......  ...........  ...........      $70,725
                                  --------------------------------------
      Total penalties collected..     $964,040   $1,047,842     $973,163
                                  ======================================
Warning letters..................          134          168          166
Work years of effort.............         18.4         18.0        19.75
Cases initiated/work-year........         14.2         13.7         12.1
Cases closed/work-year...........          9.6         10.5          9.6
Penalties/work-year..............      $52,207      $58,213      $45,693
Warning letters/work-year........          7.3          9.3          8.4
------------------------------------------------------------------------
\1\ Tickets are not included in the per-work-year statistics because the
  first activity did not occur until June 1996.                         

    Question. Please calculate the average settlement percentage 
[amount of civil penalties collected for valid claims divided by the 
amount of civil penalties originally assessed for valid claims] for 
these hazmat cases. Please provide compatible data to that provided 
last year.
    Answer. The following table provides the requested information:

----------------------------------------------------------------------------------------------------------------
                                                                       1994            1995          1996 \1\   
----------------------------------------------------------------------------------------------------------------
Penalties proposed..............................................      $1,382,085      $1,540,391      $1,358,225
Penalties collected.............................................        $964,040      $1,047,842        $902,438
Percentage collected............................................              70              68             66 
----------------------------------------------------------------------------------------------------------------
\1\ Does not include tickets.                                                                                   

    Question. As evidenced by OHMS inspections, what is the overall 
level of compliance with the Hazardous Materials Regulations? What 
innovative or new strategies are you using to improve your impact on 
compliance?
    Answer. RSPA can continue to report that a majority of its 
inspections have found no violations of the regulations, although it is 
difficult to determine a precise rate of compliance (or noncompliance) 
for any given year. This is due in part to the fact that enforcement 
actions initiated in a given year may be based on inspections conducted 
in the previous year. Also, many inspections are initiated on the basis 
of prior allegations of non-compliance and thus are not an unbiased 
sample of the regulated community. In the past, in order to come up 
with a statistic in this area, RSPA simply took the number of 
enforcement actions (civil penalty cases and warning letters) initiated 
in a given year and divided that number by the number of inspections 
conducted in that same year. For example, from 1992 through 1996, RSPA 
conducted 5,769 inspections, and initiated 1,125 civil penalty cases 
and issued 700 warning letters based on those inspections. Using the 
previously mentioned simplistic method, this would equate to a 31.6 
percent rate of noncompliance for that five-year period. Users of this 
data must understand that it is only an estimate.
    With the training of most of the new inspectors completed by the 
end of fiscal year 1997, RSPA will increase the number of compliance 
inspections conducted, particularly inspections of shippers. RSPA's 
regional hazardous materials offices also have an important secondary 
mission to provide outreach, typically through information and training 
for State and local enforcement and response personnel, and assistance 
to industry and interaction with the public through presentations, 
seminars, and workshops. The additional inspector resources will allow 
these offices to perform more outreach activities to improve 
compliance.
    In fiscal year 1997, RSPA cooperated with the Federal Aviation 
Administration (FAA) to increase public and shipper/carrier outreach 
and focus on air transportation issues involving hazardous materials; 
develop additional training materials and programs involving the air 
transportation of hazardous materials; and increase information 
dissemination on compliance with the HMR. To accomplish this, RSPA led 
a team composed of representatives from FAA, the Transportation Safety 
Institute (TSI), and the air transport industry, and Federal & State 
enforcement officials who provided technical assistance in developing 
new training materials and informational brochures targeted to enhance 
the safe transportation of hazardous materials. Industry and State 
enforcement personnel/associations participated as distribution 
partners in distributing the training products to the targeted 
audiences.
    RSPA is strengthening the Hazardous Materials Information Center 
which assists shippers, carriers, packaging manufacturers, enforcement 
personnel, and others in their understanding of requirements in the HMR 
for the purpose of maximizing voluntary compliance. In addition, the 
Center staffs the statutorily mandated toll-free number for 
transporters of hazardous materials, and others, to report possible 
violations of the HMR or any order or regulation issued under Federal 
hazardous materials transportation law.
    As part of our efforts to improve compliance, RSPA implemented an 
interagency agreement with the Department of Defense for package 
testing. A number of packages were procured and tested by the Army's 
testing facility at Tobyhanna, Pennsylvania. Testing has revealed 
significant failure problems for certain Packagings and RSPA has 
alerted the manufacturers about them. Package testing is on-going.
    RSPA initiated a limited materials testing program to determine if 
shippers are properly classifying the hazardous materials they are 
offering for transportation. Thus far, we have concentrated on 
Packaging Group III corrosive materials and have found violations, 
which we are pursing through enforcement.
    Question. Please provide a detailed explanation on how compliance 
will increase, or decrease with the implementation of HM-200. How will 
this affect the RSPA workload? Does this explain the decrease from 
$260,000 to $155,000 in inspection and enforcement program costs, and 
how will the fiscal year 1998 budget be affected?
    Answer. The majority of companies who will be subject to the 
Hazardous Materials Regulations when HM-200 is implemented will be 
small companies with a lack of detailed knowledge about the 
regulations. Therefore, compliance could decrease somewhat. However, 
RSPA plans to take steps to increase awareness of the Hazardous 
Materials Regulations through additional training and outreach 
activities. RSPA's inspection workload is based on inspectors 
performing a specified number of weeks of inspection travel per year. 
RSPA is not expecting the workload to increase under HM-200.
    The difference in funding has no relation to workload under HM-200. 
The difference reflects the transfer of the COHMED program from the 
Inspection and Enforcement program area to the Information 
Dissemination area. It is a presentation change only. The fiscal year 
1998 activity levels will not be affected.
    Question. What is RSPA's plan for implementing the new HM-200 
provision? How will RSPA communicate the regulatory changes outlined in 
the rulemaking with the OMC so that intrastate motor carriers and 
shippers of hazmat are properly informed of their responsibilities 
under the regulations? How will the hazmat industry be assured that 
enforcement components of this new rule are fairly applied?
    Answer. RSPA's strengthened Hazardous Materials Information Center 
will assists shippers, carriers, packaging manufacturers, enforcement 
personnel, and others in their understanding of requirements in HM-200 
for the purpose of maximizing voluntary compliance. In addition, the 
Center staffs the statutory mandated toll-free number for transporters 
of hazardous materials, and others, to report possible violations of 
the HMR or any order or regulation issued under Federal hazardous 
materials transportation law. Reported violations will be followed up 
by the appropriate modes.
    RSPA has advised FHWA of the regulatory changes required by HM-200. 
RSPA also published, on February 27, 1997, and distributed over 50,000 
copies of a Safety Alert newsletter which highlights the requirements 
for shippers and carriers involved in intrastate transportation and 
reminds them of their responsibilities to ensure that hazardous 
materials are properly identified, packaged, authorized for 
transportation, handled, loaded, and transported in conformance with 
the Hazardous Materials Regulations.
    The Spring and Fall Cooperative Hazardous Materials Enforcement 
Development (COHMED) program conferences and Multimodal seminars 
provide for the exchange of information among States, local 
governments, and industry on compliance and enforcement issues. HM-200 
has and will continue to be a focus of COHMED efforts. We have 
developed and will continue to develop educational materials which we 
will widely disseminate information using industry associations and 
groups.
    Question. What will be the associated costs to the hazmat industry 
for intrastate carriers and shippers to come into compliance with this 
new provision?
    Answer. The final rule will affect many intrastate shippers and 
carriers, many of whom are small businesses, but RSPA believes that the 
economic impact is minimal. Twenty States have adopted the Hazardous 
Materials Regulations (HMR) in their entirety, and the vast majority of 
remaining States have adopted transport safety regulations similar to 
the HMR. However, a number of States have adopted safety regulations 
which continue to except certain intrastate highway carriers from the 
HMR or continue to provide safety standards which do not fully track 
with those in the HMR. Accordingly, compliance costs for shippers and 
carriers in those States that have fully adopted or adopted similar 
regulations to the HMR are minimal. Shippers and carriers in those 
States that have provided exceptions or waivers to intrastate shippers 
and carriers from applicability of the HMR will be the entities most 
affected by HM-200 rulemaking. In the assessment of costs and benefits 
prepared in support of this rule, RSPA estimated that operators of 
cargo tank motor vehicles that do not conform to current standards 
specified in the HMR would experience annual costs of compliance of 
$164 per cargo tank.
    RSPA has provided several exceptions in HM-200 to minimize the 
impacts on many of these entities. For example, the Materials of Trade 
exception provides a common sense approach in regard to the 
applicability of the HMR to small and local businesses. The exceptions 
for Materials of Trade can also used by interstate motor carriers. This 
exception alone provides a significant reduction in compliance costs 
for both interstate and intrastate motor carriers.
    Other exceptions have been provided for the continued use of non-
specification small cargo tanks. A phase-in period of approximately 
three years has been provided. Non-specification cargo tanks used for 
the transportation of flammable liquid petroleum products in those 
States that currently allow the use of these non-specification cargo 
tanks within their State, can continue to be used indefinitely, under 
specified conditions. These non-specification cargo tanks will be 
required to meet the continuing operational and retest requirements 
HMR. The retest requirements ensure that these cargo tanks are capable 
of containing the flammable products being transported; e.g., they do 
not leak during transportation. Since most on the non-specification 
cargo tanks that are currently being used under State exceptions are 
used for the transportation of flammable liquid petroleum products, the 
only increase in costs is associated with continuing maintenance and 
operations. The three-year phase-in period for testing will also 
minimize immediate costs.
    RSPA has also provided a total exception (not including compressed 
gases) from the HMR for farmers who transport agricultural products 
between fields of their own farm over local roads, provided the State 
in which they operate has provided a similar exception. Therefore there 
are no cost impacts for these farmers as a result of HM-200. 
Additionally, under specified conditions, farmers have been provided 
exceptions from the emergency response information and training 
requirements. RSPA believes that other requirements of the HMR, such as 
hazard identification (including shipping papers, labels, and placards) 
are necessary to provide information on the hazardous materials being 
transported to emergency responders. RSPA believes that the exceptions 
provided in HM-200 for Materials of Trade, farmer, and continued use of 
non-specification cargo tanks for flammable liquid petroleum products 
will provide substantial relief to farmers.
    Question. Since last year have you made any improvements in how 
RSPA prioritizes and selects hazmat shippers and manufacturers for 
inspections?
    Answer. RSPA continues to prioritize its selection of companies for 
inspection. We give priority to complaints and reinspections of 
companies previously subject to civil penalty enforcement. We follow up 
leads developed during inspections. Regarding manufacturers and related 
companies, we attempt to strike a balance between inspections of high-
consequence, low-incident packaging like compressed gas cylinders, and 
low-consequence, high-incident packaging like steel and plastic drums. 
We target shippers of high-hazardous materials and those frequently 
appearing on hazardous materials incident reports. We established a 
program to place emphasis on inspections of shippers who offer 
hazardous materials for transportation by all modes, especially by air.
    Question. What further progress has been made in converting to a 
more risk-based selection process?
    Answer. RSPA is working with its on-site information systems 
contractor to refine current programs for selecting shippers for 
inspection. Our effort is underway. We are trying to make better use of 
the packing group system in the regulations, which provides a priority 
rank for hazardous materials as high, medium, or low hazard through the 
assignment of packing group number. We are also utilizing our knowledge 
and experience to target industry segments and individual companies 
known or suspected to have compliance problems.
    Question. What system does RSPA have in place that will ensure that 
all reports of hazmat incidents are properly forwarded to the FHWA for 
action?
    Answer. Prior to August 1993, RSPA provided FHWA's Office of Motor 
Carrier Field Operations with copies of all hazmat highway incident 
reports received on the 5800.1 form. In August 1993, FHWA requested 
that RSPA discontinue sending copies of the form, since the data were 
readily available through RSPA's Hazardous Materials Information System 
which FHWA may access.
    Question. For each of the last two fiscal years, please specify; 
the average time spent processing enforcement cases by regional staff 
before being submitted to headquarters; and the time spent reviewing 
these cases at headquarters before being first submitted to the Office 
of the Chief Counsel.
    Answer. For 1995 enforcement cases, inspectors processed cases in 
50 days; headquarters review and referral to the Office of the Chief 
Counsel (OCC) took 36 days. For 1996 enforcement cases, inspectors 
processed cases in 46 days; headquarters review and referral to OCC 
took 53 days.
    Question. What are your doing to reduce these backlogs?
    Answer. Through 1995, the time intervals for processing enforcement 
cases were decreasing and we considered them to be acceptable, given 
the other duties of inspectors and their supervisors which affect 
report and referral production. The increase in processing time in 1996 
was due to key personnel shifts and new assignments within the 
Hazardous Materials Safety program for most of the year. RSPA currently 
is considering ways in which this upward trend might be reversed, 
including the hiring of a staff assistant to help in the processing of 
referrals to the Office of the Chief Counsel.
    Question. What changes in enforcement philosophy or practice have 
you made since last year?
    Answer. In June 1996, as part of Reinventing Government, RSPA 
established a Pilot Ticketing Program which included certain single 
violations that are determined to have little or no direct impact on 
safety, such as operating under the terms of an expired DOT exemption, 
failure to register with RSPA, failure to maintain training records, or 
failure to file hazardous materials incident reports. We expect the 
ticketing program to reduce costs to both government and industry, to 
substantially reduce the time between inspection and notification of a 
violation, and to encourage faster resolution of cases through reduced 
penalties.
    In all, 84 tickets were issued by the Office of Hazardous Materials 
Enforcement in 1996, all of which would otherwise have been issued as 
regular civil penalty cases by OCC, thereby reducing the burden on OCC. 
In fact, the 62 tickets closed in 1996 were closed in an average of 38 
days from date of issue, compared to 16 months for the average civil 
penalty case. The penalty for each ticket is half of the civil penalty 
case amount.
    In other actions, RSPA is hiring 15 new inspectors in fiscal year 
1997 in order to increase the number of shipper inspections, with an 
emphasis on shippers who offer hazardous materials for air 
transportation. We target shippers of high-hazardous materials and 
those frequently appearing on hazardous materials incident reports. 
Finally, we will be increasing our efforts to offer compliance training 
and assistance through our regional offices.
    Question. What steps have been taken during the last year to 
shorten the time period from inspection to case closure? What 
instructions have been provided to your inspectors and attorneys on 
this issue? Please provide comparative data for each of the last three 
fiscal years on the processing time involved in hazardous materials 
cases.
    Answer. The following table provides the case processing data for 
the past three years.

                              RSPA CIVIL PENALTY ENFORCEMENT CASE PROCESSING TIMES                              
----------------------------------------------------------------------------------------------------------------
                                                                       1994            1995            1996     
----------------------------------------------------------------------------------------------------------------
Inspection to report............................................         81 days         50 days         46 days
Report to referral..............................................         49 days         36 days         53 days
Referral to notices of probable violation.......................         34 days         30 days         53 days
Notices of probable violation to order..........................        282 days        247 days        142 days
Order to close..................................................        114 days         78 days         31 days
                                                                 -----------------------------------------------
      Total time................................................       560 days/                                
                                                                     18.4 months       441 days/                
                                                                                     14.5 months       324 days/
                                                                                                     10.7 months
----------------------------------------------------------------------------------------------------------------

    RSPA's emphasis on prompt post-inspection processing and early 
issuance of Notices of Probable Violations (NOPVs) has resulted in a 
large increase in cases opened. This activity has consumed a great 
amount of attorney time and resulted in a growing backlog of open 
cases.
    For 1994, the total processing time from inspection to issuance of 
NOPV was 5.4 months. This period decreased to 3.8 months in 1995, and 
increased to 5.0 months in 1996. The NOPV-to-case closure time for 
1994-1996 is currently 13.0 months, 10.7 months, and 5.7 months, 
respectively. We use the word ``currently'' because cases started in 
these years continue to be closed in later years. Thus, the total 
inspection-to-closure times for 1994-1996 are 18.4 months, 14.5 months, 
and 10.7 months respectively. This downward trend reflects the steps 
taken by the Office of Hazardous Materials Enforcement (OHME) and the 
Office of the Chief Counsel (OCC) over the last several years. No new 
steps were taken during the last year; the increase in report-to-
referral time in 1996 was due to personnel reassignments for a major 
portion of the year. The increase in referral-to-NOPV time was due to 
attorneys being assigned to high-priority statutorily-mandated 
regulatory Reinvention rulemaking projects.
    Inspectors and attorneys have timely processing of reports and 
cases as part of their performance plans. They are aware of the need to 
process cases as quickly as possible.
    Question. What are you doing to ensure timely prosecution of all 
parties responsible for the Valujet crash?
    Answer. The Federal Aviation Administration is responsible for 
initiating enforcement actions based on the ValuJet accident. RSPA will 
provide support as requested.
                           rulemaking support
    Question. Please list all pending dockets and rulemakings before 
the Office of Hazardous Materials Safety. Please specify the date of 
origin of these regulatory dockets and their expected completion dates.
    Answer. A listing of pending rulemaking actions for calendar year 
1997, follows:

------------------------------------------------------------------------
       Rulemaking project              Summary          Current status  
------------------------------------------------------------------------
Corrosive miscellaneous          To make              Initiated: 5/93   
 amendments (HM-166Y).            miscellaneous        NPRM estimated: 7/
                                  revisions to the     97.              
                                  HMR that are not                      
                                  significant or                        
                                  controversial.                        
Hazardous materials              Yearly revision to   Project           
 regulations: Miscellaneous       the regulations to   identified: 10/96
 corrections (HM-189N).           make                 Final rule       
                                  nonsignificant       anticipated: 9/  
                                  corrections of       97.              
                                  typos, spelling,                      
                                  etc.                                  
Hazardous materials in           Extends the          ANPRM published:  
 intrastate commerce (HM-200).    applicability of     1987 Delayed     
                                  the HMR to the       awaiting HMTUSA 1/
                                  transportation of    90 NPRM          
                                  hazardous            published: 7/9/93
                                  materials in         SNPRM published: 
                                  wholly intrastate    3/20/96 Extension
                                  commerce.            of Comment Period
                                                       Published: 5/17/ 
                                                       96 Final rule    
                                                       published: 1/8/97
                                                       Response to      
                                                       petitions for    
                                                       reconsideration  
                                                       anticipated: 7/  
                                                       97.              
Improving hazardous materials    To determine         HMTUSA: 11/90     
 identification systems (HM-      methods of           ANPRM published: 
 206).                            improving the        6/9/92 NPRM      
                                  current system of    published: 8/14/ 
                                  placarding           95 Public        
                                  vehicles             hearing: 10/18/94
                                  transporting         Final rule       
                                  hazardous            published: 1/8/97
                                  materials and        Final rule       
                                  improving other      responding to    
                                  identification       petitions for    
                                  systems.             reconsideration  
                                                       anticipated: 7/  
                                                       97.              
Safeguarding food from           Requests comments    SFTA: 11/90 ANPRM 
 contamination during             concerning options   published: 2/20/ 
 transportation (FS-1).           relative to          91 NPRM          
                                  regulations to       published: 5/21/ 
                                  ensure that food     93 Further action
                                  and other consumer   undetermined.    
                                  products are not                      
                                  made unsafe as a                      
                                  result of certain                     
                                  transportation                        
                                  practices.                            
Tank cars and cargo tank motor   To allow the use of  Initiated: 2/92   
 vehicles: Attendance             signaling systems    NPRM published: 9/
 requirements (HM-212).           (sensors, alarms,    14/92 Final rule 
                                  electronic           anticipated:     
                                  surveillance         Undetermined     
                                  equipment) to        pending HM-223.  
                                  satisfy the                           
                                  attendance                            
                                  requirements                          
                                  unloading tanks                       
                                  cars and for                          
                                  loading cargo tank                    
                                  motor vehicles.                       
Requirements for cargo tanks     To make revisions    Project           
 (HM-213).                        and updates to the   Identified: 6/96 
                                  requirements for     FHWA's OMC has   
                                  the manufacture,     lead. NPRM       
                                  maintenance and      anticipated early
                                  use of               fiscal year 1998.
                                  specification                         
                                  cargo tanks.                          
Incorporation of recent U.N.     Revises the HMR by   Initiated: 11/95  
 recommendations (HM-215B).       incorporating        NPRM: 10/26/96   
                                  changes based on     Partial Final    
                                  the most recent      rule published:  
                                  changes to the       12/16/96 Final   
                                  U.N.                 Rule published: 5/
                                  Recommendations,     6/97 Effective   
                                  ICAO, and IMO        date: 10/1/97.   
                                  requirements.                         
Specification 3AL aluminum       To revise Sec.       Initiated: 7/87   
 cylinders (HM-176A).             173.34 and Spec.     Combined with HM-
                                  3AL to correct a     220.             
                                  specification                         
                                  deficiency related                    
                                  to an aluminum                        
                                  alloy.                                
Labeling requirements for        To solicit comments  Initiated: 6/93   
 poisonous materials, PG III      on revising          ANPRM published: 
 (HM-217).                        labeling             11/8/93 NPRM     
                                  requirements for     anticipated: 10/ 
                                  Div. 6.1, PG III     97.              
                                  materials                             
                                  consistent with                       
                                  International                         
                                  requirements.                         
Quantity limitations on          To review utility    ANPRM published: 4/
 aircraft (HM-192).               of quantity          6/84 Public      
                                  limitations and      hearing: 5/30/85 
                                  provisions for       Future action    
                                  cargo compartments   undetermined.    
                                  on aircraft.                          
Motor carrier safety permits     To prohibit          Initiated: 5/93   
 (HM-218).                        shippers from        Companion rule to
                                  offering to motor    FHWA/OMC         
                                  carriers certain     rulemaking on    
                                  hazardous            safety permits.  
                                  materials for        Current          
                                  which the motor      rulemaking action
                                  carrier must have    terminated.      
                                  a safety permit.                      
Shipping paper retention         To implement self-   HMTAA 1994        
 requirements (HM-207B).          executing            enacted: 8/29/94 
                                  requirement of       Project          
                                  HMTAA, Sec. 115,     initiated: 9/26/ 
                                  that shippers and    94 Further action
                                  carriers retain      pending          
                                  copies of shipping   legislation      
                                  papers for 1 year    revision.        
                                  after termination                     
                                  of transportation.                    
Consolidation of specifications  To revise the        Initiated: 1/94   
 for high-pressure cylinders      requirements for     Outreach meeting:
 (HM-220).                        reinspection,        2/18/95 NPRM     
                                  retesting, and       anticipated: 12/ 
                                  repairing            97.              
                                  cylinders and                         
                                  consolidate                           
                                  seamless cylinder                     
                                  specifications.                       
Filling of propane cylinders     Responds to          Project initiated:
 (HM-220C).                       petitions for        4/96 ANPRM       
                                  rulemaking to        published: 8/23/ 
                                  allow propane        96 Further action
                                  cylinders to be      to be determined.
                                  filled by volume                      
                                  rather than by                        
                                  weight.                               
Use of nonspecification open-    This final rule      Project           
 head fiber drum packaging (HM-   terminates RSPA's    identified: 2/96 
 221B).                           rulemaking           NAS report       
                                  relating to          completed: 3/97  
                                  alternate            Direct final rule
                                  standards for open-  published: 6/2/97
                                  head fiber drum      Effective date:  
                                  packaging.           10/1/97 Comment  
                                  Additionally, this   period closes: 8/
                                  final rule           1/97.            
                                  provided for the                      
                                  continued use,                        
                                  until September                       
                                  30, 1999, of drums                    
                                  filled before                         
                                  September 30, 1997.                   
Hazardous materials program      To resolve           Project initiated:
 issues--jurisdiction (HM-223).   regulatory           1/96 ANPRM 7/29/ 
                                  jurisdictional       96 Three public  
                                  issues regarding     meetings held.   
                                  applicability of     Further action to
                                  the HMR.             be determined.   
Prohibition of oxidizers on      To prohibit the      Project           
 aircraft (HM-224A).              carriage of          identified: 6/96 
                                  oxidizers on         NPRM published:  
                                  passenger carrying   12/30/96 Final   
                                  aircraft and in      rule on proper   
                                  certain cargo        shipping name for
                                  holds on cargo       oxygen generators
                                  aircraft.            published: 6/5/97
                                                       Effective Date: 7/
                                                       7/97 SNPRM       
                                                       anticipated: 7/  
                                                       97.              
Cargo tank motor vehicles in     Interim final rule   Project           
 Liquefied Compressed Gas         specifies            identified: 11/96
 Service (HM-225).                conditions under     I-FR published: 2/
                                  which certain        19/97 Three      
                                  cargo tank motor     public meetings  
                                  vehicles may         or workshops     
                                  continue to be       held. Notice     
                                  used on an interim   published: 6/6/97
                                  basis, even if the   Authorization    
                                  emergency            expires: 8/15/97 
                                  discharge control    Final rule       
                                  system may not       anticipated: 8/97
                                  function as          NPRM anticipated:
                                  required by the      8/97.            
                                  regulations.                          
Infectious Substances:           Proposes to revise   Project           
 International Harmonization      the requirements     identified: 1/97 
 and Bulk Packaging (HM-226).     for infectious       NPRM anticipated:
                                  substances to        late CY 1997.    
                                  harmonize the                         
                                  requirements with                     
                                  international                         
                                  standards and                         
                                  propose bulk                          
                                  packaging                             
                                  requirements.                         
------------------------------------------------------------------------

    Question. What were your major regulatory accomplishments during 
the last two fiscal years?
    Answer. The following is a listing of final rules or other final 
actions issued for fiscal year 1995 through June, 1997.

                   HAZARDOUS MATERIALS RULEMAKING ACTIONS FINAL RULES FISCAL YEAR 1995 THROUGH                  
                                                    JUNE 1997                                                   
----------------------------------------------------------------------------------------------------------------
              HM docket                         Title                    Action                    Date         
----------------------------------------------------------------------------------------------------------------
HM-145K..............................  Hazardous substances...  Final rule.............  8/2/95.                
HM-169A..............................  Compatibility with IAEA  Final rule.............  9/28/95.               
                                        for radioactive         Response to petitions..  5/8/96.                
                                        materials.                                                              
HM-175A/201..........................  Crash worthiness         Final rule.............  9/21/95.               
                                        protection                                                              
                                        requirements for tank                                                   
                                        car tanks.                                                              
HM-181E..............................  Intermediate bulk        Final rule.............  7/26/94.               
                                        containers.             Response to petitions..  8/4/95.                
HM-181G..............................  Infectious substances..  Final rule.............  9/20/95.               
HM-181H..............................  Performance-oriented     Final rule.............  9/26/96.               
                                        packaging.              Response to petitions..  3/26/97.               
HM-189L..............................  Editorial revisions and  Final rule.............  9/21/95.               
                                        corrections.                                                            
HM-189M..............................  Editorial revisions and  Final rule.............  10/1/96.               
                                        corrections.                                                            
HM-200...............................  Hazardous materials in   Final rule.............  1/8/97.                
                                        intrastate commerce.                                                    
HM-206...............................  Improvements to          Final rule.............  1/8/97.                
                                        hazardous materials                                                     
                                        identification systems.                                                 
HM-207C..............................  Exemptions, approvals,   Final rule.............  5/9/96.                
                                        registration and                                                        
                                        reports; miscellaneous                                                  
                                        amendments.                                                             
HM-207D..............................  Penalty action           Final rule.............  3/6/95.                
                                        guidelines.                                                             
HM-207E..............................  Enforcement-related      Final rule.............  2/26/96.               
                                        documents, ticketing.                                                   
HM-207F..............................  Penalty guidelines.....  Final rule.............  1/21/97.               
HM-208B..............................  Registration and fee     Final rule.............  5/23/95.               
                                        assessment program.                                                     
HM-215A..............................  Incorporation of latest  Final rule.............  12/29/94.              
                                        U.N. recommendations.   Response to petitions..  5/18/95.               
                                                                Response to additional   11/13/95.              
                                                                 petitions.                                     
HM-215B..............................  Harmonization with the   Final rule.............  12/16/96.              
                                        U.N. recommendations,   Final rule.............  5/6/97.                
                                        IMO dangerous goods                                                     
                                        code, and ICAO                                                          
                                        technical instructions.                                                 
HM-216...............................  Miscellaneous            Final rule.............  6/5/96.                
                                        amendments; rail.       Response to petitions..  7/25/96.               
                                                                Response to petitions..  9/25/96.               
HM-219...............................  Approval of multi-unit   Termination of           5/8/95.                
                                        tank car tanks.          rulemaking action.                             
HM-220A..............................  Periodic inspection and  Final Rule.............  5/28/96.               
                                        testing of cylinders.   Response to petitions..  10/1/96.               
HM-220B..............................  Restructuring of         Final rule.............  5/23/96.               
                                        cylinder                Response to petitions..  10/1/96.               
                                        specifications.                                                         
HM-221...............................  Alternate standards for  Termination of           9/29/95.               
                                        open-head fiber drum     rulemaking action.                             
                                        packaging.                                                              
HM-221A..............................  Extension of authority   Final rule.............  2/29/96.               
                                        for continued use of                                                    
                                        open-head fiber drum                                                    
                                        packagings.                                                             
HM-221B..............................  Use of non-              Direct final rule......  6/2/97.                
                                        specification open-                                                     
                                        head fiber drum                                                         
                                        packaging.                                                              
HM-222...............................  Improving the hazardous  Notice.................  4/4/95.                
                                        materials safety                                                        
                                        program.                                                                
HM-222A..............................  Elimination of           Final rule.............  4/29/96.               
                                        unnecessary,                                                            
                                        duplicative                                                             
                                        regulations.                                                            
HM-222B..............................  Revision of hazardous    Final rule.............  5/30/96.               
                                        materials regulations:  Response to petitions..  10/1/96.               
                                        Regulatory review.                                                      
HM-224...............................  Temporary prohibition    Emergency final rule...  5/24/96.               
                                        of oxygen generators    Final rule.............  12/30/96.              
                                        in air commerce.                                                        
HM-224A..............................  Shipping description     Final rule.............  6/5/97.                
                                        and packaging of                                                        
                                        oxygen generators.                                                      
HM-225...............................  Cargo tank motor         Final rule.............  2/19/97.               
                                        vehicles in liquefied                                                   
                                        compressed gas service.                                                 
----------------------------------------------------------------------------------------------------------------

    Question. What are the key challenges facing you in fiscal year 
1997? What challenges lie ahead in fiscal year 1998?
    Answer. The key challenge RSPA faces is focusing our resources to 
maximize compliance, whether through regulations, enforcement, 
training, publications, or technical assistance. The important 
regulatory challenges this year and during the next fiscal year involve 
completion of several current rulemakings. These include issuing final 
rules responding to petitions for reconsideration on Dockets: HM-200--
Intrastate Transportation of Hazardous Materials; HM-206--Hazardous 
Materials Identification Systems; and HM-225--Cargo Tank Motor Vehicles 
in Liquefied Compressed Gas Service. RSPA also plans to continue is 
rulemaking efforts to address: revisions to the cylinder specifications 
(HM-220); jurisdictional issues (HM-223); issues involving the 
transportation of hazardous materials by air (HM-224A); and 
requirements for cargo tanks (HM-213). Additionally, RSPA plans to 
continue its efforts to harmonize the Hazardous Materials Regulations 
with international regulations, including those addressing infectious 
substances.
    RSPA also plans to continue the efforts initiated as a result of 
the Regulatory Reinvention Initiative to simplify, clarify, and reduce 
regulatory burdens so that the focus is on safety and not unnecessary 
paperwork.
    Question. Is OHMS considering the feasibility of a risk management 
demonstration program similar to that conducted by OPS? How is this 
reflected in your fiscal year 1998 budget request? If it isn't, how 
much would be needed to initiate planning for such a program?
    Answer. The Hazardous Materials Safety Program and the Pipeline 
Safety Program are very different and require different applications of 
risk management. The Pipeline Safety Program involves distinct fixed 
facilities where risk management can be uniquely applied to optimize 
safety and economic benefits. The Hazardous Materials Safety Program is 
a national and international intermodal program, involving hundreds-of-
thousands of shippers and carriers transporting tens-of-thousands of 
hazardous materials by highway, rail, water and air. Because hazardous 
materials are packaged and transported world-wide, RSPA employs a 
single uniform hazard and risk-based regulatory system that is critical 
in providing safety and efficiencies in packaging, inventory, training 
and compliance. Uniform hazard and risk-based safety standards also 
facilitate national and world-wide trade and open markets for American 
industries.
    An essential feature of the hazardous materials risk management 
program is the regulatory exemptions authorized by the hazardous 
materials transportation law to address specific cases. Exemptions to 
the Hazardous Materials Regulations establish alternative regulations 
that provide for a level of safety equivalent to that provided by the 
regulations. For more than 20 years, the Office of Hazardous Material 
Safety has granted hundreds of such exemptions a year to allow the use 
of new technologies and alternative methods to improve transportation 
efficiency or to reduce regulatory burden.
    Hazard- and risk-based management continue to be used by the 
Hazardous Materials Safety Program to support the development of 
regulations and to prioritize issues, needs and resources. Hazard, risk 
and cost/benefit analysis are also important tools in informing the 
public about the actual risk and cost as opposed to the perceived 
hazards, risk and cost involved in an activity. An acceptable level of 
risk for regulations and exemptions is established by consideration of 
risk, cost/benefit and public comments. Hazards analyses often are used 
where risk analysis is not practical or justified. Because of the broad 
scope and complexity of hazardous materials transportation, a 
predominately hazard-based system is used to provide a simple, 
efficient surrogate measure for risk without the cost of detailed risk 
analysis.
    Under the Research and Analysis section of the budget, RSPA has 
initiated two projects to aid in the risk management of hazardous 
materials. The first project is to develop a ``Hazardous Materials Risk 
Management Framework'' that will serve as a structure to guide all risk 
management activities associated with hazardous materials 
transportation. The second project is an ``Analysis of Risks Associated 
with Transportation of Hazardous Materials in Aircraft Cargo 
Compartments''. Under the Research and Development section of the 
budget, RSPA has initiated a ``National Assessment of Transportation 
Risk Posed by Poison Inhalation Hazard Materials, Explosives, Flammable 
Liquids and Gases''. These projects are designed as initial efforts to 
develop the risk based information necessary to better manage the risk 
associated with hazardous material transportation. The results from 
each of these projects are expected to identify questions and 
information needs that must be addressed in order to perform more 
comprehensive risk management.
            propane gas service emergency interim final rule
    Question. In February, RSPA published an Interim Final Rule on 
cargo tank motor vehicles in liquefied compressed gas service that was 
effective immediately, and was promulgated without an opportunity for 
notice and comment from the propane industry or general public. The 
rule attempts to address a specific safety concern involving the 
potential for release of propane during unloading operations. Please 
provide a complete list of all accidents resulting directly from this 
safety concern over the past decade, including any related injuries or 
deaths, and a description and cost assessment of any damage which 
occurred as a result of the accident.
    Answer. Following is a summary of data taken from RSPA's Hazardous 
Materials Incident Reporting System (HMIS) on incidents that: occurred 
between 1987-1996, involved the unintentional release of a liquefied 
compressed gas, occurred during unloading operations, and are of a type 
that may be immediately stopped through operational controls imposed by 
the interim final rule.

    REPORTED PROPANE SPILLS--SELECTED INCIDENTS THAT OCCURRED DURING UNLOADING FROM CARGO TANK MOTOR VEHICLES   
                                                   [1987-1996]                                                  
----------------------------------------------------------------------------------------------------------------
                                                    Amount              Injuries                                
             Date                   Location       spilled   Deaths ----------------  Reported       Remarks    
                                                  (gallons)           Major   Minor   damages                   
----------------------------------------------------------------------------------------------------------------
8/10/87.......................  Jeffersonville,         640  ......  ......       2       $250  Hose rupture.   
                                 IN.                                                             Fire.          
2/17/88.......................  Rochester, NY...        245  ......  ......  ......        120  Pump failure.   
8/01/88.......................  Weldon, NC......         50  ......  ......  ......        100  Valve failure.  
8/22/88.......................  Huntington, NY..         20  ......       1  ......     10,000  Hose separation.
                                                                                                 Flash fire.    
8/26/88.......................  DeLeon, TX......      3,500       1  ......  ......     28,500  Hose separation.
                                                                                                 Flash fire.    
10/17/89......................  Waitsfield, VT..         10  ......       1  ......     15,000  Hose rupture.   
                                                                                                 Explosion.     
                                                                                                 Fire.          
12/17/89......................  Lowell, MI......      3,000  ......       1  ......        950  Valve failure.  
3/15/90.......................  Ringtown, PA....         12  ......       1  ......        356  Hose rupture.   
                                                                                                 Flash fire.    
10/02/90......................  Brighton, CO....         50  ......  ......  ......        100  Hose rupture.   
3/04/91.......................  Fredericksburg,          30  ......  ......  ......    711,016  Filler valve    
                                 VA.                                                             broke.         
                                                                                                 Explosion and  
                                                                                                 fire.          
                                                                                                 Evacuation.    
11/26/91......................  Titusville, FL..        180  ......  ......  ......        100  Pump failure.   
9/09/92.......................  Milwaukee, WI...      1,255  ......  ......  ......        424  Hose rupture.   
4/19/93.......................  Derry, NH.......      1,850  ......  ......       1    165,060  Hose rupture.   
                                                                                                 Fire.          
7/07/93.......................  Horseheads, NY..          1  ......  ......  ......          3  Valve failure.  
6/09/94.......................  Tucson, AZ......      2,000  ......  ......  ......        900  Valve failure.  
                                                                                                 Evacuation.    
11/25/94......................  Louisville, KY..         50  ......  ......  ......      4,477  Pump failure.   
                                                                                                 Fire.          
                                                                                                 Evacuation.    
2/10/95.......................  Honesdale, PA...          5  ......  ......  ......      1,328  Pump failure.   
                                                                                                 Evacuation.    
2/16/95.......................  Fisshersville,           16  ......  ......       1        102  Hose rupture.   
                                 VA.                                                                            
7/05/95.......................  Woburn, MA......        200  ......  ......  ......         90  Pump failure.   
                                                                                                 Evacuation.    
8/16/95.......................  Ashton, ID......      2,000  ......       1  ......     27,000  Piping failure. 
                                                                                                 Flash fire.    
3/14/96.......................  Sister Bay, WI..      1,500  ......  ......  ......        740  Hose coupling   
                                                                                                 failure.       
8/16/96.......................  Danielsville, GA        600  ......  ......  ......        270  Pump failure.   
                                                                                                 Evacuation     
9/08/96.......................  Sanford, NC.....     40,000  ......  ......  ......     20,200  Hose coupling   
                                                                                                 failure.       
----------------------------------------------------------------------------------------------------------------

    RSPA does not have a complete list of all incidents of this type, 
because reporting of incidents involving motor carriers that transport 
liquefied compressed gases in intrastate commerce was not required 
during the requested period. A final rule issued earlier this year will 
bring those carriers under the Hazardous Materials Regulations on 
October 1, 1997 and requires their reporting of each unintentional 
release.
    In the case of propane, RSPA recognizes that most unloading 
operations are performed by motor carriers in intrastate commerce. RSPA 
is now working to develop a precise estimate of the probability of 
future releases of these hazardous materials, by gathering available 
information concerning past incidents from other government agencies, 
like State Fire Marshals, and private safety organizations, like the 
National Fire Protection Association.
    The Emergency Interim Final Rule was issued following an incident 
on September 8, 1996 in Sanford, North Carolina when more than 35,000 
gallons of propane were released during a delivery at a bulk storage 
facility. During the unloading of a specification MC 331 cargo tank 
motor vehicle into two 30,000-gallon storage tanks, the discharge hose 
from the cargo tank separated at its hose coupling at the storage tank 
inlet connection. Most of the cargo tank's 9,800 gallons and more than 
30,000 gallons from the storage tanks were released during this 
incident.
    The driver became aware of the system failure when the hose began 
to violently oscillate while releasing liquid propane. He immediately 
shut down the engine, stopping the discharge pump, but he could not 
access the remote closure control to close the internal stop valve. The 
excess flow feature of the emergency discharge control system did not 
function, and propane continued to be released from the system. 
Additionally, the back flow check valve on the storage tank system did 
not function and propane was released from the storage tanks. In light 
of the large quantity of propane released, this incident could have 
resulted in a catastrophic loss of life and extensive property damage 
if the gas had reached an ignition source. Fortunately, there was no 
fire.
    Question. Does the Interim Final Rule effectively mandate that two 
or more attendants be present while unloading propane from cargo tank 
motor vehicles? If so, was this RSPA's intent?
    Answer. Following the investigation of a September, 1996 propane 
spill at Sanford, North Carolina, the propane industry determined that 
none of their cargo tanks, as currently equipped, conform to safety 
regulations concerning emergency discharge control systems that have 
been in place for nearly 50 years. Consequently, RSPA and the Federal 
Highway Administration (FHWA) saw a need to provide for public safety 
by applying additional operational controls designed to immediately 
stop the discharge of material in an emergency.
    The Interim Final Rule allows industry to continue operating while 
we work collaboratively on a technical solution to this issue. Since 
issuance of the Interim Final Rule, RSPA and FHWA have worked closely 
with industry to develop a permanent solution to this problem. RSPA 
held public workshops on March 4 and April 16, 1997, and a public 
meeting on March 20, 1997 to discuss short and long term solutions to 
the problem.
    The major objection by the propane industry is to that part of the 
Interim Final Rule that specifies the operator must have an 
unobstructed view of the discharge system and be within arm's reach of 
a means for closure of the internal valve. Industry representatives 
interpret the rule as requiring at least two operators. The rule does 
not require that two operators be in attendance for each unloading 
operation. In fact, the preamble to the rule notes the acceptability of 
various alternatives. One alternative being perfected by the propane 
industry involves use of a radio frequency remote activation device 
that permits one attendant to immediately stop the discharge from the 
cargo tank and to shut-down the vehicle's engine.
    Question. It is the Committee's understanding that DOT has received 
Petitions for Reconsideration from the National Propane Gas Association 
and other organizations. Has RSPA given the petition its priority 
consideration? How is the agency working to resolve the issues raised 
in the NPGA's petition?
    Answer. RSPA is giving its highest priority to the resolution of 
issues raised in petitions for reconsideration filed by the National 
Propane Gas Association and one other organization. On June 9, 1997, 
RSPA published in the Federal Register a Notice of Deferral of Decision 
on Petitions for Reconsideration of Interim Final Rule. RSPA deferred 
action on the petitions for reconsideration in order to avoid 
prejudging issues that are more appropriate for resolution in the final 
rule. RSPA will address the issues raised by petitioners and commenters 
in a final rule, which it intends to issue prior to August 15, 1997, 
the expiration date of the interim final rule.
    On June 23, 1997, RSPA will conduct another public meeting at which 
two equipment manufacturers are scheduled to provide data on recently 
developed pressure-differential valves that reportedly meet, or exceed, 
the current standard to immediately stop the discharge of product in 
event of a hose separation. Installation of a fully conforming valve 
would have the effect of removing the cargo tank from the scope of this 
emergency regulation, thereby eliminating concerns raised by the NPGA. 
RSPA believes the partnership it formed with this segment of the 
hazardous materials transportation industry created the synergy that 
fostered development of this technology.
    Question. In light of the fact that over 90 percent of the 
businesses affected by the Interim Final Rule are small businesses, did 
RSPA conduct a cost/benefit analysis on the Interim Final Rule prior to 
its effective date, or since? If so, did the analysis address whether 
those small businesses would bear disproportionate impacts from the 
Interim Final Rule?
    Answer. RSPA conducted a preliminary assessment of estimated costs 
and benefits of the Interim Final Rule. While the assessment does not 
specifically consider whether small businesses would bear a 
disproportionate impact, RSPA recognized that at least 90 percent of 
the affected entities are small businesses.
    RSPA's decision to apply the selected operational controls was 
based, in part, upon our sense that most small businesses would select 
the least costly means for complying with the requirement to be within 
arms reach of a means for closure of the emergency shut-down device. In 
the case of small cargo tank motor vehicles the annual cost of 
compliance was estimated at $1,324 per vehicle.
    Question. According to RSPA's current estimates, what would be the 
total annual costs to society from propane releases if RSPA had not 
promulgated the Interim Final Rule?
    Answer. In its regulatory evaluation, RSPA determined that 
annualized costs to society for the sixteen incidents reported between 
1990-1996 range from a low of $322,192 to a high of $1,520,705. To 
calculate total annual costs for all such incidents RSPA must first 
know the number, and consequences, of related incidents involving motor 
carriers that transport hazardous materials in intrastate commerce. 
RSPA is currently working to collect those data.
    The regulatory assessment also considered the possibility that such 
a release of propane could have catastrophic consequences on a level 
similar to other unintentional releases, like a 1975 incident at Eagle 
Pass, Texas. That incident, involving the release of 8,000 gallons of 
propane, resulted in 16 fatalities and serious injuries to 51 persons. 
In monetary terms, RSPA determined that a single plausible unloading 
incident on that order would result in losses in excess of $50 million.
    Question. According to RSPA's current estimates, what are the total 
annual costs relating to a requirement to have two attendants be 
present while unloading propane from a cargo tank motor vehicle?
    Answer. RSPA's rule does not require that two operators be in 
attendance for each unloading operation and allows operators to use 
various alternatives to achieve the level of safety contemplated in the 
Hazardous Materials Regulations. Our preliminary regulatory evaluation 
prepared in support of the interim final rule estimates that there 
would be increased costs to propane marketers who choose to use a 
second attendant of $0.00041 per gallon in the wholesale market and 
$0.00123 per gallon in the retail market, or an overall increase in 
costs of $0.00164 per gallon. In the case of a delivery of 200 gallons 
of propane, RSPA estimated that the retail customer will pay an 
additional $0.33. Considering that, at the time of that estimate, the 
national average retail price of propane was $1.255 per gallon, the 
extra $0.33 on a fuel bill of $251 was not considered to represent a 
significant or unreasonable cost increase.
    Question. Please discuss the underlying issue of excess flow valve 
failure. What new automatic emergency shut-off equipment technologies 
are being considered by RSPA and the industry? What about remote shut-
off technology?
    Answer. Following the investigation of a September, 1996 propane 
spill at Sanford, North Carolina, the propane industry determined that 
none of their cargo tanks, as currently equipped, conform to safety 
regulations that have been in place for nearly 50 years concerning 
emergency discharge control systems. The requirement is to ensure that 
the flow of lading is stopped in the event of a separation or rupture 
of a hose or piping.
    RSPA and FHWA have worked closely with industry to develop a 
permanent solution to this problem. The regulated industry has agreed 
that it is the best position to develop new emergency discharge control 
systems since it is aware of the operational constraints and costs 
associated with developing new systems or modifying existing systems.
    RSPA and FHWA have recently been made aware of two fully automatic 
and several radio-controlled remote manual shut-down systems that 
industry has developed and is presently testing. The automatic shut-
down systems would function if a hose ruptured or separated. The radio-
controlled remote shut-down systems require the operator to initiate 
shut-down, but would stop any leakage observed by the operator. RSPA 
has requested details on the automatic systems from the manufacturers 
and is awaiting information from the industry associations (National 
Propane Gas Association and The Fertilizer Institute) on the remote 
systems their task forces have tested.
    Question. Has RSPA identified any additional hazardous materials 
research and analysis needs that would assist the timely development of 
improved liquefied gas delivery safety equipment?
    Answer. The Volpe Center has been tasked to provide RSPA and 
industry with technical assistance in systems development and 
evaluation. Volpe has developed a computer model of typical cargo tank 
piping and hose systems to evaluate system performance over variations 
in operating conditions. To date, RSPA has not identified any 
additional research or evaluation needs that would assist the timely 
development of improved liquefied gas delivery safety equipment.
                            hazmat training
    Question. How many joint inspections did OHMS regional inspectors 
conduct last year with State inspectors? (Do not include joint 
inspections conducted with the IPA hazardous materials specialists).
    Answer. In 1996, OHMS headquarters and regional inspectors 
conducted five multi-day multi-agency joint inspections and 14 
individual inspections with State compliance personnel.
    Question. Please discuss the scope, nature, and frequency of 
assistance that OHMS regional staff provided to State hazmat personnel 
during the last year. Please include data on the number of training 
programs conducted by the regional inspectors for the benefit of State 
inspectors.
    Answer. RSPA does not inspect carriers. Because most State 
enforcement involves highway carriers, RSPA does not receive many 
requests for training from the States. We continue to attend every 
Cooperative Hazardous Materials Enforcement Development (COHMED) 
program meeting, either making presentations or making staff available, 
and assure the States that our headquarters and regional offices will 
assist them in any request they make.
    OHMS headquarters and regional staffs receive phone calls from 
State and municipal agencies on a regular basis. These calls involve 
requests for clarification of regulations, for other informational 
material, and, occasionally, a request that RSPA investigate a matter 
outside the State's jurisdiction. Because most State inspectors work in 
areas other than those of OHMS inspectors, we receive relatively few 
requests for training.
    In 1996, OHMS headquarters and regional inspectors participated in 
five multi-day and 14 individual inspections, all of which included 
State inspection personnel. Although no formal training was conducted, 
OHMS inspectors made a point to provide training to State and other 
inspectors during these activities.
    Question. How many State officials participated in the IPA 
specialists program during each of the last three years? How much money 
was appropriated for this program during each of the last three years? 
How much is requested for fiscal year 1998?
    Answer. In 1995, five State officials participated in the IPA 
specialists program, in 1996, three participated, and in 1997, one has 
participated thus far. In fiscal year 1995 and fiscal year 1997, 
$40,000 was appropriated for the IPA program. No funds were 
appropriated for the program in 1996.
    Question. Please discuss the extent of interest that State and 
local governments have expressed in the Hazardous Materials Specialists 
Program. How many applications did you receive for the available 
positions during fiscal year 1996 and thus far during fiscal year 1997? 
What do you anticipate for fiscal year 1998?
    Answer. The Hazardous Materials Specialist program has generated 
widespread interest. In 1996, we received 3 applications from potential 
candidates; so far, in 1997 we have received 1 application.
    We anticipate receiving a high volume of written and verbal 
inquiries requesting information about the program in 1998 as a result 
of the new HM-200 requirements.
                       information dissemination
    Question. Please breakout the subcategories of anticipated spending 
by activity for the information dissemination contract program.
    Answer. The $520,000 \1\ requested for fiscal year 1998 to fund the 
Information Dissemination program is broken down as follows:
---------------------------------------------------------------------------
    \1\ Cooperative Hazardous Materials Enforcement Development 
(COHMED) and the HM Specialist Internship Program, previously shown 
under Inspection and Enforcement, were moved to Information 
Dissemination.
---------------------------------------------------------------------------
  --For maintenance of the COHMED program sponsored by the Office of 
        Hazardous Materials Initiatives and Training--$100,000. This 
        program, through semi-annual conferences and the COHMED 
        newsletter, provides for the exchange of information among 
        States, local governments, and industry on compliance, 
        enforcement and regulatory issues.
  --To fund the Hazardous Materials Specialist Internship program 
        sponsored by the Office of Hazardous Materials Initiatives and 
        Training--$40,000. In this program, candidates from State and 
        local HM transportation enforcement agencies participate in a 
        six-week residency with RSPA.
  --RSPA will also continue outreach and information dissemination 
        efforts through the Hazardous Materials Information eXchange 
        (HMIX), interagency agreements and by direct contact with the 
        public and private safety and emergency response personnel--
        $25,000.
  --RSPA will develop, produce and distribute a video for drum 
        reconditioners, the third in the ``ENSURING SAFETY'' video 
        series. Drum reconditioners are primarily very small businesses 
        in a competitive industry. They requalify a packaging with high 
        risk potential not only because of the nature of the contents, 
        but because of the volume of distribution--$40,000.
  --RSPA is enhancing its Hazardous Materials Information Center 
        capabilities by purchasing up-to-date telephone, facsimile, and 
        computer hardware and software for Internet accessibility to 
        assist HMS permanent staff in answering telephone inquiries--
        $315,000.
                shipper and carrier registration program
    Question. Please provide a detailed breakout of costs and 
expenditures for the shipper and carrier registration program.
    Answer. The registration program is implemented through four 
contractual arrangements. Forms and fees are submitted to a lockbox 
bank, which deposits checks and credit car payments into the Treasury, 
provides data-entry services, and forwards data files and the submitted 
paperwork to RSPA at the Volpe National Transportation Systems Center 
(VNTSC) in Cambridge, Massachusetts. The lockbox bank contract is 
supplied through the Treasury Department's Financial Management Service 
(FMS).
    VNTSC provides data management services, and operational support, 
including a 24-hour 800-number service. Because VNTSC is an element of 
RSPA, the vehicle used to obtain these services is a Multi-Year Project 
Plan Agreement, which is adjusted annually to reflect the level of 
effort required. In fiscal year 1997, $600,000 was budgeted for these 
services.
    Additional programming and information request response services, 
including a full-time help desk available during business hours, are 
provided through an on-site contract at the headquarters office. In 
fiscal year 1997, $100,000 was budgeted for these services.
    The remaining $50,000 was budgeted for printing and distributing 
the registration brochure and form, other mailings, and other 
administrative costs of the program.
    Question. The shipper and carrier registration program is in its 
sixth full year of operation. Please display the total in registration 
fees collected each year, broken out by use (emergency preparedness 
activities and registration activities). How much do you expect to 
collect during fiscal year 1997?
    Answer.

                                      EMERGENCY PREPAREDNESS FUND--RECEIPTS                                     
----------------------------------------------------------------------------------------------------------------
                                                                  Grants program   Registration                 
                           Fiscal year                               receipts        receipts     Total receipts
----------------------------------------------------------------------------------------------------------------
1993............................................................           1,433           8,117           9,550
1994............................................................           1,397           6,986           8,383
1995............................................................           1,365           6,873           8,238
1996............................................................           1,605           6,910           8,515
1997 (estimated)................................................           1,200           6,910           8,110
1998 (estimated)................................................           1,200           6,910           8,110
----------------------------------------------------------------------------------------------------------------

    Question. RSPA has requested $750,000 for the Shipper and Carrier 
Registration System. What cost analysis has been done to indicate that 
this amount is appropriate? What would be the consequences of reducing 
the amount of funding for this program?
    Answer. RSPA has evaluated the costs of this program and concluded 
that $750,000 is the minimum amount necessary to provide timely 
collection and deposit of the fees and issuance of registration 
certificates, and to respond adequately to the heavy demand for 
assistance from the public. The costs themselves could be reduced by 
limiting some of the services we currently supply, such as, the 24-hour 
800-line service for expedited registrations. All customer-oriented 
services, however, are heavily used by persons either required to 
register or who need assistance in understanding the registration 
requirements. To curtail these services would tend to adversely impact 
on the public's ability to get information on a timely basis.
    Question. For each of the modal administrations that enforce the 
registration requirement, please present data on the number of 
enforcement actions taken against those that have not registered or 
paid the required fee, or failed to present the registration number as 
required.
    Answer. The Federal Highway Administration (FHWA) opened 295 cases 
between June 1993 and September 1996 that included citations for 
violations of the registration regulations. Additionally, FHWA has 
issued 96 ``Notices of the Requirement to Register,'' an informal 
notice developed for use during Roadcheck 1993, but used beyond that 
exercise. FRA has issued 155 of these informal notices and has 
initiated 3 cases against parties for failure to register. Since the 
beginning of fiscal year 1994 RSPA's Office of Hazardous Materials 
Enforcement has initiated 48 enforcement actions which included 
violations for failure to register, 35 of which were civil penalty 
cases and 13 of which were ticket citations.
    Question. What is the scope of cooperation and assistance that you 
are receiving from the Office of Motor Carriers regarding enforcement 
of the hazmat registration program? Are you satisfied with the extent 
to which OMC Safety Specialists are disseminating information on the 
registration program and its associated fees?
    Answer. RSPA and FHWA's Office of Motor Carriers (OMC) continue to 
work together to improve compliance with the registration program. For 
example, OMS has incorporated the registration regulations into its 
routine compliance review procedures and has issued at least 295 
citations for the failure to register or for related record-keeping 
requirements. When cases for failure to register are completed, OMC 
frequently issues a press release to highlight the enforcement actions 
taken. RSPA supplies copies of the registration brochure to the OMC 
regional offices for them to distribute. Additionally, RSPA and OMC 
worked together during Roadcheck 1995 to further identify parties 
failing to register and to obtain more current and accurate compliance 
information.
    Question. What are RSPA, OMC, and FRA doing to publicize 
enforcement actions against companies who are required to, but are not 
paying, the registration fee required under the HMTUSA?
    Answer. RSPA provides copies of its civil penalty case orders to 
six trade press publishers. It also publishes an annual Penalty Actions 
Report that includes all actions taken by RSPA and the Department's 
modal administrations for violations of the hazardous materials 
regulations. This report is also incorporated into RSPA's biennial 
report to Congress on the transportation of hazardous materials. OMC 
frequently issues press releases to highlight enforcement actions 
taken.
    Question. What compliance rates were achieved in the 1994-95 
registration cycle, estimated for the 1995-96 registration cycle, and 
projected for the 1997-98 registration cycle for the hazardous 
materials registration program?
    Answer. We believe compliance with the registration requirement is 
greater than 90 percent. This conclusion is based upon analysis by use 
of the Truck Inventory and Use Survey (TIUS) (1987), which provides 
specific data on truck characteristics and other data on 
characteristics of the hazardous materials industry. Included in TIUS 
are data on the number of trucks involved in hazardous materials 
transport, and the number of trucks and/or trailers owned and/or 
operated at the same home base. We were able to extrapolate from these 
data the approximate number of companies, not under lease, using one or 
more placarded trucks weighing 26,000 pounds or more. Airlines and 
railroads are well known, and we are confident that they are 
registered. Compliance enforcement with the registration requirements 
was a key element of ROADCHECK-93 and ROADCHECK-95, nationwide 
inspection efforts sponsored by the Federal Highway Administration. Of 
2,300 placarded trucks that were checked for proof of registration 
during the 1993 inspection, 88 percent were registered and had proof on 
board. Of the 12 percent that did not have proof on board, 80 percent 
were already registered. Thus, there was approximately 98 percent 
compliance with the registration requirement. Of the 1,220 placarded 
trucks that were checked during the 1995 inspection, 91 percent were 
registered and had proof on board. Of the nine percent that did not 
have proof on board, 60 percent were already registered. Therefore, 
there was approximately 96 percent compliance with the registration 
requirement. Similarly, during fiscal year 1995 the Office of Motor 
Carriers conducted 2,338 compliance reviews of carriers of hazardous 
materials and initiated 100 enforcement cases that cited the 
registration regulations. This indicates a 96 percent compliance rate. 
During fiscal year 1996 the Office of Motor Carriers opened 79 
enforcement cases citing the registration regulations as a result of 
3,215 compliance reviews of hazardous materials carriers, indicating a 
97 percent compliance rate. During CY 1995 RSPA's Office of Hazardous 
Materials Enforcement conducted 1,217 inspections of hazardous 
materials shippers and initiated 15 cases that involved the 
registration regulations. In CY 1996 1,208 inspections were performed, 
resulting in 15 citations of the registration regulations. These two 
sets of inspection results indicate a compliance rate of 99 percent. We 
expect that the compliance rate for 1997 will remain consistent with 
the previous years.
             implementation of hazardous transportation act
    Question. Please provide a detailed update of how RSPA has 
implemented Section 116 of the Hazardous Materials Transportation 
Authorization Act (Public Law 103-311), which requires the Secretary to 
designate a toll-free telephone number for the reporting of possible 
violations of hazardous materials transportation laws or regulations. 
How has the implementation of this provision shown to be beneficial, 
and how well is this system working?
    Answer. RSPA's toll free number (1-800-HMR-4922) was established on 
May 8, 1995. Each modal Administration (i.e., USCG, FRA, FAA, FHWA) and 
RSPA have established their own toll-free numbers to handle the 
reporting of possible violations in their respective enforcement area. 
RSPA's toll-free number is a computer operated system that allows a 
caller who wishes to report a possible violation of the Hazardous 
Materials Regulations to be transferred to RSPA's hazardous materials 
enforcement office or to any of the other modal administrations without 
having to place another call. Each mode has established its own 
mechanism for responding to complaints involving possible violations of 
the regulations. In addition, through RSPA's toll-free number, a person 
can receive clarification on the Hazardous Materials Regulations (HMR), 
copies of training materials, and copies of recent Federal Register 
publications. Callers can also leave a message requesting information 
on the HMR. We have set a customer service standard that calls 
requesting assistance with the HMR will be returned within 24 hours.
    RSPA receives more than 25,000 phone calls annually to the 
Hazardous Materials Information Line (HMIL). Since callers can access 
the HMIL either by a standard long distance telephone number or by 
dialing an 800 telephone number, we cannot identify accurately the 
number of callers using the 800 number. Additionally since callers have 
a series of selection options, we do not have information on the number 
of callers that select an individual option. We estimate that 
approximately 20,000 of these calls are received using the 800 number. 
Most of these calls (an estimated 80-90 percent) are requests for 
information on compliance with the HMR. The remaining calls to the 800 
number are requests for rulemaking actions, requests for training 
materials, and reports of possible violations. RSPA believes, that by 
establishing and operating the 800 number, it has provided better 
access for the regulated public to obtain regulatory guidance, 
instructional materials, and rulemaking information, and to report 
suspected violations of the regulations.
    Question. How is the information that is gathered through this 
system shared with other modes and agencies?
    Answer. Callers wanting to report violations of the regulations can 
be automatically transferred to the appropriate modal administration.
    Question. Does the information that is collected through this 
system include hazmat shippers? If so, how? If not, please provide an 
explanation on how the system could be modified to incorporate shipper 
data, and what the costs would be.
    Answer. Use of the toll free 800 number provides the opportunity 
for anyone to report a potential violation of the regulations, 
including shippers, carriers, freight transporters, and packaging 
manufacturers.
    Question. How does RSPA, OMC and FRA follow-up on complaints or 
notices of possible violations that are received through this system?
    Answer. Complaints received by RSPA through the toll-free number 
which allege violations by persons under the jurisdiction of RSPA are 
electronically routed to the Office of Hazardous Materials Enforcement 
(OHME) through a ``blind'' transfer feature incorporated into the 
system. OMC and FRA receive calls in a similar manner.
    OHME enters the complaint into its COMPLAINT data set. The 
complaint is then assigned and investigated. OHME investigates all 
complaints that it receives.
    The message routing calls to OMC advises complainants that their 
complaint must be in writing and contain specific information about 
dates, times, material facts, violator name and address and/or 
location. Complainants must clearly state the alleged violation and/or 
problem. OMC provides its headquarters address for submission of these 
written complaints. Upon receipt, OMC forwards them to the appropriate 
division for handling.
    FRA follows a process similar to RSPA's. Complaints (hazmat and 
otherwise) are logged in and assigned to the appropriate region for an 
investigation.
    Question. What are the fiscal year 1997 and expected fiscal year 
1998 costs associated with this system?
    Answer. RSPA received $315,000 in a supplemental appropriation in 
fiscal year 1997 for the Hazardous Materials Information Center and is 
requesting the same funding level for fiscal year 1998.
    Question. Which provisions of current law regarding hazmat safety 
have not been fully implemented by OHMS? What are your plans to 
implement these provisions? When will these actions be taken?
    Answer. RSPA has implemented all provisions of current law 
regarding hazmat safety.
                         reauthorization issues
    Question. When does the OHMS's current authorization expire? Has 
the administration proposed new authorizing legislation? What action 
has been taken to date, if any, by the appropriate Senate and House 
authorizing committees?
    Answer. OHMS's authorization expires at the end of fiscal year 
1997. On April 17, 1997, the Administration proposed reauthorizing 
legislation as Title X of the National Economic Crossroads 
Transportation Efficiency Act of 1997 (NEXTEA). This legislative 
proposal is under consideration by the House and Senate authorizing 
committees. Congressmen Dingell and Oberstar, by request, introduced 
the Administration's NEXTEA safety titles (titles IX-XIV) as H.R. 1720. 
The Senate Subcommittee on Surface Transportation and Merchant Marine 
held a public hearing on the Administration's proposal on May 8, 1997.
    Question. What are the major components of your reauthorization 
bill and how is this strategy or direction reflected in your fiscal 
year 1998 budget request and program planning?
    Answer. The major component of the Administration's bill is a 
series of amendments that would enhance and clarify the enforcement 
authority of DOT inspection personnel. These amendments would clearly 
establish DOT inspectors' right to inspect packages, take samples, hire 
experts to sample and analyze materials, and issue orders to stop 
transportation of an undetermined material if an imminent hazard may 
exist. They also would authorize the Secretary of Transportation to 
issue emergency orders when there is an emergency situation involving a 
hazard of death, injury or significant harm to the environment. These 
authorities would improve DOT's ability to prevent undeclared shipments 
of hazardous materials, detect violations of the hazardous materials 
regulations, and prevent hazardous materials transportation that 
jeopardizes people or the environment.
    The fiscal year 1998 budget requests no additional funding for 
implementation of these provisions. We are planning to implement these 
authorities when they are enacted through delegations, training and 
establishment of standards and procedures.
                   office of emergency transportation
    Question. How much of your budget request supports maintenance of 
the Crisis Management Center?
    Answer. In fiscal year 1998, of the $200,000 requested for the 
Crisis Management activity, $40,000 is designated for Crisis Management 
Center (CMC) on-going maintenance, based on fiscal year 1977 funding 
levels. Funding for on-going maintenance is vital to maintaining a 
technologically strong focal point for transportation response to 
disasters. The remainder of the funding is allocated for headquarters 
and regional response team training, the Regional Emergency 
Transportation Coordinator (RETCO) program support funding, ongoing 
data processing and geographical outreach efforts with industry.
    Question. How useful are the Regional Transportation Coordinators 
trained by your Office? Are they able to provide full time and 
attention to the disaster in lieu of their regular positions?
    Answer. The 10 Regional Emergency Transportation Coordinators 
(RETCO's) are senior regional executives from the Federal Aviation 
Administration, the Federal Highway Administration and the United 
States Coast Guard. Under the general supervision of the Office of 
Emergency Transportation, their function is to provide the overall 
leadership and policy direction for the regional emergency response 
effort. This includes not only DOT Operating Administrations, but also 
other Federal transportation support agencies. This leadership role 
requires a modest expenditure of time and does not interfere with their 
day-to-day activities.
    Each RETCO also has a Regional Emergency Transportation 
Representative (RETREP). This employee has day-to-day responsibility 
for planning, monitoring and reporting incidents and providing on-site 
management of the DOT response during a disaster within their region. 
Currently, RETREP duties within the DOT Operating Administrations vary 
from full time, sole duty, to part-time, collateral duty. The work of 
the RETREP's is pivotal to the Department's ability to deliver 
assistance to the victims of disasters.
    Question. Please prepare a table indicating the amount appropriated 
and the amount actually spent for the different major categories and 
subcomponents of the Emergency Transportation budget for the last three 
years. Please explain any deviation or reallocation of funds.
    Answer. The table below shows the three requested years.

------------------------------------------------------------------------
               Fiscal year                 Appropriation    Obligation  
------------------------------------------------------------------------
1995:                                                                   
    Contract programs:                                                  
        Transportation Res management...         $42,000         $42,000
        Operational readiness...........          80,000          80,000
        Crisis management...............     \1\ 454,000         442,000
    R&D: Operational management support.          50,000           6,000
1996:                                                                   
    Contract Program: Crisis management.         250,000         250,000
    R&D: Operational management support.          50,000          81,000
1997:                                                                   
    Contract program: Crisis management.         200,000     \2\ 215,000
    R&D: Operational management support.          50,000      \3\ 57,000
------------------------------------------------------------------------
\1\ Funds for CMC design and construction.                              
\2\ Transfer PC&B to contract program.                                  
\3\ Estimated obligations.                                              

    Question. Please specify what research and development activities 
the Office of Emergency Transportation plans to accomplish with a 
budget of $50,000?
    Answer. The R&D budget for the Office of Emergency Transportation 
allows us to harness new technologies to enhance the Department's 
ability to provide Federal assistance to the States under the Federal 
Response Plan. This funding allows the CMC to remain contemporary, so 
that we can manage our future response operations reliably and 
efficiently. In addition, this funding allows us to upgrade software to 
extend existing computer databases used within this office to support 
our response efforts. Finally, we will continue the expansion of our 
series of informational monographs on threats to transportation systems 
around the nation, prepared in partnership with the natural hazard 
scientific community. Over 1,000 copies of the first two volumes of 
this series have been distributed by the private publishers who has 
made the publication available through the Internet and by DOT. Copies 
have been distributed to Federal, State and local agencies, private 
industry, regional transit operators and engineering firms. The current 
monographs developed by the Central U.S. Earthquake Consortium (CUSEC) 
and the Western States Seismic Policy Council (WSSPC) each discuss the 
importance of increased awareness with regard to earthquake risk and 
vulnerability of the transportation system (infrastructure). The 
monographs center around areas in the central U.S. (AR, IL, IN, KY, MS, 
MO and TN) as well as in the western U.S. (AK, AZ, CA, CO, HI, ID, MT, 
NV, NM, OR, UT, WA, WY, Guam, the Yukon Territory and British 
Columbia).
                     emergency preparedness grants
    Question. Please describe the allocation formula for emergency 
preparedness grants.
    Answer. RSPA allocated grant funds for fiscal year 1996 based on 
objective factors using verifiable publicly available data which 
represented community risks and needs. With the exception of the States 
and territories that did not apply, and the three percent of the 
training funds that were set-aside for Indian tribes, each grantee 
received an award equal to its share based on RSPA's allocation 
factors.
    RSPA used the following factors for allocation of training grants:
  --Fifty percent of the funds were allocated to States (including 
        territories) based on their percentage of total population. 
        Population is a surrogate for the number of responders needing 
        training.
  --Thirty percent of the funds were allocated to States based on their 
        percentage of total highway miles, which is a surrogate for 
        highway risk.
  --Twenty percent of the funds were allocated to States on the basis 
        of their percentage of the total number of chemical facilities, 
        as reported by the U.S. Census Bureau. This allocation measure 
        is a surrogate for fixed-facility risk.
    We used an appropriately different approach in allocating planning 
funds:
  --Twenty percent of the funds were allocated to States based on their 
        percentage of total population.
  --Forty percent of the funds were allocated based on the State's 
        percentage of total hazardous materials truck miles.
  --Forty percent of the funds were allocated on the basis of the 
        State's percentage of the SuperFund Amendments and 
        Reauthorization Act of 1986 Sec. 302 chemical facility reports.
    Question. What are the measures of success or accomplishments for 
this program? How do you know whether the grant funds are used 
effectively by the States?
    Answer. RSPA measures the success of the program by the States' 
accomplishments in terms of training and planning for emergency 
response to hazardous materials incidents. To the present time, 424,000 
hazmat emergency responders have been trained, in part, using grant 
funds. Also in the latest year, 511 commodity flow studies, which 
identify where hazardous materials are being transported to facilitate 
emergency response planning, were accomplished; 770 exercises were 
held, and 4,477 response plans were created or updated.
    RSPA's grants have supported emergency response training along the 
U.S.-Mexican border in support of NAFTA. Grants have totaled $3.9 
million over four years (fiscal years 1993-1996) to the States of 
California, Arizona, New Mexico, and Texas. RSPA also used the program 
to fund translation of the North American Emergency Response Guidebook 
into Spanish, thus helping Spanish-speaking first responders in the 
U.S. and Mexico.
    RSPA grantees have used their grant funds effectively and 
creatively to train a large number of emergency responders at a modest 
cost. For example, Arkansas used an educational TV network to provide 
hazmat training to emergency responders in its communities. North 
Carolina uses mobile training facilities to provide technician 
training, and Idaho provides hazmat training in a training center 
developed at an unused airport.
                            the volpe center
    Question. For fiscal year 1996 and fiscal year 1997, what percent 
of funds were contracted out? For fiscal years 1997 and 1998, what 
percent of funds do you plan to contract out?
    Answer. For fiscal year 1996 about 74 percent of the Center's 
obligations were contracted to the private and university sectors. The 
percentage is not expected to change significantly in fiscal year 1997 
or fiscal year 1998.
    Question. What percent of your personnel costs are for contract 
administration, technical program direction, and in-house research?
    Answer. About 3 percent of personnel costs is for contract 
administration. About 73 percent is tied to specific technical project 
work, including both technical direction and technical performance. No 
funds or staff were devoted to in-house research (i.e. independent 
research and development not tied to a client project) in fiscal year 
1996 and none is planned for fiscal year 1997-98. The remaining 22 
percent of personnel costs covers facility operations and all other 
Center administrative and management services.
    Question. What have you done to stop ``pass throughs'' to the Volpe 
Center?
    Answer. Neither the Volpe Center Working Capital Fund nor RSPA work 
acceptance policy permits the Center to accept funds earmarked by the 
customer for a specific contractor, commonly known as ``pass-
throughs.'' The responsibility for the selection, technical direction, 
and performance of all Volpe Center contracts rests with the Volpe 
Center (except for the Small Business Innovation Research (SBIR) 
Program in which the funding agency usually provides the technical team 
to select and oversee the contracts.) In fiscal year 1996 less than 2 
percent of the Center's contract obligations were sole-sourced.
    Question. Please break out, in tabular form, obligations by each of 
the DOT modal administrations to the Volpe Center for each of the last 
three years. What is the significance of these funding trends?
    Answer.

      OBLIGATIONS OF DOT MODAL ADMINISTRATIONS TO THE VOLPE CENTER      
                        [In millions of dollars]                        
------------------------------------------------------------------------
                                                    Fiscal years--      
                                             ---------------------------
                                                1995     1996   1997 \1\
------------------------------------------------------------------------
FAA.........................................     93.6     86.5      85.0
FHWA........................................     10.7     10.0      10.0
USCG........................................      7.2      5.3       6.0
FRA.........................................     12.3      9.5       9.0
FTA.........................................      5.6      4.8       4.5
NHTSA.......................................      6.1      7.9       7.3
RSPA........................................      4.5      4.2       5.2
Other DOT...................................      2.1      2.8       3.0
OST.........................................      1.2      1.5       1.2
                                             ---------------------------
      Total.................................    143.3    132.7    131.2 
------------------------------------------------------------------------
\1\ Estimated.                                                          
                                                                        
Note.--Each amount includes that customer's participation in DOT's SBIR 
  program, which the Volpe Center manages.                              

    The trends generally reflect the appropriations to our customers 
and changes in their program emphasis.
    Question. What are you doing to build up the in-house expertise of 
Volpe personnel and their technical capabilities to do more of their 
own research?
    Answer. This year the Center focused on improving staff 
competencies in safety and security, environmental issues, traffic 
management and infrastructure renewal areas. Transportation lecture 
series focused on issues such as transportation safety, airport 
strategic planning and information systems modeling. In addition, 
lunchtime meetings were held monthly to share information, experiences, 
and current trends of interest to the technical community.
    Since last year the number of Center staff who possess advanced 
degrees has increased from 229 to 236. This increase is due, in part, 
to the Center's Fellows Program which is designed to provide career 
staff with the opportunity to seek graduate and post-graduate education 
in key transportation areas.
    During the first eight months of fiscal year 1997 the Center hired 
two technical staff members for each technical staff loss which 
resulted in net increases in many technical occupations including 
Operations Research, Computer Engineering, Computer Systems Analysis, 
and Environmental Engineering. The Center also has a very active 
cooperative education intern program involving 12-15 Universities and 
Colleges.
    Question. When was the last time that Volpe conducted customer 
surveys? What were the results?
    Answer. All Volpe Center customers participated in our first round 
of structured customer satisfaction interviews in 1995 and 1996. The 
summary results, based on interviews with 219 customers' project 
managers and 62 senior-level customers, are shown as follows. More 
detailed results were reported to all customers in a report, ``Round 1 
Executive Summary of the Customer Satisfaction Monitoring Initiative,'' 
October, 1996. The Volpe Center plans to complete its second round of 
customer satisfaction monitoring during the spring of 1998.
    The overall customer satisfaction rating is on a scale of 0 to 10 
where 10 equals extremely satisfied.

------------------------------------------------------------------------
                                           Project-level   Senior-level 
           Satisfaction rating              interviews      interviews  
                                             (percent)       (percent)  
------------------------------------------------------------------------
10......................................               7  ..............
9.......................................              22              23
8.......................................              40              43
7.......................................              19              17
6.......................................               7               7
5.......................................               1               7
                                                                        
4.......................................               2  ..............
3.......................................               2               3
<3......................................  ..............  ..............
------------------------------------------------------------------------

    Question. Please prepare a table showing the percent of the Volpe 
work that has been conducted for non-DOT agencies for each of the last 
four years.
    Answer.

              VOLPE CENTER OBLIGATIONS FOR NON-DOT AGENCIES             
                              [In percent]                              
------------------------------------------------------------------------
                                                Fiscal years--          
                                    ------------------------------------
                                       1994     1995     1996   1997 \1\
------------------------------------------------------------------------
DOD................................       24       12       12        12
Other non-DOT......................       10       15       16        18
                                    ------------------------------------
      Total........................       34       27       28       30 
------------------------------------------------------------------------
\1\ Estimated.                                                          

    Question. What are the Volpe overhead charges and how have you 
tried to reduce these? Please provide a detailed explanation and dollar 
figures of what all of the overhead costs are for each of the last 
three fiscal years.
    Answer. Following is the distribution of the Center's indirect 
expenses:

                   [In millions of dollars obilgated]                   
------------------------------------------------------------------------
                                                    Fiscal years--      
              Indirect activity              ---------------------------
                                                1995     1996   1997 \1\
------------------------------------------------------------------------
Facility operations.........................      3.7      4.0       3.7
Business services...........................      8.2      7.6       7.9
Line management.............................      2.0      2.3       2.4
Centerwide services.........................      1.2      0.9       1.2
Computer & LAN services.....................      3.6      3.8       4.1
Executive operations:                                                   
    Industry outreach.......................      0.3      0.3       0.2
    Capability development..................      0.3      0.3       0.5
    Plans and program development...........      1.0      1.1       1.2
    Chief counsel...........................      0.4      0.4       0.5
    Executive management....................      1.1      0.8       0.8
                                             ---------------------------
      Total indirect........................     21.7     21.5      22.5
                                             ---------------------------
      Total obligations.....................    198.2    186.1     195.0
                                             ===========================
Indirect to total (percent).................     10.9     11.6     11.5 
------------------------------------------------------------------------
\1\ Estimated.                                                          

    The estimated fiscal year 1997 indirect expenses reflect increases 
for salaries, benefits, negotiated contract price adjustments and other 
normal cost growth. Reductions from our $25.7 million fiscal year 1993 
indirect budget (baseline established by the Federal Workplace 
Restructuring Act of 1994) have been achieved primarily by 
administrative staff reductions of 46 FTE. Continuing efforts are 
focused on process simplification, improved automation and introducing 
current energy conservation technology.
    Question. Please provide a detailed listing of all fiscal year 1997 
new start reimbursable agreements that the Volpe Center has with other 
Federal agencies. Be certain to include all costs that are paid out to 
contractors hired by the Volpe Center.
    Answer. Through eight months of fiscal year 1997 there have been 
five new starts totaling $1,008,700. The information follows:

------------------------------------------------------------------------
                                                                Planned 
            Project                   Customer       Funding    contract
                                                               (percent)
------------------------------------------------------------------------
Support for the President's                                             
 Commission on Critical                                                 
 Infrastructure Project........  EPA \1\..........   $320,000         10
Strategic planning support to    EPA..............     80,700  .........
 region III.                                                            
Yosemite National Park                                                  
 environmental logistics &                                              
 transportation analysis.......  Interior.........    350,000         79
Technical litigation support...  Justice..........      8,000         18
Facilities management system                                            
 planning, development, and                                             
 implementation support........  USPS.............    250,000        48 
------------------------------------------------------------------------
\1\ Multi-agency effort.                                                

    Question. Please provide detailed explanation as to why the Volpe 
Center tends to hire outside contractors to complete technical aspects 
of work tasks. Federal agencies using the Volpe Center assume that work 
is done by ``in-house'' staff as part of the negotiated amount of 
contract. Further, please explain why it is critical for Volpe staff to 
travel, sometimes long distances at huge costs, to provide ``quality 
control'' to hired contractors. How can quality be handled without 
excess travel?
    Answer. At any point in time the Volpe Center is responsible for 
about 350 projects. For each, the Volpe Center determines the 
appropriate contract support role, if any. Projects in support of 
Federal regulatory or policy analysis typically rely primarily on our 
Federal staff. Projects that require extensive software development, 
specialized testing, or extensive system deployment typically use 
contractor support more intensively. Project agreements with customer 
agencies identify the anticipated costs associated with Volpe Center 
federal staff and with contractor support.
    While some Volpe Center staff travel is for contractor oversight, 
most is for coordination with our agency customers, data collection, or 
interaction with the ultimate users of systems being developed and 
deployed. All Volpe Center travel is performed in accordance with 
federal regulations, and is taken only when it is a cost effective way 
to achieve results.

              St. Lawrence Seaway Development Corporation
      Prepared Statement of David G. Sanders, Deputy Administrator
    This budget request for fiscal year 1998 from the Saint Lawrence 
Seaway Development Corporation (SLSDC) is different from past budget 
requests. As a result of the Administration's effort to convert the 
SLSDC to a Performance Based Organization (PBO), the SLSDC is not 
making an appropriation request. Financing is to be derived from an 
automatic annual payment from the Harbor Maintenance Trust Fund (HMTF). 
The PBO proposal includes an automatic annual payment for fiscal year 
1998 of $11,200,000 from the HMTF, and $1,220,000 from non-federal 
source revenue collections and the Corporation's financial reserve. The 
Corporation's fiscal year 1998 budget program level totals $12,420,000. 
This includes $11,680,000 to fund operations and maintenance, and 
$740,000 for capital improvements.
    On March 4, 1996, as part of the Administration's reinventing 
government initiative, Vice President Gore announced the 
Administration's plans to restructure eight federal agencies as PBO's. 
The SLSDC was one of the eight agencies chosen for conversion to a PBO.
    Prerequisites for becoming a PBO candidate: have a clear mission, 
measurable services, and a performance measurement system in place or 
in development; generally focus on external, not internal, customers; 
have a clear line of accountability to an agency head who has a policy 
accountability for the functions; have top level support to transfer a 
function into a PBO; and have predictable sources of funding.
    Immediately following the March 4 announcement, Corporation staff 
began work at three levels: the National Performance Review (NPR) PBO 
Advisory Group; the SLSDC Conversion Team, which included NPR, the 
Office of Management and Budget (OMB), Department of Transportation 
Officials (DOT), and SLSDC staff; and an internal Corporation work 
group led by the Administrator. In coordination with these groups the 
SLSDC developed options and recommendations for proposed management, 
organizational structure, performance indicators, administrative 
waivers, and a financial plan. OMB the SLSDC PBO plan on June 3, 1996. 
Legislation, including the financial plan, was submitted to the 
Congress on July 16, 1996.
    On July 31, 1996, the Senate passed the DOT appropriations for 
fiscal year 1997, which included a sense of the Senate amendment to 
consider legislation to establish SLSDC as a PBO beginning in fiscal 
year 1998. The Conference Committee deferred consideration of the SLSDC 
PBO proposal; however, the Committee directed the GAO to conduct a 
review of the PBO concept, with special emphasis on SLSDC. This year, 
revised PBO legislation was resubmitted to the Congress May 5, 1997, 
and the GAO study was completed May 15, 1997.
    Under the PBO plan, the SLSDC would be funded, beginning in fiscal 
year 1998, by an annual automatic payment (fiscal year 1998 through 
fiscal year 2002) from the HMTF. The payment is to be a dollar amount 
equal to the rolling five year average of U.S. international metric 
tonnage moved through the Seaway, adjusted by a factor of 1.076, and 
adjusted for inflation by the percentage difference between the 
Consumer Price Index for all urban consumers (CPI-U) for the first 
quarter of calendar year 1996, and the CPI-U for the first quarter of 
the calendar year in which an annual payment is determined. The 
Corporation would have flexibility to use the funds and other resources 
to meet the performance targets specified in the COO performance 
contract. Achieving these targets would meet the overall goals of the 
PBO initiative: to improve the performance of government by making it 
more responsive and efficient at reduced cost.
                    1996 navigation season overview
    Overall tonnage levels in 1996 were almost even with 1995 levels. 
Total tonnage through the Montreal/Lake Ontario section of the St. 
Lawrence Seaway in CY 1996 was 38.1 million metric tons, which was 
610,000 tons or 2 percent below the 1995 total. The decrease was the 
first downturn in Seaway traffic since 1992. Even with the slight 
reduction from 1995, the 1996 season exceeded the previous five year 
average (1991 through 1995) by 8 percent or 3 million tons. Vessel 
transits were 2,707, down 3 percent from 1995.
    During the 274-day 1996 navigation season (March 29-December 27), 
the Seaway experienced a sluggish first half of the season, before 
rebounding during the latter months with the fall harvest of corn and 
soybeans. Both U.S. and Canadian grain export shipments were down more 
than 2 million tons or 16 percent below 1995 levels. At the start of 
the season, U.S. wheat movements and transshipments through St. 
Lawrence River elevators were temporarily suspended by the Canadian 
Agricultural Ministry for possible contamination from the Karnal Bunt 
fungus. Despite a strong overseas market for U.S. grains, exports 
declined 9.4 percent nationally due in part to low carryover stocks 
from 1995. By contrast, Seaway movements of iron ore increased 6 
percent to 11.6 million tons, the highest tonnage level for ore since 
1981.
    There was also strong growth in the movement of general cargo, 
including manufactured iron and steel, which rose sharply in CY 1996. 
All general cargo through the Seaway totaled 5.9 million tons, an 
increase of 25 percent. The gain was led by increases in manufactured 
iron and steel at 4 million tons, an increase of 25 percent, and steel 
slabs at 1.7 million tons, an increase of 27 percent.
    The U.S. locks were open for navigation 274 days in 1996 and 
available to vessel customers 97 percent of that time. Delays to 
navigation for all causes totaled 187.6 hours of which weather and 
visibility conditions accounted for 73 percent or 137.2 hours.
                          1996 accomplishments
Pilotage transfer
    On December 11, 1995, regulation of Great Lakes pilotage was 
transferred to SLSDC from the U. S. Coast Guard (USCG). This transfer 
of regulatory responsibility has been very smooth and has not resulted 
in any disruption to navigation. The pilotage staff completed the first 
full pilotage rate making review since 1987. The audit was completed at 
a cost of $50,000, considerably lower than the cost of past audits in 
the USCG. This resulted in the first increase in pilotage rates since 
1992. The final rates became effective March 1, 1997.
Toll negotiations
    For the 1996 season, the SLSDC negotiated a freeze on the Canadian 
Tariff of Tolls at the 1993 Tariff level for the third consecutive year 
with the Canadian Seaway Authority (SLSA).
PBO conversion
    The SLSDC PBO conversion team, beginning in March 1996, worked 
throughout the year preparing a plan to transform the SLSDC into a PBO. 
Working closely with Seaway union and non-union employees, NPR, OMB, 
DOT's Office of the Secretary, and Seaway users, the conversion team 
developed a draft bill that was submitted to the Congress in July. 
While the bill was not eventually adopted, a sense of the Senate 
resolution was attached to the DOT Appropriations Bill declaring the 
SLSDC PBO initiative worthy of future consideration. The SLSDC's draft 
bill was used by the NPR as a model for other agencies being considered 
as PBO's. Since November of 1996, the SLSDC conversion team has worked 
closely with the GAO staff studying the SLSDC's PBO plan. The report 
was completed and released on May 15, 1997.
NPR hammer award
    On October 4, 1996, the SLSDC and the USCG received a joint Hammer 
Award for improving the vessel screening program conducted in Montreal. 
The screening program supports implementation of the Oil Pollution Act 
of 1990 and the Non-indigenous Aquatic Nuisance Prevention and Control 
Act of 1990. Combining Seaway and Coast Guard inspections with SLSDC 
also reduces transit time and operating costs for vessel customers 
entering the Seaway.
Vessel fleet study
    The SLSDC completed a first-of-its-kind ``State of the Seaway 
Fleet'' analysis of the world vessel fleet as part of a long-term 
program to address the challenge of aging vessels in the Seaway fleet. 
The study found that many more vessels than expected are able to 
transit the Seaway--over 40 percent of the world fleet.
Trade development
    As a result of SLSDC trade development meetings with vessel owners 
in Denmark and the Netherlands, eighteen new vessels will be equipped 
with Seaway fittings. Meetings with vessels owners and operators in 
Greece and Cyprus resulted in two new vessel services beginning 
operations in July 1996. Ferum Lines, a Greek firm, has committed four 
vessels to the Seaway for break-bulk monthly service between the lake 
ports and the Mediterranean. A Portuguese firm initiated a ``project 
cargo'' charter service with a first sailing to the port of Chicago 
during July.
    The SLSDC refocused its trade development efforts during the past 
year. Instead of organizing large delegations on multi-country trade 
missions, the SLSDC is now concentrating on smaller, more focused 
missions. The agency will participate in already existing conferences 
and events, sponsored by other organizations. This will allow more 
effective use of resources; instead of focusing on organizing an event 
and making travel arrangements for an entire delegation, SLSDC can 
devote more of its resources to targeting important companies and 
individuals. Greater emphasis is now placed on meeting with companies 
and individuals that own, operate, and control vessels capable of 
entering the Seaway. In addition, the SLSDC will devote more time and 
resources on existing North American customers and potential customers 
of the Seaway. For example, during the first week in March, SLSDC and 
SLSA officials traveled to Minneapolis, Winnipeg, and Calgary to meet 
with U.S. and Canadian grain industry representatives. The SLSDC 
intends to work more closely with our Canadian counterpart, SLSA, and 
Seaway stakeholders to plan, fund, and implement trade development 
initiatives together. The SLSDC's planned trade development schedule 
for the remainder of Calendar Year 1997 includes: attending the Montana 
Coal Conference in Butte, Montana (July); during August the Corporation 
plans to conduct a Seaway North America/Great Lakes trade mission, with 
programs and events at several U.S. and Canadian lake ports. Each port 
event, which will include port customers and new business potential 
users, will be co-sponsored with local port authorities. We have 
tentative plans at this time to participate in the Universal Congress 
of the Panama Canal in and the third biennial International Canals and 
Waterways Chief Executives Conference meeting, both in Panama, during 
September 1997, and vessel operator, broker and financier exhibitions 
in Hamburg, Germany, and South Africa during October 1997.
Global positioning system
    At the insistence of the SLSDC, a work group has been formed among 
the two Seaway entities, the two Coast Guards, and Great Lakes vessel 
carrier associations to determine operational requirements for Global 
Positioning System (GPS/DGPS) applications throughout the System. The 
group is also exploring cost-sharing of identified GPS/DGPS systems for 
implementation. An implementation and cost-sharing timeline is being 
developed at this time.
Customer exit survey
    On June 12, 1996, the Corporation published a report of the 1995 
Customer Exit Survey of all ocean and lake vessels transiting the 
Seaway. The response to the survey was extremely positive, and the 
information received has been shared with the SLSA to determine what 
areas are significant to improving customer satisfaction. The 
Corporation is working with the SLSA to implement many of the 
suggestions and ideas generated by the Seaway's customers.
United States/Canada working group
    Following a June 5, 1996 meeting between the Secretary and the 
Canadian Minister of Transport, a U.S./Canada Binational Working Group 
was formed to examine the possibility of greater cooperation between 
the two countries in administering and managing services in the Great 
Lakes/St. Lawrence Seaway System. The group, which includes a steering 
committee and subgroup committees, has exchanged information on 
respective restructuring of the two Seaway entities, explore options 
for binational management of the Seaway, and increased binational 
cooperation in the provision of other Great Lakes services. Several 
meetings took place during 1996 to prepare for an interim progress 
report that was presented to the Secretary and Minister on September 
17, 1996. The work of the group is expected to continue throughout 
fiscal year 1997.
Emergency response drill
    The SLSDC participated with SLSA, the U.S. and Canadian Coast 
Guards, and local U.S. and Canadian agencies in the Canada-U.S. Lake 
emergency response drill that ran round-the-clock for four days during 
September 1996. The program simulated a major oil spill in the St. 
Lawrence River. The value of these drills is to ensure 100 percent 
readiness for quick resolution of emergency situations affecting safety 
and the environment.
                significant 1997 accomplishments to date
1997/1998 toll negotiations
    The Deputy Administrator and the President of the Seaway Authority 
reached agreement on a Tariff of Tolls for the 1997 and 1998 navigation 
seasons. The final agreement calls for elimination of Lockage fees at 
the Welland Canal in 1998 and would allow for a 2.5 percent tariff 
increase across-the-board for all commodity tariff items, to be 
implemented August 1, 1997. Effective in 1998, the Welland Canal 
Lockage fee, which discourages smaller vessel transits, will be 
eliminated and replaced with a $0.12 cent (Canadian) increase on cargo 
and vessel tolls at the Welland Canal only.
PBO conversion
    The revised PBO legislation was completed and submitted to the 
Congress on May 5, 1997. SLSDC and DOT initiated consultations with 
appropriations and authorizing committees in both the Senate and the 
House. The Corporation also worked closely with the GAO PBO study team 
that prepared a congressionally mandated review of the PBO initiative, 
with specific analysis of the SLSDC PBO candidacy. The report was 
completed and submitted to the Congress May 15, 1997.
New union contract
    SLSDC successfully concluded negotiations with its bargaining unit 
employees, represented by AFGE Local 1968, Massena, N.Y. The three-year 
agreement includes a major rewrite of the union contract and a wage-
level increase on a par with industry contracts prevailing in the 
Massena area. No issues went to mediation or impasse.
Pilotage accomplishments
    In the last year, pilotage accidents are down and vessel delays due 
to pilotage have decreased. All three Great Lakes pilotage associations 
have adopted improved training plans. All three Great Lakes pilotage 
associations have adopted improved applicant pilot selection processes. 
Audits of the pilot associations have improved, current audits are more 
independent, timely and thorough. All three pilot associations are now 
in compliance with Federal drug testing requirements. The office of 
Great Lakes Pilotage hosted the first-ever Great Lakes Pilotage Safety 
Summit, which brought together pilots and industry to discuss safety 
matters. The Pilotage office approved funds for each pilot association 
to test and evaluate the latest Differential Global Positioning System 
(DGPS) technology, and continues to support the development of this 
promising new technology.
Ocean vessel inspections
    The Corporation and the USCG in conjunction with Transport Canada 
and the Canadian Seaway Authority, signed a memorandum of understanding 
March 27 that will more closely coordinate inspection and enforcement 
activities in the Seaway and on the Lakes. This will expedite the safe 
transit of shipping through the Seaway and the Great Lakes with 
significant cost savings to Seaway users. Under the agreement all 
vessels will be cleared in Montreal before entering U.S. waters; no 
inspection boardings will be conducted while a vessel is underway 
except when it is clearly agreed to by all concerned that the boarding 
will not interfere with safe navigation of the vessel; the number of 
vessels that require more than one port state control boarding during a 
navigation season will be minimized; and international shipping 
throughout the System will continue to meet the highest standards of 
safety and environmental protection.
Binational GPS steering group
    In coordination with Volpe Center staff, the SLSDC completed a 
review of a Canadian Coast Guard pilot project on alternative Automatic 
Identification Systems (AIS). The GPS Steering Group will determine the 
utility of the pilot program for use in development of DGPS-based AIS 
operational requirements for Seaway operations. The Canadian Seaway 
Authority has agreed to 50 percent cost-sharing with SLSDC on the Volpe 
contract to develop the Seaway AIS operating requirements.
                                 ______
                                 

            Questions Submitted by Senator Richard C. Shelby

            performance based organization (pbo) initiative
    Question. Please fully discuss all points of difference between the 
July 15, 1996 and May 5,1997 versions of the Saint Lawrence Seaway 
Development Corporation's (``the Corporation'') proposed PBO 
legislation.
    Answer. In agreement with the Office of Management and Budget 
(OMB), SLSDC implemented a change to the application of the Consumer 
Price Index (CPI) element of the PBO financial plan to calculate more 
accurately year-to-year inflation. The revised legislation reference 
now reads: ``* * * adjusted for inflation by the percentage difference 
between the Consumer Price Index for all urban consumers (CPI-U) for 
the first quarter of calendar year 1996, and the CPI-U for the first 
quarter of the calendar year in which an annual payment is 
determined.''
    Significant changes to the 1996 legislation are the result of a 
collaborative effort among the NPR, OMB, the Office of Personnel 
Management (OPM), the Office of Federal Procurement Policy (OFPP), and 
the General Services Administration (GSA). The group developed a PBO 
template legislation to be used by all PBO candidates. The model 
legislation has been cleared through the interagency legislative review 
process; the personnel flexibilities were prepared by OPM, the 
procurement flexibilities by OFPP, the support service flexibilities by 
GSA. The title of Chief Executive Officer changed to Chief Operating 
Officer (COO). by a team at the Commerce Department. Application of the 
template to the SLSDC bill results in some additional potential 
personnel and acquisition flexibilities. It is our understanding that 
these changes were developed in consultation with national federal 
employee union representatives.
    Question. The Committee understands that one difference in the new 
proposed legislation is that this revision would not create a reduction 
in the discretionary spending cap scored to offset the mandatory 
funding stream. How would this work? Is an amendment to the Budget 
Enforcement Act necessary?
    Answer. We understand that considered with other elements of the 
President's proposed program, this proposal meets the pay-as-you-go 
requirements. Therefore an amendment to the Budget enforcement Act is 
not necessary.
    Question. Please update the Committee on any legislative actions 
taken by either the House Transportation and Infrastructure Committee 
or by the Senate Commerce Committee toward moving the performance based 
organization legislation in the 105th Congress.
    Answer. There has been no legislative action taken to date by 
either the House Transportation and Infrastructure Committee or by the 
Senate Commerce Committee.
    Question. Has there been any official reaction from the Senate 
Commerce Committee or any members of the committee regarding the lack 
of confirmation procedures in the Chief Operating Officer (COO) 
selection process?
    Answer. There has been no official reaction from any committee 
staff or members regarding the lack of Congressional confirmation in 
the COO selection process.
    Question. What are the benefits of having a COO versus an 
Administrator? How were goals in the proposed COO's performance 
contract developed? What are the sanctions if performance is not met?
    Answer. The COO would be vested with all the authority currently 
residing in the position of Administrator, however there would be 
significant changes that would increase the position's effectiveness. 
For example, the competitive selection of a COO would ensure that the 
head of the agency possesses the highest qualifications. The selection 
of a COO based on knowledge and experience rather than political 
affiliation would help ensure that SLSDC operates in the most 
economically and operationally rational manner possible. The COO would 
have to agree to clearly articulated performance goals and the COO's 
record in achieving or failing to achieve those goals would be easily 
measured. Currently, the Administrator enters into a yearly performance 
agreement with the Secretary, however, the only penalty for failure to 
meet those goals is a mild rebuke. The proposed performance incentives 
and penalties would ensure that the COO meets agreed-to goals. Failure 
to meet these goals will result in termination of the COO's position. 
The financial incentives provided in the PBO plan are a powerful tool 
to the COO and all SLSDC employees to foster greater productivity, 
creativity and effectiveness.
    The goals and performance measures were developed over the course 
of the past 16 months, since the SLSDC PBO initiative was begun in 
March 1996.
    Representatives from the SLSDC, NPR, OMB, and DOT/OST developed the 
draft document.
    Sanctions will be listed in the performance agreement between the 
Secretary and the COO. The ultimate sanction for failure to meet 
performance goals will be dismissal of the COO by the Secretary.
    Question. For purposes of comparison, please display the enacted 
appropriated funding level for the Saint Lawrence Seaway Development 
Corporation from fiscal year 1983 through 1997. In a second column, 
please adjust each year's funding to 1997 dollars. In a third column, 
please project what the PBO formula would have provided to the 
Corporation (in constant 1997 dollars), using actual tonnage figures 
for each year.
    Answer. For fiscal year 1983 through fiscal year 1986, SLSDC did 
not receive appropriations. We became appropriated April 1, 1987, and 
received a partial appropriation for the year, and used emergency 
reserves to meet our needs. fiscal year 1988 was the first full year 
for SLSDC as an appropriated agency. Therefore the requested 
information is shown for fiscal year 1988 to fiscal year 1997.

----------------------------------------------------------------------------------------------------------------
                                                                                   Appropriation                
                                                                   Enacted HMTF       in 1997     PBO formula in
                           Fiscal year                             appropriation      dollars      1997 dollars 
                                                                     (nominal        (constant       (constant  
                                                                     dollars)        dollars)        dollars)   
----------------------------------------------------------------------------------------------------------------
1988............................................................         $10,806         $10,806         $12,788
1989............................................................          11,097          11,325          12,755
1990............................................................          11,375          11,936          13,327
1991............................................................          10,250          12,438          13,447
1992............................................................          10,550          12,811          13,513
1993............................................................          10,734          13,195          10,502
1994............................................................          10,765          13,598          10,439
1995............................................................          10,193          13,917          10,263
1996............................................................           9,549          14,335          10,568
1997............................................................          10,322          14,722          11,760
----------------------------------------------------------------------------------------------------------------

    Question. One of the primary reasons for pursuing PBO status is the 
Corporation's belief that mandatory payment will give them more 
reliable funding. Are there other means besides becoming a PBO to 
ensure the necessary level and stability of funding?
    Answer. The only other means to achieve more reliable funding is 
alternative legislative action by the Congress within the budget 
process.
    Question. Please provide specific examples of Departmental 
constraints from which a PBO framework would free the Corporation. 
Please estimate the personnel time and associated funding that would be 
saved in each instance, on an annualized basis.
    Answer. Rather than constraints, we characterize the issue as a 
Departmental mandate that requires SLSDC to participate in all DOT-wide 
programs and initiatives along with the other, much larger, operating 
administrations. Mandatory participation in all DOT-wide programs 
coupled with the relatively limited Corporation mission and resources 
add up to a serious challenge to the agency's effectiveness.
    We do not maintain time allocation records however, a reliable 
estimate is 3 to 5 FTE's (17 percent to 29 percent of total D.C. staff) 
annually, is spent in this area at a total SLSDC average annual 
compensation of $168,000 to $280,000.
    Question. What reporting requirements are currently placed on the 
Corporation by the Department of Transportation? Has the Corporation 
sought a waiver from any of these reporting requirements?
    Answer. We have sixty-two reports, ranging from weekly to annual, 
that are required by the Department, some of which are required of DOT 
by other federal agencies. As a PBO the Corporation will have fewer 
report requirements. We also have 32 reports required by other federal 
agencies, primarily due to our Corporation structure.
    We have not sought a waiver from DOT or other federal agency 
reporting requirements.
    Question. Unlike the British ``Next Steps'' agencies, the PBO 
concept focuses on improving performance rather than reducing operating 
costs. In the statement of purpose and need included in the May 1997 
proposed PBO legislation, performance measures for the corporation are 
listed as: (1) safety; (2) reliability; (3) trade development; (4) 
management accountability; and (5) cost effectiveness. For each of 
these five areas, explain why improved performance is necessary. Use 
concrete examples and numbers to the greatest possible extent.
    Answer. With respect to the SLSDC PBO conversion plan, reduction of 
operating costs is included in improved performance. The SLSDC plan has 
four performance areas. The actual measures and numbers to develop a 
basis for performance evaluation in the COO performance contract are 
being developed at this time. Examples of programs being considered for 
measurement are noted below.
    Safety.--Safety measures will apply to vessel and workplace safety, 
the first priorities of the SLSDC, as well as to environmental 
protection. The SLSDC will be held accountable for maintaining 
acceptable levels of safety and reducing the likelihood of accidents 
that result in costs to users and injuries to workers. It will have to 
demonstrate that it is prepared to respond in a timely manner in the 
event of an environmental emergency, such as an oil spill. In its role 
as Captain of the Port, the SLSDC is responsible for initial response 
to and containment of environmental emergencies. Draft performance 
areas being considered, include but are not limited to: reduction of 
the risk of vessel incidents; reduction of employee lost time from work 
injuries; and response time to vessel spill incidents.
    Long and Short Term Reliability.--The Corporation seeks to maximize 
the Seaway while minimizing costly delays to ships going through the 
Seaway. The SLSDC's plans and decisions must ensure Seaway user 
confidence in System availability and the long term reliability of U.S. 
navigation facilities. Draft performance areas being considered, 
include but are not limited to: SLSDC measures to maintain the 
availability and reliability of the navigation facilities each 
navigation season; reduction of vessel delays due to facility failure 
and pilot delays; and evaluation of maintenance and inspection 
programs.
    Trade Development.--The SLSDC will make every effort to increase 
the international tonnage through the Seaway, through trade development 
and promotional programs. The goal is to encourage greater System 
utilization, which benefits the Midwest economy and increases System 
competitiveness. Draft performance areas being considered, include but 
are not limited to: the annual growth rate of international tonnage 
volume; and the increase of ocean vessel utilization.
    Management Accountability, including Customer Service, Fiscal 
Performance and Cost Effectiveness.--The SLSDC must provide direct 
mechanisms to ensure that the customers themselves will have a voice in 
evaluating its performance and contributing to business decisions. The 
SLSDC will ensure that the capital reserves are adequate to keep U.S. 
Seaway navigation facilities in good working condition. Human resources 
must be managed in a way that promotes the health and productivity of 
the organization. Performance targets will be used to promote both 
employee satisfaction and human resources management practices that 
serve the business needs of the SLSDC. To achieve those targets, the 
SLSDC will continue to partner with employees and their 
representatives. Draft performance areas being considered, include but 
are not limited to: vessel customer satisfaction ratings; an employee 
baseline satisfaction survey; emergency reserves management and goals; 
and reduced operating costs.
    Question. The President's fiscal year 1998 budget request assumes 
enactment of PBO legislation and does not include an appropriations 
request for the Corporation. If the authorizing committees fail to 
enact PBO legislation before the Senate passes its version of the 
fiscal year 1998 Transportation appropriations bill, will the 
administration submit a budget amendment requesting an appropriation of 
$11,200,000 from the harbor maintenance trust fund? If not, and 
appropriations legislation is conferenced and passed without including 
appropriated funds for the Corporation, how will the agency make up the 
funding shortfall?
    Answer. If the PBO legislation is not enacted, we believe the 
administration will submit a budget amendment, however we do not have 
formal confirmation of such action.
    If not, the Corporation would have no choice but to rely on its 
available emergency reserves.
                           navigation season
    Question. Please provide the opening and closing dates and number 
of shipping days for the Seaway for the 1993, 1994, 1995 and 1996 
navigation seasons, and the opening for 1997.
    Answer. The information follows.

                        MONTREAL-LAKE ONTARIO SECTION OPENING AND CLOSING DATES 1993-1997                       
----------------------------------------------------------------------------------------------------------------
                                                                                                      Navigation
            Navigation season                      Opening date                 Closing date             days   
----------------------------------------------------------------------------------------------------------------
1993.....................................  March 30...................  December 26................          272
1994.....................................   April 05..................  December 29................          269
1995.....................................  March 24...................  December 28................          280
1996.....................................  March 29...................  December 27................          274
1997.....................................  April 02...................  ...........................  ...........
----------------------------------------------------------------------------------------------------------------

                        status of administrator
    Question. When did Gail McDonald leave her position as 
Administrator of the Corporation? Has a new Administrator been 
nominated?
    Answer. Administrator McDonald's resignation was effective May 1, 
1997. A new Administrator has not been nominated by the President.
                       advisory board membership
    Question. Please list all the current members of the Seaway 
Advisory Board. Provide each Board member's term dates and a brief 
description of their employment background and qualifications.
    Answer. The information follows. Currently the term dates for 
Advisory Board members are at the pleasure of the President.
    Anthony S. Earl.--Appointed October 3, 1994. Mr. Earl has been a 
Partner, in the Quarles and Brady Law Firm since 1987 and was Governor 
of the State of Wisconsin from January 1983 to December 1986. Other 
positions include: Assistant District Attorney, Marathon County, WI 
1965; City Attorney, Wausau, WI, 1966-1969; Member WI State 
Legislature, 1969-1974; Secretary, WI Department of Administration, 
1975; and Secretary WI Department of Natural Resources, 1976-1980.
    Vincent J. Sorrentino.--Appointed October 3, 1994. Mr. Sorrentino 
has been a Senior Partner of Cole, Sorrentino, Hurley and Hewner, P.C. 
since 1964. Other positions include: 1988 to the present, Mr. 
Sorrentino has served as Commissioner of the Buffalo and Fort Erie 
Bridge Authority and Town Attorney and/or Deputy Town Attorney for 
Hamburg, NY; since 1989 to the present, he served as Commissioner of 
the Erie County Water Authority; and 1991 to the present, Treasurer of 
the Erie County Water Authority.
    Jay C. Ehle.--Appointed August 14, 1995. Mr. Ehle joined Cleveland 
Builders Supply in 1938 and retired as President and Chairman in 1985, 
remaining on the Board of Directors until 1989. He served on the Board 
of the Cleveland/Cuyahoga County Port Authority for nineteen years, 
eleven years as Chairman, and later as a special consultant to the 
Board.
    George D. Milidrag.--Appointed December 26, 1995. Mr. Milidrag is 
the Chairman and owner of Engineering Technology, Ltd., an engineering 
and design firm which he founded in 1973. Mr. Milidrag served as a 
Director of Midwest Guaranty Bank. He was honored in 1993 as Commodore 
of the United States Naval Institute and recently honored by the 
Society of Automotive Engineering as one of the Chief Executives of 100 
of the world's leading automotive industries.
    William L. Wilson.--Appointed June 11, 1996. Mr. Wilson is a 
Research Fellow at the Center for Urban and Regional Affairs at the 
University of Minnesota's Hubert H. Humphrey Center in Minneapolis. 
From 1980 to 1993 he served as Council member (and as President from 
1989 to 1993) of the Saint Paul City Council. Mr. Wilson has previously 
served as Commissioner of the Saint Paul Port Authority and serves 
currently as a member of the Board of Directors of the Minnesota World 
Trade Corporation.
                     harbor maintenance trust fund
    Question. Please discuss the current status of the pending appeal 
against the U.S. Court of International Trade's ruling that the harbor 
maintenance tax is unconstitutional. If this ruling is not overturned, 
what are the potential ramifications for the Saint Lawrence Seaway 
Development Corporation's source of funding?
    Answer. Our understanding is that the ruling applies only to the 
Harbor Maintenance Tax (HMT) on export goods in transit, and not to 
imports, domestic trade or cruise ships. If the Supreme Court agrees to 
hear the appeal, resolution of the issue could be delayed another 18 
months or more. If the Supreme Court declines to hear the appeal, 
refunds to exporters could begin in as little as nine months. If the 
Tax is revoked on exports alone, we believe sufficient funds would be 
available in the HMTF to fund the SLSDC. If that is not the case, the 
Corporation would have to pursue Congressional action to provide 
funding.
    Question. Please update the table on page 984 of Senate Report 104-
671, part 2, regarding harbor maintenance trust fund revenues, 
transfers, and year-end balances for fiscal years 1994 through 1997.
    Answer. The U.S. Customs Service furnished the following available 
information, published report data is not available at this time.

                       HMTF REVENUE AND TRANSFERS                       
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                                       Fiscal years--   
                                                   ---------------------
                                                       1995       1996  
------------------------------------------------------------------------
Beginning balance.................................    670,532    698,267
Revenues:                                                               
    HMTF..........................................    670,532    698,267
        Toll receipts.............................        173  .........
        Interest..................................     30,186     40,870
                                                   ---------------------
          Net revenue.............................    700,891    739,137
                                                   ---------------------
          Net available...........................  1,152,276  1,360,331
                                                   =====================
Transfers:                                                              
    Corps of Engineers............................    519,196    482,126
    SLSDC.........................................     10,193      9,539
    Toll rebates..................................      1,512  .........
    DOT/SLSDC rent................................        181        169
    Administration costs..........................  .........      3,000
                                                   ---------------------
      Net expenditures............................    531,082    494,834
                                                   =====================
Surplus/(Deficit).................................    621,194    865,497
------------------------------------------------------------------------

                           revenue available
    Question. Please update the table on page 991 of last year's 
hearing record regarding revenue available by source in fiscal years 
1997 and 1998.
    Answer. The information follows.

    REVENUE AVAILABLE BY SOURCE FISCAL YEAR 1997 AND FISCAL YEAR 1998   
------------------------------------------------------------------------
                                                       Fiscal years--   
                                                   ---------------------
                                                       1997       1998  
------------------------------------------------------------------------
Interest on retained earnings.....................   $500,000   $500,000
Concession operation..............................    300,000    300,000
Rental of administration building.................     44,000     45,000
Miscellaneous.....................................     56,000     55,000
------------------------------------------------------------------------

                           financial position
    Question. Please update the tables on pages 991 through 993 last 
year's hearing record regarding the statement of your financial 
position, as well as the statement of operations and changes.
    Answer.

   ST. LAWRENCE SEAWAY DEVELOPMENT CORPORATION STATEMENT OF FINANCIAL   
            POSITION AS OF SEPTEMBER 30, 1996, 1995, AND 1994           
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                            1996       1995       1994  
------------------------------------------------------------------------
                 ASSETS                                                 
                                                                        
Current assets:                                                         
    Cash:                                                               
        Held by U.S. Treasury..........      1,573      2,631      4,031
        Held in banks and on hand......         20         13         22
        Short-term time deposits in                                     
         minority banks................     10,908     10,403      9,180
        Tolls and other receivables....        131        138      1,510
        Other current assets...........  .........          4          3
        Inventories....................        279        292        316
                                        --------------------------------
          Total current assets.........     12,911     13,481     15,062
                                        ================================
Non-current assets: Long-term time                                      
 deposits in minority banks............      1,470      1,207      1,206
                                        ================================
Plant, property and equipment:                                          
    Plant in service...................    151,848    151,495    150,993
    Less accum depreciation............    -63,912    -62,250    -60,205
    Net plant in service...............     87,936     89,245     90,788
    Work in progress...................        302        162        429
                                        --------------------------------
      Total plant, property and                                         
       equipment.......................     88,238     89,407     91,217
                                        ================================
Other assets:                                                           
    Lock spare parts...................        777        659        674
    Less accum depreciation............       -109        -82        -54
                                        --------------------------------
      Net Lock spare parts.............        668        577        620
                                        --------------------------------
    Investment in Seaway Int'l Bridge                                   
     Corporation, Ltd..................          7          7          7
                                        --------------------------------
      Total other assets...............        675        584        627
                                        ================================
Deferred charges: Workman's                                             
 compensation benefits.................      1,397      1,232      1,179
                                        --------------------------------
      Total assets.....................    104,691    105,911    109,291
                                        ================================
   LIABILITIES AND EQUITY OF THE U.S.                                   
               GOVERNMENT                                               
                                                                        
Current liabilities:                                                    
    Payable to the U.S. Treasury.......  .........  .........      1,403
    Accounts payable...................        691        743        875
    Accrued leave......................        691        611        596
    Accrued payroll costs..............        373        297        293
    Deferred revenue...................  .........  .........          3
                                        --------------------------------
      Total current liabilities........      1,755      1,651      3,170
                                        ================================
Actuarial liabilities: Workman's                                        
 compensation benefits.................      1,397      1,232      1,179
                                        --------------------------------
      Total liabilities................      3,152      2,883      4,349
                                        ================================
Equity of the U.S. Government:                                          
    Invested capital...................    103,053    104,230    106,050
    Cumulative results of operations...     -1,514     -1,202     -1,108
                                        --------------------------------
      Total equity of the U.S.                                          
       Government......................    101,539    103,028    104,942
                                        --------------------------------
      Total liabilities and equity of                                   
       the U.S. Government.............    104,691    105,911    109,291
------------------------------------------------------------------------


ST. LAWRENCE SEAWAY DEVELOPMENT CORPORATION STATEMENTS OF OPERATIONS AND
  CHANGES IN CUMULATIVE RESULTS FOR THE YEARS ENDED SEPTEMBER 30, 1996, 
                             1995, AND 1994                             
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                                            1996       1995       1994  
------------------------------------------------------------------------
Operating revenues:                                                     
    Appropriations expended............      8,950      9,337      9,694
    Other..............................        897        467        534
                                        --------------------------------
      Total operating revenues.........      9,847      9,804     10,228
                                        ================================
Operating expenses:                                                     
    Locks and marine operations........      2,163      1,999      1,971
    Maintenance and engineering........      3,006      3,166      4,021
    General and development............      2,725      2,486      2,947
    Administrative expense.............      2,935      2,800      2,746
    Depreciation.......................      1,776      2,667      2,693
                                        --------------------------------
      Total operating expenses.........     12,605     13,118     14,378
                                        ================================
Operating loss.........................     -2,758     -3,314     -4,150
                                        ================================
Other financing sources:                                                
    Interest on deposits in minority                                    
     banks.............................        670        553        383
    Transfer from invested capital for                                  
     depreciation......................      1,776      2,667      2,693
                                        --------------------------------
      Total other financing sources....      2,446      3,220      3,076
                                        ================================
Excess of operating revenues and other                                  
 financing sources over operating                                       
 expenses..............................       -312        -94     -1,074
Beginning cumulative results of                                         
 operations............................     -1,202     -1,108        -34
                                        --------------------------------
      Ending cumulative results of                                      
       operations......................     -1,514     -1,202     -1,108
------------------------------------------------------------------------

                           vessel casualties
    Question. Please detail any major vessel casualties in the American 
waters of the Seaway for the 1996 navigation season, and for the 1997 
navigation season to date.
    Answer. There were no major casualties during 1996, just four 
groundings. We have experienced one grounding during 1997 to date. Each 
of these groundings were resolved without incident.

                              VESSEL GROUNDINGS DURING CY 1996 AND CY 1997 TO DATE                              
----------------------------------------------------------------------------------------------------------------
             Vessel                   Dates 96/97          Location              Cause              Damage      
----------------------------------------------------------------------------------------------------------------
Steel Flower....................  April 5, 1996.....  Near LT. 212......  Lost power........  None/no pollution.
Kapitonas Stulpinas.............  June 11, 1996.....  Above Eisen. Lk...  Lost steering.....  None/no pollution.
Sauniere........................  Sept. 15, 1996....  Bay State Shoal...  Human error.......  Holed/no          
                                                                                               pollution.       
Utviken.........................  Nov. 26, 1996.....  Near LT. 5........  Lost steering.....  Holed/no          
                                                                                               pollution.       
Canadian Mariner................  June 18, 1997.....  Near Lt. 162......  Lost steering.....  Holed/no          
                                                                                               pollution.       
----------------------------------------------------------------------------------------------------------------

                    travel and transportation costs
    Question. In a similar format to that on pages 995 through 996 of 
last year's hearing record, please provide a listing of trade, mini-
trade, Lake State, industry, and other travel missions made by or 
planned for Seaway personnel September 1996 through September 1997. Be 
inclusive, including the dates of travel, trip purposes, location, 
Seaway Development Corporation representatives, travel costs for each, 
and actual or planned trip results.
    Answer. There were no overseas trade missions since the March 1996 
mission reported in the fiscal year 1997 questions for the record. We 
do have tentative plans at this time to participate in the Universal 
Congress of the Panama Canal and the International Canals and Waterways 
Chief Executives meeting, both in Panama during September 1997, and 
vessel operator, broker and financier exhibitions in Hamburg, Germany, 
and South Africa during October 1997.
    Question. For fiscal years 1995 and 1996 actual, and fiscal years 
1997 and 1998 estimated, please break out travel and transportation of 
persons into two categories: (1) trade and travel missions to both 
potential new markets and traditional markets; and (2) non-trade 
related travel.
    Answer. The information follows.

----------------------------------------------------------------------------------------------------------------
                                                                               1996         1997         1998   
                                                              1995 actual     actual     estimated    estimated 
----------------------------------------------------------------------------------------------------------------
Trade missions..............................................      $30,000      $23,000      $20,000      $20,000
Non-trade related travel....................................      128,000      135,000      154,000      154,000
----------------------------------------------------------------------------------------------------------------

    Question. In as clear and precise a manner possible, please 
describe specific benefits and new trade or business resulting from 
previous Seaway trade missions conducted in calendar years 1995 and 
1996.
    Answer. 1995 Trade Mission to Italy and Morocco. Locations: Milan 
and Casablanca. Dates: March 24 to April 1. Fertilizer shipments from 
Morocco to the port of Ogdensburg; wheat shipments from the United 
States to Italy shipped by Louis Dreyfus. Steel shipments to and from 
Italy and North America.
    1995 Trade Mission to Brazil, Venezuela and Panama. A shipment of 
500,000 tons of HBI from Venezuela to mini steel mills in the Great 
Lakes region; the Corporation and the Panama Canal Commission 
established an Employee Exchange Program; plans for the shipment of 
fertilizers, iron ore, and other minerals are being arranged for 
movement between Brazil and North America; arrangements to move DRI and 
HBI between Venezuela and mini-mills in Cleveland are underway.
    1996 Trade Mission to Norway, Denmark and the Netherlands. At least 
18 new ships will be built with Seaway fittings and are planning to 
trade in the Seaway (the first is scheduled to call on the port of 
Chicago in August); the port of Duluth expects to handle a shipload of 
drilling equipment from Denmark this summer; the port of Toledo 
received a shipload of fertilizers from Norway and three more shipments 
are scheduled for later this year; two shiploads of U.S. export grain 
totaling 33,000 tons were arranged for delivery to Europe; and one 
shipload of U.S. grain was fixed for delivery to the Mediterranean.
                        seaway sponsored events
    Question. Please provide a listing of any trade, industry, or other 
visits, seminars, or ``summits'' at the Seaway that have been sponsored 
by the Corporation during the last year. Please outline the results of 
and benefits derived from each of these sponsored events.
    Answer. The following is a list SLSDC sponsored activities that 
occurred after the submittal of the fiscal year 1997 report.
    July 23, 1996.--The Corporation and the Seaway Authority (SLSA) co-
sponsored the first meeting of the binational GPS--Steering committee 
in Ottawa. Membership includes the two Seaway entities, the two Coast 
Guards, and carrier representatives of the ocean and domestic laker 
fleets. The responsibilities of the Steering Committee include 
determining technologies to be used, proper cost-sharing, developing an 
overall schedule establishing and approving system requirements, 
reviewing and approving system design, and overseeing installation and 
implementation of the system.
    August 6 and 7, 1996.--The SLSDC sponsored a Seaway Safety and 
Pilotage Summit meeting with industry in Linthicum, Maryland. Primary 
issues raised included GPS technology status; maritime safety training; 
speed surveillance activities; emergency response procedures; pilotage 
ratemaking, billing procedures, rest periods and training.
    September 24, 1996.--SLSDC conducted a congressional staff 
briefing, in Washington D.C. to discuss any questions on a published 
notice of proposed rulemaking which proposed an increase in pilotage 
compensation.
    December 3, 1996.--The Corporation sponsored a meeting of steel 
importers and exporters, in New York City, to determine the steel 
customer viewpoint on the Seaway System firsthand.
    December 5, 1996.--The Corporation and the Seaway Authority co-
sponsered a second meeting of the GPS steering group in Montreal.
    March 4, 1997.--The SLSDC and SLSA co-sponsored the third meeting 
of the GPS steering group.
    March 4 and 5, 1997.--The SLSDC and the SLSA sponsored outreach 
meetings with U.S. and Canadian grain industry customers in Minneapolis 
and Winnipeg.
    March 11, 1997.--The Corporation sponsored a public outreach 
meeting on Great Lakes Pilotage, in Cleveland, to obtain public input 
on long-range planning for the pilotage system throughout the Great 
Lakes and St. Lawrence Seaway.
    March 20, 1997.--The SLSDC and SLSA co-sponsored the Annual 
Industry day event in Montreal with vessel operators to review 
operations for the 1997 navigation season.
    April 2, 1997.--Opening Day ceremonies were conducted in Massena, 
NY.
    During August the Corporation plans to conduct a Seaway North 
America/Great Lakes trade mission, with programs and events at several 
U.S. and Canadian lake ports. Each port event, which will include port 
customers and new business potential users, will be co-sponsored by the 
local port authority.
     discretionary changes in the fiscal year 1998 operations and 
                           maintenance budget
    Question. Almost $600,000 in management savings are assumed in the 
Corporation's outlay program, as well as a reduction of 2 FTE's. Please 
specifically detail these anticipated savings.
    Answer. Management savings are derived from an overall reduction in 
the Corporation's fiscal year 1998 capital outlay program and the 
elimination of two management positions.
    Question. Is the $150,000 increase in discretionary changes 
associated with office rent a one-time moving cost from the Nassif 
Building to other office space, or the difference between Nassif 
Building rental costs and those costs at other Washington, D.C. office 
locations?
    Answer. The $150,000 represents estimated annual rent after 
relocating the D.C. office out of the current Nassif building site.
         global positioning system-based vessel traffic service
    Question. Are any budgeted fiscal year 1998 capital costs 
associated with the global positioning system (GPS) vessel traffic 
service? How much has been spent on this program by the Corporation 
thus far (broken out by fiscal year cost was incurred)? What is the 
anticipated total project cost?
    Answer. No funds were budgeted in fiscal year 1998 for projects 
associated with the GPS-based Vessel Traffic System (VTS) until cost-
sharing issues are resolved. To date SLSDC has expended a total of 
$200,000; fiscal year 1994--$50,000, fiscal year 1995--$125,000, and 
fiscal year 1997--$25,000. The anticipated remaining project cost is 
estimated at $500,000.
    Question. Please list the members of the GPS Steering Committee and 
their organizational affiliation. How many times and when has the 
Steering Committee met? When will the committee's deliberations be 
complete?
    Answer. Members of the binational GPS Steering Committee are:
    Stephen Hung.--Saint Lawrence Seaway Development Corporation
    Pat Vincelli.--The St. Lawrence Seaway Authority
    CDR. Ken Prime.--United States Coast Guard
    Lea Barker.--Canadian Coast Guard
    S.B. MacPhee.--Canadian Hydrographic Service
    Rejean Lanteigne.--Canadian Shipowners Association
    Ivan Lantz.--Shipping Federation of Canada
    The Committee has met five times to date, in July, September and 
December 1996, and in March 1997. The next scheduled meeting is June 
25, 1997. A series of meetings will be held over the next 18 to 24 
months to resolve major program elements such as: system requirements, 
test and evaluation plans, performance specifications, cost-sharing 
issues, and program implementation. Our goal is to have implementation 
by April 1999.
    Question. Have any cost-sharing requirements for project costs been 
determined by the Steering Committee?
    Answer. Detailed cost-sharing requirements have not been discussed 
thus far but will be addressed as significant elements of the program 
are resolved. The Canadian Seaway Authority is sharing half of the cost 
for the fiscal year 1997 technical assistance provided by the Volpe 
Transportation Systems Center.
    Question. What other issues are being addressed by the GPS Steering 
Committee?
    Answer. In addition to cost-sharing, the Committee must resolve 
major program elements such as: system requirements, test and 
evaluation plans, performance specifications, and program 
implementation.
    Question. Has the National Research Council Marine Board study on 
VTS privatization issues yet been released? If so, please provide a 
copy of the report's executive summary for the record.
    Answer. The report was released in June 1996. A copy of the 
executive summary will be provided under separate cover as an 
attachment to these questions for the record.
    [The information follows:]

 Executive Summary of Vessel Navigation and Traffic Services for Safe 
    and Efficient Ports and Waterways, Interim Report, Committee on 
   Maritime Advanced Information Systems, Marine Board Commission on 
      Engineering and Technical Systems, National Research Council

                           executive summary
Background
    The economic vitality of the United States depends on growing 
trade, both domestic and international. Foreign trade in particular is 
of increasing importance. The overwhelming portion of foreign trade 
moves by water through major seaports on all U.S. coasts. It is, 
therefore, critical that U.S. ports and waterways foster U.S. economic 
growth and affirm the position of the U.S. in world trade by ensuring 
safe and efficient transit for vessels and meeting the demands for the 
smooth flow of goods.
    The United States does not have a centralized, national management 
structure for ports and waterways, which are remarkably diverse in 
terms of geography and environmental conditions, the vessel traffic 
they serve, and the variety of services they provide. Ports must 
provide efficient, rapid turnaround capabilities to accommodate 
expanding trade and the increasing size and speed of oceangoing ships, 
a growing proportion of which are foreign. Many U.S. ports must also 
handle a large volume of coastal and inland traffic.
    Stakeholders in safe and efficient maritime transportation are 
diverse. The activities that take place in ports and connecting 
waterways affect practically every citizen. The major categories of 
stakeholders include federal agencies, commercial groups, state and 
local groups, and public and community groups. All stakeholders share 
the following goals:
  --Ensuring safety, protecting the environment, reducing the costs of 
        accidents, and promoting law enforcement and national security;
  --Moving vessels and cargo in and out of ports efficiently under all 
        conditions;
  --Ensuring a smooth flow of goods from one mode of transport to 
        another to save time and reduce costs; and
  --Fostering economic growth, creating jobs and prosperity in the 
        process.
    Navigational information systems, such as vessel traffic services 
(VTS), can contribute to the achievement of these goals if vision, 
leadership, resources, and state-of-the-art technology are combined. 
This interim report by the Committee on Maritime Advanced Information 
Systems addresses issues surrounding navigational information systems 
in general but particularly the U.S. Coast Guard's VTS-2000 program, 
under which new or upgraded VTS systems would be installed in as many 
as 17 ports.
Navigational information systems: Needs and solutions
    A wide variety of navigational information systems are already 
being used to foster safe and efficient vessel transits in U.S. ports. 
The fundamental system essential to all classes of mariners encompasses 
the buoys, lights, and ranges operated and maintained by the Coast 
Guard. Combined with nautical charts, notices to mariners, and other 
primary data about waterways which are still delivered primarily in 
paper form, these constitute the basic information essential for 
navigation. A final component is a ship-to-ship and ship-to-shore 
communications system, which is essential for the adequate exchange of 
data among waterway users and managers.
    Some additional data can now be provided in electronic form using 
advanced technology, which is more accurate and reliable. New systems 
include satellite-based positioning systems and electronic charts, 
which are now available in various forms and will probably become 
standard in years to come. In selected ports, real-time water levels, 
currents, and other data now can be delivered electronically.
    Although some users and providers of navigational information 
cooperate and share data, no central entity is responsible for 
management or control of port-specific or national information on 
vessel movements or cargo. Furthermore, because of gaps in the 
deployment of navigational information systems, information is not 
always available to users who need it. Evidence of uneven deployment is 
largely anecdotal, based in part on outreach workshops and site visits 
conducted by the committee. The evidence indicates that, despite the 
substantial efforts of federal agencies that maintain navigational 
information systems and services, and despite recent advances in 
technology, deficiencies at U.S. ports range from outdated charts to 
inadequate vessel traffic management. Advanced information delivery 
services are of little value if the underlying data are inaccurate or 
unreliable. Some of these underlying data are in question now.
    State-of-the-art components and systems are available to meet or 
exceed most functional requirements. These systems are accurate, 
reliable, and adaptable. In other words, funding and institutional 
issues, not technology, are the limiting factors in the implementation 
of improved navigational information systems. The institutional issues 
include bringing all vital interest groups together, providing 
responsible leadership, and fostering a consensus on needs and 
mechanisms for funding and management.
Existing vessel traffic services
    Currently, VTS and related information systems in the United States 
are federal, federal/private, private, or port authority operations. 
The Coast Guard has installed and operated VTS systems in a number of 
major U.S. ports and paid for them with appropriated federal funds. The 
eight systems currently operating are located in Puget Sound 
(Washington), New York/New Jersey, Houston/Galveston, San Francisco, 
Prince William Sound (Alaska), Berwick Bay (Louisiana), St. Mary's 
River (Michigan), and Louisville (Kentucky). Users of these systems 
report varying levels of satisfaction. Some assert that VTS systems 
provide few benefits, while others say they are essential to safe 
navigation. In general, the committee found that Coast Guard-operated 
VTS systems are well managed and make a significant contribution to 
port safety.
    In some ports, private entities have deployed VTS-like systems. The 
most prominent of these are in the ports of Los Angeles and Long Beach 
(LA/LB) and the Delaware River and Bay. The LB/LB system, authorized by 
state legislation, is managed by the local Marine Exchange and is 
manned by both the Marine Exchange and the Coast Guard, both of which 
have agreements with the state. The Marine Exchange is the 
legislatively authorized agent of the state of California (which, by 
statute, has addressed the issue of liability) and collects the tariffs 
authorized by the ports. The funds are then transmitted the state to 
pay for the Coast Guard billets, which make up half of each operating 
shift. The Coast Guard has an interagency agreement with the state to 
ensure funding and clarify the conditions under which operation of the 
VTIS is carried out. This agreement was authorized by the Coast Guard 
appropriation bill. The Coast Guard provides half of the staff, which 
means it has the authority of the captain of the port, which can be 
exercised in an emergency. The Delaware Bay system is operated by local 
pilots, and cost are recovered through increased pilot charges to 
vessels. This system is fully private and does not have legal authority 
to mandate participation or to direct traffic.
    These and other private systems usually satisfy the needs of the 
operators and users who established the system, but most of them 
provide limited coverage, and they may not fully serve the needs of the 
public.\1\ Fully private operators do not have legal authority to 
intervene in emergencies, as the Coast Guard does. There is also 
widespread concern among private operators about the potential tort 
liability associated with providing information or direction that could 
be implicated vessel accidents. This concern has often been advanced as 
a reason fully private systems are unworkable, but the state of 
California and Delaware have addressed the liability issue in separate 
legislation.
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    \1\ This committee finding is supported by comparisons of the 
capabilities of specific private systems with international guidelines 
for VTS and by input from stakeholders such as environmental and harbor 
safety organizations.
---------------------------------------------------------------------------
    The committee could not locate any comprehensive data that could be 
used to quantify improvements in safety and efficiency provided by VTS 
and VTS-like systems. However, there is anecdotal evidence of the 
utility of these systems in averting accidents and saving lives. It is 
interesting to note that the benefits of VTS are accepted as obvious in 
certain foreign ports. A committee work group visited the ports of 
London (United Kingdom), Rotterdam (Netherlands), and the Elbe River 
(Germany). Although formal cost-benefit analyses were not available, 
VTS systems enable the Rotterdam and German ports to stay open on many 
days when they otherwise would be closed. The managers of these systems 
stated that improved safety and efficiency were obvious benefits and 
that formal analysis was not necessary.
    In general, the history of VTS development in the United States is 
dominated by public concern about oil spills and tanker accidents. 
These problems led to national legislation requiring studies of port 
safety and supporting the development of VTS. Consequently, the 
available data and analyses are focused mostly on the risk of tanker 
accidents, which is reflected in references to tanker problems and the 
discussions of tanker accidents in this report. The committee 
recognizes that other benefits of VTS are also important and encourages 
further analyses of the improvements to overall safety and efficiency 
they can provide.
Perspectives on VTS-2000
    The Oil Pollution Act of 1990 (Public Law 101-380) required the 
Coast Guard to investigate the risk of oil spills in all U.S. ports, 
estimate the number of (oil spill) accidents that could be avoided with 
improved VTS, and implement a nationwide program for improving or 
implementing VTS systems. The resulting program is VTS-2000.
    If VTS-2000 is implemented as planned, then the estimated total 
development and installation costs will be between $260 and $310 
million in fiscal year 1993 dollars. The estimated annual operating 
cost for the complete 17-port system is $42 million. The difficulty of 
obtaining federal funding at these levels in an era of tight budgets 
has prompted the administration, the U.S. Congress, and others to 
question the extent and cost effectiveness of the program as well as 
the viability of current funding plans. Private initiatives that have 
established user fees to recover costs, like the one in LA/LB, have 
been held up as alternatives.
    Although the Coast Guard has yet to design VTS-2000 systems for 
specific ports, the maritime industry, port managers, vessel operators, 
and other interested parties already have strong opinions about how the 
program should be implemented and alternative approaches that may serve 
their needs and ensure safe and efficient maritime transportation:
  --Local users in many ports believe VTS-2000 goes beyond their needs.
  --The VTS-2000 program, as currently structured, will not fulfill the 
        most urgent needs, such as improving basic navigational safety 
        in some ports.
  --If local stakeholders will be required to pay user fees, they 
        demand more involvement in VTS design and procurement than in 
        the past.
  --Although the Coast Guard conducted an outreach program to determine 
        VTS-2000 requirements, many do not feel their concerns were 
        heard.
  --In other words, many local stakeholders say the federal government 
        should fully fund VTS systems. If that is not possible, some 
        local users may tolerate paying modest user fees, but this 
        would increase the need for a partnership approach to 
        development and implementation of the system.
                              conclusions
    The VTS-2000 program originated in response to a congressional 
mandate following the 1989 Exxon Valdez accident and subsequent oil 
spill in Alaska. But the context in which VTS-2000 is being carried out 
has changed since the program was designed. Efforts to reduce the 
federal budget and the role of the federal government have become major 
items on the national agenda. Many policy makers now advocate shifting 
responsibility for programs like VTS from the national to the state or 
local level. Therefore, it now appears that justifications for a fully 
national system with complete federal funding cannot be sustained in 
the future.
    Given the importance of ports and waterways to U.S. trade and 
economic prosperity, and the persistent risk of maritime accidents 
involving casualties and environmental damage, there is significant 
public interest in ensuring the safety and efficiency of maritime 
transportation through Coast Guard missions addressing port safety and 
security, maritime law enforcement, and search and rescue operations. 
The committee concludes that there is a compelling national interest in 
protecting the environment and in providing safe and efficient ports 
and waterways. This interest serves the purposes of ensuring national 
security, enhancing public safety, facilitating commerce, and fostering 
environmental protection. The public interest in safety and 
environmental protection is especially important. Efficiency, which is 
of some national interest economically, may be of greater concern to 
the commercial sector.
    Many factors contribute to the safety and efficiency of maritime 
transportation. Chief among these factors is the availability of 
accurate and reliable navigational information. The committee concludes 
that environmental protection, safety, and the efficiency of ports and 
waterways depend on the accuracy and availability of traditional and 
advanced navigational aids, nautical charts, and real-time hydrographic 
and meteorological data. When multiple vessels are involved, safety and 
efficiency also depend on effective waterways management, adequate 
electronic communications, and local knowledge of the kind typically 
supplied by pilots. In addition, the committee concludes that there are 
deficiencies in the accuracy and availability of many essential types 
of navigational information provided by federal agencies.
    VTS can enhance maritime safety and efficiency by collecting and 
managing the most reliable navigational information, monitoring and 
evaluating vessel traffic and potentially dangerous traffic situations, 
and providing accurate and timely information to mariners. When 
dangerous situations arise, the Coast Guard has the authority to impose 
traffic controls in areas covered by VTS to ensure safety of life and 
prevent accidents and pollution. The committee concludes that VTS can 
be a significant factor in enhancing the safety and efficiency of ports 
and waterways when used in conjunction with other traditional aids to 
navigation and hydrographic and other information.
    The public derives substantial national benefits from safe and 
efficient ports and waterways, and VTS systems can contribute to safety 
and efficiency. Therefore, the committee concludes that the 
implementation, function, and role of VTS systems are integral to the 
Coast Guard's federal mission of safeguarding the nation's ports and 
waterways. However, VTS-2000 was developed in a different political 
atmosphere than exists today. Possible user fees have changed the 
attitudes of waterway users toward the perceived scope and costs of 
VTS-2000. Progress now depends on achieving better understanding and 
building partnerships among federal agencies and port and waterway 
users at the local level.
    Private support has been suggested as a means of reducing federal 
costs for VTS-2000. The existence of private VTS-like systems indicates 
that user fees are feasible and acceptable to local maritime 
communities under certain circumstances. A key requirement for 
acceptance of user fees is some measure of local control. However, 
local funding of VTS may not be possible in many ports, primarily 
because the amount of revenues required and the willingness to pay 
could vary significantly. The committee concludes that there are 
significant unresolved issues associated with competitiveness, both 
domestic and international, that are affected by port-specific fees. 
User fees to pay for VTS systems would be affected by the capital and 
operating costs of the system, which would differ widely among ports 
depending on geography and port-specific needs. In addition, there are 
major impediments to nonfederal development of VTS-like systems. These 
impediments include the significant capital needed to acquire and 
install VTIS systems and the potential liability inuring to private 
operators. Significant concerns could also be raised about the 
uniformity and consistency of systems, which need to be established 
through federal standards.
             the importance of public/private partnerships
    Both public and private stakeholders have a role In the development 
and implementation of navigational information systems.
    The Coast Guard needs to maintain the legal authority to ensure the 
safe operation of ports and waterways, and private users need to be 
involved in development and operation of local VIS.
    The utility of all types of navigational information systems 
depends on (a) recognition of needs and (b) Mechanisms for cooperation 
among users and stakeholders.
    Although the Coast Guard has consulted With local stakeholders in 
the past, we need true federal/local partnerships, similar to the ones 
in LA/LB and Some foreign ports.
    Local stakeholder groups, such as port authorities and harbor 
safety committees, need to be identified and should work with the Coast 
Guard to make decisions.
    Federal/local partnerships can foster the development of a 
consensus on local needs and establish institutions to identify, 
design, acquire, implement, and operate the most urgently needed 
systems.
    Given the difficulty of implementing VTS-2000 in a cost effective 
and timely manner and meeting the myriad needs of local users, it may 
be useful to consider ways of reducing front-end costs and implementing 
the program in stages. With careful consideration of port-specific 
needs through continued Coast Guard interaction with local 
stakeholders, the 17 ports on the current list could be divided into 
two categories. The high-priority group could include ports with the 
greatest safety needs, if those needs could best be satisfied by VTS. 
This group might include four to six ports, roughly equivalent to the 
current list of four ports scheduled for implementation by the year 
2000 and the three scheduled for implementation in 2001. Justifying the 
selection of these ports would depend on the results of ongoing re-
evaluations of the current and specific needs of each port by the Coast 
Guard. The second group could include ports with less urgent needs 
where VTS or, perhaps another, more appropriate navigational 
information system could be implemented at a later date. This approach 
might reduce the overall capital costs of VTS-2000.
    To support this approach and justify continued federal funding, the 
minimum scope and service level of VTS to ensure safety must be 
established. The Coast Guard would need to establish a baseline for 
each port slated to receive a VTS-2000 system, as well as for each 
existing VTS and VTS-like system, to ensure minimum safety levels 
nationwide. The committee concludes that local institutions, in 
partnership with federal agencies, could introduce new strategies for 
implementing VTS-2000. Acceptance of VTS-2000 could be promoted by 
shifting the focus to establishing a generic baseline system for a 
small number of high priority ports to meet national safety needs and 
Coast Guard mission requirements.
    Recommendation 1.--The Coast Guard should take the lead in 
promoting public/private partnerships for the acquisition and operation 
of VTS systems in specific ports. Partnerships have already evolved in 
certain localities, and the Coast Guard has adequate experience working 
with the maritime community and other stakeholders to evaluate 
problems, identify needs and improve navigational safety. Organizations 
like harbor safety committees already exist in some ports and could 
help develop the partnerships.
    Recommendation 2.--The Coast Guard should use public/private 
partnerships to help establish local institutions for implementing 
local VTS systems. These institutions must bring all parties together 
and establish specific requirements for each port. They must also seek 
acceptance from all stakeholders for specific designs, operational 
approaches, and funding schemes.
    Recommendation 3.--The Coast Guard should select ports with the 
greatest safety needs for VTS and identify a minimum generic, baseline 
system that meets national safety needs as well as Coast Guard mission 
requirements for each port. A second group of ports should be selected, 
for a phase 2 program, and a similar baseline system should be defined 
for this group. Funding for both capital and operating costs for the 
baseline systems should be the responsibility of the Coast Guard and 
should be incorporated into long-range funding plans.
    Recommendation 4.--Each port, through a public/private partnership, 
should apply to the Coast Guard for enhancements beyond the generic 
system that would provide economic and other benefits to users. The 
application should include proposals for funding. Funding for 
enhancements should be the responsibility of local partnerships. 
Applications may also be used to justify or modify the priority status 
of ports.
    Recommendation 5.--The Coast Guard should examine its existing VTS 
as well as private VTIS and enhancements in order to upgrade all 
systems to meet national safety needs and Coast Guard mission 
requirements. Upgrades required to meet national safety needs should be 
funded by the Coast Guard. Enhancements beyond the generic baseline 
system should be funded by the local entities in the partnership.
                          cost-sharing options
    Although the national interest in safe and efficient ports and 
waterways justifies federal funding for generic VTS systems that meet 
national safety needs and Coast Guard mission requirements, the 
committee recognizes that full federal funding may not be feasible in 
the future. Private support can best be encouraged by negotiations to 
determine a cost-sharing formula acceptable to local stakeholders. The 
committee identified three general cost-sharing mechanisms that could 
be used as a basis for developing a more specific formula. Each 
mechanism would provide for both federal funding and local user 
funding, with specific shares to be determined by the relative benefits 
derived by each party. Some mechanisms would make use of existing 
institutions and authorities, but others would require establishing new 
authorities and, possibly, legislation. All of them would require the 
establishment of local partnerships to facilitate implementation. Any 
one of the three could be selected and applied to fit a specific 
situation. The options include (1) establishing new or using existing 
national trust funds, (2) using federal grants combined with local 
cost-sharing measures, and (3) imposing local user fees to supplement 
federal funding.
                             RELATED AGENCY
                      SURFACE TRANSPORTATION BOARD
            Prepared Statement of Linda J. Morgan, Chairman
    Chairman Shelby and Members of the Subcommittee, I am Linda J. 
Morgan, Chairman of the Surface Transportation Board (Board). It is my 
pleasure to submit the budget request for the Board for fiscal year 
1998.
                         background on the board
    As you know, on January 1, 1996, the Board was established pursuant 
to Public Law 104-88, the ICC Termination Act of 1995 (ICCTA). 
Consistent with the trend toward less economic regulation of the 
surface transportation industry, the ICCTA eliminated the ICC and, with 
it, several regulatory functions that it had administered. The ICCTA 
transferred to the Board core rail functions and certain non-rail 
adjudicative functions previously performed by the ICC. Motor carrier 
licensing and certain other motor functions were transferred to the 
Federal Highway Administration within the Department of Transportation 
(DOT).
    The Board is a three-member, bipartisan, decisionally independent, 
adjudicatory body organizationally housed within DOT. The rail 
oversight of the Board encompasses rate reasonableness, car service and 
interchange, mergers and line acquisitions, and line constructions and 
abandonments. The important rail reforms of the Staggers Rail Act of 
1980 are continued under the ICCTA. The jurisdiction of the Board also 
includes limited oversight of the intercity bus industry and certain 
pipeline carriers; rate regulation involving non-contiguous domestic 
water transportation, household goods carriers, and collectively 
determined motor rates; and the disposition of motor carrier 
undercharge claims. The ICCTA empowers the Board, through its exemption 
authority, to promote deregulation administratively. The Board 
currently has pending a little over 500 adjudications related to all of 
these functions. The number of cases pending at the Board at any given 
time remains relatively constant at a level between 500 and 600 
because, even as cases are resolved, new cases are filed.
              the board's fiscal year 1998 budget request
    The Board's fiscal year 1998 budget request totals $15.853 million 
and 134 FTE's. This budget proposes the same level and manner of 
funding provided to the Board for fiscal year 1997, and reflects the 
relatively constant workload expected and the statutory and regulatory 
deadlines associated with the resolution of the cases filed.\1\ This 
amount includes an appropriations request of $12.753 million and a 
request for $3.1 million in reimbursements from the offsetting 
collection of user fees, based on the Board's existing program 
assessing fees to cover the costs incurred by the Board for fee-related 
activities.
---------------------------------------------------------------------------
    \1\ Attached (Attachment 1) is a table that presents in more detail 
the specifics of the Board's fiscal year 1998 budget request.
---------------------------------------------------------------------------
    By comparison, the President's fiscal year 1998 budget for the 
Board totals $14.3 million, all to be funded by user fees. In this 
regard, additional statutory authority would be required to implement 
the President's user fee proposal, as the Board's current user fee 
authority would not allow the Board to increase user fees sufficiently 
to fully fund itself.\2\ The difference between the Board's request of 
$15.853 million and the President's request of $14.3 million is $1.5 
million. The Board estimates that funding at the President's level 
would require the reduction of 24 FTE's: the Board's budget is 
predominantly for personnel costs, and includes little in the way of 
other discretionary funds that can be reduced.
---------------------------------------------------------------------------
    \2\ Such a statutory change, if enacted would have needed become 
law by early June of this year. This would have allowed the minimum 
time necessary for the Board to complete a rulemaking to implement, by 
October 1 of this year, whatever new fee structure is needed to fully 
fund the Board in fiscal year 1998.
---------------------------------------------------------------------------
             overall goals and accomplishments of the board
    In the performance of its functions, the objective of the Board is 
to ensure that, where regulatory oversight is necessary, it is 
exercised efficiently and effectively, integrating market forces, where 
possible, into the overall regulatory model. In particular, the Board 
seeks to resolve matters brought before it fairly and expeditiously. 
Through use of its regulatory exemption authority, streamlining of its 
decisional process and the regulations applicable thereto, and 
consistent application of legal and equitable principles, the Board 
seeks to facilitate commerce by providing an effective forum for 
efficient dispute resolution and facilitation of appropriate business 
transactions. The Board continues to strive to develop, through 
rulemakings and case disposition, new and better ways to analyze unique 
and complex problems, to reach fully justified decisions more quickly, 
and to reduce the costs associated with regulatory oversight.
    The Board thus views its responsibility as one of promoting, where 
appropriate, substantive and procedural regulatory reform in the 
economic regulation of surface transportation. In this regard, the 
Board has exempted certain commodities and classes of transactions from 
regulation. It also has adopted several rulemakings that eliminated 
unnecessary regulations, streamlined existing regulations, and provided 
for expedited procedures and deadlines to handle various adjudicative 
matters before the Board. In addition, it has processed various matters 
brought before the Board in a way that has promoted private-sector 
negotiations and resolutions, where appropriate, and facilitated 
market-based transactions in the public interest.
    To be more responsive to the surface transportation community by 
fostering governmental efficiency, innovation in dispute resolution, 
private-sector solutions to problems, and competition in the provision 
of transportation services, the Board will:
  --Continue to strive for a more streamlined process for the 
        expeditious handling of rail rate reasonableness and other 
        complaint cases, in an effort to provide additional regulatory 
        predictability to shippers and carriers;
  --Continue to reduce processing time for all cases before the Board, 
        in particular to ensure that appropriate market-based 
        transactions in the public interest are facilitated; and
  --Continue to develop new opportunities for the various sectors of 
        the transportation community to work cooperatively with the 
        Board and with one another to find creative solutions to 
        persistent industry and/or regulatory problems involving 
        carriers, shippers, employees, and local communities.
             board workloads for fiscal year 1997 and 1998
    Attached is a table (Attachment 2) that shows workload trends, 
which form the basis for the Board's request to have its current level 
of funding maintained in fiscal year 1998. As the table indicates, the 
Board believes that the number of decisions issued is the best measure 
of workload. In accordance with the Board's continued commitment to 
resolving matters before it expeditiously, it anticipates approximately 
the same amount of work and output in fiscal year 1998 as is estimated 
for fiscal year 1997.
    In forecasting future workload trends, workload related to rail 
carrier consolidations is expected to remain constant for fiscal year 
1997 and fiscal year 1998. In particular, the Board will continue to 
monitor the implementation of the Union Pacific/Southern Pacific merger 
pursuant to the five-year oversight condition that the Board imposed as 
part of its approval of the merger in 1996. In addition, a joint 
proposal for the control of Conrail will soon be filed by CSX and 
Norfolk Southern (NS).\3\
---------------------------------------------------------------------------
    \3\ On April 10, CSX, NS, and Conrail jointly filed a notice of 
intent to file such a proposal on or before July 10, 1997. These 
parties have indicated that such a filing will be made on June 16, 
1997.
---------------------------------------------------------------------------
    Regarding oversight of rail rates and services, the workload is 
expected to remain at the fiscal year 1996 level through fiscal year 
1997 and then increase somewhat in fiscal year 1998 in anticipation of: 
rate reasonableness complaints expected to be filed as long term coal 
transportation contracts continue to expire; and the anticipated filing 
of complaints seeking application of the Board's recently issued non-
coal rate guidelines.\4\ In addition, the Board anticipates activity by 
parties seeking competitive access remedies in accordance with the 
Board's recent bottleneck rate decision.\5\
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    \4\ On December 31, 1996, the Board issued simplified guidelines to 
govern the disposition of small rail rate complaints for which the 
application of a more complex rate analysis is too costly.
    \5\ On December 31, 1996, the Board issued guidelines to govern 
rail rate reasonableness and route issues in cases where a portion of 
the rail transportation moves over a bottleneck segment (a segment 
serving a point for which no other rail transportation route is 
available).
---------------------------------------------------------------------------
    As part of the ongoing restructuring occurring throughout the rail 
industry, rail abandonments and line constructions are expected to 
remain at the fiscal year 1996 level through fiscal year 1997. The 
Board's recently completed rulemaking streamlining the abandonment 
process should further facilitate abandonments that might have already 
been planned. A small decrease in abandonment activity, however, is 
projected for fiscal year 1998 due to an expected increase in line sale 
activity. Normally, it is expected that as line sales increase, 
abandonments decrease, and vice-versa, as line sales usually involve 
lines that would otherwise be abandoned. Other line transactions (such 
as leases and trackage rights) are expected to continue at the fiscal 
year 1996 level during fiscal year 1997, and to increase somewhat 
during fiscal year 1998.
    Other rail activities are expected to remain steady during fiscal 
year 1997 (at the fiscal year 1996 levels) and then increase somewhat 
in fiscal year 1998 due to: workload related to labor arbitration 
appeals following implementation of railroad mergers recently approved; 
and the continued use of exemption authority as appropriate, with a 
view toward continuing to eliminate unnecessary rail regulations and 
streamline remaining rail regulations.
    Motor carrier undercharge workload is expected to follow the fiscal 
year 1996 level during fiscal year 1997 and then to decrease in fiscal 
year 1998. As these cases have tended recently to be filed in large 
groups, primarily in response to court action, a high volume of work 
remains pending at this time. While the filing of new cases should end 
at some point, it cannot be said with confidence when that point will 
arrive.
    Other non-rail activities are expected to remain at fiscal year 
1996 levels during fiscal year 1997, but indications are that there 
will be an increase in workload in this area during fiscal year 1998, 
in particular because of the statutorily mandated review of motor 
carrier collective rate-making agreements that the Board must 
undertake, and continued intercity bus restructuring transactions.
                                summary
    The Board's budget request would ensure the resources needed for 
the Board to continue to implement its responsibilities expeditiously 
and effectively as Congress intends. I would be happy to answer any 
other questions that the Committee may have about the Board's fiscal 
year 1998 budget request.

                                      ATTACHMENT 1.--SALARIES AND EXPENSES                                      
                                             [Dollars in thousands]                                             
----------------------------------------------------------------------------------------------------------------
                                                                          Fiscal years--                        
                                                             ---------------------------------------  Difference
                                                              1996 actual      1997         1998         from   
                                                                  \1\        enacted      request      enacted  
----------------------------------------------------------------------------------------------------------------
Permanent positions.........................................          132          134          134  ...........
Full-time equivalents.......................................          106          134          134  ...........
                                                             ===================================================
Personnel compensation and benefits.........................      $10,171      $11,623      $12,009        $386 
Former personnel............................................        2,858          712           20        (692)
Travel......................................................           35           36           38           2 
Other costs.................................................        4,316        3,087        3,786         699 
                                                             ---------------------------------------------------
      Total budget resources................................   \2\ 17,380       15,458       15,853         395 
----------------------------------------------------------------------------------------------------------------
\1\ The fiscal year 1996 numbers represent only three quarters of the fiscal year. The Board was established on 
  January 1, 1996.                                                                                              
\2\ This number includes expenses associated with the closure of the Interstate Commerce Commission (ICC).      

                          changes in resources
    For personnel compensation and benefits, $12,009,000 is requested 
to support 134 FTE's. This is an increase of $386,000 over fiscal year 
1997, of which $78,800 is required to fund the annual cost of the 
January 1997 pay raise and $207,200 is required for the January 1998 
pay raise originally estimated at 3.1 percent.\6\ The request also 
includes $100,000 for lump-sum leave payments to retiring employees. 
Funding for costs for former personnel severance and unemployment 
payments is requested at $20,000, which is a decrease of $692,000 from 
fiscal year 1997. This is due to a decrease in payments to former ICC 
and Board employees who were separated from Federal service.
---------------------------------------------------------------------------
    \6\ The Administration has revised the civilian pay raise 
assumptions for fiscal year 1998 since the Board's budget request was 
originally developed. The revised civilian pay increase is 2.8 percent, 
which amounts to a $22,000 change in personnel compensation 
requirements.
---------------------------------------------------------------------------
    A travel budget of $38,000 is requested primarily for on-site 
visits to railroads to finalize audits and review public accountants' 
workpapers, for physical inspection of proposed rail abandonment and 
construction sites and verification of environmental data provided by 
parties to proceedings, for defense of the Board's decisions in courts 
across the country, and for the general presentation upon request of 
issues within the Board's jurisdiction.
    Funding to cover other costs is requested at $3,786,000, a $699,000 
increase over fiscal year 1997. Included in this number is a rental 
payment increase directed by the General Services Administration (GSA). 
However, the Board's rent funding requirements will decrease over the 
long term as GSA amortizes the cost for the space alterations and 
accounts for the rental rate decreases anticipated in connection with 
the Board's new location. This amount also includes regular cost 
increases in telephone service, mail delivery, general equipment 
maintenance and replacement, and the maintenance associated with the 
operation of the Board's existing software system.

   ATTACHMENT 2.--FISCAL YEAR 1998 CONGRESSIONAL BUDGET JUSTIFICATION   
                          WORKLOAD SUMMARY \1\                          
------------------------------------------------------------------------
                                    Actual    Estimated \3\   Estimated 
                                 fiscal year   fiscal year   fiscal year
       Workload category           1996 \2\        1997          1998   
                                  decisions     decisions     decisions 
                                    issued        issued        issued  
------------------------------------------------------------------------
Rail carrier consolidations....          124           160           160
Rail rates and service.........           71           100           110
Rail abandonments and                                                   
 constructions.................          369           500           480
Other line transactions........          147           200           250
Other rail activities..........           94           125           140
Motor carrier undercharges.....          480           640           580
Non-rail activities............           55            75           100
                                ----------------------------------------
      Total decisions..........        1,340         1,800         1,820
------------------------------------------------------------------------
\1\ The Board believes that the number of decisions issued is the best  
  measure of workload at the Board. Certain activities performed at the 
  Board that provide direct and indirect support to rulemakings and     
  decisions in specific cases are not reflected in these workload       
  numbers. Such activities not reflected include: enforcement action;   
  judicial review work; rail audits and rail carrier reporting          
  oversight; administration of the rail waybill sample and development  
  of the Uniform Rail Costing System; and case-related correspondence   
  and informal public assistance.                                       
\2\ This column represents three-fourths of a year (January 1, 1996 to  
  September 30, 1996).                                                  
\3\ Estimated workload for fiscal years 1997 and 1998 are based on      
  historical information regarding actual filings and best estimates of 
  probable future filings by parties. Because the Board is principally  
  an adjudicatory body, it does not directly control the level or timing
  of actual case filings.                                               

                                 ______
                                 

            Questions Submitted by Senator Richard C. Shelby

                   board members' terms and staffing
    Question. Who are the current Surface Transportation Board (``the 
Board'') members, and when do their terms expire? Please display each 
Board member's office staffing, by name, position title and grade.
    Answer. The ICC Termination Act of 1995 (ICCTA) provided that the 
term for each member of the Board shall be 5 years and shall begin when 
the term of the predecessor of that member ends. Also under the ICCTA, 
a Board Member cannot be reappointed for more than one additional term.
                 board members and expiration of terms
    Gus A. Owen, December 31, 1997.
    Linda J. Morgan, December 31, 1998.
    Vacancy, December 31, 2000.

                             OFFICE STAFFING                            
------------------------------------------------------------------------
              Name                       Title               Grade      
------------------------------------------------------------------------
Linda J. Morgan.................  Chairman..........  EX-03             
Richard Armstrong III...........  Chief of Staff....  GM-905-15         
Mary L. Turek...................  Confidential        GS-301-12         
                                   assistant.                           
Gus A. Owen.....................  Vice Chairman.....  EX-04             
Vacancy (as of 6/6/97)..........  Staff advisor.....  GS-301-15         
Valerie A. Nicholas.............  Executive           GS-301-11         
                                   assistant.                           
Vacancy.........................  Commissioner......  EX-04             
Vacancy.........................  Staff advisor.....  GS-301-15         
Vacancy.........................  Executive           GS-301-11         
                                   assistant.                           
------------------------------------------------------------------------

                            funding history
    Question. Please prepare a table displaying the Board's funding 
request, the Administration's request, the enacted funding level, and 
the end of year staffing level for each fiscal year from fiscal year 
1994 to that requested for fiscal year 1998. Please display both 
appropriated funds and offsetting collections.
    Answer. The following table displays the funding history of the 
Interstate Commerce Commission (ICC) and the Board for fiscal years 
1994 through 1998.

                                   BUDGET REQUESTS AND ENACTED APPROPRIATIONS                                   
                                                [By fiscal year]                                                
----------------------------------------------------------------------------------------------------------------
                                                  ICC                                      STB                  
                                --------------------------------------------------------------------------------
                                     1994         1995       1996 \1\     1996 \1\       1997          1997     
----------------------------------------------------------------------------------------------------------------
Board:                                                                                                          
    Appropriation..............  $49,053,000  $45,069,000  $32,892,000  ...........  $12,344,000     $12,753,000
    Offsetting collections.....    7,300,000    7,300,000    8,300,000  ...........    3,000,000       3,100,000
                                --------------------------------------------------------------------------------
      Budget request...........   56,353,000   52,369,000   41,192,000  ...........   15,344,000  \2\ 15,853,000
                                ================================================================================
President:                                                                                                      
    Appropriation..............   45,466,000   44,429,000   33,202,000  ...........  ...........  ..............
    Offsetting collections.....    7,300,000    8,300,000    8,300,000  ...........   15,344,000      14,300,000
                                --------------------------------------------------------------------------------
      Budget request...........   52,766,000   52,729,000   41,502,000  ...........   15,344,000      14,300,000
                                ================================================================================
Enacted:                                                                                                        
    Appropriation \3\..........   44,960,000   33,083,000   13,379,000   $8,414,000   12,244,000  ..............
    Offsetting collections \4\.    7,300,000    7,738,000    3,200,000      652,000    3,000,000  ..............
                                --------------------------------------------------------------------------------
    Budget request.............   52,260,000   40,821,000   16,579,000    9,066,000   15,244,000  ..............
                                ================================================================================
End of year:                                                                                                    
    Staffing level.............          571          402      \5\ 317          132          134             134
    FTE level..................          607          416       \5\ 86          106          134             134
----------------------------------------------------------------------------------------------------------------
\1\ During fiscal year 1996, the ICCTA was passed, the ICC was eliminated effective December 1, 1995, and the   
  Board was established effective January 1, 1996. The enacted funding levels for the ICC for fiscal year 1996  
  reflect ICC operational and termination expenses for one-quarter of the fiscal year and the Board funding     
  levels for fiscal year 1996 reflect Board operational expenses for three-quarters of the fiscal year.         
\2\ The Board's fiscal year 1998 budget request essentially represents the Board's current funding level (for   
  fiscal year 1997) plus inflationary and personnel salary increases.                                           
\3\ Enacted appropriations less enacted rescissions.                                                            
\4\ Actual offsetting collections.                                                                              
\5\ As of December 31, 1995.                                                                                    

                  user fees and offsetting collections
    Question. Please display in tabular form the level of anticipated 
user fee income in the Board's fiscal year 1996, 1997, and 1998 budget 
requests. Please also include columns displaying the President's budget 
assumptions for user fee income in each of these three fiscal years. In 
addition, please display the level of user fee offsets included in the 
appropriations legislation for the Board in fiscal years 1996 and 1997. 
Finally, please include columns displaying the actual amount of user 
fees collected in fiscal years 1996 and 1997 (both up to the present, 
and projected through the end of this fiscal year).
    Answer. The following table displays the offsetting collection of 
user fees for fiscal year 1996 through 1998.

                                                [By fiscal years]                                               
----------------------------------------------------------------------------------------------------------------
                                                                                             STB                
                                                                 ICC  1996  ------------------------------------
                                                                                1996         1997        1998   
----------------------------------------------------------------------------------------------------------------
User fee:                                                                                                       
    Anticipated income in budget request......................   $8,300,000         N/A   $3,000,000  $3,100,000
    President's budget assumptions............................    8,300,000  ..........   15,344,000  14,300,000
    User fee offsets in appropriations language...............  \1\ 8,300,0                                     
                                                                         00         N/A    3,000,000  ..........
Offsetting collections:                                                                                         
    Actual....................................................  \2\ 3,200,0                                     
                                                                         00  \2\ $651,5                         
                                                                                     20  \3\ 761,914  ..........
    Projected end of fiscal year..............................  ...........  ..........  \4\ 3,021,3            
                                                                                                  75  ..........
----------------------------------------------------------------------------------------------------------------
\1\ Offsetting collections of $8,300,000 were intended to cover, during fiscal year 1996, both the ICC and its  
  successors (the Board and the Department of Transportation (DOT)) to carry outtransferred rail and motor      
  functions.                                                                                                    
\2\ These numbers do not include the fees collected by DOT for the transferred motor functions.                 
\3\ User fees collected 10/1/97-2/28/97.                                                                        
\4\ Includes $1,779,000 for two Class I merger applications filed in CSX/Conrail/Norfolk Southern rail merger.  

    Question. Please describe the Board's current user fee structure 
and schedule of fees. Are any other fees authorized by the Interstate 
Commerce Commission Termination Act?
    Answer. The Board's 1997 User Fee Update became effective on 
January 23, 1997. The fee schedule includes 109 fee items: fees based 
on specific types of proceedings; hourly fees for the searching and 
duplication of records by professional and clerical staff; and 
administrative fees for photocopying of records, certifications, and 
generation of computer-generated data files. The fees are updated 
annually and include direct labor cost, operations overhead, Board and 
office general administrative costs, and publication costs associated 
with providing services to the requesting public. There were no new 
fees authorized by the ICCTA. A copy of the 1997 User Fee Update 
follows. In addition, the response to the question that follows 
concerning the history of agency user fees includes other background 
information pertaining to the existing fee schedule.

                     Service date--January 23, 1997

    This decision will be included in the bound volumes of printed 
reports at a later date.

               Decision--STB Ex Parte No. 542 (Sub-No. 1)

 Regulations Governing Fees for Services Performed in Connection With 
              Licensing and Related Services--1997 Update

                       Decided: January 13, 1997

    The Board adopts the 1997 User Fee Update.
                               background
    The Surface Transportation Board (Board) is required by the 
regulations at 49 CFR 1002.3 to update its user fees annually. The 
Board's fees are revised based on the cost study formula set forth at 
49 CFR 1002.3(d). Also, in some previous years, selected fees were 
modified to reflect new cost study data or changes in Board or 
Interstate Commerce Commission fee policy. The Board's last user fee 
update was issued in Regulations Governing Fees for Service, 1 S.T.B. 
179 (1996) (1996 Fee Update I).
    The Board's regulations at 49 CFR 1002.3(a) provide that the entire 
fee schedule or selected fees can be modified more than once a year, if 
necessary. Because Board employees will receive a salary increase of 
3.33 percent in January 1997, and the cost of publishing documents in 
the Federal Register significantly increased on January 1, 1997, we are 
updating our user fees to recover these costs. All fees, with the 
exception of the ones discussed below, will be updated based on the 
cost formula at 49 CFR 1002.3(d).
                          1997 update factors
    For this update, the direct labor cost data have been revised to 
reflect the combined 1997 Government-wide general salary and 1997 
locality salary increase of 3.33 percent that will take effect in 
January 1997. The Government Fringe Benefit Cost used in the update 
formula remains at 49.55 percent. Based on the Board's Fiscal 1996 
actual budget data,\1\ the Office General and Administrative Expense 
Factor has decreased from 26.73 percent to 20.06 percent, while the 
Board's General and Administrative Expense Factor has increased from 
11.36 percent to 12.20 percent. In addition, the Operations Overhead 
Factor, which is developed from Fiscal 1996 payroll cost data, has 
increased from 13.97 percent to 23.13 percent. Finally, the cost of 
publishing documents in the Federal Register has increased as discussed 
below. The 1997 fully allocated cost for each fee item developed from 
these factors is set forth in Appendix A.
---------------------------------------------------------------------------
    \1\ The Board, which was created by the ICC Termination Act of 
1995, Public Law No. 104-88, 109 Stat. 803 began operation on January 
1, 1996. Therefore, the budget data from which these costs were derived 
covers the period of January 1, 1996 to September 30, 1996.
---------------------------------------------------------------------------
                         federal register cost
    On January 1, 1997, the cost for publishing documents in the 
Federal Register increased to $126 per column. The minimum cost for 
publishing a document also increased to $126. Accordingly, we have 
modified the Federal Register cost for each fee item that includes such 
cost to reflect these changes.
    We have determined that our current fees for items (38) through 
(41)(i) and (ii) involving major and significant rail finance 
proceedings do not include Federal Register publication costs. Based on 
a review of documents published in the Federal Register for two recent 
rail merger proceedings,\2\ we have calculated that Federal Register 
costs of $4,630.50 for major transactions and $926.10 for significant 
transactions should be included in the cost for those fee items. We 
also have increased the Federal Register publication costs for minor 
transactions and responsive applications to $1,183.96.
---------------------------------------------------------------------------
    \2\ Burlington Northern Inc. and Burlington Northern Railroad 
Company--Control and Merger--Santa Fe Pacific Corporation and The 
Atchison, Topeka and Santa Fe Railway Company, Finance Docket No. 32549 
and Union Pacific Corporation, Union Pacific Railroad Company, and 
Missouri Pacific Railroad Company--Control and Merger--Southern Pacific 
Rail Corporation, Southern Pacific Transportation Company, St Louis 
Southwestern Railway Companny, SPCSL Corp., and The Denver And Rio 
Grande Western Railroad Company, Finance Docket No. 32760.
---------------------------------------------------------------------------
                 fees items not affected by this update
    In 1996 Fee Update I, based on concerns expressed by various 
commenting parties in that decision, the Board determined that fees for 
formal complaints would be set at 10 percent of the fully allocated 
cost and would be increased gradually to the fully allocated levels. 
However, because of on-going legislative debate regarding complaint 
fees when the 1996 Fee Update I was decided, the Board initially 
maintained all complaint fees at $1,000. In Regulations Governing Fees 
for Service Performed in Connection With Licensing and Related 
Services--1996 Update, STB Ex Parte No. 542 (STB served Dec. 17, 1996) 
(1996 Fee Update II), the Board established fees for items (56)(i) and 
(iii), which do not involve rail maximum rates filed by small shippers, 
at $23,300 and $2,300, respectively. Those fee increases became 
effective on January 16, 1997. Consequently, in the current update we 
will not revise the fees for these two types of complaint 
proceedings.\3\ We will increase the fees for these items under the 
formula adopted in 1996 Fee Update I, in subsequent update proceedings.
---------------------------------------------------------------------------
    \3\ Under a gradual fee increase program over a multiple-year 
period as established in the 1996 Fee Update I, we would be justified 
in adopting a fee for Item 56(i), Formal complaints filed under the 
coal rate guidelines set at $24,800 per filing [$248,533.78 (total 1997 
cost) times 10 percent and then rounded]. We would also be justified in 
adopting a fee for Item 56(iii), All other formal complaints set at 
$2,400 per filing [$24,658.77 (total 1997 cost) times 10 percent and 
then rounded].
---------------------------------------------------------------------------
    We note that the filing fee for Item 56(ii), A formal complaint 
involving rail maximum rates filed by a small shipper, remains at 
$1,000 in keeping with Congressional mandate discussed in 1996 Fee 
Update II. In addition, the $150 filing fees that were established in 
1996 Fee Update I for items involving trails use requests, Amtrak 
conveyance and compensation proceedings, appeals to Board decisions, 
and motor carrier undercharge proceedings and the $150 filing fee for 
labor arbitration proceedings, adopted in 1996 Fee Update II, will be 
maintained. Moreover, the fee for Item 13, A feeder line development 
program, will remain at $2,600 and fees for Item 58(i), Petition for 
declaratory order involving a dispute over an existing rate or 
practice, and Item 58(ii), All other petitions for declaratory order, 
are held at the current levels of $1,000 and $1,400, respectively.
                 other adjustments to the fee schedule
    In Central Power & Light v. Southern Pacific Transportation 
Company, No. 41242 (STB served Dec. 31, 1996), the Board indicated that 
in certain cases ``bottleneck'' rate relief would be available in 
connection with the filing of a competitive access complaint. Our 
existing fee schedule, however, does not contain a separate fee for 
competitive access complaints. In light of our limited experience to 
date with competitive access complaint filings, we will initially set a 
fee of $150 for these cases. This fee will be designated Item 56(iv), 
Competitive access complaints. We will reevaluate our fee for this 
activity as we gain further experience handling these types of 
proceedings.
    In Class Exem. For the Construction of Connecting Track, 1 S.T.B. 
75 (1996), the Board adopted new regulations at 49 CFR 1150.36, that 
allow for the filing of notices of exemption for the construction and 
operation of connecting railroad track. Prior to the revisions of the 
fee schedule in 1996 Fee Update I rail line acquisition and operation 
proceedings and construction proceedings were grouped under the same 
item. When these two activities were given separate fee item numbers in 
1996 Fee Update I, the revised schedule did not include a fee for 
notices of exemption involving construction of rail lines. Therefore, 
we are adding Item 12(ii), Notices of exemption involving construction 
of rail lines under 49 CFR 1150.36, to cover that activity. The fee for 
Item 12(ii), is established as $1,100, which is the same level as the 
fee for notices involving acquisition or operation of rail lines. In 
future fee updates, that fee level may be adjusted based on our 
experience handling those proceedings. In order to be consistent with 
other fee items in our fee schedule, we are also providing for a 
separate Fee Item (12)(iii), Petitions for exemptions involving 
construction.
                     notice and comment requirement
    The fee increases involved here only result from the mechanical 
application of the current update formula at 49 CFR 1002.3(d), which 
was adopted through notice and comment procedures in Regulations 
Governing Fees for Services-1987 Update, 4 I.C.C.2d 137 (1997). 
Therefore, we believe that good cause exists for finding that notice 
and comment is unnecessary for this proceeding. See Regulations 
Governing Fees For Services-1990 Update, 7 I.C.C.2d 3 (1990), 
Regulations Governing Fees For Services-1991 Update, 8 I.C.C.2d 13 
(1991), Regulations Governing Fees For Services-1993 Update, 9 I.C.C.2d 
855 (1993).
                    regulatory flexibility analysis
    We certify that these rules will not cause a significant economic 
effect on a substantial number of small entities because the Board's 
regulations provide for waiver of filing fees for those entities which 
can make the required showing of financial hardship.
    It is ordered:
    1. 49 CFR Part 1002 of the Code of Federal Regulations is amended 
as set forth in APPENDIX B. Notice of the final rules adopted here will 
be transmitted to Congress pursuant to Pub. L. 104-121 (Mar. 29, 1996).
    2. These rules are effective on February 24, 1997.
    By the Board, Chairman Morgan and Vice-Chairman Owen.

                                        Vernon A. Williams,
                                                         Secretary.

                                                                       APPENDIX A                                                                       
                                                           [STB Ex Parte No. 542 (Sub-No. 1)]                                                           
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                 1997 Direct                                                                                            
                                    1996 Direct     labor      Government  Total (2+3)   Operations                             Publication   Total sum 
              FEE No.                  labor       updated      fringes                   overhead    Office G&A   Board G&A       cost         (4-8)   
                                                                                                                                                        
                                            (1)          (2)          (3)          (4)          (5)          (6)          (7)           (8)          (9)
                                                                                                                                                        
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.................................    $1,029.66    $1,063.95      $527.19    $1,591.13      $368.03      $393.01      $286.96         $4.00    $2,643.14
2.................................       434.09       448.55       222.25       670.80       155.16       165.69       120.98        149.88     1,262.50
3.................................     6,382.49     6,595.03     3,267.84     9,862.86     2,281.28     2,436.12     1,778.79        149.88    16,508.93
4i................................     1,029.66     1,063.95       527.19     1,591.13       368.03       393.01       286.96        149.88     2,789.02
4ii...............................        24.75        25.57        12.67        38.25         8.85         9.45         6.90  ............        63.44
5.................................       116.13       120.00        59.46       179.46        41.51        44.33        32.37          5.00       302.65
11i...............................     1,655.51     1,710.64       847.62     2,558.26       591.73       631.89       461.39        126.00     4,369.26
11ii..............................       354.50       366.30       181.50       547.81       126.71       135.31        98.80        231.00     1,139.62
11iii.............................     2,882.61     2,978.60     1,475.90     4,454.50     1,030.33     1,100.26       803.38        149.88     7,538.34
12i...............................    17,300.29    17,876.39     8,857.75    26,734.14     6,183.61     6,603.30     4,821.57        162.00    44,504.62
12ii..............................       354.50       366.30       181.50       547.81       126.71       135.31        98.80        231.00     1,139.62
12iii.............................    17,300.29    17,876.39     8,857.75    26,734.14     6,183.61     6,603.30     4,821.57        162.00    44,504.62
13................................     5,313.76     5,490.71     2,720.65     8,211.35     1,899.29     2,028.19     1,480.94        147.00    13,766.77
14i...............................     1,401.44     1,448.11       717.54     2,165.65       500.91       534.91       390.58        149.88     3,741.93
141i..............................       354.50       366.30       181.50       547.81       126.71       135.31        98.80        231.00     1,139.62
14iii.............................     1,494.58     1,544.35       765.23     2,309.57       534.20       570.46       416.54        165.38     3,996.16
15................................       357.86       369.78       183.22       553.00       127.91       136.59        99.74        128.86     1,046.10
21i...............................     5,119.05     5,289.51     2,620.95     7,910.47     1,829.69     1,953.88     1,426.67        126.00    13,246.71
21ii..............................       764.16       789.61       391.25     1,180.86       273.13       291.67       212.97        319.78     2 278.41
21iii.............................     1,418.72     1,465.96       726.38     2,192.35       507.09       541.51       395.40        183.27     3,819.61
22................................       110.71       114.40        56.68       171.08        39.57        42.26        30.85  ............       283.76
23................................       441.74       456.45       226.17       682.62       157.89       168.61       123.11  ............     1,132.23
24................................       422.68       436.76       216.41       653.17       151.08       161.33       117.80  ............     1,083.38
25................................       363.59       375.70       186.16       561.86       129.96       138.78       101.33  ............       931.92
26................................     5,268.56     5,444.00     2,697.50     8,141.51     1,883.13     2,010.94     1,468.34  ............    13,503.92
27................................       272.60       281.68       139.57       421.25        97.43       104.05        75.97  ............       698.70
36................................     4,364.04     4,509.36     2,234.39     6,743.75     1,559.83     1,665.70     1,216.25        149.88    11,335.41
37................................     2,337.14     2,414.97     1,196.62     3,611.58       835.36       892.06       651.36        149.88     6,140.24
38i...............................   345,266.30   356,763.67   176,776.40   533,540.07   123,407.82   131,783.75    96,225.26      4,630.50   889,587.39
38ii..............................    69,054.64    71,354.16    35,355.99   106,710.15    24,682.06    26,357.28    19,245.44        926.10   177,921.01
38iii.............................     1,401.44     1,448.11       717.54     2,165.65       500.91       534.91       390.58      1,183.96     4,776.01
38iv..............................       332.32       343.39       170.15       513.53       118.78       126.84        92.62        216.57     1,068.34
38v...............................     1,401.44     1,448.11       717.54     2,165.65       500.91       534.91       390.58      1,183.96     4,776.01
38vi..............................     2,139.22     2,210.46     1,095.28     3,305.74       764.62       816.51       596.20        149.88     5,632.94
39i...............................   345,266.30   356,763.67   176,776.40   533,540.07   123,407.82   131,783.75    96,225.26      4,630.50   889,587.39
39ii..............................    69,054.64    71,354.16    35,355.99   106,710.15    24,682.06    26,357.28    19,245.44        926.10   177,921.01
39iii.............................     1,401.44     1,448.11       717.54     2,165.65       500.91       534.91       390.58      1,183.98     4,776.01
39iv..............................       241.20       249.23       123.49       372.73        86.21        92.06        67.22        233.10       851.32
39v...............................     1,401.44     1,448.11       717.54     2,165.65       500.91       534.91       390.58      1,183.96     4,776.01
39vi..............................     2,139.22     2,210.46     1,095.28     3,305.74       764.62       816.51       596.20        149.88     5,632.94
40i...............................   345,266.30   356,763.67   176,776.40   533,540.07   123,407.82   131,783.75    96,225.26      4,630.50   889,587.39
40ii..............................    69,054.64    71,354.16    35,355.99   106,710.15    24,682.06    26,357.28    19,245.44        926.10   177,921.01
40iii.............................     1,401.44     1,448.11       717.54     2,165.65       500.91       534.91       390.58      1,183.96     4,776.01
40iv..............................       223.42       230.86       114.39       345.25        79.86        85.28        62.27        190.59       763.24
40v...............................     1,401.44     1,448.11       717.54     2,165.65       500.91       534.91       390.58      1,183.96     4,776.01
40vi..............................     2,139.22     2,210.46     1,095.28     3,305.74       764.62       816.51       596.20        149.88     5,632.94
41i...............................   345,266.30   356,763.67   176,776.40   533,540.07   123,407.82   131,783.75    96,225.26      4,630.50   889,587.39
41ii..............................    69,054.64    71,354.16    35,355.99   106,710.15    24,682.06    26,357.28    19,245.44        926.10   177,921.01
41iii.............................     1,401.44     1,448.11       717.54     2,165.65       500.91       534.91       390.58      1,183.96     4,776.01
41iv..............................       265.63       274.48       136.00       410.48        94.94       101.39        74.03        216.00       896.84
41v...............................     1,401.44     1,448.11       717.54     2,165.65       500.91       534.91       390.58      1,183.96     4,776.01
41vi..............................     1,494.58     1,544.35       765.23     2,309.57       534.20       570.46       416.54        165.38     3,996.16
42................................       479.72       495.69       245.62       741.31       171.47       183.10       133.70        273.00     1,502.58
43................................    16,189.86    16,728.98     8,289.21    25,018.19     5,786.71     6,179.46     4,512.09        149.88    41,646.34
44i...............................     2,966.04     3,064.81     1,518.61     4,583.42     1,060.15     1,132.10       826.63        149.88     7,752.18
44ii..............................        24.75        25.57        12.67        38.25         8.85         9.45         6.90  ............        63.44
45................................       184.23       190.36        94.33       284.69        65.85        70.32        51.34  ............       472.20
46................................     1,820.53     1,881.15       932.11     2,813.27       650.71       694.87       507.38        149.88     4,816.11
47................................    35,016.04    36,182.07    17,928.22    54,110.29    12,515.71    13,365.18     9,758.92  ............    89,750.10
48................................    42,470.72    43,884.99    21,745.02    65,630.01    15,180.22    16,210.53    11,836.53  ............   108,857.30
56i...............................    96,965.56   100,194.51    49,646.38   149,840.89    34,658.20    37,010.52    27,024.17  ............   248,533.78
56ii..............................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ............     1,000.00
56iii.............................     9,620.63     9,941.00     4,925.76    14,866.76     3,438.68     3,672.07     2,681.26  ............    24,658.77
56iv..............................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ............       150.00
57................................     2,063.49     2,132.20     1,056.51     3,188.71       737.55       787.61       575.09  ............     5,288.96
58i...............................     1,938.52     2,003.07       992.52     2,995.60       692.88       739.91       540.26        472.50     5,441.15
58ii..............................     1,533.86     1,584.94       785.34     2,370.27       548.24       585.45       427.48        126.00     4,057.46
59................................     1,594.62     1,647.72       816.45     2,464.17       569.96       608.65       444.42        149.88     4,237.07
60................................     3,159.82     3,265.04     1,617.83     4,882.87     1,129.41     1,206.06       880.64  ............     8,098.98
61................................     1,540.45     1,591.75       788.71     2,380.46       550.60       587.97       429.32  ............     3,948.35
62................................     2,440.51     2,521.78     1,249.54     3,771.32       872.31       931.51       680.17  ............     6,255.31
76................................       288.83       298.45       147.88       446.33       103.24       110.24        80.50          2.00       742.30
77................................        30.55        31.57        15.64        47.21        10.92        11.66         8.51  ............        78.30
78i...............................         5.75          594         2.94         8.89         2.06         2.19         1.60  ............        14.74
78ii..............................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ............         1.00
79i...............................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ............        45.00
79ii..............................        36.40        37.61        18.64        56.25        13.01        13.89        10.14  ............        93.30
80................................       142.47       147.21        72.94       220.16        50.92        54.38        39.71  ............       365.17
81i...............................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ............        45.00
81ii..............................        36.40        37.61        18.64        56.25        13.01        13.89        10.14  ............        93.30
82................................        57.85        59.78        29.62        89.40        20.68        22.08        16.12  ............       148.28
83................................         9.56         9.88         4.89        14.77         3.42         3.65         2.66  ............        24.50
84................................        61.97        64.03        31.73        95.76        22.15        23.65        17.27  ............       158.84
85................................       266.35       275.22       136.37       411.59        95.20       101.66        74.23  ............       682.69
86................................       347.03       358.59       177.68       536.27       124.04       132.46        96.72  ............       889.48
96................................         7.47         7.72         3.82        11.54         2.67         2.85         2.08  ............        19.15
97................................         5.69         5.88         2.91         8.79         2.03         2.17         1.59  ............        14.58
98i...............................        72.33        74.74        37.03       111.77        25 85        27.61        20.16  ............       185.39
98ii..............................       107.77       111.36        55.18       166.54        38.52        41.13        30.04        126.00       402.23
99i...............................        44.45        45.93        22.76        68.69        15.89        16.97        12.39  ............       113 93
99ii..............................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ............        25.00
100i..............................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ............        50.00
100ii.............................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ............        10.00
100iii............................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ............        20.00
1OOiv.............................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ............       500.00
100v..............................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ............       400.00
100vi.............................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ............        50.00
100vii............................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ............     1,500.00
101i..............................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ............       450.00
101ii.............................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ............       150.00
101iii............................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ............       650.00
101iv.............................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ............       450.00
101v..............................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ............       500.00
101vi.............................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ............        50.00
102*..............................         3.97         4.10         2.03         6.13         1.42         1.52         1.11  ............        10.18
103*..............................        24.52        25 34        12.55        37.89         8.76         9.36         6.83  ............        62.85
104*..............................        16.97        17.54         8.69        26.22         6.07         6.48         4.73  ............        43.50
105*..............................          .56          .58          .29          .87          .20          .21          .16  ............         1.44
106*..............................        42.69        44.11        21.86        65.97        15.26        16.29        11.90  ............       109.42
--------------------------------------------------------------------------------------------------------------------------------------------------------

                   [STB Ex Parte No. 542 (Sub-No. 1)]

                               Appendix B

    For the reasons set forth in the preamble, title 49, chapter X, 
part 1002, of the Code of Federal Regulations is amended as follows:

                            Part 1002--FEES

    1. The authority citation for part 1002 continues to read as 
follows:
    Authority: 5 U.S.C. 552(a)(4)(A) and 553; 31 U.S.C. 9701 and 49 
U.S.C. 721(a).
    2. Section 1002.1 is amended by revising paragraphs (a), (b), (c), 
and (e)(1) and the chart in paragraph (f)(6) to read as follows:

Sec. 1002.1 Fees for records search. review, copying, certification, 
                    and related services.

          * * * * * * *
    (a) Certificate of the Secretary, $10.00.
    (b) Service involved in examination of tariffs or schedules for 
preparation of certified copies of tariffs or schedules or extracts 
therefrom at the rate of $25.00 per hour.
    (c) Service involved in checking records to be certified to 
determine authenticity, including clerical work etc., incidental 
thereto, at the rate of $17.00 per hour.
          * * * * * * *
    (e) * * *
    (1) A fee of $44.00 per hour for professional staff time will be 
charged when it is required to fulfill a request for ADP data.
          * * * * * * *
    (f) * * *
    (6) * * *

------------------------------------------------------------------------
             Grade                  Rate          Grade           Rate  
------------------------------------------------------------------------
GS-1...........................      $7.37  GS-9 ............     $17.20
GS-2...........................       8.02  GS-10............      18.95
GS-3...........................       9.04  GS-11............      20.82
GS-4...........................      10.15  GS-12............      24.95
GS-5...........................      11.35  GS-13............      29.67
GS-6...........................      12.66  GS-14............      35.06
GS-7...........................      14.06  GS-15 and over...      41.24
GS-8...........................      15.58                              
------------------------------------------------------------------------

          * * * * * * *
    2. In Sec. 1002.2, paragraph (f) is revised to read as follows:

Sec. 1002.2 Filing fees.

    (a) ***
    (f) Schedule of filing fees.

        Type of proceeding                                           Fee

PART I: Non-Rail Applications or Proceedings to Enter Upon a 
    Particular Financial Transaction or Joint Arrangement:
    (1) An application for the pooling or division of traffic.    $2,600
    (2) An application involving the purchase, lease, 
      consolidation, merger, or acquisition of control of a 
      motor carrier of passengers under 49 U.S.C. 4303........     1,200
    (3) An application for approval of a non-rail rate 
      association agreement. 49 U.S.C. 13706..................    16,500
    (4) An application for approval of an amendment to a non-
      rail rate association agreement:
        (i) Significant amendment.............................     2,700
        (ii) Minor amendment..................................        60
    (5) An application for temporary authority to operate a 
      motor carrier of passengers. 49 U.S.C. 14303(i).........       300
PART II: Rail Licensing Proceedings other than Abandonment or 
    Discontinuance Proceedings:
    (11) (i) An application for a certificate authorizing the 
      extension, acquisition, or operation of lines of 
      railroad. 49 U.S.C. 10901...............................     4,300
        (ii) Notice of exemption under 49 CFR 1150.31-1150.35.     1,100
        (iii) Petition for exemption under 49 U.S.C. 10502....     7,500
    (12) (i) An application involving the construction of a 
      rail line...............................................    44,500
        (ii) A notice of exemption involving construction of a 
          rail line under 49 CFR 1150.36......................     1,100
        (iii) A petition for exemption under 49 U.S.C. 10502 
          involving construction of a rail line...............    44,500
    (13) A Feeder Line Development Program application filed 
      under 49 U.S.C. 10907(b)(1)(A)(i) or 10907(b)(1)(A)(ii).     2,600
    (14) (i) An application of a class II or class III carrier 
      to acquire an extended or additional rail line under 49 
      U.S.C. 10902............................................     3,700
        (ii) Notice of exemption under 49 CFR 1150.41-1150.45.     1,100
        (iii) Petition for exemption under 49 U.S.C. 10502 
          relating to an exemption from the provisions of 49 
          U.S.C. 10902........................................     3,900
    (15) A notice of a modified certificate of public 
      convenience and necessity under 49 CFR 1150.21-1150.24..     1,000
PART III: Rail Abandonment or Discontinuance of Transportation 
    Services Proceedings:
    (21) (i) An application for authority to abandon all or a 
      portion of a line of railroad or discontinue operation 
      thereof filed by a railroad (except applications filed 
      by Consolidated Rail Corporation pursuant to the 
      Northeast Rail Service Act [Subtitle E of Title XI of 
      Pub. L. 97-35], bankrupt railroads, or exempt 
      abandonments............................................    13,200
        (ii) Notice of an exempt abandonment or discontinuance 
          under 49 CFR 1152.50................................     2,200
        (iii) A petition for exemption under 49 U.S.C. 10502..     3,800
    (22) An application for authority to abandon all or a 
      portion of a line of a railroad or operation thereof 
      filed by Consolidated Rail Corporation pursuant to 
      Northeast Rail Service Act..............................       250
    (23) Abandonments filed by bankrupt railroads.............     1,100
    (24) A request for waiver of filing requirements for 
      abandonment application proceedings.....................     1,000
    (25) An offer of financial assistance under 49 U.S.C. 
      10904 relating to the purchase of or subsidy for a rail 
      line proposed for abandonment...........................       900
    (26) A request to set terms and conditions for the sale of 
      or subsidy for a rail line proposed to be abandoned.....    13,500
    (27) A request for a trail use condition in an abandonment 
      proceeding under 16 U.S.C.1247(d).......................       150
PART IV: Rail Applications to Enter Upon a Particular 
    Financial Transaction or Joint Arrangement:
    (36) An application for use of terminal facilities or 
      other applications under 49 U.S.C. 11102................    11,300
    (37) An application for the pooling or division of 
      traffic. 49 U.S.C. 11322................................     6,100
    (38) An application for two or more carriers to 
      consolidate or merge their properties or franchises (or 
      a part thereof) into one corporation for ownership, 
      management, and operation of the properties previously 
      in separate ownership. 49 U.S.C. 11324:
        (i) Major transaction.................................   889,500
        (ii) Significant transaction..........................   177,900
        (iii) Minor transaction...............................     4,700
        (iv) Notice of an exempt transaction under 49 CFR 
          1180.2(d)...........................................     1,000
        (v) Responsive application............................     4,700
        (vi) Petition for exemption under 49 U.S.C. 10502.....     5,600
    (39) An application of a non-carrier to acquire control of 
      two or more carriers through ownership of stock or 
      otherwise. 49 U.S.C. 11324:
        (i) Major transaction.................................   889,500
        (ii) Significant transaction..........................   177,900
        (iii) Minor transaction...............................     4,700
        (iv) A notice of an exempt transaction under 49 CFR 
          1180.2(d)...........................................       850
        (v) Responsive application............................     4,700
        (vi) Petition for exemption under 49 U.S.C. 10502.....     5,600
    (40) An application to acquire trackage rights over, joint 
      ownership in, or joint use of any railroad lines owned 
      and operated by any other carrier and terminals 
      incidental thereto. 49 U.S.C. 11324:
        (i) Major transaction.................................   889,500
        (ii) Significant transaction..........................   177,900
        (iii) Minor transaction...............................     4,700
        (iv) Notice of an exempt transaction under 49 CFR 
          1180.2(d)...........................................       750
        (v) Responsive application............................     4,700
        (vi) Petition for exemption under 49 U.S.C. 10502.....     5,600
    (41) An application of a carrier or carriers to purchase, 
      lease, or contract to operate the properties of another, 
      or to acquire control of another by purchase of stock or 
      otherwise. 49 U.S.C. 11324:
        (i) Major transaction.................................   889,500
        (ii) Significant transaction..........................   177,900
        (iii) Minor transaction...............................     4,700
        (iv) Notice of an exempt transaction under 49 CFR 
          1180.2(d)...........................................       850
        (v) Responsive application............................     4,700
        (vi) Petition for exemption under 49 U.S.C. 10502.....     3,900
    (42) Notice of a joint project involving relocation of a 
      rail line under 49 CFR 1180.2(d)(5).....................     1,500
    (43) An application for approval of a rail rate 
      association agreement. 49 U.S.C. 10706..................    41,600
    (44) An application for approval of an amendment to a rail 
      rate association agreement. 49 U.S.C. 10706:
        (i) Significant amendment.............................     7,700
        (ii) Minor amendment..................................        60
    (45) An application for authority to hold a position as 
      officer or director under 49 U.S.C. 11328...............       450
    (46) A petition for exemption under 49 U.S.C. 10502 (other 
      than a rulemaking) filed by rail carrier not otherwise 
      covered.................................................     4,800
    (47) National Railroad Passenger Corporation (Amtrak) 
      conveyance proceeding under 45 U.S.C. 562...............       150
    (48) National Railroad Passenger Corporation (Amtrak) 
      compensation proceeding under Section 402(a) of the Rail 
      Passenger Service Act...................................       150
PART V: Formal Proceedings:
    (56) A formal complaint alleging unlawful rates or 
      practices of rail carriers, motor carriers of passengers 
      or motor carriers of household goods:
        (i) A formal complaint filed under the coal rate 
          guidelines (Stand-Alone Cost Methodology) alleging 
          unlawful rates and/or practices of rail carriers 
          under 49 U.S.C. 10704(c)(1) except a complaint filed 
          by small shipper....................................    23,300
        (ii) A formal complaint involving rail maximum rates 
          filed by a small shipper............................     1,000
        (iii) All other formal complaints (except competitive 
          access complaints...................................     2,300
        (iv) Competitive access complaints....................       150
    (57) A complaint seeking or a petition requesting 
      institution of an investigation seeking the prescription 
      or division of joint rates or charges. 49 U.S.C. 10705..     5,200
    (58) A petition for declaratory order:
        (i) A petition for declaratory order involving a 
          dispute over an existing rate or practice which is 
          comparable to a complaint proceeding................     1,000
        (ii) All other petitions for declaratory order........     1,400
    (59) An application for shipper antitrust immunity. 49 
      U.S.C. 10706(a)(5)(A)...................................     4,200
    (60) Labor arbitration proceedings........................       150
    (61) Appeals to a Surface Transportation Board decision 
      and petitions to revoke an exemption pursuant to 49 
      U.S.C. 10502(d).........................................       150
    (62) Motor carrier undercharge proceedings................       150
PART VI: Informal Proceedings:
    (76) An application for authority to establish released 
      value rates or ratings for motor carriers and freight 
      forwarders of household goods under 49 U.S.C. 14706.....       700
    (77) An application for special permission for short 
      notice or the waiver of other tariff publishing 
      requirements............................................        70
    (78) (i) The filing of tariffs, including supplements, or 
      contract summaries (per page. $14 minimum charge.)......         1
        (ii) Tariffs transmitted by fax (per page)............         1
    (79) Special docket applications from rail and water 
      carriers:
        (i) Applications involving $25,000 or less............        45
        (ii) Applications involving over $25,000..............        90
    (80) Informal complaint about rail rate applications......       350
    (81) Tariff reconciliation petitions from motor common 
      carriers:
        (i) Petitions involving $25,000 or less...............        45
        (ii) Petitions involving over $25,000.................        90
    (82) Request for a determination of the applicability or 
      reasonableness of motor carrier rates under 49 U.S.C. 
      13710(a)(2) and (3).....................................       100
    (83) Filing of documents for recordation. 49 U.S.C. 11301 
      and 49 CFR 1177.3(c) (per document).....................        24
    (84) Informal opinions about rate applications (all modes)       150
    (85) A railroad accounting interpretation.................       650
    (86) An operational interpretation........................       850
PART VII: Services:rved]
    (96) Messenger delivery of decision to a railroad 
      carrier's Washington, DC, agent (per delivery)..........        19
    (97) Request for service or pleading list for proceedings 
      (per list)..............................................        14
    (98) (i) Processing the paperwork related to a request for 
      the Carload Waybill Sample to be used in a Surface 
      Transportation Board or State proceeding that does not 
      require a Federal Register no- tice.....................       150
        (ii) Processing the paperwork related to a request for 
          Carload Waybill Sample to be used for reasons other 
          than a Surface Transportation Board or State 
          proceeding that requires a Federal Register notice..       400
    (99) (i) Application fee for the Surface Transportation 
      Board's Practitioners' Exam.............................       100
        (ii) Practitioners' Exam Information Package..........        25
    (100) Uniform Railroad Costing System (URCS) software and 
      information:
        (i) Initial PC version URCS Phase III software program 
          and manual..........................................        50
        (ii) Updated URCS PC version Phase III cost file, if 
          computer disk provided by requester.................        10
        (iii) Updated URCS PC version Phase III cost file, if 
          computer disk provided by the Board.................        20
        (iv) Public requests for Source Codes to the PC 
          version URCS Phase III..............................       500
        (v) PC version or mainframe version URCS Phase II.....       400
        (vi) PC version or mainframe version Updated Phase II 
          databases...........................................        50
        (vii) Public requests for Source Codes to PC version 
          URCS Phase II.......................................     1,500
    (101) Carload Waybill Sample data on recordable compact 
      disk (R-CD):
        (i) Requests for Public Use File on R-CD--First Year..       450
        (ii) Requests for Public Use File on R-CD Each 
          Additional Year.....................................       150
        (iii) Waybill--Surface Transportation Board or State 
          proceedings on R-CD--First Year.....................       650
        (iv) Waybill--Surface Transportation Board or State 
          proceedings on R-CD--Second Year on same R-CD.......       450
        (v) Waybill--Surface Transportation Board of State 
          proceeding on R-CD--Second Year on different R-CD...       500
        (vi) User Guide for latest available Carload Waybill 
          Sample..............................................        50

     * * * * * * *
                          history of user fees
    Question. Please briefly summarize the history of user fees at the 
Surface Transportation Board, and the Interstate Commerce Commission. 
(Include a synopsis of the most recent fee increases in January 1997.)
    Answer. In 1982, after a critical report by the General Accounting 
Office, in Interstate Commerce Commission Should Revise Its User Fee 
Program (GAO Report RCED 83-55, 1983), Congress directed the ICC to 
revise its user fee program. In response, the ICC instituted a complete 
review of all of its activities to identify all of those services for 
which fees should be assessed. Subsequently, the ICC conducted an 
agency-wide cost study to determine the cost of providing the 
identified services to the public.
    In Regulations Governing Fees for Services, 1 I.C.C. 2d 60 (1984), 
the ICC adopted a new fee schedule, which reflected direct labor costs 
and overhead costs of providing services to the public. Those overhead 
costs included Employee Fringe Benefits, an Operations Overhead Factor, 
which reflected upper-level supervisory costs, and a Commission 
Overhead Factor, which covered costs associated with the Commissioners 
and their immediate staff. When it was appropriate, Federal Register 
publication cost was added for each fee item. In addition, pursuant to 
a Congressional mandate, the ICC adopted a rule in 49 CFR 1002.3(a) \7\ 
requiring that its fees be updated annually pursuant to the cost 
formula in 49 CFR 1002.3(d) that measured the changes in the ICC's 
direct labor and overhead costs.
---------------------------------------------------------------------------
    \7\ In 1994, that rule was modified to allow the ICC to update fees 
more than once a year, if necessary.
---------------------------------------------------------------------------
    From 1985 to 1994, the ICC issued annual user fee updates. Most of 
those use fee update proceedings were limited to revising fees 
according to the cost formula to reflect increases in direct labor and 
overhead costs. In the 1987 update proceeding, however, the ICC 
modified the cost formula by adding an Office General and 
Administrative Cost Factor to reflect costs for personnel support, 
rent, communications, utilities, etc., for each office involved in fee-
related activities. In the 1988, 1990, and 1994 user fee update 
proceedings, the ICC revised the fees for various items in the existing 
fee schedule and added new fee items based on cost studies conducted by 
the ICC's staff.
    The Board issued its first user fee update in 1996. In its decision 
in Regulations Governing Fees For Service Performed, 1 S.T.B. 179 
(1996), the Board: (1) revised its entire fee schedule based on the 
cost study formula set forth at 49 CFR 1002.3(d) related to 
inflationary increases in direct labor and overhead costs; (2) modified 
selected fees to reflect new cost study data; (3) established new fees 
for services and activities that had not been previously included in 
the Board's fee schedule; and (4) removed caps on various fee items. 
The Board also eliminated fee items related to activities that were 
transferred to the Federal Highway Administration or were no longer 
under the Board's jurisdiction. In a subsequent decision in Regulations 
Governing Fees for Services Performed In Connection with Licensing and 
Related Services--1996 Update (STB Ex Parte No. 542, STB served Dec. 
17, 1996), the Board limited the filing fee for rail maximum rate 
complaints filed by small shippers to $1,000, as required by Section 
1219 of the Federal Aviation Authorization Act of 1996, Pub. L. 104-
264, 110 Stat. 3213 (Oct. 9, 1996).
    In Regulations Governing Fees For Services Performed In Connection 
With Licensing and Related Services--1997 Update, (STB Ex Parte No. 542 
(Sub-No. 1), STB served Jan. 23, 1997), the Board modified its fees to 
reflect the 1997 combined Government-wide general salary and 1997 
locality salary increase of 3.33 percent that took effect in January 
1997, and changes in the Board's overhead costs.\8\ In addition, the 
Federal Register publication costs in the user fee items were adjusted 
to reflect the increase in Federal Register charges.\9\
---------------------------------------------------------------------------
    \8\ In 1997, there was no change in Government Fringe Benefits. The 
changes in the overhead factors for 1997 are as follows: (1) the 
Administrative Expense Factor decreased from 26.73 to 20.06 percent; 
(2) the Board's General and Administrative Expense Factor increased 
from 11.36 to 12.20 percent; and (3) the Operations Overhead Factor 
increased from 13.97 to 23.23 percent.
    \9\ We note that, because the Board uses the fee rounding formula 
in 49 CFR 1002.2(e), not every fee changes annually.
---------------------------------------------------------------------------
    Question. Please detail in tabular form the 1997 user fee schedule, 
including all 109 fee items or sub-fee items, including both the 1996 
and 1997 fee amounts, with a column showing the amount of increase, if 
any.
    Answer. The following displays the pricing for fee items under the 
1996 User Fee Update and the 1997 User Fee Update, along with the 
change from the 1996 to the 1997 schedules.

       COMPARISON OF STB EX PARTE NO. 542 FEE SCHEDULE WITH STB EX PARTE NO. 542 (SUB-NO. 1 FEE) SCHEDULE       
----------------------------------------------------------------------------------------------------------------
                                                                       STB EP 542       STB EP 542-S1           
                                                                   ------------------------------------  Change 
                    Fee or sub-fee description                       1996              1997               from  
                                                                      fee   1996 fee    fee   1997 fee   1996 to
                                                                     item    amount    item    amount     1997  
----------------------------------------------------------------------------------------------------------------
Application pooling or div. traf. non-rail........................     1.0    $2,400     1.0    $2,600      $200
Application purchase, Lease--MC passenger.........................     2.0     1,100     2.0     1,200       100
Application approval non-rail rate association AGR................     3.0    15,400     3.0    16,500     1,100
Application amend non-rail rate association--signifi-  cant.......     4.1     2,500     4.1     2,700       200
Amend non-rail rate association agree--minor......................     4.2        50     4.2        60        10
Application for temporary authority MC passing....................     5.0       250     5.0       300        50
Application extension or acquisition or operation.................    11.1     4,000    11.1     4,300       300
Notice of exemption 1150.31-1150.35...............................    11.2     1,000    11.2     1,100       100
Petition for exemption (except construction)......................    11.3     7,000    11.3     7,500       500
Application involving the construction of line....................      12    41,700    12.1    44,500     2,800
Notice of exemption 1150.36 construction..........................  ......       950    12.2     1,100       150
Petition for exemption construction of line.......................    12.1    41,700    12.3    44,500     2,800
Feeder line development program application.......................    13.0     2,600    13.0     2,600  ........
Application class II-III acquire or extend line...................    14.1     3,400    14.1     3,700       300
Notice of exemption acquire or extend line........................    14.2       950    14.2     1,100       150
Petition for exemption acquire or exte line.......................    14.3     3,700    14.3     3,900       200
Notice of modified certificate PC&N...............................    15.0       950    15.0     1,000        50
Application to abandon or discontinue service.....................   21.11     2,400    21.1    13,200       800
Notice of exemption abandon or discontinue........................    21.2     2,000    21.2     2,200       200
Petition for exemption abandon or discontinue.....................    21.3     3,500    21.3     3,800       300
Application to abandon CRC-NE rail service........................    22.0       250    22.0       250  ........
Abandonment filed by bankrupt railroads...........................    23.0     1,000    23.0     1,100       100
Waiver request for filing required--abandonment...................    24.0     1,000    24.0     1,000  ........
Offer of financial assistance (OFA)...............................    25.0       900    25.0       900  ........
OFA--set terms and conditions.....................................    26.0    12,700    26.0    13,500       800
Request for a trails use condition................................    27.0       150    27.0       150  ........
Application for use of terminal facilities........................    36.0    10,600    36.0    11,300       700
Application pooling or DIV. TRAF. (Rail)..........................    37.0     5,700    37.0     6,100       400
Application to merge or consolidate--major........................    38.1   830,500    38.1   889,500    59,000
Application to merge or consolidate--significant..................    38.2   166,100    38.2   177,900    11,800
Application to merge or consolidate--minor........................    38.3     3,400    38.3     4,700     1,300
Notice of exemption merge or consolidate..........................    38.4       950    38.4     1,000        50
Responsive application merge or consolidate.......................    38.5     3,400    38.5     4,700     1,300
Petition for exemption merge or consolidate.......................    38.6     5,200    38.6     5,600       400
Application non-carrier to control--major.........................    39.1   830,500    39.1   889,500    59,000
Application non-carrier to control--significant...................    39.2   166,100    39.2   177,900    11,800
Application non-carrier to control--minor.........................    39.3     3,400    39.3     4,700     1,300
Notice of exemption non-carrier control...........................    39.4       750    39.4       850       100
Responsive application non-carrier control........................    39.5     3,400    39.5     4,700     1,300
Petition for exemption non-carrier control........................    39.6     5,200    39.6     5,600       400
Application to acquire track rights--major........................    40.1   830,500    40.1   889,500    59,000
Application to acquire track rights--signficant...................    40.2   166,100    40.2   177,900    11,800
Application to acquire track rights--minor........................    40.3     3,400    40.3     4,700     1,300
Notice of exemption acquire track rights..........................    40.4       650    40.4       750       100
Responsive application acquire track rights.......................    40.5     3,400    40.5     4,700     1,300
Petition for exemption acquire track rights.......................    40.6     5,200    40.6     5,600       400
Application of carrier to purchase property--major................    41.1   830,500    41.1   889,500    59,000
Application of carrier to purchase property--significant..........    41.2   166,100    41.2   177,900    11,800
Application of carrier to purchase property--minor................    41.3     3,400    41.3     4,700     1,300
Notice of exemption carrier purchase property.....................    41.4       800    41.4       850        50
Responsive application carrier purchase property..................    41.5     3,400    41.5     4,700     1,300
Petition for exemption carrier purchase property..................    41.6     3,700    41.6     3,900       200
Notice of a joint project involve relocation......................    42.0     1,300    42.0     1,500       200
Application rail rate association agreement.......................    43.0    39,000    43.0    41,600     2,600
Amendment rail rate agreement--significant........................    44.1     7,200    44.1     7,700       500
Amendment rail rate agreement--minor..............................    44.2        50    44.2        60        10
Authority to hold position--officer/director......................    45.0       400    45.0       450        50
Petition for exemption RR not otherwise covered...................    46.0     4,400    46.0     4,800       400
Amtrak conveyance proceeding. 45 USC 562..........................    47.0       150    47.0       150  ........
Amtrak compensation proceeding. sec. 402(a).......................    48.0       150    48.0       150  ........
Complaint filed under coal rate guidelines........................    56.1    23,300    56.1    23,300  ........
Complaint filed by small shipper--rate............................    56.2     1,000    56.2     1,000  ........
Complaint--all other except competitive access....................    56.3     2,300    56.3     2,300  ........
Competitive access complaint......................................  ......  ........    56.4       150       150
Complaint or petition request investigation.......................    57.0     4,900    57.0     5,200       300
Petition for declaration order--existing rate.....................    58.1     1,000    58.1     1,000  ........
Petition for declaration order--all others........................    58.2     1,400    58.2     1,400  ........
Application for shipper antitrust immunity........................    59.0     3,900    59.0     4,200       300
Labor arbitration appeal reviews..................................    60.0       150   60.01       150  ........
Appeals to STB Dec. Pet. revoke exemption.........................    61.0       150    61.0       150  ........
Motor carrier undercharge proceeding..............................    62.0       150    62.0       150  ........
Application--authority released value rates.......................    76.0       650    76.0       700        50
Application special permission short notice or waiver.............    77.0        70    77.0        70  ........
Tariffs, including supplement and contract summary................    78.1        13    78.1        14         1
Tariffs submitted by fax..........................................    78.2         1    78.2         1  ........
Special docket application involving $25,000 or less..............    79.1        40    79.1        45         5
Special docket application involve over $25,000...................    79.2        80    79.2        90        10
Informal complaints about rail application........................    80.0       300    80.0       350        50
Tariff reconciliation petition MC $25,000 or less.................    81.1        40    81.1        45         5
Tariff reconciliation petition MC over $25000.....................    81.2        80    81.2        90        10
Request availability or reasonable MC rates.......................    82.0       100    82.0       100  ........
Filing of documents for recordation...............................    83.0        22    83.0        24         2
Informal opinions rate application--all modes.....................    84.0       100    84.0       150        50
Railroad accounting interpretation................................    85.0       600    85.0       650        50
An operational interpretation.....................................    86.0       800    86.0       850        50
Messenger delivery of decision--RR agent..........................    96.0        17     6.0        19         2
Request for service or pleadings list.............................    97.0        13    97.0        14         1
Request carload WAYB no FR notice require.........................    98.1       150    98.1       150  ........
Request for service FR notice required............................    98.2       350    98.2       400        50
Application for the STB practioners' examination..................    99.1       100    99.1       100  ........
Practioners' examination information package......................    99.2        25    99.2        25  ........
URCS--initial PC versus PH III soft PROG/MAN......................   100.1        50   100.1        50  ........
Updated PC versus CST file, disk by requst........................   100.2        10   100.2        10  ........
Updated PC versus CST file, disk by STB...........................   100.3        20   100.3        20  ........
Public request for source codes--PH III...........................   100.4       500   100.4       500  ........
PC versus or mainframe versus URCS phase II.......................   100.5       400   100.5       400  ........
PC versus or mainframe versus update phase II.....................   100.6        50   100.6        50  ........
Public request for source codes--phase II.........................   100.7     1,500   100.7     1,500  ........
Requests for public use file R-CD first year......................   101.1       450   101.1       450  ........
Requests for public use file R-CD additional years................   101.2       150   101.2       150  ........
Waybill--STB or ST. proceeding R-CD FIR...........................   101.3       650   101.3       650  ........
Waybill--STB or ST. proceeding R-CD--DIFF.........................   101.4       450   101.4       450  ........
Waybill--STB or ST. proceeding on R-CD--same......................   101.5       500   101.5       500  ........
User guide latest available carload WB............................   101.6        50   101.6        50  ........
Certificate of the secretary......................................   102.0         9   102.0        10         1
Examination of tariff or schedules--certification.................   103.0        24   103.0        25         1
Checking records to certify authenticity..........................   104.0        16   104.0        17         1
Electrostatic copies tariffs, reports, et.........................   105.0         5   105.0         5  ........
Search and copy services add process..............................   106.0        42   106.0        44         2
----------------------------------------------------------------------------------------------------------------

                     offsetting collection request
    Question. Why doesn't the Board anticipate a greater increase in 
fiscal year 1998 in offsetting collections above the fiscal year 1997 
level of $3,000,000, given that fees collected throughout all twelve 
months of the fiscal year will be at the higher 1997 user fee schedule, 
whereas in fiscal year 1997, four months of collections were at the 
1996 schedule levels?
    Answer. The Board does not project a significant increase in fiscal 
year 1998 offsetting collections above the fiscal year 1997 level 
because the Board anticipates its workload to remain essentially the 
same into fiscal year 1998. In fact, based on current estimates, if no 
class I rail merger is filed in fiscal year 1998 (which is likely), the 
Board could very well fall short of its fiscal year 1998 goal. The 
Board has collected $761,914 through February 1997, due in part to the 
increased fees adopted in the 1997 User Fee Update. However, this five-
month figure represents only 25 percent of the Board's user fee target 
of $3,000,000 for fiscal year 1997. The two $889,500 filing fees by CSX 
and Norfolk Southern to accompany applications to acquire control of 
Conrail will allow the Board to attain the $3.0 million level. Because 
the Board's current user fee collection program is based on actual 
filings, the Board has no control over what is actually collected, and 
estimates of future collections may or may not be realized.
    Question. In the Board's opinion, who are the ``beneficiaries'' of 
the Surface Transportation Board's activities?
    Answer. The direct beneficiaries of the Board's activities are the 
parties that request the Board to approve or exempt from regulation a 
particular transaction, such as a merger or construction, sale, or 
abandonment of a rail line, or the parties that ask the Board to 
resolve an adjudication, such as a rail rate complaint or a rail labor 
dispute. By law, the Board is to assess fees against direct 
beneficiaries based on the cost of specific services rendered to them. 
Because these parties are the direct beneficiaries of the Board's 
actions, it is appropriate that user fees for those activities be paid 
by such parties.
    The Board also recognizes that the general public is the indirect 
beneficiary of the Board's activities. However, because the benefits 
that flow to the public generally are incidental to the private 
benefits that are derived from the Board's activities, it is not 
necessary to allocate costs for these activities to the public. See 
Cent. & Southern Motor Freight Tariff Ass'n v. United States, 777 F.2d 
722 at 732, (D.C. Cir. 1985), in which the court stated: ``If the 
asserted public benefits are the necessary consequence of an agency's 
provision of the relevant private benefits, then the public benefits 
are not independent, and the agency would therefore not need to 
allocate any costs to the public.''
    Question. Will the Board realize ``the anticipated carryover of 
approximately $800,000 in fees derived from 1997 rail merger 
activities'' [Appendix, fiscal year 1998 Budget of the United States 
Government, p. 822]? If not, how in the Board's opinion was this number 
derived?
    Answer. In the Office of Management and Budget (OMB) Passback on 
the Board's fiscal year 1998 Budget Request, OMB assumed that, with the 
filing of two merger applications and associated filing fees, the Board 
would have $800,000 more than the $3.0 million limit for fiscal year 
1997, which would carry over into fiscal year 1998. The Board cannot 
explain OMB's carryover assumption. As previously indicated, with the 
user fees associated with the two merger applications for Conrail, the 
Board will barely meet the $3.0 million level, based on the current 
fiscal year 1997 fee item workload filings.
    Question. Will the Board have any carryover user fees above 
$3,000,000, to be available for obligation after October 1, 1997. If 
so, how much?
    Answer. With the filing of the two merger applications associated 
with the Conrail merger, the Board projects that it may have 
approximately $21,000 carrying over into fiscal year 1998 under the 
statutory provision contained in the fiscal year 1997 appropriation 
allowing for user fee collections in excess of the $3.0 million amount.
                  personnel compensation and benefits
    Question. The President's budget submission states that the Board's 
request reflects a higher 1998 pay raise for Surface Transportation 
Board employees than the Administration requests for other federal 
employees. Please discuss this statement.
    Answer. The Board, because it is organizationally housed within 
DOT, depends upon the Department for administrative updates of 
information and guidelines so that it may conform to, among other 
things, budgetary development guidance. In July 1996, the Board was 
notified by DOT that the fiscal year 1998 cost of living adjustment 
(COLA) would be set at 3.1 percent for Federal employees. This figure 
was used to calculate the pay raise for Board employees for the fiscal 
year 1998 budget. Only after the President's budget was prepared and 
submitted was the Board notified that the COLA for fiscal year 1998 had 
been decreased to 2.8 percent.
    Question. Why wasn't the $78,000 associated with the January 1997 
pay raise paid from fiscal year 1997 funding?
    Answer. Federal cost-of-living pay raises increase Federal annual 
salary rates for the entire year even though they are enacted in 
January of each year. This means that three-fourths of COLA will be 
paid out in fiscal year 1997 and one-fourth in fiscal year 1998. When 
the fiscal year 1997 appropriation request was enacted, the Board, 
along with other agencies, received funding for three-fourths of the 
1997 pay raise. The remaining part of the 1997 pay raise must be funded 
in fiscal year 1998, thereby increasing the salary base by $78,000.
    Question. If the Board assumes a 2.8 percent pay increase for 
fiscal year 1998 (for 134 employees), what will be the total fiscal 
year 1998 costs associated with the January 1998 pay raise?
    Answer. The total fiscal year 1998 costs associated with the 
January 1998 pay raise of 2.8 percent for 134 employees is $185,200.
                 board's request vs. president's budget
    Question. How many FTE's would a total funding level of $14,300,000 
support in fiscal year 1998 (assuming a 2.8 percent pay increase on 
January 1, 1998)?
    Answer. Using an average salary method, the Board estimates that a 
reduction from the current staffing level of approximately 24 FTE's 
would be required for the Board to meet the President's funding 
allocation.
    Question. In meetings with Appropriations Committee staff, Board 
officials have asserted that a funding level of $14,300,000 would 
result in a cut of 24 FTE's. However, the President's budget avers that 
this funding level would result in the elimination of only 2 FTE's; and 
that these positions would no longer be required because of the 
completion of the one-time workload imposed by the Interstate Commerce 
Commission Termination Act, and productivity improvements. There is a 
marked difference between the Administration's and the Board's 
correlation of funding levels to staffing levels. Please explain this 
disconnect in detail.
    Answer. There are three fundamental differences in assumptions 
between the President's budget proposal and the Board's budget request 
that contribute to the disparity between the two.
  --The President's budget assumes that the Board funded the 1997 
        relocation to new office space. In fact, the General Services 
        Administration (GSA) funded the relocation due to the fact that 
        it was a forced move associated with the closing and renovation 
        of the old ICC building. Therefore, the assumption that one-
        time funds associated with the Board's move can be eliminated 
        from the Board's fiscal year 1998 budget request is unfounded: 
        elimination of such an amount from the Board's fiscal year 1998 
        budget would mean that more FTE's than estimated by the 
        Administration would need to be eliminated.
  --The President's budget proposal assumes a reduction in rent costs 
        due to the Board's relocation to new office space, and the 
        repricing of the space based on GSA's anticipated rental rates. 
        The Board, as of yet, has not received a final rent bill for 
        the new office space. GSA has indicated that the Board would 
        pay approximately $26 per square foot of office space. However, 
        the build-out and relocation costs incurred by GSA will be 
        amortized over the term of the lease that GSA has negotiated 
        for the Board and included in the rent bill. Thus, the reduced 
        rental costs assumed in the President's budget proposal cannot 
        be justified by any documentation that the Board has received 
        from GSA: an underestimation of rent puts at risk the FTE level 
        needed and requested by the Board.
  --Even assuming that the President's budget only would result in the 
        reduction of 2 FTE's, this reduction is based on an unfounded 
        assumption that these 2 FTE's are no longer needed because they 
        were originally dedicated to handle one-time workload 
        associated with the ICCTA. While many rulemakings have been 
        completed in accordance with the ICCTA, other rulemaking 
        activity pursuant to the ICCTA continues as the Board further 
        rescinds unnecessary and obsolete regulations, streamlines the 
        decisional process, and explores new ways to analyze and 
        resolve complex problems presented to it. In addition, as staff 
        complete tasks associated with implementation of the ICCTA, 
        they are shifted to case work: if the current staffing level is 
        reduced, the Board will find it more difficult to meet case 
        deadlines and to resolve matters before it expeditiously in 
        accordance with Congressional intent.
                          other services costs
    Question. Please explain the dramatic increase in the fiscal year 
1998 requested funding for ``purchases of goods from government 
accounts'' ($327,000 in fiscal year 1997; $871,000 requested for fiscal 
year 1998).
    Answer. The increase in the fiscal year 1998 requested funding for 
``purchases of goods from government accounts'' is primarily 
attributable to the anticipated need for VOLPE's facility management of 
the Board's software systems and computer database network. A smaller 
amount of the increase reflects additional funds for employee training.
                         rent & utilities costs
    Question. Please explain the increase in the fiscal year 1998 
requested funding for ``communications, utilities, miscellaneous 
charges'' ($211,000 in fiscal year 1997; $352,000 in fiscal year 1998).
    Answer. The increase in the fiscal year 1998 requested funding for 
``communications, utilities, miscellaneous charges'' is due to an 
increase in local telephone costs associated with Bell Atlantic service 
at the Board's new location and to the replenishment of the Board's 
postage meters. The Board's postage meters had preexisting fund 
balances when transferred from the ICC, pursuant to the ICCTA, and 
covered the needs of the Board in fiscal year 1997.
    Question. Please compare rental costs at the Board's 1925 K Street, 
N. W. office site to the old Interstate Commerce Commission building. 
What is the difference in total annual rent? What is the cost per 
square foot and total square footage utilized by the Board at each 
site? How long does the Board intend to stay at its site?
    Answer. The Board's relocation was directed and funded by GSA 
because of the impending closure and renovation of the old ICC building 
at 1201 Constitution Avenue, NW. The rental rate at the old ICC 
building is estimated at $32.59 per net usable square foot for office 
space. The Board's assigned space totaled 64,658 square feet as of 
December 15, 1996.
    The Board has not received a rent bill for the new office space at 
1925 K Street, NW. The Board has included $1,806,000 for rental 
payments in the fiscal year 1998 Budget Request. GSA has indicated that 
the Board would pay approximately $26 per square foot of office space. 
However, the build-out and relocation costs incurred by GSA would be 
amortized over the term of the lease that GSA has negotiated for the 
Board. While the total assigned square feet of office space to be 
subject to rental payments has yet to be finally determined by GSA, the 
Board occupies less office space at the new location than in the old 
ICC building.
    The original lease was for five years; however GSA exercised a five 
year option and the current term is now ten years.
    Question. Under what object classification line item are costs of 
publication in the Federal Register included? What were the fiscal year 
1996 and 1997 costs of Federal Register publications of official 
decisions and other matters? What costs are anticipated for fiscal year 
1998? What is the estimated annualized cost for the Board of Federal 
Register printing, taking into account the January 1997 price increase 
per column?
    Answer. The object classification line item which includes the 
Board's publications in the Federal Register is 26.00, Supplies and 
Materials. The fiscal year 1996 cost for publication in the Federal 
Register was $104,700. The fiscal year 1997 and 1998 budget allocations 
are $82,500 and $90,750, respectively. However, as of March 1, 1997, 
the Board obligated $64,630 for publications costs, and the new 
estimated annualized cost for Federal Register publishing for fiscal 
year 1997 is $113,000, due to the January 1997 price increase per 
column and the number of documents necessitated by the ICCTA and 
required to be published in the Federal Register.
                                 travel
    Question. The Board has requested $38,000 for travel in fiscal year 
1998. Generally, what sort of travel is required for Board members and 
employees? What were travel costs in fiscal year 1996 and 1997?
    Answer. Travel resources provide for Board representation upon 
request at meetings and conferences with shippers, carriers, employees, 
States and localities, and other parties interested in the activities 
of the Board. Court appearances throughout the country by Board 
employees are required to defend Board decisions and present the 
Board's views on issues within its jurisdiction. Travel funds are also 
required for activities associated with personnel complaints, visits to 
railroads to review public accountants' workpapers, and physical 
inspection of rail abandonment and construction sites by environmental 
staff. Travel funds allocated for fiscal year 1996 and fiscal year 1997 
were $35,333 and $36,000 respectively.
                    omb passback vs. board's request
    Question. Please provide a table contrasting the Board's proposed 
fiscal year 1998 budget request and the OMB Passback, by office.
    Answer. The Board's Budget was developed by object classification 
rather than individual offices. The side-by-side comparison table 
follows.

                            [By fiscal year]                            
------------------------------------------------------------------------
                                                            President's 
                  Title                    Board's 1998     1998 budget 
                                          budget request      request   
------------------------------------------------------------------------
Personnel compensation..................     $10,383,900  \1\ $9,067,800
Personnel benefits......................       1,625,400   \1\ 1,448,500
Payments to former personnel............          20,000          20,000
Transportation of personnel.............          38,000          38,000
Transportation of things................           8,000           8,000
Rent....................................       1,806,000       1,806,000
Communications and utilities............         352,000         352,000
Printing................................          33,000          33,000
Contractual services....................       1,254,700   \1\ 1,194,700
Supplies................................         272,000         272,000
Equipment...............................          60,000          60,000
                                         -------------------------------
      Total request.....................      15,853,000      14,300,000
                                         ===============================
Appropriation...........................      12,753,000  ..............
Offsetting collections..................       3,100,000      14,300,000
------------------------------------------------------------------------
\1\ This table reflects that reductions in personnel and training would 
  be necessary to meet the President's funding level. The other expenses
  to be incurred by the Board are not discretionary and thus cannot be  
  reduced in order to meet the President's level.                       

                          authorization issues
    Question. The Board's current authorization is in the Interstate 
Commerce Commission Termination Act of 1995. When does the 
authorization expire? Who are the House and Senate authorizing 
committees?
    Answer. Pursuant to Section 705 of the ICCTA, the Board has a 3-
year authorization through fiscal year 1998. The Senate and House 
authorizing committees are the Senate Committee on Commerce, Science, 
and Transportation and the House Committee on Transportation and 
Infrastructure.
    Question. Please discuss the Senate Commerce Committee's proposal 
to merge the Surface Transportation Board with the Federal Maritime 
Commission.
    Answer. S. 414, the Ocean Shipping Reform Act of 1997, proposes to 
transfer the Federal Maritime Commission (FMC) functions to the Board 
and renames the Board the Intermodal Transportation Board (ITB) 
effective January 1, 1999. Two members would be added to create a five-
member ITB. The FMC would be authorized at $15.0 million for fiscal 
year 1998. The Board is already authorized for fiscal year 1998. The 
Board/ITB authorization for fiscal year 1999 and beyond is not 
addressed in S. 414.
             relationship with department of transportation
    Question. Please describe the Board's relationship with the 
Department of Transportation. Does the Secretary have any input into 
the Board's budget request or operations?
    Answer. The Board is a decisionally independent body 
organizationally housed within DOT. The Board's decisional independence 
is explicitly expressed in the ICCTA. However, DOT is apprised of 
rulemakings and adjudications as they are served or published and may 
appear before the Board as a party in the Board's regulatory activities 
and decisions, just as DOT appeared before the ICC as a party. Any role 
or input that DOT may have in a Board's regulatory activity or 
decision, like any other party, is carried out through a filing of 
public record. Administrative functions such as accounting, 
procurement, warehousing, equipment inventory, and personnel security 
are performed by DOT staff, and the Board reimburses DOT for the cost 
of those services.
    The ICCTA provides the authority for the Board to develop and 
submit budget estimates, requests for information, and legislative 
recommendations and testimony directly to Congress at the same time 
they are sent to the Secretary of Transportation. The ICCTA allows for 
the review and assessment of the budgetary needs of the Board by the 
Secretary in each annual request for appropriation by the President.
      administration of severance pay benefits for rail employees
    Question. What are the Board's statutory responsibilities in regard 
to the administration of severance pay benefits for rail employees?
    Answer. The Board's responsibilities in this area derive from the 
statutory provision at 49 U.S.C. 11326 governing employee protective 
arrangements in transactions involving rail carriers. Subsection (a) of 
section 11326 embodies the pre-ICCTA provision at 49 U.S.C. 11347, 
which mandates labor protective conditions for employees affected by 
Board-approved railroad consolidations, mergers, or acquisitions of 
control. The Board has similar responsibilities under 49 U.S.C. 10901 
to protect employees adversely affected by Board-approved railroad 
abandonments and discontinuances.
    The Board meets these responsibilities by imposing conditions upon 
transactions it approves that require protection at or above the level 
mandated by statute. For most types of transactions, standard 
conditions have evolved and are routinely imposed. For example, in 
railroad mergers, the Board imposes the conditions set out in New York 
Dock Ry.--Control--Brooklyn Eastern Dist., 360 I.C.C. 60, aff'd sub 
nom. New York Dock Ry. v. U.S., 609 F.2d 83 (2d Cir. 1979). For 
railroad leases and trackage rights, respectively, the Board imposes 
conditions set out in Mendocino Coast. Rwy., Inc.--Lease and Operate, 
354 I.C.C. 732 (1978), and Norfolk and Western Ry. Co.--Trackage 
Rights--BN, 354 I.C.C. 605 (1978), both as modified in Mendocino Coast 
Ry., Inc.--Lease and Operate, 360 I.C.C. 653 (1980), and both aff'd sub 
nom. Railway Labor Executives Ass'n v. U.S., 675 F.2d 1248 (D.C. Cir. 
1982). In abandonments and discontinuances, the Board imposes 
conditions set out in Oregon Short Line R. Co.--Abandonment--Goshen, 
360 I.C.C. 91 (1979).
    These conditions provide for severance pay benefits for adversely 
affected railroad employees under certain conditions. These benefits 
normally take the form of dismissal allowances or separation 
allowances. A dismissed employee may elect a separation allowance in 
lieu of other protective benefits and accept a lump sum payment that is 
computed in accordance with section 9 of the Washington Job Protection 
Agreement of May 1936.
    As a general matter, the Board does not administer the process by 
which severance or other protective payments are made because the 
conditions are self-executing. The Board may, however, from time to 
time, be called upon to ensure that parties, in implementing a 
transaction and the applicable protective conditions, have not 
abrogated employees rights provided by the protective conditions (see 
Norfolk & Western R. Co. v. Nemitz, 404 U.S. 37, 44 (1971) and Rilling 
v. Burlington Northern R. Co., 31 F.3d 855, 858 (9th Cir. 1994)), or to 
resolve disputes, most often in the context of a request that the Board 
review a decision of an arbitrator who has issued a ruling as provided 
for where disputes arise in the implementation of Board-imposed 
conditions.
    The ICCTA added a new statutory provision at subsection (b) of 
section 11326, which limits the labor protection mandated by subsection 
(a) of that section to one year of severance pay in consolidations, 
mergers, or acquisition of control transactions involving a Class II 
and one or more Class III rail carriers. Similar language limiting 
labor protection to one year's severance pay for line purchases by 
Class II carriers is included in 49 U.S.C. 10902 (also a new 
provision), which governs short line purchases by Class II and Class 
III rail carriers. See 49 U.S.C. 10902(d). Also under the ICCTA, the 
Board may not require labor protection in consolidations, mergers, or 
acquisition of control transactions that involve only Class III 
carriers (see 49 U.S.C. 11326(c)), in transactions involving line 
purchases by Class III carriers (see 49 U.S.C. 10902(c) and (d)), or in 
transactions involving line purchases by noncarriers (see 49 U.S.C. 
10901(c)).
    In Wisconsin Central Ltd.--Acquisition Exemption--Lines of Union 
Pacific Railroad Company, STB Finance Docket No. 33116 (STB served Nov. 
27, 1996), which involved a proposed line purchase by a Class II 
railroad, the Board sought public comments on whether it should 
establish and oversee procedures and standards for employee protective 
arrangements in that type of transaction. The Board found that it had 
authority to oversee implementation of approved or exempted 
transactions and the labor protection mandated by the new statutory 
provisions.
    Question. What severance pay administration responsibilities, if 
any, does the Board have in relation to layoffs associated with 
termination of Amtrak lines?
    Answer. The Board has no such responsibilities.
                              rulemakings
    Question. Please list all unnecessary and obsolete rulemakings that 
have been rescinded by the Surface Transportation Board since January 
1996.
    Answer. The following table list rulemakings that have been 
rescinded by the Board.
                    obsolete proceedings terminated
    Rail:
  --State Intrastate Rail Rate Auth'y Pub. L. No. 96-448, Ex Parte No. 
        388 (Apr. 3, 1996).
  --Cost Ratio for Recyclables--1994 Determination, Ex Parte No. 394 
        (Sub-No. 13) (Mar. 29, 1996).
    Motor:
  --Revision of Tariff Regs.--Indexes, Ex Parte No. MC-211 (Mar. 8, 
        1996).
  --Policy Statement on the Transp. Industry Regulatory Reform Act of 
        1994, Ex Parte No. MC-222 (Apr. 3, 1996).
  --Policy Statement on Motor Contract Requirements Under the 
        Negotiated Rates Act of 1993, Ex Parte No. MC-198 (Sub-No. 1) 
        (May 3, 1996).
  --Review of Motor Tariff Regs.--1993, Ex Parte No. MC-212 (May 3, 
        1996).
                     superseded proposals withdrawn
    Rail:
  --Uniform System of Records of Property Changes for Railroad 
        Companies, Ex Parte No. 512 (Mar. 7, 1996).
  --Abandonment Proceedings: Elimination of the Revenue and Cost Data 
        for All Years Prior to the Base Year Period, Ex Parte No. 274 
        (Sub-No. 26) (Mar. 15, 1996).
  --New Procedures in Rail Exemption Revocation Proceedings, Ex Parte 
        No. 400 (Sub-No. 4) (Mar. 22, 1996).
  --Rail Gen. Exemption Auth'y--Exemption of Nonferrous Recyclables and 
        Railroad Rates on Recyclable Commodities, Ex Parte No. 346 
        (Sub-No. 36) (May 5, 1997).
                     obsolete regulations removed:
    Multimodal:
  --Removal of Obsolete Regs. Concerning Filing Quotations for Gov't 
        Shipments, 1 S.T.B. 39 (May 16, 1996) (STB Ex Parte No. 547) 
        (removing 49 CFR 1330).
    Rail:
  --Removal of Obsolete Rail Tariff Regs., 1 S.T.B. 4 (Feb. 28, 1996) 
        (STB Ex Parte No. 530) (removing 49 CFR 1314).
  --Removal of Obsolete Recyclables Regs., 1 S.T.B. 7 (Feb. 28, 1996) 
        (STB Ex Parte No. 531) (removing 49 CFR 1134, 1135.1, 1145).
  --Removal of Obsolete Regs. for Reasonably Expected Costs and Joint 
        Rates Subject to Surcharge or Cancellation, 1 S.T.B. 10 (Feb. 
        28, 1996) (STB Ex Parte No. 532) (removing 49 CFR 1138, 1140 & 
        1039.18).
  --Removal of Obsolete Passenger Train or Ferry Discontinuance Regs., 
        1 S.T.B. 14 (Feb. 28, 1996) (STB Ex Parte No. 534) (removing 49 
        CFR 1153).
  --Removal of Obsolete Securities Regs., 1 S.T.B. 17 (Feb. 28, 1996) 
        (STB Ex Parte No. 535) (removing 49 CFR 1175).
  --Removal of Obsolete Valuation Regs., 1 S.T.B. 20 (Mar. 7, 1996) 
        (STB Ex Parte No. 539) (removing 49 CFR 1262).
  --Removal of Obsolete Regs. for Determination of Avoidable Losses 
        under the Rail Passenger Service Act of 1970, 1 S.T.B. 23 (Apr. 
        11, 1996) (STB Ex Parte No. 540) (removing 49 CFR 1154).
  --Removal of Obsolete Regs. Concerning Railroad Contracts, 1 S.T.B. 
        71 (June 7, 1996) (STB Ex Parte No. 550) (removing 49 CFR 
        1039.23).
    Motor:
  --Removal of Obsolete Regs. for Discontinuance of Bus Transp. in One 
        State, 1 S.T.B. 26 (Apr. 22, 1996) (STB Ex Parte No. 544) 
        (removing 49 CFR 1169).
  --Regulations Implementing Section 7 of the Negotiated Rates Act of 
        1993, 1 S.T.B. 29 (May 3, 1996), pets. to reopen denied, Ex 
        Parte No. MC-180 (Sub-No. 3) (Mar. 12, 1997) (removing 49 CFR 
        1053).
  --Removal of Obsolete Regs. Concerning Owner-Operators, 1 S.T.B. 33 
        (May 10, 1996) (removing 49 CFR 1164 & 1311).
  --Removal of Obsolete Regs. Concerning Exemption of Motor Carrier of 
        Property Finance Transactions, STB Ex Parte No. 553 (Feb. 4, 
        1997) (removing 49 CFR 1186).
  --Removal of Obsolete Regs. Concerning Expedited Complaint Procedures 
        Against Bus Carrier Rates, STB Ex Parte No. 621 (Feb. 4, 1997) 
        (removing 49 CFR 1142).
    Water:
  --Removal of Obsolete Regs. Concerning Water Carriers, STB Ex Parte 
        No. 557 (Oct. 17, 1996) (removing 49 CFR 1070 & 1071).
  --Removal of Obsolete Regs. Concerning Extension of Operations by 
        Water Carriers, STB Ex Parte No. 620 (Jan. 30, 1997) (removing 
        49 CFR 1166).
                         alameda rail corridor
    Question. In June 1996, the Board approved the construction of the 
Alameda Rail Corridor in California. What are the Board's adjudicative 
responsibilities as they apply to new rail corridor construction? 
Please briefly and generally describe the approval process, and outline 
the factors considered in deciding whether to approve such 
construction.
    Answer. Under 49 U.S.C. 10901, a person may construct an additional 
railroad line or an extension to any of its railroad lines only if the 
Board issues a certificate authorizing the construction. A proceeding 
before the Board commences when a person files an application for 
construction authority. On receiving the application, the Board 
publishes notice of it in the Federal Register and affords members of 
the public the opportunity to comment on it. Following consideration of 
the application and the comments, the Board must grant the sought 
authority and issue a certificate unless it finds that the construction 
is inconsistent with the public convenience and necessity.\10\ Under 
the law, the Board may approve the application as filed or with 
modifications, and may require compliance with conditions (other than 
labor protection conditions) that it finds necessary in the public 
interest.
---------------------------------------------------------------------------
    \10\ The law that existed prior to the passage of the ICCTA, and 
which governed processing of the Alameda Rail Corridor proceeding, 
differed slightly from the law in effect now. The old law permitted 
construction only if the agency found that the present or future public 
convenience and necessity required or permitted it.
---------------------------------------------------------------------------
    The statute does not define ``public convenience and necessity,'' 
but the agency and its predecessor have developed and applied certain 
criteria for evaluating whether a proposed construction project is 
permissible. Principally, the Board asks: (1) whether the applicant is 
financially fit to undertake the construction and provide services; (2) 
whether there is a public demand or need for the proposed services; and 
(3) whether the construction project will be in the public interest and 
not unduly harm existing services. In deciding railroad construction 
applications under the statute, the agency and its predecessor have 
applied Section 10901 in light of the Rail Transportation Policy (RTP) 
now set out at 49 U.S.C. 10101. The agency considers the RTP to be a 
statement of the public interest that it uses as a guideline in 
determining whether the construction of a new rail line is consistent 
with the public convenience and necessity. Finally, the agency also 
considers environmental and energy impacts in deciding whether to 
approve construction.
    While Board approval for construction of the Alameda Corridor was 
sought and obtained through an application filed under 49 U.S.C. 10901, 
Board authorization for construction can alternatively be pursued 
through the Board's exemption powers found at 49 U.S.C. 10502. Under 
that provision, the Board must exempt rail construction if 
consideration of an application is not necessary to carry out the RTP 
and either the proposed construction is limited in scope or 
consideration of an application is not necessary to protect shippers 
from an abuse of market power. Even if an exemption is appropriate, 
however, the environmental impacts of the construction must be 
considered.
    Question. Specifically, in the Board's review of the Alameda Rail 
Corridor construction application, what were the determining factors 
for a favorable decision?
    Answer. In reviewing the Alameda Rail Corridor construction 
application, the Board found numerous factors warranting a favorable 
decision. First, as there was broad-based financial support for the 
construction, and the applicants (the cities of Los Angeles and Long 
Beach, CA) projected greatly increased tonnage that would generate 
revenues and associated economic benefits, the project was deemed 
feasible and financially viable. Next, it found that, as applicants 
anticipated a substantial growth in port-related train movements over 
rail lines serving the port area, there was a clear public need for the 
proposed project and service. The agency further found that the 
proposed consolidation of rail traffic of three rail carriers onto a 
single, high-density rail system would divert from the railroads' 
separate lines port-related traffic that traversed residential areas. 
Next, as applicants projected an increase in the percentage of their 
traffic that would move in intermodal cargo containers and a 
concomitant reduction in the truck transportation of containers from 
ships to rail transfer facilities, the Board concluded that 
inefficiencies and traffic congestion would be reduced. The Board also 
found that the project would not result in harm to existing carriers. 
To the contrary, it was noted that the three major rail carriers 
serving the port area had reached agreements with applicants and were 
willing participants in the project. The Board further noted that the 
project was pro-competitive, as each involved railroad would continue 
to serve non-port-related shippers over its own rail lines, and each 
would be solely responsible for any improvement to its existing rail 
lines that might be required to carry out that railroad's common 
carrier obligations.
    The Board found that approval of the construction application would 
significantly advance specific goals of the RTP. It found that the 
proposal would contribute to a sound transportation system, meet the 
public need, and promote effective competition and coordination among 
rail, motor, and ocean carriers. Finally, the Board concluded that, 
subject to specified environmental ``mitigating measures,'' a grant of 
a certificate was warranted and that its action would not significantly 
affect either the quality of the human environment or the conservation 
of energy resources.



 DEPARTMENT OF TRANSPORTATION 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 following testimonies were received by 
the Subcommittee on Transportation and Related Agencies for 
inclusion in the record. The submitted materials relate to the 
fiscal year 1998 budget request.
    The subcommittee requested that public witnesses provide 
written testimony because, given the Senate schedule and the 
number of subcommittee hearings with Department witnesses, 
there was not enough time to schedule hearings for 
nondepartmental witnesses.
                       Aviation-Related Testimony
    Prepared Statement of the Air Traffic Control Association, Inc.
                              introduction
    The Air Traffic Control Association, Inc. (``ATCA'') is a 
professional association of forty-years standing dedicated to 
advancement in the science and profession of air traffic control and 
aviation safety. Its membership is worldwide in scope and represents 
all aspects of the air traffic control discipline, from air traffic 
control specialists and airway facilities technicians who operate and 
maintain the air traffic control system, to those individuals and 
companies who develop and manufacture the technology, equipment, and 
services which support the system, to the citizens, government 
agencies, and airlines who use the system.
    Because of rapid growth in the volume and complexity of air 
traffic, and the availability of new technologies to meet that growth, 
ATCA urges the Congress to make increased funding for activities and 
projects of the Federal Aviation Administration in fiscal year 1998 a 
National priority.
                             the challenge
    Between 1995 and 1996, US domestic air traffic increased over 5 
percent. US air carrier traffic increased over 4 percent worldwide, up 
nearly 7 percent on routes to Latin America and the Pacific. This trend 
is expected to continue. Over the next twelve years, US air traffic 
activity is anticipated to increase at an annual rate of 1.5 percent or 
more per year. Worldwide traffic is expected to increase 5 percent per 
year. These large increases in air traffic will mean proportional 
increases in accidents and fatalities, unless improvements in aviation 
safety continue apace. Achieving increased safety in air transportation 
will require substantial investments, both in aviation infrastructure 
and technology.
    Rapidly increasing air traffic also is resulting in congestion in 
all phases of air transportation--choking congestion in many terminal 
airspace areas and airports. Air transportation--both for commercial 
and business purposes and for recreation and tourism--is a significant 
driver of the Nation's economy, and can be a limiting factor on 
economic growth if capacity is inadequate to meet demand. Therefore, 
substantial and continuous expansion of air transportation capability 
is an absolute necessity, in addition to maintaining an acceptable 
level of aviation safety.
    Despite the clear need for expanding and improving the Nation's air 
transportation capability, the National Airspace System gradually is 
being permitted to deteriorate. Delayed infusion of new or replacement 
equipment, deferred maintenance, resource deprivation, and personnel 
reductions have exhausted all reserves of flexibility and unexploited 
operating potential in the system.
    In testimony last year at this time, the Association described for 
the Congress an air traffic control system which by all indicators is 
under considerable strain. Nothing has changed. Older equipment 
continues to break down and is more and more time consuming and 
difficult to repair. Reductions in force (FAA has experienced the 
unfortunate distinction of being a leader within the Federal Government 
in ``downsizing'' activities) are creating personnel shortages which 
delay or eliminate important safety and capacity-enhancing activities--
training, new procedures, research, engineering and development.
    Acknowledging the value of reducing fat in federal government 
activities, a ``leaner and meaner'' FAA will not result from cutting 
into muscle and bone. Rather, the organization must be invigorated and 
sustained with resources--both financial and human--suffcient to fuel 
not only continued safe operation of a patched-up, antiquated National 
Airspace System, but adequate to replenish and improve infrastructure 
so as to keep pace with expanding global aviation demands.
                       assuring adequate funding
    The Administration requests $5.386 billion for FAA Operations in 
fiscal year 1998, an 8.7 percent increase over the fiscal year 1997 
enacted level. This amount would fund an additional 500 controllers, 
326 additional flight standards inspectors, and 25 new field 
maintenance technicians. It also would provide $47 million to bring 
operational new safety and capacity equipment.
    It's not enough. The proposed increase is approximately offset by 
non-discretionary increases associated with mandatory pay adjustments 
and inflationary growth in costs, rendering the proposal merely a 
current services budget. Virtually no additional funds would be 
available for personnel and other costs of eliminating backlogs of 
deferred maintenance, training on new equipment and procedures, 
accelerated development of innovative operating concepts and 
procedures, intensified international standardization and harmonization 
efforts, and other important activities that enhance aviation safety 
and efficiency. FAA's Operations account must be funded significantly 
above the amount the Administration requests for fiscal year 1998 if 
FAA is to meet aviation challenges of the 21st century.
    The Administration requests $1.875 billion in fiscal year 1998 for 
FAA Facilities and Equipment, a 3 percent decrease from the fiscal year 
1997 enacted level. Again, it's simply not enough.
    Although FAA controllers today provide safe ATC services to the 
world's largest aviation marketplace, they do this using proven but 
antiquated equipment improved by a patchwork of temporary fixes and 
upgrades designed to enhance system reliability and capacity while 
modernized equipment is being developed and fielded. Although 
dedicated, creative airway facilities personnel keep the system 
operating remarkably well, equipment continues to deteriorate, wiring 
becomes more brittle, spare parts are increasingly difficult to obtain, 
and repairs are more difficult and time consuming. Meanwhile the volume 
and complexity of air traffic is increasing exponentially. Major 
infrastructure investment is an absolute necessity, and it must be made 
now.
    Concern also is intensifying over potential security threats to 
aviation, including the threat of attack on the air traffic control 
system. Significant new resources will have to be made available to 
protect against these threats--resources which cannot come from funding 
allocated for air traffic control modernization or aviation safety 
improvements.
    Other news however is very good. FAA has programs and projects well 
underway to replace legacy air traffic control systems with modernized 
equipment which not only is more reliable, but also is capable of 
enhancing capacity and permitting more flexible operating procedures. 
For example, modernized communications for en route ATC facilities 
(Voice Switching and Control System) already is being fielded. New air 
traffic controller work stations (Display System Replacement) will 
begin to appear in 1998. ATC terminal automation (Standard Terminal 
Automation Replacement System) is on a fast track to begin 
implementation in 1998.
    These new systems will accommodate useful automation tools 
(Decision Support Systems) that will help air traffic controllers align 
and sequence aircraft in ways that increase safety and expedite the 
flow of air traffic. For example the Converging Runway Display Aid/
Controller's Automated Sequencing Aid projects the ``ghost'' of one 
aircraft onto the displayed flight path of another, helping the 
controller visualize the distance between two aircraft and thereby 
establish safe spacing between them, even though they are approaching 
to land on diverging runways. Another new tool is the Center/TRACON 
(Terminal Radar Approach Control) Automation System, computer software 
that provides the controller optimal aircraft arrival and departure 
sequences. A third tool is the Surface Movement Advisor, a much needed 
safety system which aids controllers in separating aircraft on the 
airport surface.
    Between departure and arrival, Traffic Flow Management will be 
enhanced with Automated En Route Air Traffic software under development 
that will probe the ATC system for potential conflicts between the 
routes of aircraft, alert the controller, and suggest to the controller 
a safe maneuver to resolve the potential conflict. Like tools used by 
terminal controllers, AERA will foster more efficient use of airspace, 
allowing en route controllers to reduce unnecessarily large buffers of 
airspace between aircraft without degrading safety.
    Technological advances such as these potentially will allow safe 
transition to ``Free Flight,'' a new concept in air traffic operations 
permitting aircraft operators to select their route and speed of 
flight, with air traffic control intervening only to ensure safety. 
Aircraft will be taking advantage of the entire volume of airspace 
rather that just fixed corridors, and it is hoped therefore that Free 
Flight will increase airspace capacity.
    Also well underway is the application of satellite technology to 
air traffic control. Enhanced by the Wide Area Augmentation System, 
planned for initial implementation in 1998, and by Local Area 
Augmentation Systems the Global Positioning System will permit aircraft 
to determine their own position to within ten meters. This information 
will increase the flexibility of aircraft operators to land at airports 
without ground based landing aids. Through the concept of Automatic 
Dependent Surveillance, aircraft can provide position information to 
air traffic control, allowing ATC to compile a depiction of air traffic 
even in places where radar is unavailable such as over the oceans. 
Future systems will allow this location information to be broadcast, 
giving appropriately equipped aircraft a Cockpit Display of Air Traffic 
Information. Widespread aircraft equipage and use of ADS and ADS-B 
(Broadcast) will allow ATC safely to reduce separation between 
aircraft, thereby increasing airspace capacity. It also will reduce 
costs by eliminating the need for many ground based navigation aids and 
sensors.
    All of these essential technological improvements are on the 
horizon, promising substantial and long term operating benefits for 
users and economies for the Federal Government. Controllers, airway 
facility maintenance technicians, and aircraft operators eagerly await 
these needed new technologies and systems. The Vice President's 
Commission on Airline Safety and Security (the ``Gore Commission'') has 
endorsed accelerated application of satellite technology to air traffic 
control. Now simply is not the time to pinch pennies on ATC 
infrastructure improvements.
    ATC modernization is well underway, and will be a continuing 
process. As air traffic increases and technology advances, new concepts 
and improved systems will become available to make air traffic control 
more safe, productive, and efficient. As in other enterprises, wise and 
systematic investment will continue to make good economic sense. The 
Administration's fiscal year 1998 budget proposal is below that 
[required to maintain momentum and prevent funding shortfalls from 
becoming a limiting factor in the progress of needed and promising 
modernization initiatives. Inadequate investment today will translate 
directly into deferred operating benefits and lost economies. To 
maintain the momentum of needed ATC modernization and to pursue the 
objective of accelerated application of satellite technology to air 
traffic control, ATCA urges Congress to appropriate $1.969 billion, 5 
percent more than the Administration's request, for FAA Facilities and 
Equipment in fiscal year 1998.
    The Administration proposes $200 million in fiscal year 1998 for 
FAA Research, Engineering and Development, a decrease of 4 percent from 
the fiscal year 1997 enacted level. In view of the aviation challenges 
ahead and the great benefits to be derived from investments in aviation 
research, ATCA urges Congress to increase the amount appropriated for 
FAA RE&D to $250 million in fiscal year 1998.
    Aviation research plays a critical role in advancing aviation 
safety and efficiency.. Not only must FAA continue a high level of 
research directed toward aircraft safety and security. The increasing 
level and complexity of air traffic, and the emergence of operating 
concepts such as ``Free Flight'' are opening new areas for safety-
critical and capacity-enhancing research. Aviation human factors 
including human-machine interaction, high levels of automation, wake 
vortex and hazardous weather detection and dissemination, advanced 
traffic flow management, improvements in communications technologies 
and data link, applications of information technology to ATC, modeling 
and simulation, satellite technology in ATC, and cockpit collision 
avoidance are new and expanding avenues of research which can yield 
significant safety and economic benefits. Work in many of these areas, 
especially advanced air traffic management and developments in ATC 
communications, navigation and surveillance directed toward enabling 
``Free Flight'', could be accelerated with additional funding. As in 
the case of ATC modernization, prudent and systematic investment in 
aviation research and development makes good sense.
    The Administration proposes a one-third drop in funding for Airport 
Grants-in-Aid, from $1.46 billion in fiscal year 1997 to $1 billion in 
fiscal year 1998. Again, the funding proposed simply is not enough. 
ATCA urges Congress to enact funding of at least $1.5 billion for 
Airport Grants in fiscal year 1998.
    The complexity and volume of traffic through the nation's airports 
increases daily. Regardless of how safe and efficient the air portion 
of the journey is, congestion and delay before take-off or after touch-
down can make the difference between a peasant, timely trip and a 
harried, unsatisfactory ordeal. Although the ability of airports to 
assess a limited passenger facility charge provides some measure of 
relief, localities especially small communities are hard pressed to pay 
for the airport improvements needed to keep pace with an expanding 
aviation marketplace. Continued prudent investment in airport 
infrastructure remains an essential component of a balanced plan to 
meet aviation demands of the 21st Century.
                     reliable funding stream needed
    During the coming year, aviation policy makers in partnership with 
the aviation community will conduct comprehensive discussions directed 
toward devising a mechanism that will assure adequate and reliable 
funding for aviation safety and air traffic control activities of the 
Federal Government. ATCA looks forward with other members of the 
aviation community to these deliberations.
    Regardless of the outcome, the ultimate reality is that greater 
levels of resources--both dollars and people--must be applied to the 
air traffic control system now, today, if FAA is going to be able to 
meet the demands of increasing air traffic while continuing to provide 
the same safe and reliable ATC and aviation safety services the 
traveling public enjoys and has come to expect, and which have fueled 
the national economy since the inception of Federal air traffic control 
in 1936.
                               conclusion
    The potential for rapid advance of ATC-related technology and the 
emergency of new concepts for air traffic management give cause for 
optimism about the future of air transportation, and provide 
opportunities for the United States to forge ahead in its position as 
world leader in aviation and air traffic control. The Air Traffic 
Control Association urges Congress to join hands with FAA and the 
aviation community in a partnership for progress, enacting funding 
levels for FAA in fiscal year 1998 which are not merely adequate, but 
which foster excellence into the 21st Century.
                                 ______
                                 
Prepared Statement of Wellington Webb, Mayor, City and County of Denver
    On behalf of the City and County of Denver, I am proud to say that 
Denver International Airport successfully completed its second full 
year of operations on February 28, 1997.
    I want to thank Congress, and particularly this Subcommittee, for 
providing the funding that enabled the FAA to provide AIP grants and 
equipment and facilities for this nationally important project. DIA is 
the first major airport built in the United States in over 20 years. It 
is a critical component of our national transportation infrastructure 
and its successful completion simply would not have happened without 
the close cooperation of the City, the FAA, the DOT and Congress. To 
those of you who have not yet seen DIA, I would like to extend an 
invitation to visit the airport and would like to give you a personal 
tour of its state-of-the-art facilities, which are serving as a model 
for other cities that are building new airports all over the world.
    There are three main reasons why DIA was built.
    One was to provide a more efficient, cost-effective and user-
friendly facility for the citizens of the City of Denver, the State of 
Colorado and the Rocky Mountain region, and the millions of visitors 
who are so important to the region's economy.
    The second, closely tied to the first, was to provide a more cost-
effective and efficient hub by reducing or even eliminating the delays 
that were keeping Denver from taking maximum advantage of its central 
geographical location and were impacting the nation's air 
transportation system.
    Third, Stapleton was the source of serious noise problems that 
required a resolution. It was located only seven miles from downtown 
Denver and was surrounded on three sides by residential communities. 
About 14,000 people lived within the 65 LDN contour--the noise level 
which the FAA has determined is unsuitable for homes.
    Against the background of these three objectives, I can report to 
you that DIA has met or exceeded our goals in every respect. The 
Airport's revenues have exceeded its expenses; it is highly efficient 
and has the least delays of any of the nation's 20 busiest airports and 
the second highest percentage of on-time arrivals; and we have slashed 
the number of people impacted by noise from about 14,000 to about 500.
    By virtue of this performance, DIA has made a major contribution to 
the efficiency of the carriers operating at the Airport and, according 
to the FAA, to the national system through reduced flight delays. What 
seems to remain, however, are some cobwebs of myth and echoes of the 
past which I would like to take the opportunity to dispel.
    Let me now turn to more specifics about the results of DIA's first 
two years of operation.
    a. dia's first two years of operations have been very successful
1. DIA Is Financially Sound.
    DIA's record of performance confirms that the Airport is managed 
properly and is financially very viable. For our second full year of 
operations, we project that our net revenues, i.e., revenues less 
operating expenses and debt payments, will more than $30 million, an 
increase of 50 percent over the prior year. Under our agreement with 
the airlines, 80 percent of these net revenues are provided to the 
carriers, which reduces their costs at DIA. We are achieving these 
highly favorable financial results despite the fact that Continental 
Airlines eliminated its Denver hub operations for reasons, I might add, 
unrelated to the fact that DIA was built. To put Continental's 
withdrawal into perspective, in 1993, only four years ago, Continental 
and Continental Express had over 250 flights per day at Stapleton and 
accounted for about 35 percent of the passengers. Today, Continental 
accounts for only about a dozen flights per day and less than three 
percent of DIA's passengers. While some airports would have suffered 
tremendously from such a downsizing by a major airline tenant, Denver 
bounced back extremely well. The gap was substantially filled by our 
other airlines, almost all of which have reported increases in 
passengers compared to their passenger levels at Stapleton. As a 
result, traffic for 1996 was up to about 32.3 million (or four percent 
over 1995). This solid traffic level is evidence of Denver's strong 
origin and destination market and also its central geographic location 
for east-west hubbing operations.
    We also carefully managed our other sources of revenue, such as 
concessions and parking, and our costs, particularly through successful 
refinancing of our debt obligations. As a result of the strong revenue 
performance and the Airport's ability to control operating costs, our 
bonds were upgraded to investment grade by Standard & Poor's to BBB and 
are presently rated at Baa by Moody's. The marketability of our bonds, 
tested by our refinancing, reflects the Airport's overall financial 
strength and the public's support for DIA. As you also know, the GAO 
issued a report confirming that DIA is financially sound and, despite 
all the allegations about problems at DIA, the Airport has uniformly 
received a clean bill of health.
    I would also like to address questions that have arisen concerning 
the cost to build DIA. The total cost was $4.9 billion, which includes 
FAA and airline costs. This has to be considered in the context of 
other airport projects. As shown in Attachment 1, the cost for this new 
airport is low by comparison with other new airports worldwide and 
other airport projects here in the United States, such as the $4 
billion projects at JFK International and Miami International.
    As we enter our third year of operations, we expect our record of 
financial success to continue and believe that DIA will continue to be 
one of the world's most efficient airports.
2. DIA Has Substantially Reduced Delays.
    Our second major goal was to reduce delays. The latest results for 
1996 show DIA to be the least delayed of the nation's 20 busiest 
airports. Specifically, we had 1.9 delays per thousand operations, half 
the amount of the airport ranked number two. We also enjoyed the second 
highest percentage of on-time arrivals for 1996 among the top 20 U.S. 
airports. In contrast, at Stapleton, we suffered 14 delays per thousand 
operations, one of the worst records in the United States. Stapleton, a 
major connecting airport for travelers flying between the eastern and 
western parts of the country, was a terrible bottleneck during bad 
weather. While Stapleton could handle 88 air carrier jet arrivals per 
hour on two runways in good weather, it would be down to only one 
runway and barely 32 arrivals per hour in a storm, resulting in 
tremendous backups throughout our national aviation system. That was 
one of the major reasons for then-Secretary of Transportation Skinner's 
strong support which was the impetus that allowed DIA to be built.
    Since DIA opened, its benefits to the national air transportation 
system have been dramatic. In fact, on the day we opened, Denver was 
hit by a snowstorm that would have left Stapleton with only one 
operating air carrier jet runway and only 32 operations per hour. 
Despite the bad weather, DIA had three runways operating at the same 
time and the capacity to handle up to 120 flights per hour. As a 
result, the FAA has credited DIA for contributing to a nationwide 
reduction of 11 percent in flight delays due to bad weather.
3. DIA Has Substantially Reduced Airport Noise Impacts.
    Our third major goal was to reduce the tremendous impact of 
aircraft noise on the people of our communities. As previously 
mentioned, Stapleton was located only seven miles from downtown Denver 
and had about 14,000 people living within the 65 LDN contour, a noise 
impacted area which the FAA has determined to be unsuitable for homes.
    To solve this serious problem, DIA was built 23 miles from downtown 
Denver on a 53-square-mile site. The location and size of the site were 
chosen specifically to minimize noise problems as far as possible. The 
result was to reduce almost to the point of elimination the number of 
individuals within the 65 LDN contour from 14,000 at Stapleton to only 
about 500 at DIA.
    Although this is a dramatic reduction, DIA, like every major 
airport in the nation, still receives noise complaints, in some cases 
from individuals as far as 50 miles away where the noise impact is 
significantly below 65 LDN. The noise levels for many of these 
individuals, while no doubt bothersome to them, are not within the 
FAA's established criteria, so that there are no Federal resources 
available for mitigation purposes. However, we are taking these 
community concerns very seriously.
    Under our Intergovernmental Agreement with Adams County, noise 
limits were established at 101 specific points. We are in compliance 
with 97 of these points and are working to comply with the remaining 
four. The City has also established a technical task force consisting 
of experts from DIA, United Airlines, other airlines at DIA, noise and 
airspace consultants and seven counties to address the noise impacts on 
all the surrounding communities. The Task Force issued nine 
recommendations, including construction of DIA's sixth runway. Denver 
and the FAA have implemented seven of these recommendations. The eighth 
recommendation is under review. The ninth recommendation is the sixth 
runway.
    In summary, DIA's successful first two years have proven that we, 
and by that I mean the people of Denver, Colorado, the Rocky Mountain 
region, the FAA, the DOT and Congress, have been able to build the 
safest, most efficient airport in the world, and the first new airport 
in this country since Dallas/Fort Worth was built over 20 years ago. 
This statistic alone is evidence of the enormous hurdles that cities 
face today in trying to build new airports. Chicago and Minneapolis, as 
most recent examples, have considered building new airports, only to 
give up because of the almost insurmountable obstacles facing such 
massive projects. Yet, Denver took on this difficult challenge. Sure, 
with hindsight, there are some things we might have done differently 
but, as DIA's performance has demonstrated, there are lots of things 
that we did right and a lot of things that no other city has been able 
to achieve in over 20 years and for who knows how many more years to 
come.
    I would hope that this Subcommittee, Congress and people across the 
country will focus on this positive achievement in building this great 
airport and the tremendous benefits it has for the entire nation.
    When we did not open on time and things did not go as we had 
planned, there were some grounds for valid criticism and, where that 
was the case, we accepted responsibility. But that is the past and we 
must now deal with the present and the future. If we do not--if we 
continue to focus only on the negative--a strong signal will be sent to 
other communities that the risks of building a new airport are simply 
not worth it and we may never see a major airport built in the United 
States again. That would be terribly damaging to aviation and to the 
nation's overall transportation system.
 b. denver should not be barred from seeking aip funds for dia's sixth 
                                 runway
    Having reported on what DIA has achieved, we must now focus on one 
significant component of the DIA project that is only partially built 
and requires completion--the sixth runway.
    Your Subcommittee has been a strong advocate of measurable criteria 
for federal funding at airports, an initiative Denver supports. In 
conjunction with this, I would like to request that this Subcommittee 
allow Denver the opportunity to be measured under these criteria by 
eliminating the unique statutory prohibition on our ability even to 
apply for, much less to receive, AIP funding for our sixth runway. As 
you know, this prohibition was first enacted in 1994, before DIA was 
opened and while we were addressing the problems with the baggage 
system. The statutory prohibition was repeated again the following year 
and then, again, the year after that for the third time in a row. Since 
we now have a successfully operating airport, it is simply not 
appropriate to single DIA out for this harsh treatment. There are over 
3,000 airports nationwide that are eligible to complete for AIP funds 
and we believe we merit an equal right to compete by having the 
statutory prohibition lifted. Punitive legislation against us is not 
warranted. If there are continuing concerns with DIA that you will 
share with us, we will work with you, the FAA or whoever else is 
involved to address them, but we ask that the blanket prohibition on 
our eligibility for AIP funding be lifted.
    I also want to highlight that DIA is a national asset. We estimate 
that about 75 percent of the 32 million passengers using DIA each year 
come from states other than Colorado. Thus, the AIP funding prohibition 
impacts not only Denver, but also people throughout the country.
    Some people have questioned why we want to add a new runway to an 
airport that just opened a year ago. This issue, of course, is separate 
from whether Denver has the right to apply for AIP funds under the same 
criteria as other airports. However, the fact is that the sixth runway 
is not a recent development. DIA was designed originally to have six 
runways so that the Airport would have three separate arrival runways 
and three separate departure runways in order to minimize delays.
    The record clearly shows the long-term planning and support for the 
sixth runway.
  --The sixth runway was included in the Environmental Impact Statement 
        for DIA.
  --The sixth runway is on DIA's Airport Layout Plan, which was 
        approved by the FAA several years ago.
  --The local FAA Air Traffic personnel and the FAA's Northwest 
        Mountain Region have long supported the sixth runway, as 
        evidenced by a White Paper entitled ``Completion of the Sixth 
        Runway by Opening Day''.
  --The Airline Flight Operations and Airfield Subcommittee supported 
        the sixth runway in 1991 and the Airline Technical and Affairs 
        Committee several times since then.
  --The FAA awarded Denver a $10 million AIP grant in September 1993 
        for site preparation work for this runway and Denver has 
        completed this work.
    The total cost of the runway will be about $85 million. About $15 
million has been spent for site preparation work and about $70 million 
is needed for construction, of which up to $52 million is eligible for 
AIP funds. Note that I say ``eligible''. If the sixth runway 
prohibition is not enacted again, it will still be up to the FAA, using 
the same criteria it applies to every other airport in the nation, to 
decide how much it will provide for DIA.
    However, there is a condition that must be met before DIA would 
apply for FAA funds for the sixth runway. That condition is that Denver 
must demonstrate, through the use of an FAA-approved computer 
simulation, that annual operating cost savings are equal to or exceed 
the annual debt service and operating and maintenance costs of the 
sixth runway. The computer simulation process requires FAA input on 
flight patterns, which, in turn, affects the noise impact of the sixth 
runway on surrounding communities. This is a significant community 
issue which we are very much trying to address and we need FAA 
participation in the process. Yet, this Subcommittee's prohibition on 
the use of FAA funds ``for planning, engineering, etc.'' is construed 
by the FAA as barring its involvement and stands in the way of what 
would be a productive process of analyzing the runway's cost-benefits 
and community noise impacts. It is, we hope, an unintended result but 
it is obstructive, nonetheless, and represents another cogent reason 
why, after three years of enactments, and two years of successful 
airport operation, the time has come to eliminate the prohibition.
    In summary, Mr. Chairman, I am not asking this Subcommittee to give 
us AIP funds for the sixth runway. I am simply asking this Subcommittee 
to let the AIP statutory criteria and FAA regulations apply to DIA, 
just like thousands of other airports nationwide, and ask that you not 
re-enact the prohibition on AIP funding for DIA's sixth runway.
    I appreciate the opportunity to provide this report on DIA's second 
year and invite you to visit our airport to see its operation first-
hand.
    Thank you.
                             [attachment 1]
         Denver International Airport Project Cost Comparisons
    The City County of Denver received considerable value for its $4.2 
billion outlay to build Denver International Airport (DIA's total cost 
is $4.9 billion when FAA, airline and other tenant costs are added). A 
comparison with current U.S. airport improvement projects and with new 
international airport construction projects is illustrative.

                                         NEW AIRPORT PROJECTS COMPARISON                                        
----------------------------------------------------------------------------------------------------------------
                                                           Size                  Passenger                      
                        Airport                          (acres)    Runways      capacity            Cost       
----------------------------------------------------------------------------------------------------------------
Denver Int'l..........................................     34,000          5      50,000,000      $4,900,000,000
Inchon Int'l (Seoul, Korea)...........................     11,715          2      27,000,000       4,980,000,000
Chep Lap Kok (Hong Kong)..............................      3,083          2      30,000,000       9,000,000,000
Kuala Lumpur..........................................     24,989          2      25,000,000       3,800,000,000
Kansai Int'l (Osaka)..................................      1,300          1      30,000,000      14,000,000,000
Franz Joseph Srauss (Munich)..........................      3,705          2      15,000,000       6,000,000,000
----------------------------------------------------------------------------------------------------------------


                                  U.S. AIRPORT IMPROVEMENT PROJECTS COMPARISON                                  
----------------------------------------------------------------------------------------------------------------
                Airport                                        Projects                              Cost       
----------------------------------------------------------------------------------------------------------------
Denver International...................  New airport........................................      $4,900,000,000
Los Angeles Int'l......................  20-year expansion..................................      12,000,000,000
John F. Kennedy Int'l..................  New international terminal, light rail, other             4,300,000,000
                                          improvements.                                                         
Miami International....................  New terminal, parking garages, cargo buildings,           4,000,000,000
                                          fourth runway.                                                        
San Francisco Int'l....................  International terminal, light rail ground                 2,400,000,000
                                          transportation center, other improvements.                            
Washington National and Dulles           New National terminal, Dulles terminal expansion,         2,000,000,000
 International.                           other improvements.                                                   
St. Louis Lambert......................  New terminal, new runway, runway extension, more          2,000,000,000
                                          gates, people mover, parking.                                         
----------------------------------------------------------------------------------------------------------------
Sources: Airports, Aviation Week & Space Technology, FAA, Franz Joseph Strauss Airport, Jane's Airport Review,  
  Korea Airport Construction Authority, Metro Detroit Connections, New York Times, San Francisco International  
  Airport Master Plan Executive Summary.                                                                        

                                 ______
                                 
      Prepared Statement of the Greater Orlando Aviation Authority
    Senator Shelby, and distinguished members of the Senate 
Transportation Appropriations Subcommittee:
    The Greater Orlando Aviation Authority (GOAA) is extremely pleased 
to submit written testimony to you, and we deeply appreciate this 
opportunity to provide you with the current status of the development 
of Orlando International Airport (OIA). GOAA is very grateful for the 
past support of this Committee, and will strive to maintain your trust 
and confidence. The future ability of the national aviation system to 
ensure safe and secure air transportation will strongly depend on the 
Airport Improvement Program (AIP). In order to ensure the Federal 
Aviation Administration (FAA) has the resources needed to fund critical 
capacity improvement projects, GOAA respectfully requests the Senate 
Transportation Appropriations Subcommittee to fully fund AIP at the 
authorized level of $2.347 billion with an obligation ceiling of no 
less than $1.46 billion.
    Airfield improvements are intended to increase needed capacity, 
provide improved flight safety operations, and enhance the efficiency 
of the national aviation system. The AIP is a critical component of the 
financial strategy to ensure airports, including OIA, have the 
resources necessary to construct essential airfield improvements.
    Past aggressive planning efforts have enabled OIA to accommodate a 
phenomenal growth rate over the past 15 years. Forecasts indicate OIA 
will experience at least a 7-10 percent annual growth rate during the 
next five-year period. In 1996 OIA marked a 13.8 percent increase in 
passenger traffic which was among the top three fastest growing 
airports in the world. During the same year OIA recorded 25.6 million 
passengers which was an increase of 3.1 million passengers over the 
previous year.
[GRAPHIC] [TIFF OMITTED] T12NON.031

    The Central Florida community continues to grow at an amazing rate. 
Walt Disney World is only 25 percent developed and will open its fourth 
theme-park in 1998 (Animal Kingdom). Universal Studios is underway with 
a seven year, $3 billion expansion program that will create 14,000 new 
jobs. The Orange County Convention Center recently completed a major 
expansion program that now ranks Orlando as one of the top 5 US cities 
for convention facilities. Orlando is the fastest growing Metropolitan 
Statistical Area (MSA) in the US and currently ranks as the 39th 
largest. Orlando is expected to generate 232,000 new jobs, an increase 
of 32.4 percent, between 1994 and 2005. Businesses in the areas of 
computer software, laser optics, and health services are among the 
fastest growing employers in Orlando. The development of Orlando 
International Airport must keep pace with the growth of the community.
    An independent economic impact study reports Orlando International 
Airport generates an annual economic benefit of $14 billion and is 
responsible for more than 54,000 jobs throughout Central Florida. This 
report further stated the total economic benefit will be $20 billion 
when passenger traffic reaches 30 million.
[GRAPHIC] [TIFF OMITTED] T12NON.032

    Orlando International Airport has the largest acreage of any 
commercial airport on the East Coast, and is located at a key strategic 
crossroads for future global commerce. During the past twenty years 
GOAA has acquired almost 15,000 acres to ensure OIA will have the 
ability to satisfy future aviation demands. Our airport has the 
potential to become the focal point connecting European, South 
American, and domestic air service. Existing airport property and 
environmental mitigation will allow the development of an airfield 
capacity that could exceed one million flight operations per year 
serving eighty to ninety million passengers. GOAA believes future 
investments in developing OIA capacity will maximize the national 
aviation system.
    In an effort to create a logical method to fund future airport 
projects, GOAA has developed a Capital Improvement Program (CIP) to 
implement the OIA Master Plan. During the next seven years GOAA will 
undertake nearly $2 billion of airfield, terminal, and roadway 
improvements. The CIP includes an estimated $170 million or 9 percent 
of the total projects costs to be funded under the Airport Improvement 
Program (AIP). On January 23, 1997 GOAA submitted an application for a 
Letter of Intent (LOI) to the FAA to partially fund three major 
airfield capacity improvements with a total cost of $208,750,000. The 
federal share is $156,562,500 which is 75 percent of the full amount. 
These projects included the construction of a fourth runway system, 
north crossfield taxiway, and the final rehabilitation of an original 
primary runway.
[GRAPHIC] [TIFF OMITTED] T12NON.033

    An October 1990 Capacity Design Team Report recommended the 
construction of a single north crossfield taxiway. The team consisted 
of FM, GOM, Airline Transportation Association (ATA), and officials 
representing other airlines serving OIA. This recommendation was based 
on 294,000 annual operations in 1988. In fiscal year 1996 OIA reported 
a total of 341,984 operations representing a 16 percent increase. The 
report further indicated the construction of the north crossfield 
taxiway would result in $2.9 million annual savings due to improved 
operational efficiency. In addition, the Airport Capacity Enhancement 
Tactical Initiative--North Crossfield Taxiway System was completed in 
November 1995 indicating an eventual annual savings of $4 million. This 
project will cost $70,600,000.
    The Annual Service Volume (ASV) of the existing airfield 
configuration at OIA is 471,000 operations. On May 21, 1996 the FM 
accepted as part of the OIA Master Plan that the airport will incur a 
4.4 percent increase in annual flight operations through the year 2000. 
Therefore, it is anticipated this growth requires GOAA to begin 
construction of a fourth runway in 1998 when operations will reach 80 
percent of the established ASV. In addition, the Capacity Design Team 
Report recommended a fourth runway should be commissioned when the 
airport reached 400,000 annual operations. This level of aircraft 
operations is expected in the year 2000. As flight operations increase 
beyond 400,000 the 1990 Capacity Design Team Report states the fourth 
runway will generate $47.3 million in annual benefits from reduced 
delays. Most importantly, the FM, GOAA, and FDOT have committed $72 
million towards this project. This amount represents land acquisition, 
mitigation requirements, initial site preparation, relocation of a high 
voltage power line, and the preparation of 30 percent design costs. The 
fourth runway will cost $128,130,000.
    GOAA received an earlier FM grant to rehabilitate the initial 9,000 
feet of runway 18R/36L. This concrete runway is deteriorating at the 
joints and has been patched with bituminous material. Continuing 
deterioration is resulting in excessive foreign object debris. 
Replacement of this runway will assure the Authority of three 
operational runways, prevent the unplanned emergency shutdown of the 
runway, and reduce maintenance costs. The runway's remaining 3,000 feet 
now requires rehabilitation and will cost $10,020,000.
    The OIA Master Plan includes the construction of a new 300 foot Air 
Traffic Control Tower (ATCT). The proposed tower is absolutely 
essential for the future development of OIA. The planned construction 
of a fourth airside building, fourth runway system, and south terminal 
complex requires the immediate design and construction of this ATCT 
which is needed to eliminate existing and future line-of-sight 
problems. GOAA is attempting to identify alternative funding sources; 
however, OIA will require at least $10 million FAA participation in the 
construction of the tower and at least $5 million to procure equipment 
for the tower to be included in the 1998 budget. GOAA hopes these funds 
will be made available through the FAA Facilities and Equipment budget.
    In closing, we would like to express our gratitude for allowing 
GOAA to submit this testimony. We are confident that our comments have 
provided you with a better understanding of the future expansion and 
financial dynamics impacting Orlando International Airport.
                                 ______
                                 
                     Coast Guard-Related Testimony
Prepared Statement of Charles L. Calkins, National Executive Secretary, 
                       Fleet Reserve Association
                              introduction
    Mr. Chairman and distinguished members of the Subcommittee: The 
Fleet Reserve Association (FRA) appreciates this opportunity to present 
its position on the fiscal year 1998 Coast Guard Budget.
    The FRA was founded in 1922 and now represents over 162,000 active 
duty, reserve, and retired members of the Coast Guard, Navy, and Marine 
Corps. The association is chartered by Congress and represents the 
interests of its members on personnel issues which are the focus of 
this statement.
                           coast guard parity
    FRA strongly supports full funding of the Coast Guard at the level 
requested by President Clinton in his proposed fiscal year 1998 Budget. 
The request addresses the important issue of parity with the Department 
of Defense (DOD)--an issue especially important to adequate funding for 
personnel programs.
    In the past, the Coast Guard has often been placed in the position 
of having to rely upon DOD to supplement its annual funding in order to 
maintain equivalent pay and allowances for its people. The President's 
budget request addresses this disparity with attention to important 
quality of life programs. In addition, the request supports the fourth 
year of a highly effective Coast Guard ``streamlining plan'' resulting 
in continued personnel and spending reductions.
                      compensation and allowances
    Full employment cost index (ECI) annual active duty pay adjustments 
are a top priority with not only the FRA--but also The Military 
Coalition (TMC), a consortium of 24 groups representing the interests 
of over five million active duty, reserve, and retired military 
personnel. FRA is a founding member and active participant in TMC.
    Competitive pay is important to maintaining the all-volunteer 
force, yet pay raises have been capped below ECI in 11 of the past 15 
years resulting in a pay gap in excess of 12 percent and decreased 
adjustments in allowances tied to annual pay increases.
    FRA strongly urges your support of a full ECI pay adjustment. The 
requested 2.8 percent adjustment is .5 percent less than the ECI, and 
touted as the ``maximum'' amount established by law. Not only is this 
less than the full ECI rate, it is implemented 15 months after 
statistics are compiled, exacerbating the substantial gap between 
military and civilian pay.
    In the event Congress approves a pay adjustment larger than 2.8 
percent, we implore your distinguished panel to include money in the 
Coast Guard budget to make up the difference and thus ensure parity 
with DOD compensation and allowances.
    FRA also strongly supports the budget request of nearly $8 million 
for quarters/housing allowances; sea pay for 65' cutter crews; 
increased dislocation allowance; VHA locality floor; and round trip 
travel expenses for POV drop-off during overseas PCS moves. In 
addition, funds (over $1.2 million) are included to bring Coast Guard 
child care centers up to the level comparable to DOD standards. This 
funding will ensure parity with DOD for these vital quality of life 
programs.
    Finally, the FRA supports establishment of a standard measure for 
the basic allowance for subsistence (BAS) and opposes the DOD proposal 
to revamp the BAS program by limiting annual adjustments to only 1 
percent over several years until BAS is in line with the new standard. 
Such a plan would result in a decrease in total compensation for 
enlisted personnel over the adjustment period. Although this is not 
under the cognizance of your distinguished panel, the FRA wishes to 
share its position on DOD's proposed revisions to BAS.
    The Association supports the 7th Quadrennial Review of Military 
Compensation (QRMC) recommendation that establishes a BAS standard 
based on the U.S. Department of Agriculture (USDA) moderate plan level, 
along with adjusting basic pay in all cases to preserve the value of 
the compensation package.
                                housing
    Adequate, safe, and affordable housing is a major concern for Coast 
Guard personnel. Currently, the Coast Guard maintains 5,200 family 
units and 4,900 barracks rooms for unaccompanied personnel. The 
condition of many of these units is unacceptable, and there is a six-
year backlog for maintenance of major facilities along with a 
substantial maintenance backlog for family housing units.
    Examples of this growing problem include seeping brick walls and 
leaking windows that flood berthing areas during heavy rains; housing 
with rotted walls and leaking basements; termite damage; kitchens with 
rusty and dented metal cabinets; and substandard electrical wiring. 
These problems are often handled via expensive short-term, piecemeal 
repairs utilizing scarce housing operating funds. Just as within DOD, 
which has similar housing problems, deferred maintenance vastly 
increases the total cost and postpones a permanent resolution to the 
problems. It's difficult for active duty personnel in all branches of 
the Armed Forces to understand why housing and barracks facilities have 
been left to deteriorate to their present condition, while senior 
officials annually extol the importance of military people and their 
quality of life. Ironically, incarcerated felons are often afforded 
better housing than many uniformed personnel who are forced to live in 
inadequate or substandard housing.
    Also compounding the situation is the fact that housing management 
staffing has fallen to 70 percent of what the Coast Guard indicates is 
necessary to adequately manage a housing inventory of this size.
    The budget request allocates nearly $9 million for housing and 
barracks maintenance plus funds for additional housing management staff 
personnel to address these challenges.
    Your attention is also invited to the environmental risk assessment 
of Coast Guard housing units. In 1995, the service began a multi-year 
evaluation of environmental risks posed to occupants of its housing 
units and child care centers. Threats include radon, lead, and asbestos 
especially in the older units which comprise the bulk of the Coast 
Guard's inventory. While the final results are yet to be determined, 
the data already indicates that at least 20 percent of the units 
require immediate attention to remove these hazards. Accordingly, 
$3,700,000 is included in the budget request to begin work on this 
threat to Coast Guard personnel and their families.
                               recruiting
    The budget includes additional funding for Coast Guard recruiting. 
Recent surveys indicate only about 25 percent of young people are 
interested in a military career--and of these, less than 6 percent 
reveal an interest in the Coast Guard.
    Just as the other military services rely on volunteers to fill the 
ranks, so too does the Coast Guard and the budget includes enhanced 
funding to support recruiting efforts.
                           invaluable service
    The Coast Guard provides invaluable service to our nation. A 
relatively small number of personnel perform a vast array of operations 
supporting our national security, maritime safety, drug interdiction 
program, and environmental protection.
    Unfortunately, many of these valuable services receive little media 
and/or public attention. As a return on the taxpayer's investment, the 
Coast Guard yields significant value in terms of lives and property 
saved annually. Accordingly, these dedicated professionals deserve 
parity with the Department of Defense regarding compensation, benefits, 
and entitlements--essential components of their quality of life.
                              in gratitude
    The FRA wishes to express appreciation to you and other 
distinguished members of the Subcommittee for past support of quality 
of life programs benefiting Coast Guard personnel and asks for your 
endorsement of the President's budget request.
                                 ______
                                 
Prepared Statement of Ed Carter, Boating Law Administrator, Tennessee, 
  President, National Association of State Boating Law Administrators
    Mr. Chairman and Members of the Subcommittee: I am Ed Carter, 
Boating Law Administrator for the State of Tennessee and I serve as 
President of the National Association of State Boating Law 
Administrators.
    The National Association of State Boating Law Administrators 
(NASBLA) is a professional association consisting of state officials 
having responsibility for administering and/or enforcing state boating 
laws.
    Our Association is recognized for it's stewardship of 
``Recreational Boating Safety''. We have over the years worked closely 
with the U.S. Coast Guard, the States and others to insure that the 
intent of Congress to promote uniformity, reciprocity and comity among 
the various states was given high priority. Testimonial of this is the 
many resolutions, model acts etc. that has been generated by our 
Association. In doing this we bring to the table at various meetings, 
highly qualified personnel in the field of boating law enforcement, 
education, boating safety and on the water, search and rescue.
    Our membership takes pride in their accomplishments and the many 
words of praise we have received from the Commandant, U.S. Coast Guard 
and the Chairman, National Transportation Safety Board over the years.
    Our reward is saving a life and what a wonderful reward that is.
    My testimony today will focus on the Aquatic Resources Trust Fund 
(Wallop-Breaux) and more specific, the Reauthorization/Appropriation of 
the Boat Safety Account of this fund.
    The boating safety account of the trust fund is derived solely from 
the tax boaters pay on their motorboat fuel. This user fee paid by the 
boaters, is returned to the States to help defray their cost for 
services provided to the recreational boater. We think this is indeed 
in keeping with the user fee concept, (i.e.) user pays-user benefits, 
thus not costing the general tax payer one cent and especially 
noteworthy, does not add one penny to the national debt.
    The Wallop-Breaux Trust Fund has resulted in a willingness on the 
states part to assume a major share of the boating safety and boating 
law enforcement responsibilities. This, I think is noteworthy since 
this responsibility is logically and statutorily a joint federal-state 
responsibility. The financial base provided by Wallop-Breaux funding 
allows the states to concentrate on establishing an administrative 
infrastructure, purchase equipment and promote the education and 
enforcement techniques to stimulate increased boating safety awareness, 
and thereby decrease fatalities.
    Funds made available from the boating safety trust funds have made 
a major contribution to boating safety. With these trust funds, the 
states have been able to reduce boating accidents and fatalities, 
relieve the Coast Guard boating safety teams on many of the nation's 
waterways, thus allowing the Coast Guard to pursue higher priority 
programs, provide a higher quality of boating safety education, produce 
a system of investigating and reporting boat accidents and most of all, 
provide a more rapid response to boats in distress. It is the desire of 
the states to continue and strengthen this proven boating safety 
program known to be in the best interest of the boating public we 
serve.
    Congress (and rightfully so) continues to be concerned over the use 
and effectiveness of these trust funds. So the question is often asked, 
``How do the states use federal boat safety trust funds?'' Attached is 
a comprehensive listing of the use of these funds.
    Specifically what we are asking this Subcommittee for is 
appropriation as authorized for the state boating safety program. 
Again, these are trust funds derived solely from the tax boaters pay on 
their gasoline used in motorboats.
    During the 2nd Session of the 103rd Congress and again in the 104th 
Congress, legislation surfaced to provide stable and dependable funding 
for grants to state boating safety programs. If passed, this would have 
alleviated the uncertainty each year for these trust funds in order 
that the state could make long range plans and insure continuity in our 
boating safety efforts.
    Again this year we see in the highlights of the Coast Guard's 1998 
budget as submitted to the Congress, a proposal of $55 million for the 
boat safety grant. This proposed legislation would convert state grants 
to a mandatory appropriation from the Aquatic Resources Trust Fund 
(Wallop-Breaux).
    Where our National Association is recognized for it's stewardship 
of ``recreational boating safety'', this Subcommittee over the years, 
is recognized for their untiring efforts in providing appropriation of 
boating safety trust funds to help defray the cost of services provided 
by the states to the recreational boating public. Be assured the 
efforts of this Subcommittee is well recognized and appreciated 
throughout the boating community.
    Areas of concern to our Association as we focus on long range plans 
for the 21st century are:
    (1) Identify and evaluate future impacts on boating safety and 
apprise our Association of the status of any legislation, policies or 
procedures relative to the issue at hand.
    (2) Surface use conflicts--Study what is being done and what can be 
done to alleviate these problems.
    (3) Personal Watercraft--Examine what is being done through 
education, enforcement and regulations and what is the long-range 
outlook for their sales and use.
    (4) Education options--Research what has happened in the states 
that have adopted ``mandatory education'' for adults, phase in versus 
more immediate methods, what is the cost effectiveness of these 
programs and are they making a difference in the target audience. What 
about other educational initiatives--dealer-based education or 
education using computers or the Internet.
    (5) Drinking and Boating--Examine what more needs to be done as far 
as education or legislation.
    (6) Personal Flotation Devices. If wearing a PFD will save 80 
percent of the boating accident victims--what should we be doing to 
encourage it, model it or require it?
    (7) Funding issues--Examine the outlook and future for state/
federal funding.
    (8) The Role of the U.S. Coast Guard and the States--Where should 
we be in the next 10 years in boating safety?
    The national trend shows a general boating growth pattern. The 
momentum is not only expected to continue, but to increase in the 
coming years. This is readily understandable when you consider that as 
available land becomes scarce and with 70 percent of the earths' 
surface covered by water, our waterways are a natural place to seek 
relief from the pressures of a growing population. The beautiful waters 
that abound our states satisfy the insatiable appetite of sport 
fishing, the recreational boating enthusiast and those who desire to 
leave pressures behind and to relax and absorb the tranquility of our 
waters and beaches.
    Additionally, the commercial traffic (i.e.) passenger and cargo 
ships, oil tankers, off shore drilling for oil on the continental 
shelf, fishing fleets etc. add new responsibility to the states in 
managing this priceless natural resource, ``our waterways''. Further, 
the Coast Guard is downsizing and even more of the responsibilities 
once absorbed by the Coast Guard are being given to the states. Boating 
safety is and will continue to be of high priority.
    We take pride in the fact that we make the best use of these trust 
funds and that the end product is a major contribution by the states to 
the overall reduction in the boating fatality rate.
    However, recreational boating safety is still on the National 
Transportation Safety Board's ``most wanted'' list. We must continue to 
focus our attention and coordinated efforts to remove recreational 
boating safety from this list. (See attached NTSB report).
    To keep the momentum in our boating safety efforts we strongly 
request appropriation as authorized for the states boating safety 
program for fiscal 1998.
    We feel the state program, to date, is a shining example of an 
ideal State/Federal partnership. We will continue to strive for more 
innovative use of the funds to better educate the boater and further 
reduce boating fatalities. However, we cannot over-emphasize that 
stability in the boating safety trust funds is needed if the true 
fruits of our efforts are to be realized. Needless to say, the Federal 
boat safety trust funds are critical to the success or failure of our 
state recreational boating safety program.
    We appreciate this Subcommittee continuing support and again ask 
for your consideration for appropriation as authorized from the Aquatic 
Resources Trust Fund (Wallop-Breaux) for the states boating safety 
program for fiscal 1998.
    Thank You.
 States Use of Federal Boat Safety Funds Aquatic Resources Trust Fund 
                           ``Wallop-Breaux''
    The states are proud of the use and effectiveness of the federal 
boat safety funds in pursuing our goal of ``safe and enjoyable boating 
for all who use our nation's waterways''.
    We feel, as statistics validate ``that'' the state program to date, 
is living up to the high expectations of the Congress. With full 
funding as authorized, we will strive for more innovative use of the 
funds to better educate the boater and further reduce boating accidents 
and fatalities. We foresee the states taking an even greater lead role 
in boating safety, boating education and boating law enforcement, thus 
allowing the Coast Guard to pursue the re-prioritized responsibilities 
and assignments placed on the service by Congress.
    Congress (and rightfully so) continues to be concerned over the use 
and effectiveness of these trust funds. So the question is often asked, 
``HOW DO THE STATES USE FEDERAL BOAT SAFETY TRUST FUNDS?''. Following 
is a comprehensive listing of the use of these funds.
  --Increased boating safety patrols;
  --Better boating accident investigations have pointed to causes which 
        are targeted for increased education and enforcement;
  --Increased training of enforcement officers;
  --Better communications and enforcement equipment;
  --Now reaching more boaters with free education classes;
  --Working towards better statistical data on effects of alcohol and 
        boating, (i.e.) in California, a two year study showed that in 
        59 percent of fatal motorboat accidents where testing could be 
        conducted, alcohol was a contributing factor to the cause of 
        the accident;
  --The erection of Kiosks to provide boaters information on coastal 
        bar crossings, navigation, equipment requirements, rules of the 
        road and related information including charts;
  --Erection of wind warning strobe lights across heavily used bodies 
        of water to warn boaters of impending high winds;
  --Courtesy boat safety inspections;
  --Conducting boating surveys, which provide critical data for 
        assessing boat use, conflict areas and safety courses;
  --Handing out free literature on boat noise, sailboarding safety, 
        make way in dealing with large ships, hypothermia, pleasure 
        craft, use of life jackets (PFD's) and dealing with alcohol 
        use;
  --Waterproof exhibits at boat launching ramps with boater safety 
        information;
  --Marking of hazards to recreational vessels;
  --Development of school video systems;
  --Some states are now handling all regatta permits and thereby 
        completely relieving the Coast Guard of this responsibility.
  --States picked up the load after the Coast Guard removed their 
        boating safety detachment teams (BOSDET) from joint 
        jurisdictional waters;
  --Developed and placed in use boating safety home study courses;
  --Developed and placed at marine dealers, a boating information 
        display;
  --Developed coloring books for elementary schools;
  --Stepped up TV and radio public service announcements;
  --Implementation of boating while intoxicated program including 
        purchase of portable testers, training classes and public 
        awareness announcements;
  --Computerizing boat accident information and arrests, which provides 
        capabilities of responding to public, legislative and other 
        inquiries regarding boating accident and water fatality 
        statistics;
  --Improved the integrity of the boat registration system;
  --Upgraded enforcement equipment;
  --Expanded our boating safety education capabilities;
  --Purchased special search and rescue boats that are fully equipped 
        for marine law enforcement;
  --Adding additional full-time and part-time marine patrol officers 
        and boating safety educators;
  --Implemented special boating investigation teams to handle boat 
        accident investigations;
  --Improved cooperation with volunteer groups such as the Coast Guard 
        Auxiliary by providing boat dock space, communication stations, 
        phone, utilities, etc. This has resulted in much more 
        visibility of search and rescue units and free boat safety 
        inspections;
  --Bringing together federal, state and local authorities in the 
        interest of boating safety, law enforcement, training and 
        equipment needs;
  --Better coordination with local governments to establish boating 
        restricted zones in heavy activity areas that present safety 
        hazards to the boating public;
  --Updating film library with additional programs and equipment to 
        provide to the general boating community, and to maintain 
        literature dealing with safety equipment regulations, safe 
        boating information, registration, titling and numbering 
        requirements for statewide distribution, so as to be highly 
        visible and readily available to the boating public;
  --Improve communications system to provide for better and extended 
        coverage with waterway enforcement officers, end result is 
        improved response time to marine emergencies and as a devise 
        for greater officer protection;
  --Establishing new aids to navigation and regulatory marker system 
        for controlled areas;
  --Construction and repair of boat access ramps;
  --As preventative strategies, inaugurated programs to reach new 
        generation of recreational boaters to the public schools.
    The fruits of our labor is evidenced by the fact that the annual 
fatality rate in the United states has dropped from 1,754 deaths in the 
seventies to a record low of 784 deaths in 1994, despite more people on 
our waters in a wider diversity of craft than ever before.
    Our Joint efforts are paying off. For this, we feel that we have 
made the Administration, the Congress, the State Legislators and most 
of all, the boating public that we serve proud.

    [Clerk's note.--The other attachments to Mr. Carter's statement do 
not appear in the hearing record, but are available for review in the 
subcommittee's files.]
                                 ______
                                 
  Prepared Statement of Capt. Fred R. Becker, Jr., JAGC, USN (Ret.), 
  Director, Naval Affairs, Reserve Officers Association of the United 
                                 States
    Mr. Chairman and members of the Committee: It is my pleasure to 
address this committee concerning the fiscal year 1998 budget request 
for the United States Coast Guard.
    The Reserve Officers Association continues to strongly advocate 
adequate resource allocations for the United States Coast Guard. Over 
the past several years, providing the needed resources to the Coast 
Guard has been a distinct challenge. It has continually required action 
by the Congress to provided a unique combination of Department of 
Transportation and Department of Defense funding to support the Coast 
Guard's requirements. It would, of course, be preferable for the 
Congress to fully fund the Coast Guard from within Transportation 
appropriations. If, however, such is not possible given continuing 
budget constraints, we would again ask that, recognizing the Coast 
Guard's role unique role with regard to the Department of Defense that 
additional Department of Defense funding be provided.
                       coast guard budget request
    The Coast Guard has shown great professionalism and flexibility in 
doing more with less. The Commandant, Admiral Kramek, has streamlined 
the Coast Guard and reduced resource requirements while maintaining the 
capabilities upon which our nation depends. Already Coast Guard 
streamlining has saved the American public almost $100M and eliminated 
over 4,000 positions. As a result the Coast Guard has the smallest 
work-force in over 30 years. Concomitantly, the responsibilities and 
work of the Coast Guard have not been reduced. Given the downsizing 
that has occurred and the continued demands on the force, the Coast 
Guard must not be further stretched to the breaking point by 
underfunding.
    The Coast Guard's fiscal year 1998 budget request will allow the 
Coast Guard to maintain current services. It includes the following 
important priorities:
  --An increase in National Security and Drug Law Enforcement 
        Operations ($34.4M),
  --Quality of Life Improvements ($26.4M), and
  --Acquisitions, Construction and Improvements (AC&I) ($379M).
    The AC&I account provides for the acquisition, construction and 
improvement of vessels, aircraft, information management resources, 
shore facilities and aids to navigation required to execute the Coast 
Guard's mission and achieve its performance goals. It is noted that the 
AC&I account is at the lowest level in 10 years. If not funded to this 
bare minimum, the Coast Guard would be forced to cancel long-standing 
contracts to build ships and purchase mission-essential equipment.
                       selected reserve strength
    We strongly support the fiscal year 1998 authorization request to 
maintain the Coast Guard Selected Reserve end-strength at the 8,000 
level. While recognizing that the Coast Guard Reserve's end-strength is 
currently below 7,600, we have serious concerns regarding the 
administration's proposal for an appropriated end-strength of only 
7,600.
    The plans of just a few years ago to reduce the personnel strength 
of this key part of the Coast Guard's Total Force below the post-World 
War II low of 8,000 Selected Reservists now authorized was a source of 
major concern. Since that time the Congress, the administration, and 
Coast Guard leadership have ever increasingly recognized the unique 
capabilities of the Coast Guard Reserve. It is now well-recognized that 
the Coast Guard Reserve has clearly become a value-added resource for 
peacetime day-to-day operations, as well as a highly cost-effective 
source of needed trained personnel to meet military contingency and 
other surge requirements.
    In view of the foregoing, we are particularly concerned that the 
administration and the Coast Guard allowed the Coast Guard Reserve's 
end-strength to fall below the authorized and appropriated level for 
fiscal year 1997. We attribute the end-strength shortfall to a failure 
to devote the requisite assets to recruiting Coast Guard Reservists.
    By way of background, Team Coast Guard, has, with limited 
exceptions, resulted in the complete assimilation of Coast Guard 
Reservists into the active duty force. Prior to Team Coast Guard, 
Reserve unit commanding officers had specific responsibilities for 
recruiting. These recruiting responsibilities were not transferred to 
active duty commanding officers following Reserve integration. 
Furthermore, Reserve recruiting quotas have not been assigned to active 
duty Coast Guard recruiters.
    Until just one year ago, no recruiter in the system had ever 
recruited a Reservist. Recruiting a Reservist is substantially more 
difficult than recruiting a new entrant. This is because Reservists 
must be recruited to a targeted billet at a specific location. 
Concomitantly, it must be noted that the Coast Guard has undertaken 
some effort to recruit Reservists, to include the production of a 
formalized recruiting plan for Reservists, requiring Selected Reserve 
participation for 59 days following release from active duty; mailing 
out letters to over 6,000 members of the Individual Ready Reserve; 
creating a Reserve-specific Recruiting Web page; and engaging in 
limited advertising. Despite these efforts, while the Coast Guard 
exceeded one-hundred percent of the goals for the active-duty force, it 
has recruited only 65 percent of those needed for the Reserve force in 
fiscal year 1996 and through January 31, 1997, only 32 percent of its 
monthly requirements. Finally, it should be noted that the Coast Guard 
has not applied the various bonus programs that currently exist in law 
to recruit Reservists up to authorized and appropriated end-strength.
    The administration has requested $65 million for the Reserve 
Training (RT) appropriation for fiscal year 1997. We support this 
request as the minimum needed to fund a full training program for 7,600 
personnel. Additional funding required to support the full 8,000 level 
authorized is only $2M. This additional funding would allow sufficient 
resources, with additional efforts in recruiting, to attain the 8,000 
level. Such additional funding would also have a positive morale-
building effect on Reservists by avoiding the negative signal that 
Reserve strength is again in jeopardy.
    This committee's support of the Coast Guard has been critical to 
maintaining its military capability. Your continued support is vital.
                            team coast guard
    The Coast Guard has embraced the reality that its Reserve is a 
value-added resource. This fact has been demonstrated by the adoption 
of Team Coast Guard, which as previously discussed, includes the full 
integration of Coast Guard Reservists into their parent Active force 
commands. This expansion and modification of the historic method of 
augmentation training directly benefits the Coast Guard. As a result of 
Team Coast Guard Reservists now perform day-to-day operations as an 
integral part of the active duty force. In addition, integration has 
reduced administrative overhead by making the parent command 
responsible for Reserve personnel in the same manner as the assigned 
active-duty personnel.
    We support the goals and objectives of this new method of 
operations. The Coast Guard Reserve has become the ``bench-strength'' 
of the active duty force. At a strength of 8,000, the Coast Guard 
Reserve consumes only 700 full-time equivalent positions. Simply 
stated, the Reserve leverages the entire organization and stands ready 
to go in response to both domestic and national emergencies. As a 
result, the Coast Guard is readily able to surge its forces to meet 
domestic and national emergencies in an extremely cost effective 
manner.
    Concomitantly, the Coast Guard active duty force must recognize its 
ownership role of Reservists, from the deck-plates to headquarters, and 
direct responsibility therefor. As previously noted, integration has 
eliminated the Reserve support structure in the field. Reserve training 
officers and administrative officers no longer exist. As a result, 
questions regarding Reserve career progression, professional 
development, meaningful assignments for senior Reservists (officer and 
enlisted), and effective advocacy for Reserve issues are not yet fully 
resolved. The Coast Guard active duty force must step forward and take 
a pro-active leadership role and direct responsibility for officer and 
enlisted Reservists to ensure that they are not ``lost in the shuffle'' 
as a result of integration. Finally, we are also concerned about issues 
such as effective advocacy, identity and continued management 
responsibility for the Reserve component as the Coast Guard's 
headquarter's structure is realigned.
                    port security unit requirements
    As part of the continuing review of mission requirements, the Coast 
Guard must establish three additional port security units (PSU's) to 
meet validated war-fighting CINC requirements. This action has been 
coordinated with the Chairman of the Joint Chiefs of Staff and the 
Chief of Naval Operations and stems from war-gaming at Total Force 1993 
and 1994 as well as development in several CINC deliberate planning 
processes.
    PSU's are manned by 115 selected reservists and 2 active duty 
personnel. Each unit has six transportable boats, of Boston Whaler type 
design, with twin outboard engines, a .50 caliber machine gun forward 
and two M60 7.62 mm machine guns aft. These units are air deployable 
worldwide within 4 days' notice. The units provide waterside security 
of ports and high value assets and fill the security perimeter gap 
between the land side security force and coastal assets.
    The three existing units performed critical mission-essential 
functions during Operation Desert Storm and during Operations Support 
and Uphold Democracy in Haiti. The major lessons learned from these 
operations are:
  --The port security unit mission is logical for the Coast Guard 
        Reserve,
  --Three additional PSU's are needed to meet CINC requirements, and
  --Equipment is needed to replace what has been consumed by the high 
        tempo of operations by the three existing units and to outfit 
        the three additional PSU's.
             roa recommendations for fiscal year 1998 ng&re

                           Coast Guard Reserve

Refurbishing existing PSU's.............................      $4,600,000
Equipping 3 additional PSU's............................       9,900,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total Coast Guard Reserve equipment for 
      consideration in .................................
        fiscal year 1998 NG&RE..........................      14,500,000

    Unfunded equipment needs include transportable PSU boats, secure 
communications equipment, organizational outfitting and facility 
equipment, personal equipment and replacement parts.
    We recommend that the fiscal year 1998 National Guard and Reserve 
Equipment (NG&RE) appropriation include funds for port security unit 
equipment for the Coast Guard Reserve.
    Thank you for this opportunity to present the position of the 
Reserve Officers Association to this committee. I would be pleased to 
respond to any questions you may have at this time.
                                 ______
                                 
                       Highway-Related Testimony
Prepared Statement of Thomas J. Donohue, President and Chief Executive 
             Officer, American Trucking Associations, Inc.
                           executive summary
    ATA asks the Transportation and Related Agencies Subcommittee to 
evaluate the Federal investment in transportation and increase spending 
on those programs that are clearly national in scope and economic 
significance. Recognizing large unspent balances in the Highway Trust 
Fund and urgent highway needs, ATA encourages the Subcommittee to 
define the national interest in transportation by supporting those 
programs that contribute the most to interstate and international 
travel and commodity flows, national defense, safety, and research.
    Specifically, we urge the Subcommittee to increase the Federal 
investment in transportation and appropriate the maximum allowable 
funding under current legislative conditions, or $26 billion for the 
Federal Highway Program. This level of funding would mark a return to 
the user fee principles of the Highway Trust Fund and deflate efforts 
to turn back the highway program to the states.
    ATA does not believe that the unspent balances in the Highway 
Account should be allowed to accumulate at the current annual rate of 
13 percent. Although over $20.2 billion was appropriated to fund the 
Federal Highway Program in 1997, annual revenues will reach a net $21.8 
billion this year. The resulting annual unspent surplus of $1.6 billion 
in highway users' tax revenue represents a 13 percent annual increase 
and brings the total Highway Account surplus to $13.7 billion.
    The importance of properly funding the NHS cannot be overstated. 
The NHS represents only 4 percent of the nation's total highway miles 
but carries 40 percent of all traffic and 75 percent of all commercial 
truck traffic. The core of the NHS is the Interstate system. Sadly, the 
FHWA finds that over 37 percent of urban Interstates and 27 percent of 
rural Interstates are in poor or mediocre condition. Over 24 percent of 
Interstate bridges are classified as deficient. A total of 115 billion 
vehicle miles of Urban NHS travel occurred in congested conditions in 
1995. Over 50 percent of the investment requirements to maintain 
conditions on the NHS are needed to increase highway capacity. But 
investment remains 40 percent below even basic maintenance 
requirements. These deplorable conditions can only be remedied through 
funding the Federal Highway Program at the maximum allowable level of 
$26 billion.
    U.S. economic growth and the Highway Trust Fund depend on trucking. 
The trucking industry is the prime mover of American freight and is 
four times larger than all other freight modes combined. In 1995, 
shippers moved 5.5 billion tons of freight by truck, spending 79 
percent of their freight dollars on trucking. That $348 billion outlay 
represents 5 percent of gross domestic product. Furthermore, commercial 
trucks pay 43 percent of the Highway Trust Fund taxes. The vital role 
of trucking in the economy and its strong contribution to the Trust 
Fund, dictate that maximum allowable levels of funding be directed to 
the most productive programs.
                            i. introduction
                  ata represents the trucking industry
    The American Trucking Associations, Inc. (ATA) is the national 
trade association of the trucking industry. The ATA federation includes 
nearly 4,200 carriers, affiliated associations in every state, and 13 
specialized national associations. Together, ATA represents every type 
and class of motor carrier in the country. Combined with ATA's direct 
membership, we are a federation of over 36,000 member trucking 
companies, representing an industry that employs over 9 million people. 
All across the country, ATA represents businesses whose survival 
depends upon a high quality and productive work place--the highway 
network.
    ATA appreciates the opportunity to present testimony to the 
Appropriations Transportation and Related Agencies Subcommittee. We 
applaud the Committee for its strong commitment to good highways and 
for its decision to fund the Federal-aid Highway Program at the 
authorized level of $20.2 billion for fiscal year 1997.
    However, ATA urges the Subcommittee to increase that funding to $26 
billion, the maximum level allowed under current legislative 
conditions.\1\ This is the minimum level of funding needed to improve 
safety, reduce congestion, maintain the roads and bridges on the 
National Highway System, provide for national defense, and conduct 
essential research. Unfortunately, it is still inadequate to deal with 
the costs associated with improving the system as a whole.
---------------------------------------------------------------------------
    \1\ Current legislative conditions include the 4.3 cents that is 
diverted to the General Fund, including the Highway Trust Fund in the 
Unified Budget, and maintaining separate accounts for mass transit and 
highways.
---------------------------------------------------------------------------
                      ii. the core highway program
    In light of these urgent highway needs, ATA encourages the 
Subcommittee to fully fund the following core highway programs as 
essential to transportation goals that are national in scope and 
economic significance: the National Highway System including the 
Interstate Maintenance Program, the Federal Bridge Program, the Federal 
Lands Program, the FHWA Highway Safety Programs, which includes the 
Motor Carrier Safety Assistance Program (MCSAP), and the FHWA Highway 
R&D (403) Program.
A. National Highway System
    ATA encourages the Subcommittee to target Federal dollars to fund 
the National Highway System (NHS). The NHS represents only 4 percent of 
the nation's total highway miles but carries 40 percent of all traffic, 
80 percent of all highway tourism, and 75 percent of all commercial 
truck traffic. The Federal Highway Administration reported to Congress 
on December 9, 1993 that ``the National Highway System (NHS) will serve 
as the backbone of a national intermodal transportation network.'' The 
NHS program addresses the problem of movement within cities--a fact 
reflected in that 25 percent of all NHS miles are within urban areas. 
Just as important, these areas must be linked together and bound to our 
rural and suburban areas and our NAFTA partners by a system of highways 
and bridges which are interconnected to the appropriate rail, airport, 
and port facilities.
    The National Highway System is a program that maximizes the 
efficiency of past highway investment. In fact, only 2 percent of the 
NHS involves newly constructed roadways. The program calls for the 
maintenance, preservation, and improvement of 160,000 miles of road 
deemed by FHWA and the Congress as most critical in meeting America's 
future civil and defense transportation needs.
B. The Bridge Program
    ATA supports a separate appropriation for the bridge program. 
Maintaining our nation's bridges is imperative for safe and efficient 
highway travel for both passengers and freight. A total of 11,035 
bridges on the rural Interstate System are classified as deficient, as 
are 28,063 of the bridges on the Urban Interstate.
    FHWA estimates an annual investment over the next 20 years of $5.1 
billion is needed to ensure that the nation's bridges deteriorate no 
further. ATA encourages funding the nation's bridge program at least at 
the ISTEA authorized $2.76 billion annual program level.
    Here in the Washington area we see the safety and congestion 
problems created by the old and deficient Woodrow Wilson Bridge. As the 
owner of the Wilson Bridge, the Federal government is responsible for 
providing the funds needed to replace this major link on the I-95 
corridor. A total of 17,000 trucks use the Wilson bridge every day to 
provide groceries, petroleum, and other manufactured items to the 
surrounding area. Approximately 80 percent of the truck traffic on the 
Wilson Bridge serves communities along the I-95 corridor between 
Richmond and Baltimore, including Washington, DC.
    If the Federal government fails to provide the necessary $1.5 
billion to replace the bridge, these trucks will be diverted to other 
already seriously congested highways, worsening existing congestion and 
air pollution problems. The additional costs imposed on truckers, 
already operating on razor-thin profit margins, would have to be passed 
on to area consumers as higher prices. The basic necessities, home 
heating fuel and groceries would be especially hard hit.\2\
---------------------------------------------------------------------------
    \2\ Safeway and Giant food chains both have distribution centers in 
Landover, Maryland. Closure of the Bridge would cause at least a 60 
mile increase in length of haul. Home heating fuel currently delivered 
to southern Maryland from the pipe transfer facility in Newington, 
Virginia would be effected. Prices would increase due to increased 
length of haul and increased exposure to accidents.
---------------------------------------------------------------------------
    The Federal government should honor its obligation to fully fund 
the Woodrow Wilson Bridge.
C. Truck Safety and Related Research
    ATA supports full funding at authorized levels of the FHWA Highway 
Safety Programs, and the FHWA Highway R&D (403) Program as integral to 
the national interest in a safe, efficient, and well designed highway 
system. ATA continues to support the Motor Carrier Safety Assistance 
Program (MCSAP), especially its program of roadside inspectors.
Motor Carrier Safety Assistance Program (MCSAP)
    The trucking industry has long been a strong supporter of efforts 
to improve highway safety and continues to promote and invest in 
highway safety programs. ATA fully backs funding of efforts to get to 
the root causes of highway safety issues. We have fully supported--and 
we appreciate--efforts of this Subcommittee to fund safety initiatives, 
such as the Motor Carrier Safety Assistance Program (MCSAP), which pays 
for state inspectors and roadside inspection programs. ATA applauds the 
Subcommittee's decision to recommend an increase in MCSAP spending to 
$77,425,000 in 1997 and encourages the committee to fund the MCSAP 
program at the maximum allowable levels for fiscal year 1998.
                    iii. the importance of trucking
A. The Trucking Industry Works to Improve Highway Safety
    The trucking industry continues to work to make travel on the 
nation's highways safer. Truck safety has improved dramatically because 
thousands of trucking companies across the country have made safety a 
top priority. Over the 1985-95 decade, while the number of miles heavy 
trucks put on the road increased 41 percent, the fatal accident rate 
dropped 39 percent. Furthermore, 1995 police reports show that 72 
percent of the fatal accidents involving a truck and a car cite the 
driver of the car, not the driver of the truck. Successful safety-
related legislation and other initiatives we have supported include:
  --creation of a single, national Commercial Driver's License, with 
        stringent standards to test and license commercial drivers;
  --a more than ten-fold increase in the number of inspections of heavy 
        trucks;
  --cost-effective drug and alcohol testing to ensure that truck 
        drivers are free of substance abuse when they are behind the 
        wheel;
  --elimination of commercial zones in which trucks and drivers were 
        allowed to operate without having to comply with Federal safety 
        regulations;
  --common-sense placement of reflecting tape to make trucks more 
        visible at night;
  --a ban on radar detectors in trucks; and
  --rear trailer guards at a height to reduce car under-ride of truck 
        trailers.
    To make sure that the latest technical improvements are fully 
employed to improve truck safety, as an industry, we are investing an 
estimated additional $6 billion over the next ten years to equip our 
trucks with anti-lock brake systems.
    We are prepared to do even more. For example, we are redoubling our 
efforts to understand and prevent safety problems:
  --ATA, in partnership with the Federal government and several 
        universities, is investing millions of dollars through the ATA 
        Research Foundation to investigate fatigue-related questions. 
        One of the research findings was a shortage of highway rest 
        areas, a situation which ATA worked with Congress to address in 
        the recent National Highway System legislation. Those safety 
        areas are now eligible for 100 percent Federal funding.
  --ATA is working with the AAA Foundation for Traffic Safety, National 
        Association of Truck Stop Operators, and the National Private 
        Truck Council to distribute crucial safety information and 
        driving best practices to all highway users.
  --ATA created and recently expanded the America's Road Team, a group 
        of professional truck drivers who help teach motorists how to 
        share the road safely with trucks. We are sponsoring 40 
        communications programs annually in major cities to convey 
        highway safety education, through the local media, schools, and 
        community groups.
B. The Trucking Industry Pays Its Fair Share in Highway-User Taxes
    Commercial trucks will pay an estimated $11.1 billion in Federal 
highway user taxes, or 43 percent of all revenue to be paid into the 
Federal Highway Trust Fund, although trucks account for only 15 percent 
of all motor vehicle miles traveled. Commercial trucks will pay $21 
billion in combined Federal and state highway user taxes this year. Per 
gallon, the Federal diesel fuel tax is 24.3 cents and the average state 
diesel fuel tax is 20.53 cents, as of January 1, 1997.
    Fuel costs account for anywhere from 4 percent to 20 percent of a 
trucking company's operating revenue, depending on the nature of the 
company's vehicles, customers, and length of haul. Trucking companies 
operate on razor-thin profit margins: reports show an average 2.08 
percent profit margin in 1995. For example, a truck with 40,000 lbs. of 
cargo typically would be paid by the shipper about $600 to move the 
cargo 500 miles. The company would pay $20.25 in Federal diesel fuel 
tax alone--and earn a profit of $12.00 on the shipment.\3\
---------------------------------------------------------------------------
    \3\ Class 7-8 trucks average 6 miles per gallon. This trip would 
consume 83.3 gallons of fuel at .243 cents Federal diesel fuel tax per 
gallon.
---------------------------------------------------------------------------
    Failure to spend Highway Trust Fund revenues to improve roads and 
bridges increases trucking operating costs (fuel and vehicle 
replacement) and makes it harder for trucking companies to provide the 
timely and reliable service U.S. manufacturing industries require in 
today's ``just-in-time'' inventory systems, which improve productivity 
and sustain jobs.
    But moneys from the Highway Trust Fund have been increasingly 
siphoned off for non-highway purposes. In addition, 4.3 cents of the 
Federal fuel tax is deposited into the general fund, for an estimated 
revenue loss to the Highway Trust Fund of more than $6 billion per 
year.
C. The Trucking Industry Plays a Vital Role in the U.S. Economy
    Trucking is vital to the American economy. The trucking industry is 
the prime mover of American freight and is nearly 4 times larger than 
all other transportation modes combined. In 1995, shippers moved 5.5 
billion tons of freight by truck, spending 79 percent,\4\ or $348 
billion of their total $441 billion freight dollars on trucking. This 
$348 billion represents 5 percent of Gross Domestic Product (GDP). And 
we're growing. By the year 2004, truckers will drive 29 percent more 
miles while adding 14 percent more heavy vehicles to haul the nation's 
freight.
---------------------------------------------------------------------------
    \4\ Transportation in America, The Eno Transportation Foundation, 
Inc., 1996. p. 9.
---------------------------------------------------------------------------
    Trucking firms employ over 9 million people and provide 1 out of 14 
civilian jobs. And these are good jobs--with the potential to earn good 
wages. Truck drivers earn an average annual salary of $35,000 with 
additional benefits that bring average total compensation to $45,000, 
greater than the national average salary.\5\
---------------------------------------------------------------------------
    \5\ Ibid. p. 23.
---------------------------------------------------------------------------
1. U.S. Economic and Industrial Growth Depend on Reliable Trucking
    The U.S. economy grows when industry is more productive. And 
industry is more productive when highways, especially the National 
Highway System (NHS), allow trucks to deliver their products in a 
timely and reliable manner.\6\ That's why recent research funded by the 
Federal Highway Administration (FHWA) shows a strong link between 
carefully targeted highway investment and economic prosperity. In fact, 
each dollar invested in the NHS allows industry to reduce its 
production costs by 24 cents. And, between 1980 and 1989, 8 percent of 
all U.S. annual productivity growth is attributed to highway 
investment.\7\
---------------------------------------------------------------------------
    \6\ Measuring the Relationship Between Freight Transportation 
Services and Industry Productivity, Hickling Lewis and Brod Inc., NCHRP 
(2-17(4), The National Academy of Science, April 1994. p. b-7.
    \7\ Highway Capital and Productivity Growth, Nadiri, M. Ishad and 
Theofanis Mamuneous, 1996.
---------------------------------------------------------------------------
    The chart below shows that economic prosperity, measured as 
increased GNP, and industrial productivity depend on trucking.\8\
---------------------------------------------------------------------------
    \8\ Data for this Chart is complied from Transportation in America, 
The Eno Foundation, Inc., 1996, pp. 38 and 39, Tables: Transportation 
Outlays and the Gross National Product, and National Economic and 
Transport Trends.
[GRAPHIC] [TIFF OMITTED] T12NON.034

    Industry has substituted fast and reliable truck services for other 
factors of production to reduce costs and the results are increases in 
industrial productivity and economic prosperity.
    Highway investment improves industrial productivity because better 
highways let trucks deliver goods on more timely and reliable 
schedules. Improved delivery schedules allow firms to restructure and 
reduce the number and size of their warehouses along with their 
associated labor costs. These changes allow industry to reduce 
production costs 24 cents for every $1 invested in the NHS.\9\
---------------------------------------------------------------------------
    \9\ Nadiri and Hickling Lewis and Brod Inc.
---------------------------------------------------------------------------
    Because timely and reliable truck services improve industrial 
productivity, U.S. firms are able to maintain a competitive edge over 
countries that compete in global markets on the basis of low wages.
2. Timely and Reliable Trucking Becomes ``Moving Warehouse'' for 
        Industry
    Trucking has become a ``moving warehouse'' for industry, allowing 
businesses to cut inventory costs and to respond immediately to changes 
in consumer demand. Timely and reliable trucking provides easy access 
to world-wide markets, allowing industry to save more when purchasing 
raw materials and to increase market share by selling more goods at 
lower prices.
    U.S. industry will continue to press for more efficient delivery 
systems in production and distribution. In 1994, 18 percent of total 
shipments were ``Quick Response'' and ``Just-In-Time'' (JIT). By 2000, 
nearly half of all shipments will fall under these categories.

  Use of ``Just-In-Time'' and ``Quick Response'' truck delivery as a 
                   percentage of total shipments \10\
---------------------------------------------------------------------------

    \10\ Bernard J. LaLonde, Professor Emeritus, Ohio State University. 
Published in Traffic World, September 23, 1996. p. 49.
[GRAPHIC] [TIFF OMITTED] T12NON.035

3. Trucking is Essential to Emerging Industries
    To continue to grow, the U.S. needs to capture emerging industries. 
Emerging industries include microelectronics, biotechnology, material 
sciences, telecommunications, computers, civilian aircraft, and machine 
tools and robotics. These ``brain powered'' emerging industries depend 
even more on efficient trucking than established industries--and they 
can locate anywhere on the globe. But, emerging industries will choose 
to locate in those countries with, among other things, the superior 
highway systems that enable timely and reliable truck services so 
essential to competing effectively in global markets.
4. Trucking Vital to the U.S. Economy and the Highway Trust Fund
    It is clear, therefore, that timely and reliable trucking is vital 
to current and future economic growth and productivity, and that the 
trucking industry pays its fair share of user fees into the Highway 
Trust Fund. Further, failure to spend Highway Trust Fund revenues on 
urgent highway needs can only result in less efficient trucking and 
economy-wide productivity losses which result in lower wages and 
reduced quality of life.
                 iv. federal funding is not sufficient
A. Current Highway Conditions
    Unfortunately, the current Federal investment in highways is not 
even sufficient to keep up with the transportation needs of existing or 
emerging industries. The Federal Highway Administration (FHWA) 
estimates that an annual capital investment of $50 billion from all 
levels of government is required just to keep the system from further 
deterioration. Last year, all levels of government provided $30 billion 
in highway capital investment. The shortfall in funding has resulted in 
the following:
  --Over 37 percent of Urban Interstates and 27 percent of Rural 
        Interstates are in poor or mediocre condition.\11\ (Poor 
        conditions require immediate improvement and mediocre require 
        improvement in the near future.)
---------------------------------------------------------------------------
    \11\ FHWA Highway Statistics, 1995, Table HM-64.
---------------------------------------------------------------------------
  --Some 13,000 bridges, or over 24 percent of the bridges on the 
        Interstate system are classified as deficient.\12\ Twenty-eight 
        percent of the bridges on all other arterial highway systems 
        are deficient.
---------------------------------------------------------------------------
    \12\ FHWA 1995 Conditions and Performance Report, p. 132.
---------------------------------------------------------------------------
  --A total of 115 billion vehicle miles of Urban NHS travel occurred 
        in congested conditions in 1995.\13\ The costs of congestion, 
        not including lost productivity, has reached $50 billion \14\ 
        in the 50 metropolitan areas where highway congestion is the 
        worst.
---------------------------------------------------------------------------
    \13\ FHWA Highway Statistics, 1995, Chart-page v-67, and Table HM 
14.
    \14\ Urban Roadway Congestion--1982-1993, Volume 1: Annual Report, 
David Shrank and Timothy Lomax, Texas Transportation Institute, Texas 
A&M University, August 1996. p. 62.
---------------------------------------------------------------------------
B. Safety is Suffering on the NHS
    The shortfall in Federal highway investment limits states' ability 
to make the roadway improvements needed to increase safe driving 
conditions on the NHS. The importance of safe driving conditions on 
these highways is underscored by the fact that Americans traveled over 
1.04 trillion vehicle miles on the NHS in 1995.\15\
---------------------------------------------------------------------------
    \15\ FHWA Highway Statistics, 1995, Table VM-3.
---------------------------------------------------------------------------
    FHWA 1995 crash statistics confirm this concern. On the Interstate, 
there are .73 fatalities per 100 million vehicle miles traveled. But on 
the NHS, there are 1.16 fatalities per 100 million vehicle miles 
traveled, or a 59 percent increase in the fatality rate. And on NHS 
miles off the Interstate, the fatality rate jumps to 1.74 per 100 
million vehicle miles traveled, or 138 percent higher than on 
Interstate miles. The fatality rate on NHS miles off the Interstate 
increased a full 18 percent from 1994 to 1995, from 1.48 to 1.74 per 
100 million vehicle miles traveled.\16\
---------------------------------------------------------------------------
    \16\ FHWA Highway Statistics, 1994 and 1995, Table FI-1.
---------------------------------------------------------------------------
    This is a sad reminder of the life-threatening effects of failing 
to fully invest in the National Highway System.
    Unsafe conditions can be improved by increasing the Federal 
investment in the NHS. In fact, improved roadway characteristics such 
as 12-foot lanes and ample shoulders, gentler curves, and improved 
median barriers can significantly reduce the number and severity of 
highway accidents.\17\ A 1995 study estimates that full funding of the 
NHS over a 10-year period would prevent 720 fatal crashes, 55,000 
personal injury crashes, and 120,000 property damage crashes, for an 
annual societal saving of $800 million.\18\
---------------------------------------------------------------------------
    \17\ Effects of Highway Standards on Safety, McGee, H.W., W.E. 
Hughes, and K. Dailey, Final Report to National Cooperative Research 
Program, Project 17-9. Dec. 1994.
    \18\ Safety Effects Resulting from Approval of the National Highway 
System, AAA Foundation for Traffic Safety, Bellomo-McGee, Inc., July 
1995.
---------------------------------------------------------------------------
    The safety impact of fully funding the NHS becomes more clear when 
one considers that over 43 percent of the NHS is comprised of two-lane 
roads, often with no median separation to prevent head-on collisions. 
Two-lane roads are more prevalent on NHS mileage off the Interstate, 
where the fatal accident rate is high and increasing rapidly (See 
above).
    Recent research shows that adequate lane width, wide shoulders, and 
clear zones provide motorists with the critical space they need to 
recover the control of a vehicle in an emergency situation. But these 
features are inadequate or nonexistent on the NHS two-lane roads. In 
fact, two-lane roads on the NHS are characterized by tight curves with 
few warning signs and poor visibility to alert motorists before it is 
too late to slow down and change direction.
C. The Administration Claims Highway Congestion has Stabilized
    Deputy Secretary of Transportation Mortimer Downey claimed that 
highway system performance, measured by peak hour congestion, ``has 
stabilized'' when he presented the Administration's Fiscal Year 1998 
Transportation Budget.\19\ This ``improvement'' was used to support the 
Administration's budget, which would hold the Federal investment in 
highways at fiscal year 1997 levels through 2002.
---------------------------------------------------------------------------
    \19\ Remarks Prepared for Delivery, Fiscal Year 1998 Budget 
Presentation, U.S. DOT. Office of the Secretary. p. 2.
---------------------------------------------------------------------------
    But, there are two measures of congestion. The Deputy Secretary was 
referring to volume to service flow ratios. In fact, the volume to 
service flow ratio has stabilized because highways, especially the 
Urban NHS, have reached full capacity during peak periods of 
congestion, or a volume to service flow ratio greater than .8, the top 
of the scale. But by this measurement, things can't get any worse.\20\
---------------------------------------------------------------------------
    \20\ Urban Roadway Congestion--1982-1993, Volume 1: Annual Report, 
David Shrank and Timothy Lomax, Texas Transportation Institute, Texas 
A&M, August 1996. Introduction.
---------------------------------------------------------------------------
    A second measure of congestion, the average daily vehicles per lane 
(AADT), gives a more complete picture. AADT measures the severity and 
the duration of congestion. By this measure, peak period congestion 
continues to get worse. In fact, at current AADT levels, non-recurring 
congestion, or incident-induced congestion, increases more rapidly than 
recurring congestion.\21\ This is important to highlight because not 
only does increased non-recurring congestion seriously reduce safety on 
the nation's highways, but non-recurring congestion also makes it very 
difficult for truckers to make ``Just-In-Time'' and ``Quick-Response'' 
deliveries. Reduced truck reliability erodes the productivity gains 
made possible by previous highway investments.
---------------------------------------------------------------------------
    \21\ FHWA, Office of Policy Development, Highway Needs and 
Investment Branch, Division Chief, phone number 1-202-366-9208.
---------------------------------------------------------------------------
D. Congestion Increases on the Urban NHS
    The severity and duration of congestion on the Urban NHS is getting 
worse.
    Average daily vehicles per lane Increased from 12.8 to 13.1 million 
vehicles from 1994 to 1995, an increase of about 2.3 percent.\22\ (See 
chart below.) At this level of use, highway capacity is decreased to 
the point where any disruption will bring traffic to a standstill. This 
is termed non-recurring congestion.
---------------------------------------------------------------------------
    \22\ FHWA Highway Statistics, 1995, p. V-67.
    [GRAPHIC] [TIFF OMITTED] T12NON.036
    
    Travel on the Urban NHS increased 3 percent from 1994 to 1995,\23\ 
measured in vehicle miles traveled, or at about the same rate as 
congestion. This indicates that highway capacity is not keeping up with 
the additional truck trips required to sustain growing businesses.
---------------------------------------------------------------------------
    \23\ FHWA Highway Statistics, 1994 and 1995, Table VM-1.
---------------------------------------------------------------------------
1. Capacity Requirements on the Urban NHS
    The Urban NHS, the metropolitan component of the major trade routes 
deemed by Congress as essential to continued growth and economic 
prosperity, does not have sufficient capacity to support that growth.
    The need to improve capacity accounts for over 50 percent of the 
investment needs identified by FHWA to maintain the urban NHS at 
current conditions.\24\
---------------------------------------------------------------------------
    \24\ FHWA 1995 Conditions and Performance Report, p. 175.
---------------------------------------------------------------------------
2. True Costs of Congestion Include Lost Productivity
    Texas Transportation Institute (TTI) at Texas A&M University 
reports that the costs of congestion for the 50 urban areas studied was 
approximately $50 billion in 1993, up $7 billion from 1990. (See 
appendix.) These are the latest figures available. TTI includes only 
wasted fuel and driver time in its calculation.
    But, traffic congestion and bottlenecks on major trade routes 
serving large metropolitan areas not only impose delays on local 
commuters and regional freight, it also interferes with the timely and 
reliable cargo movement essential to increase industrial productivity 
and enhance global competitiveness.
    ATA believes that the true cost of congestion includes reduced 
safety and additional loss of life in highway accidents. Add to this 
reduced industrial productivity, which will limit future economic 
growth and prosperity, and the critical nature of the problem is clear.
             v. ata recognizes serious funding constraints
    The American Trucking Associations supports well-targeted 
investment in the nation's infrastructure. ATA also recognizes serious 
funding pressures that constrain all federal discretionary spending. In 
light of these conflicting considerations, ATA encourages the 
Subcommittee to set two priorities when considering the Federal Highway 
Program.
A. Spend Highway Trust Fund Annual Incoming Revenues
    First, ATA encourages the Subcommittee to spend annual incoming 
revenues to the Highway Trust Fund. Last year, although $20.2 billion 
was appropriated for the Federal Highway Program for fiscal 1997, the 
Treasury Department's Mid-Session Review estimates that a net $21.8 
billion in fuel and vehicle use taxes will be deposited in the Highway 
Account of the Highway Trust Fund.
    The resulting annual surplus of $1.6 billion will increase the 
total surplus in the Highway Account to $13.7 billion in 1998. This 
represents a 13 percent increase over the $12.1 billion 1997 Highway 
Account surplus. ATA believes that annual revenue into the Highway 
Account should be spent to build better roads and bridges.
    ATA encourages the Subcommittee to fund the Title I Federal Highway 
Program at the maximum level allowable under current conditions,\25\ or 
$26 billion. ATA supports this level of funding as the Federal share of 
funding essential to provide for the maintenance and improvement of the 
highways necessary to move people and goods safely into the 21st 
century.
---------------------------------------------------------------------------
    \25\ Current conditions include a diversion of 4.3 cents of the 
Federal fuel tax to the General Fund, including the Highway Trust Fund 
in the Unitary Budget, and providing separate accounts for mass transit 
and highways.
---------------------------------------------------------------------------
B. Programs that are National in Scope and Economic Significance Take 
        Priority
    Second, funding for basic highway programs that are clearly 
national in scope and economic significance should take priority. For 
this reason, ATA urges the Subcommittee to target increased funds to 
the Core Highway Program.
                             vi. conclusion
    ATA urges Congress to provide the Department of Transportation with 
the maximum levels of funding allowable under current legislative 
conditions to maintain the nation's highway system, or $26 billion. The 
inevitable funding shortfall between actual funding and investment 
requirements just to maintain the system at current conditions requires 
the Congress to target Federal investment to those programs that are 
clearly national in scope and economic significance. That shortfall 
argues strongly against diverting funds from the Highway Account of the 
Highway Trust Fund to other transportation purposes or not fully 
spending annual revenues.
    More than 42,000 people die each year on our nation's highway--the 
equivalent of a Valujet crash each day. To reduce this carnage, we need 
to invest in better highways.
    American industry, and the associated jobs, depends more than ever 
on reliable, efficient, and timely freight movement. ATA encourages the 
Congress to prioritize Federal investment in the nation's surface 
transportation program and consider the urgent funding needs reported 
by FHWA to maintain the nation's highways and bridges. By investing in 
the NHS, Congress will ensure that the nation's infrastructure is able 
to support a growing economy and a growing population into the 21st 
century.
    ATA urges the Congress to continue funding Federal safety and 
research programs as integral to a well-balanced national 
transportation program.
    ATA thanks the Subcommittee for the opportunity to present our 
testimony.
                                appendix

            TOTAL CONGESTION COSTS BY URBAN AREA FOR 1993 \1\           
                          [Millions of dollars]                         
------------------------------------------------------------------------
                  Urban area                        Cost          Rank  
------------------------------------------------------------------------
Los Angeles, CA..............................           8,530          1
New York, NY.................................           7,600          2
San Fran-Oak, CA.............................           2,980          3
Chicago, IL..................................           2,800          4
Washington, DC...............................           2,790          5
Detroit, MI..................................           2,340          6
Houston, TX..................................           1,920          7
Boston, MA...................................           1,560          8
Atlanta, GA..................................           1,360          9
Seattle, WA..................................           1,350         10
Philadelphia, PA.............................           1,310         11
Dallas, TX...................................           1,240         12
Miami, FL....................................           1,090         13
San Berno-Riv, CA............................           1,040         14
Phoenix, AX..................................             880         15
San Jose, CA.................................             880         16
San Diego, CA................................             770         17
Denver, CO...................................             750         18
Baltimore, MD................................             730         19
St. Louis, MO................................             640         20
Pittsburgh, PA...............................             560         21
Fort Worth, TX...............................             530         22
Minn-St. Paul, MN............................             510         23
Portland, OR.................................             420         24
Sacramento, CA...............................             380         25
Ft. Lauderdale, FL...........................             380         26
San Antonio, TX..............................             360         27
Cleveland, OH................................             320         28
Norfolk, VA..................................             320         29
Honolulu, HI.................................             310         30
Jacksonville, FL.............................             300         31
New Orleans, LA..............................             300         32
Cincinnati, OH...............................             280         33
Austin, TX...................................             270         34
Columbus, OH.................................             240         35
Orlando, FL..................................             230         36
Milwaukee, WI................................             220         37
Tampa, FL....................................             220         38
Kansas City, MO..............................             210         39
Hartford, CT.................................             200         40
Nashville, TN................................             170         41
Charlotte, NC................................             160         42
Louisville, KY...............................             150         43
Indianapolis, IN.............................             130         44
Albuquerque, NM..............................             130         45
Memphis, TN..................................             130         46
Oklahoma, OK.................................             130         47
Salt Lake City...............................             120         48
                                                                        
El Paso, TX..................................              60         49
Corpus Christi...............................              20         50
------------------------------------------------------------------------
Total Costs of Congestion in these Fifty Urban Areas: $50 billion.      
                                                                        
\1\ ``Urban Roadway Congestion--1982-1993, Volume 1: Armual Report,''   
  David Shrank and Timothy Lomax, Texas Transportation Institute, Texas 
  A&M University, August 1996, p. 62.                                   

                                 ______
                                 
 Prepared Statement of Michael P. Kenny, Executive Officer, California 
    Air Resources Board, et al., California Industry and Government 
                               Coalition
    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 $100,000 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, and the proposed PM-2.5 standards by mid-2003. 
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, unpaved shoulders 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. Chemical 
transformations of gaseous precursors are also a significant 
contributor to PM-2.5, as are combustion sources.
    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.
    This research has direct applications to the Department of 
Transportation. Specifically, Federal Highway Administration research 
funds are available through Caltrans for a number of targeted proposals 
under discussion by officials of both Caltrans and the California Air 
Resources Board. Included among the priority research topics are:
    1. Analysis of methodologies for estimating emissions of PM-10/PM-
2.5 from California roadways; Significant emphasis on characterizing 
emissions from unpaved shoulders due to large amounts of heavy duty 
vehicle traffic through Central California, which is necessary to 
support California's economy;
    2. Characterization of the sources and composition of PM-10/PM-2.5 
emissions from roadway construction;
    3. Tunnel study; and
    4. Characterization of heavy duty truck activity.
    These studies will explore the effects of roadway construction and 
use on ambient PM-10/PM-2.5 levels. Other proposals under review would 
address problems with unpaved road shoulders, roadway dust mitigation 
strategies and assessment of heavy duty truck travel patterns. 
Currently available data and other PM-10/PM-2.5 research efforts do not 
adequately address transportation concerns, so DOT support of this 
targeted research is essential.
    California industry wants 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 $14 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 $13 million over the next three 
years to fund this important study.
    The following is a list of PM-10/PM-2.5 research projects which are 
in progress:
  --Planning.--Development of protocols for emissions, field 
        monitoring, data analysis and modeling.
  --Technical support studies.--Suitability of data base; 1995 
        Integrated Monitoring 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 $100,000 in federal 
funding through the U.S. Department of Transportation to support 
continuation of this vital study in California. We respectfully request 
that the Appropriations Subcommittee on Transportation provide this 
additional amount in the DOT appropriation for fiscal year 1998, and 
that report language be included directing the full amount for 
California.
    The California Regional PM-10/PM-2.5 air quality 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.
    The Coalition appreciates the Subcommittee's consideration of this 
request for a fiscal year 1998 appropriation of $100,000 for DOT to 
support the California Regional PM-10/PM-2.5 Air Quality Study.
                                 ______
                                 
    Prepared Statement of Wayne Shackelford, Commissioner, Georgia 
                      Department of Transportation
    Mr. Chairman, Members of the Committee, I am Wayne Shackelford, 
Commissioner of the Georgia Department of Transportation. Thank you for 
the opportunity to present our appropriations request for the Sidney 
Lanier Bridge, located in Brunswick, Georgia, and share with you our 
concern about an undertaking that is crucial to both maritime and 
highway safety in Georgia, as well as the economic future of our region 
and nation.
    As you will recall, last year I came before this committee and 
requested your attention on the Sidney Lanier Bridge replacement at the 
Post of Brunswick in Glynn County, Georgia. At that time, I pointed out 
ten people were killed when a ship struck the Sidney Lanier Bridge in 
1972, and that an eleventh life was lost during bridge repair work 
following another incident in 1987.
    I also reminded you that I was directed by Congress in the 1990 
Coast Guard Omnibus Bill to remove this bridge. The Commandant of the 
Coast Guard issued an order directing the state to alter the bridge by 
reconstructing it on the same general alignment.
    Under the provisions of the Transportation Appropriations Acts of 
fiscal year 1992, 1993, 1994, 1995, 1996, and 1997 Georgia has received 
$28.75 million in federal appropriations to begin removal and 
replacement of the bridge. The State of Georgia has matched this 
appropriation with $28.75 million, demonstrating our commitment.
    Under the direction of the Coast Guard, these funds have been used 
to advance the engineering and design for a new high level, fixed span 
bridge that will remove the threat to public safety and provide the 
navigation clearance necessary for the Port of Brunswick to remain 
competitive in the rapidly changing global economy.
    With replacement of the bridge and other planned port improvements, 
the port will be capable of expanding services and competing 
internationally. The Port of Brunswick is located in a region of the 
United States that has the potential to benefit from both NAFTA and 
GATT. Already, the Port of Brunswick is exporting automobiles 
manufactured by the General Motors Saturn Division and lumber products 
for varied uses around the world.
    The Port of Brunswick is an economic generator for the southeastern 
region of the United States. The Port created over $188 million in 
business income in fiscal year 1996. The Port also generated $971 
million in sales revenue for Georgia and is directly responsible for 
over 8,400 jobs statewide.
    Georgia's congressional delegation has requested $27.95 million in 
federal funds for fiscal year 1998 to advance the replacement of the 
Sidney Lanier Bridge. This will allow us to proceed on schedule with 
the funding requirements for the main span, and pier protection for the 
replacement bridge.
    This request represents the 50 percent federal share provided for 
in Section 302 of the Coast Guard Omnibus Act of 1990. Mr. Chairman, we 
ask that funding continue to be provided under the Coast Guard 
appropriation, and that the Coast Guard continue to be the federal 
manager.
    Our deepwater ports at Savannah and Brunswick are a valuable asset 
for Georgia, and benefit the entire nation in the global economy we 
must now operate in. We urgently request your help in getting the 
maximum benefit from them for our state and the nation.
    The attached ``Transportation Evaluation Criteria'' provides 
additional detail on the design, construction, and funding requirements 
for the Sidney Lanier Bridge.
    Thank you.
Transportation Evaluation Criteria--Sidney Lanier Bridge, Brunswick, GA
Criteria 1--Primary Congressional District: 1
    Congressman: The Honorable Jack Kingston, The U.S. House of 
Representatives
Criteria 2--Primary Implementation Responsibility:
    Georgia Department of Transportation, No. 2 Capitol Square, 
Atlanta, GA 30334
Criteria 3--Project Eligibility:
    Congress designated this bridge as an unreasonable hazard to 
navigation in the 1990 Coast Guard bill, and called for its replacement 
under the Truman-Hobbs Act. The roadway and bridge are functionally 
classified as a Principal Arterial making the project eligible for 
federal funds. The project is also on the National Highway System.
Criteria 4--Design, scope and objectives of the project:
    The principal objective of the Sidney Lanier Bridge Replacement is 
to provide the transportation infrastructure that will result in the 
safe and efficient movement of people and goods throughout the US 17 
corridor. Providing a high-level fixed-span bridge replacement can 
achieve this by removing the potential for bridge/ship collisions that 
continue to expose motorists and endanger lives.
    The Sidney Lanier Bridge Replacement project consists of several 
phases:
    (1) MLP-25(66)--US 17/SR 25--Preliminary Engineering and Design
    (2) RWMLP-25(66)--US 17/SR 25--Right-of-way Acquisition
    (3) MLP-25(66)--US 17/SR 25--Construction of Roadway and Approaches 
for Sidney Lanier Bridge Replacement. (See the attached location map)
    (4) CG-009-2(4)--US 17/SR 25--Sidney Lanier Bridge Approaches 
Construction Engineering and Inspection
    (5) CG-009-2(1)--US 17/SR 25--Construction of Main Span of High 
Level Sidney Lanier Replacement Bridge and removal of existing bridge. 
(See the attached location map)
    (6) CG-009-2(3)--US 17 /SR 25--Sidney Lanier Bridge Main Span 
Construction Engineering and Inspection
    (7) CG-009-2(2)--US 17 /SR 25--Removal of the Old Sidney Lanier 
Bridge.
    The composite of these phases will replace the obsolete Sidney 
Lanier Bridge across the Turtle River in Brunswick.
    Beginning at the Jekyll Island Causeway (SR 520), the project will 
extend approximately 2700' north of the existing bridge. The 
replacement structure will be a new high-level bridge on the east, or 
downstream side, of the present lift-span bridge. The total project 
length will be approximately 1.8 miles. Estimated base year traffic 
(1996) is 12,500 ADT, with design year traffic (2016) projected to be 
18,000 ADT. The posted speed limit is 55 mph.
    The existing bridge provides a width of 55' and a vertical 
clearance of 18' for the roadway. Horizontal clearance under the bridge 
for shipping is 250' and vertical clearance for ships is only 139'. The 
present bridge is 4,471' long with a sufficiency rating of 54.0 out of 
a possible 100.
    The proposed typical section for the approaches will include two, 
12' lanes in each direction with a raised median that varies from 6.5' 
to 20' in width. Design speed will be 55 MPH. The cable-stayed bridge 
will provide two, 12' lanes in each direction, with 8' outside 
shoulders and 2' inside shoulders, with a median barrier. Both concrete 
and steel design alternates will be considered for the cable-stayed 
portion of this bridge. Traffic will be maintained across the existing 
bridge during construction.
    The Sidney Lanier Bridge Replacement Project is a large scale 
replacement project designed to remove a serious threat to public 
safety. The principal objective of this project is to replace an 
obsolete liftspan bridge that poses an extreme hazard to navigation and 
to highway motorists. Ships have hit the Sidney Lanier Bridge twice in 
the past twenty-two years, and ten lives have been lost because of 
these collisions.
    The new high-level bridge will provide a minimum of 185' vertical 
clearance and 1,038' of horizontal clearance for shipping, which will 
allow the development of a major container port in Brunswick. The 
1,038' of horizontal clearance will also allow widening the Turtle 
River to a proposed 400' channel width with a 45' channel depth. The 
new bridge will improve safety for shipping and vehicular traffic.
Criteria 5--Total Project Cost and Source of Funding:
    Estimated design, engineering, rights-of-way and construction costs 
are $98.2 million. Adding contingencies brings the total estimated cost 
to $108 million. The total estimated annual life-cycle costs for a 
high-level fixed-span bridge are $20,000 in the early years, increasing 
to $70,000 per year in the final years, with periodic maintenance of 
$335,000 every ten years. For a fifty-year life-cycle, the estimated 
annual maintenance cost is $78,500 per year. Funding for the annual 
maintenance expenses of the bridge will be 100 percent state funds. 
Private sector funding is not available for this project.

                       Table 1.--Completion costs

        Phase                                                      Total
Preliminary engineering and design......................      $4,183,035
Right-of-way............................................         100,000
Bridge approaches.......................................      18,884,886
Construction engineering................................       5,700,000
Main span and pier protection...........................      65,475,129
Final construction--Including the removal of existing 
    bridge..............................................       8,749,979
Contingencies (10 percent)..............................      10,309,303
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................     113,402,332
Less previous Federal appropriations (see question No. 
    14).................................................     -28,750,000
Less previous State appropriations......................     -28,750,000
                    --------------------------------------------------------
                    ____________________________________________________
      Balance...........................................      55,902,332
                    ========================================================
                    ____________________________________________________
Federal authorization requested (50 percent)............      27,951,166

                                            TABLE 2.--FUNDING PHASES                                            
----------------------------------------------------------------------------------------------------------------
                       Phase                         Fiscal year       Total          Federal          State    
----------------------------------------------------------------------------------------------------------------
Preliminary engineering............................      1992-93        $100,000         $50,000         $50,000
Design.............................................      1994-95       4,083,035       2,041,518       2,041,518
Right-of-way.......................................         1995         100,000          50,000          50,000
Bridge approaches..................................         1995      18,884,886       9,442,443       9,442,443
Construction engineering...........................         1996       5,700,000       2,850,000       2,850,000
Main span and pier protection......................         1997      65,475,129      32,737,565      32,737,565
Final construction--Including removal of existing                                                               
 bridge............................................         1998       8,749,979       4,374,990       4,374,990
Contingencies......................................  ...........      10,309,303       5,154,652       5,154,652
                                                    ------------------------------------------------------------
      Totals.......................................  ...........     113,402,303      56,701,166      56,701,166
----------------------------------------------------------------------------------------------------------------

Criteria 6--Obligation Schedule for Next Five Years:
    All phases of the project are expected to be complete over the next 
five years. Therefore, the full authorization request of $27,951,166 is 
expected to be obligated during this period.
Criteria 7--Proposed Schedule and Current Status:

                        TABLE 3.--PROJECT STATUS                        
------------------------------------------------------------------------
                Phase                   Fiscal year         Status      
------------------------------------------------------------------------
Design and right-of-way.............         1992-93  Complete.         
Environmental.......................            1993  Complete.         
Bridge approaches...................            1995  Underway.         
Main span and pier protection.......            1997  Underway.         
Construction engineering and                 1996-98  Underway.         
 inspection.                                                            
Final construction--Including                   1998  ..................
 removal of existing bridge.                                            
------------------------------------------------------------------------

    Preliminary engineering is complete. The Project Concept Report was 
approved in March 1992. Design of the bridge approaches was completed 
in 1994. The project environmental impact statement was approved in 
November 1992 and the Section 404 permit has been approved. 
Construction on the new roadway and approaches is underway. The State 
awarded a contract for construction of the main span in January 1997.
Criteria 8--Metropolitan and/or State Transportation Improvement Plan 
        and Funding Schedule:
    The Brunswick Metropolitan Transportation Improvement Program and 
the State Transportation Improvement Program (STIP) both include the 
main span and bridge approach projects. (See attachments)
Criteria 9--Support by State and/or Regional Transportation Officials:
    Ten lives have been lost in the past twenty-one years because of 
ship/bridge collisions. Following a 1987 accident, the Georgia 
Department of Transportation began urgently seeking funding to remedy 
this hazardous situation. Receiving funds is critical so that 
construction of the main span and removal of the old bridge can 
continue on schedule. The Brunswick Metropolitan Transportation Plan 
and Georgia's Statewide Plan include the Sidney Lanier Bridge project. 
Georgia Ports Authority expansion plans also include the replacement 
bridge.
Criteria 10--National/Regional Significance:
    The Coast Guard declared the bridge an unreasonable hazard to 
navigation in 1990. US 17 is designated as a National Highway System 
(NHS) route. US 17 serves as an emergency alternative route for I-95 
and is a major linkage between the Brunswick area and the surrounding 
coastal region. US 17 is significant to regional freight movement 
because it provides a direct linkage to the Georgia Ports Authority's 
Brunswick facilities.
Criteria 11--Environmental opposition, obstacles or concerns:
    No significant opposition has been encountered, nor is it expected. 
A project environmental impact statement was completed and approved 
November 1992. The project has received strong support from local 
governments. The Brunswick Metropolitan Transportation Improvement 
Program and the State Transportation Improvement Program (STIP) both 
include the main span and bridge approach projects. Construction for 
the roadway and bridge approaches is underway. The State has awarded a 
contract for the construction of the main span.
Criteria 12--Economic, energy efficiency, environmental, congestion 
        mitigation and safety benefits:
    Economic.--With replacement of the bridge and deepening of the 
channel, it is estimated that sales revenues will increase by $464 
million annually; personal income will increase by $107 million 
annually; tax revenues will increase by $15.8 million annually; and 
jobs will increase by 1,100 by the year 2010.
    The value of increased tonnage into the Port of Brunswick by the 
year 2010 is estimated at $183,000,000 in 1991 dollars.
    Energy Efficiency.--Current conditions on the Sidney Lanier Bridge 
are a 50 mile per hour speed limit with approximately 120 minutes of 
delay over a twenty-four hour period due to the raising and lowering of 
the bridge. Current estimated average annual daily traffic (AADT) is 
9,100 vehicles per day. Approximately 455 vehicles traverse the bridge 
during peak hours. At this rate, the delays caused by the raising and 
lowering of the bridge result in approximately 150 vehicle minutes of 
delay for each raising. With an average of twenty railings per day, 
there are approximately 3,000 vehicle minutes of delay per twenty-four 
hour period. At the rate of $0.07 per hour of vehicle delay, the cost 
associated with this delay is $27,375 annually.
    Environmental.--Replacement of the current lift span bridge by a 
high level fixed span bridge will result in continuous traffic flow. 
Air quality benefits will be positive but negligible.
    Congestion Mitigation.--Providing a high level fixed span bridge 
will result in continuous flow in vehicular traffic and adequate safe 
clearances for ships navigating the channel.
    Safety Effects.--The value of improved safety improvements is 
estimated at $3.5 million annually by the year 2010.
Criteria 13--Previous Federal funding:
    The authorization requested for the Sidney Lanier Bridge continues 
a prior Federal commitment for Federal funding from the General Fund as 
originally provided in the Coast Guard Omnibus Act of 1990 (and 
reaffirmed, by funding in subsequent Appropriations Acts, and Coast 
Guard Authorization Acts) for bridges that are unreasonable hazards to 
navigation. Further, the requested authorization conforms to the 
Federal funding commitment provided for highway bridges as provided 
under Section 1103 of the Intermodal Surface Transportation Efficiency 
Act of 1991, and consistent with congressional directives included with 
the passage and subsequent enactment of the Department of 
Transportation and Related Agencies Appropriation Acts, 1994, 1995, 
1996, and 1997.
Criteria 14--First Federal authorization or increase to previous 
        Federal Authorization:

                     PREVIOUS FEDERAL APPROPRIATIONS                    
------------------------------------------------------------------------
                                                 Fiscal                 
                                                  year     Federal share
------------------------------------------------------------------------
Truman-Hobbs Act (Coast Guard)...............       1992        $900,000
    Do.......................................       1993       5,000,000
    Do.......................................       1994       6,000,000
FHWA Demo--transferred to Coast Guard........       1995       1,850,000
H.R. 2002 ``Alterations of Bridges'' (Coast                             
 Guard)......................................       1996       8,000,000
Public Law 104-205...........................       1997       7,000,000
                                              --------------------------
      Total..................................  .........      28,750,000
------------------------------------------------------------------------

    [Clerk's note.--The attachments to Mr. Shackelford's statement do 
not appear in the hearing record but are available for review in the 
subcommittee's files.]
                                 ______
                                 
 Prepared Statement of Harry Harris, Chairman, Executive Board, Deputy 
 Commissioner, Connecticut Department of Transportation, I-95 Corridor 
                               Coalition
    Thank you for the opportunity to submit this written testimony for 
submittal to the record of the Subcommittee on Transportation and 
Related Agencies, Committee on Appropriations, U.S. Senate.
    The I-95 Corridor Coalition, which I currently chair, is a 
partnership of the major public and private transportation agencies 
serving the Northeast Corridor of the United States. Since 1993, the 
Coalition has focused on bringing our member agencies together to 
develop and improve multi-agency activities that result in a more 
effective and efficient use of existing infrastructure through the 
integration of technologies. The relationships that have been developed 
are continuing to expand and support the delivery of a seamless, multi-
modal transportation network benefiting both travelers and goods 
movements throughout the Northeast.
    The Coalition consists of twenty-eight transportation agencies and 
over a dozen private sector organizations in the twelve states from 
Maine to Virginia. These member agencies include the twelve state 
departments of transportation (DOT's), the City of New York DOT, the 
Washington, DC Department of Public Works, as well as most major toll 
and bridge authorities, and Amtrak.
    The transportation operating agencies who are members of the 
Coalition recognize the importance of Intelligent Transportation 
programs and are prepared to spend portions of their discretionary 
dollars to support them. Public sector agencies in the Northeast are 
now investing over $400 million a year to support over 350 Intelligent 
Transportation projects and programs. The activities of the I-95 
Corridor Coalition provide a foundation for the continuing coordination 
and integration of traditional products and services, using new 
technologies which enhance the effectiveness of transportation 
investments.
                               background
    In 1991, ISTEA established a strategic plan to enhance 
transportation services through the use of technologies. The overall 
goal of making the most of our nation's transportation investments and 
resources with strategic applications of technology was supported by 
the principles of economic productivity, safety, environmental 
protection, return on investment, and innovation.
    To assist the nation in incorporating these principles into 
transportation projects, Congress provided for the designation of 
several ``Priority Corridors,'' including the Northeastern United 
States. Since that time, the I-95 Corridor Coalition and our member 
agencies have worked hard to fully incorporate the ISTEA themes or 
principles into the planning and development of transportation 
projects. We are now engaged in deploying the technologies to make 
these projects work.
              achievements of the i-95 corridor coalition
    Much of the Coalition's work to date has centered on the all-
important task of building operational coordination and 
interjurisdictional cooperation among twenty-eight separate agencies 
within our twelve member states. While the benefits of this effort are 
difficult to quantify, this work has been, and still is, absolutely 
critical in achieving our goal of uniform and coordinated applications 
of technology to improve transportation flow for people and goods. 
Successful ``Model Deployment'' can not occur until after a system of 
institutional coordination has been established and tested. Having 
successfully established this cooperative institutional framework, the 
Coalition is now moving aggressively toward the deployment and 
implementation of smart transportation projects.
    Among our accomplishments to date are the following:
    Operational Coordination.--The ``Information Exchange Network'' 
(IEN) allows any member agency to quickly communicate with other 
Coalition agencies during emergencies, and to coordinate transportation 
management and traveler information on a regional and Corridor-wide 
basis. The Coalition's IEN system provides the points of entry and 
access to transportation agency databases for highway operations 
centers and metropolitan transit operation centers. Currently, there 
are over 40 operating IEN stations with plans for about 12 additional 
stations.
    The Coalition's member agencies have developed standard operating 
guidelines for the Incident Management process throughout several 
subregions of the Northeast Corridor. Multiple regional workshops were 
held to achieve consensus on elements of the ``Regional Response 
Plans.'' The project also included the preparation of a ``Regional 
Resource Guide'' based on an inventory of the Corridor's related 
resources.
    Commercial Vehicle Operations (CVO) Program.--The Coalition has 
developed a CVO program that will enhance the productivity and safety 
of the goods-movement industry through the identification and 
application of technologies in the areas of safety, automated 
credentialing, and information-sharing. These technologies and 
applications are being developed and tested through a partnership of 
public agencies and private industry. For example, the Coalition is 
implementing a system that will provide commercial vehicle dispatchers 
and drivers with information on traffic congestion, accidents, weather 
and alternative routing to help meet the needs of businesses for 
reliable delivery of goods and services.
    Electronic Toll and Traffic Management.--All of the Coalition's 
members agencies have jointly adopted an Electronic Toll and Traffic 
Management (ETTM) vision for compatibility within the Northeast. The 
Coalition will champion the achievement of only one automated tag per 
vehicle, one account per customer, and one set of credentials per 
commercial vehicle.
    Traveler Information.--The Coalition provides travelers with 
information in a variety of ways. For example:
  --The Northeast Travelers Alert Map identifies locations of major 
        construction activities, dates and location of upcoming events, 
        and locations of holiday and/or weekend bottlenecks. Through 
        the I-95 Corridor Coalition, this map is made available to 
        travelers at welcome centers, rest areas, truck stops and 
        regional AAA offices, and is also located on the Coalition's 
        World Wide Web home page.
  --The Coalition's World Wide Web home page includes traveler 
        information and facilitates the distribution of Coalition 
        products and services between member agencies and the traveling 
        public.
    The Coalition distributes information to highway travelers through 
the use of variable message signs, highway advisory radio, and public 
broadcast traffic reports.
    Additional achievements include:
  --a two-year test of a variety of business arrangements to provide 
        enhanced traveler information services;
  --installation of Highway Advisory Radio stations at critical points 
        where diverting traffic assists in managing congestion and 
        reducing delays;
  --development of guidelines to ensure that messages on Variable 
        Message Signs are consistent throughout the Corridor; and
  --encouragement of information and technology exchange.
    We believe that these accomplishments are fully in keeping with the 
strategic planning process laid out in ISTEA. We have done our best to 
uphold our part of the ISTEA bargain.
              istea reauthorization and the i-95 coalition
    We believe that reauthorization of the ISTEA legislation, and its 
funding support, should build upon ISTEA's strategic framework to 
create a state-of-the-art transportation system for the 21st Century. 
Americans will demand this kind of transportation system as our economy 
becomes more fully integrated on both a national and international 
basis. More than ever before, the quality and availability of 
transportation services is tied to our standard of living. With the 
application of new technologies and other infrastructure support, 
innovations such as integrated logistics and ``just-in-time'' 
deliveries will continue to allow us to maintain a high level of 
competitiveness relative to other areas of the world.
    Coalition members well understand the realities of the current 
economic conditions and the resulting pressure placed on the federal 
budget and the need to restrain spending. However, it is very clear 
that wise investments in the delivery of Intelligent Transportation 
Systems will allow us to address our ever growing transportation needs 
more effectively at a lower cost, over the long term. For example, it 
is estimated that as much as two thirds of the new capacity required 
for our most congested corridors can be provided by intelligent 
transportation systems at significantly lower cost than traditional 
infrastructure construction. Assuming that the benefits resulting from 
a comprehensive application of I-95 Corridor strategies could postpone 
the need for new construction for ten years, the savings could be as 
high as $40 million.
             economic benefits of the i-95 corridor program
    As noted above, investments in Intelligent Transportation are 
clearly investments in economic growth. The I-95 Corridor Coalition 
Program has been, and will continue to be, instrumental in enhancing 
and supporting future economic opportunities.
    It is estimated that by the year 2020, travel will increase by 35 
percent in the New York metropolitan region alone. At the same time, 
government resources available for infrastructure investment are 
certain to be limited. If the nation's transportation infrastructure is 
expected to continue to meet our national needs and to enhance our 
economic vitality, it is imperative that we manage the existing 
transportation system as efficiently as possible. The potential 
economic effects of transportation investments integrating traditional 
and new technologies are likely to be analogous to those of highway 
construction in the past. It cannot be disputed that great benefits 
were realized from the development and construction of the Interstate 
Highway System, both in terms of enhancing the quality of life and in 
providing economic stability. Likewise, investments made today in the 
integration of technologies and transportation services will also reap 
many benefits.
    Specific economic benefits of the I-95 Corridor Coalition Program 
include:
    Enhanced business efficiency.--The ability to deliver goods and 
services in an efficient and timely manner is critical to US businesses 
hoping to compete in a global economy. The reality of today's market 
place requires that many businesses operate within a ``just-in-time'' 
delivery framework. Improvements in mobility through the implementation 
of the Coalition's initiatives will enhance business profitability in 
the Northeast, and throughout the nation. For example, time savings of 
as little as ten minutes per trip for the 14 million eastbound trucks 
entering New York City each year, would translate into direct cost 
savings of nearly $50 million a year. Reduced inventory costs 
associated with ``just-in-time'' operations could add an additional 
$20-30 million in benefits each year.
    Lower infrastructure costs.--The capital costs for new highway 
construction are approaching $18 million per lane mile in some parts of 
the Northeast. Over 380 new lane miles would need to be constructed 
each year in the principal I-95 Corridor urban areas just to maintain 
traffic flow at current levels of congestion. The total estimated cost 
of this construction could reach almost $6.9 billion annually without 
considering the associated legal and political difficulties.
    Reduced travel delay.--The annual costs of incident-related travel 
delay exceeds $7.8 billion in the five largest metropolitan areas of 
the Northeast Corridor. Chronic traffic congestion adds approximately 
40 percent more to the costs of delay in these areas. I-95 Corridor 
Coalition Program initiatives promise to significantly reduce these 
delays. For example, in Maryland, the early results of the state's 
incident management program are showing a benefit/cost ratio of almost 
6:1.
    These significant economic benefits are clearly consistent with our 
national goals of quality transportation, cleaner air, lower societal 
costs, and economic prosperity.
                           future activities
    Coalition members are proud of what they have accomplished and are 
excited about the future. Assuming the continuation of adequate 
funding, the next few years will enable us to further realize tangible 
benefits from dollars invested. The Information Exchange Network 
Project and the Commercial Vehicle Operations related projects will 
continue to achieve gains from expanded use and economies of scale. In 
addition to our focus on integration and deployment of technologies, we 
are now directing attention toward the development of a comprehensive 
Intermodal Program as a means of encouraging and facilitating the 
integration of all modes.
    Building on the strong foundation already in place, and with your 
continued help, we will continue to meet our national transportation 
objectives.
                         funding recommendation
    Thanks to the Priority Corridors Program and the related funding 
levels made available in ISTEA, the institutional foundations required 
to create and support a state-of-the-art transportation system have now 
been put into place. The I-95 Corridor Coalition has played a key role 
in building these critical foundations. To realize the most significant 
benefits of the Coalition's previous work, adequate funding for these 
coordination efforts must be continued.
    We have estimated that the I-95 Corridor Coalition can continue to 
provide the coordination and cooperation among its member agencies with 
an appropriation of five million dollars, per year. This modest level 
of funding is needed in order to support the required administration 
and coordination duties, as well as, key projects and field operational 
tests for the coming five year period.
                                summary
    The I-95 Corridor Coalition appreciates the opportunity to submit 
this discussion of our accomplishments and our plans for the future. To 
continue our work, we need continued congressional support. Our members 
have worked hard to fulfill the goals and objectives which were 
established by Congress in ISTEA. The foundation of an institutional 
framework to build a state-of-the-art transportation system is in place 
in the Northeast, and we are now focusing on the deployment of 
technologies in conjunction with the more traditional transportation 
solutions to better serve the demand for transportation services.
    The potential economic benefits of these efforts, not only to the 
Northeast, but to the nation as a whole, are enormous. Over the next 
several years our efforts promises to demonstrate significant and 
quantifiable benefits for dollars expended as projects go on-line. The 
Coalition needs your help in meeting our common objectives. Again, to 
continue this important work, we respectfully request $5 million in 
appropriations for fiscal year 1998, and an equal amount for each year 
of the life of the next authorization legislation.
                                 ______
                                 
  Prepared Statement of Anne Shane, Chief of Staff, to Mayor Stephen 
                  Goldsmith, City of Indianapolis, IN
    For those who may have missed it, the reality of the new 
Indianapolis is a far cry from the old image of Indianapolis as a 
traditional conservative midwestern city. The City of Indianapolis has 
invested more than $1 billion in our downtown projects in recent years, 
including $300 million in the Circle Centre Mall, $240 million in the 
convention center, and more than $200 million in the RCA Dome. We are 
researching the possibility of investing $175 million in a new 
basketball arena downtown.
    In addition, at a time when many central business districts in mid-
sized cities are facing serious problems, employment in downtown 
Indianapolis has risen 15 percent over the last five years, while the 
vacancy rate for commercial office space has fallen 10 percent.
    While all this is happening in downtown Indianapolis, the 
commercial and entertainment center of the central Indiana region, the 
region as a whole is expected to maintain its strong economy and to 
continue to attract new residents drawn to our high quality of life and 
economic opportunity. According to forecasts in the ``Indianapolis 
Regional Transportation Plan,'' population in the urbanized area is 
forecasted to grow 27 percent between 1990 and 2020. The number of 
households is expected to increase by 38 percent, with employment 
rising by 44 percent.
    Much of that development will occur in suburban areas. Growth will 
be especially concentrated in the area to the north and northeast of 
Indianapolis and Marion County. Hamilton County is expected to be among 
the fastest growing areas in Indiana over the coming decades. So we are 
facing strong development trends at both ends of the northeast 
corridor. This means that increasing strain will be placed on our 
already overburdened transportation system. The transportation plan's 
forecasts are for daily person trips to increase by 48 percent, vehicle 
miles of travel by 69 percent, and daily vehicle hours of travel by 77 
percent. Such dramatic increases in travel could threaten the very 
quality of life that makes the region so attractive to those of us who 
live here now and to those who would like to live and work in central 
Indiana.
    Our traditional approach to addressing transportation needs has 
been to expand the highway system to accommodate greater automobile 
usage. But we are now at the point where simply adding lanes to 
existing roads, as well as building new freeways, will not solve the 
transportation problem. Congressman Burton mentioned the recently 
completed study of the I-69 corridor which foresees a massive expansion 
of highway facilities in the northern end of the northeast corridor. 
That comes two decades after the community killed a plan to extend I-69 
into the heart of Indianapolis.
    The project that we are discussing today would move toward an 
alternative solution to a problem widely acknowledged in the community. 
Under the direction of the Indianapolis Metropolitan Planning 
Organization, we are completing a feasibility study of several 
transportation alternatives. These are likely candidates for detailed 
analysis in a Major Investment Study. We are seeking a fiscal year 1998 
appropriation for that study. These include two light rail options, 
commuter rail, HOV/busway, transportation systems management and 
highway expansion. We will have preliminary cost and ridership 
forecasts soon.
    We want to carefully consider the costs and benefits of many 
transportation options in order to connect the downtown with the high 
growth area to the northeast of Indianapolis. In this way we can help 
assure the continued vibrancy of the downtown and safeguard the City of 
Indianapolis' enormous capital investment. I hope we can count on your 
support to help us address and thoroughly analyze these critical 
transportation issues.
                                 ______
                                 
 Prepared Statement of Lee R. Redmond, III, Senior Vice President-Real 
                      Estate, Kaiser Ventures Inc.
    Thank you for the opportunity to present to you for the record 
materials regarding a proposed project in San Bernardino County, 
California that we believe is worthy of your consideration for the 
fiscal year 1998 Transportation Appropriations Bill. Our project is 
located at the juncture of Etiwanda Avenue and the I-10 Freeway, 
approximately 1 mile east of the I-15 and I-10 Interchange in San 
Bernardino County, California. The area affected by this project is 
generally the area known as the former Kaiser Steel Mill.
    Over the past several years, Kaiser has been re-developing a 
portion of this property into the California Speedway, a major 
motorsports facility owned and operated by Penske Motorsports which 
will open on June 22, 1997. We are continuing our efforts to return the 
remaining acreage to productive new uses. We have identified many uses 
that are appropriate for the area which will have a direct impact on 
goods movement through Southern California to both international and 
national destinations.
    A unique attribute of our property is that it is served by both the 
Burlington Northern Santa Fe and Union Pacific Railroads. This provides 
for a significant opportunity to establish major intermodal facilities 
in the area. We also believe that the development of the property for 
such intermodal use will contribute meaningfully to achieving the 
purposes of NAFTA.
    In light of efforts to improve rail and truck transportation to and 
from the ports of LA and Long Beach, this freeway improvement will 
assist in improving the efficiency with which goods move, as well as 
encourage additional development to serve this expanding sector of our 
economy. In fact, one of the proposed developments for a portion of the 
property around this interchange is a major truck stop to provide 
adequate facilities for the significant existing and future truck 
traffic.
    In order for these goals to be achieved, it is imperative to 
alleviate certain safety and congestion impacts that currently exist. 
The project will provide for a grade separation of a major rail 
crossing at Valley Boulevard which has been identified as one of the 
most dangerous in the State of California. It will also improve certain 
congestion safety factors that exist on Etiwanda Avenue and the I-10 
Freeway due to the mixture of automobile and truck traffic. In fact, 
the California Department of Transportation has found this project of 
such interest that they are working with us to facilitate an expedited 
review as an emergency safety project.
    In summary, the project addresses a number of worth-while 
objectives: it will relieve congestion; eliminate a hazardous 
intersection of truck and auto traffic; contribute further to truck 
safety by providing a major rest stop which addresses fatigue; 
establishes the linkage for a future intermodal rail/truck facility; 
and assists the region and the state to maximize the benefits from 
NAFTA.
    We had the opportunity to meet with the clerk of the Transportation 
Subcommittee, Mr. Wally Burnett, on May 12 to discuss this project. If 
you should require additional information, I stand ready to provide it. 
I would also be pleased to provide a tour of the project if you are 
interested.
    Thank you for your time and consideration.
Interstate 10/Etiwanda Avenue/Valley Boulevard Interchange Improvements 
     Proposal for Project Specific Funding Authorization Under the 
    Intermodal Surface Transportation Efficiency Act (ISTEA) of 1997
    1. Name and Congressional District of the primary Member of 
Congress sponsoring the project, as well as any Members supporting the 
project (each project must have a single primary sponsoring Member).
    The project site is within the 42nd Congressional District, Hon. 
George Brown, H.R.
    2. Identify the State or other qualified recipient responsible for 
carrying out the project.
    The local agency sponsor for the project is the County of San 
Bernardino, California, in cooperation with the California Department 
of Transportation (Caltrans) and Kaiser Ventures, Inc. (Kaiser).
    3. Is the project eligible for the use of Federal-aid funds (if a 
road or bridge project, please note whether it is on the National 
Highway System)?
    Yes. As an Interstate route, the project is eligible for Federal-
aid funds. Interstate 10 (I-10) is on the National Highway System.
    4. Describe the design, scope, and objectives of the project and 
whether it is part of a larger system of projects. In doing so, 
identify the specific segment for which the project funding is being 
sought, including the terminus points.
    The project objectives are to: (1) improve safety and enhance 
mainline freeway operations on I-10 in the vicinity of the Etiwanda 
Avenue and Valley Boulevard interchanges by eliminating existing 
weaving movements with new ramp configurations, and (2) improve access 
to proposed intermodal and truck stop facilities to be located on a 
portion of the Kaiser site. The project's regional location is shown in 
Figure 1. Specific design elements are shown in Figure 2 and include 
the following:
  --Realign and reconstruct Valley Boulevard from east of the SPRR spur 
        track and extend the road west to Slag Haul Road, eliminating 
        the existing at-grade rail crossing of the 1-10 off- and on-
        ramps.
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        [GRAPHIC] [TIFF OMITTED] T12NON.038
        
  --Reconstruct the existing weaving section on westbound I-10 between 
        the Valley Boulevard on-ramp and the Etiwanda Avenue off-ramp 
        as a ``braided-ramp'' configuration, which will eliminate the 
        westbound weaving movement.
  --Reconstruct the existing Etiwanda/I-10 interchange by converting 
        the existing four quadrant full cloverleaf interchange to a 
        partial cloverleaf, retaining the northeast and southwest loop 
        on-ramps and demolishing the northwest and southeast loop off-
        ramps. The exit ramps from I-10 in each direction will be 
        connected to Etiwanda Avenue at two new signalized 
        intersections.
    The project is not part of a larger system of improvements.
    5. What is the total project cost and proposed sources of funds 
(please identify the federal, state, or local shares, and the extent, 
if any, of private sector financing or the use of innovative financing) 
and of this amount, how much is being requested for the specific 
project segment described in Item No. 4?
    The total project construction cost is $13,031,000. Currently, the 
only project funding commitment to date is private sector funding to be 
provided by Kaiser. Kaiser's share of the project costs will be 
determined based upon the Kaiser project's relative contribution to the 
need for the improvements. Kaiser is funding project design costs, and 
will be dedicating additional right-of-way needed for the improvements. 
The amount of funding requested at this time is $10,000,000. The 
balance of $3,031,000 will be locally funded.
    6. Of the amount requested, how much is expected to be obligated 
over each of the next five years?
    The project is proposed for construction in fiscal year 1998-99, 
and it is anticipated that all funds requested would be obligated in 
that year.
    7. What is the proposed schedule and status of work on the project?
    Preliminary engineering is currently in progress, and will result 
in a Combined Project Study Report/Project Report approval by December 
1997. Project design will be completed by mid-1998, with project 
advertisement for construction scheduled to occur by late 1998.
    8. Is the project included in the metropolitan and/or State 
transportation improvements plan(s), or the State long-range plan, and 
if so, is it scheduled for funding?
    Caltrans has approved the project for inclusion in Administrative 
Amendment No. 3 to the Regional Transportation Improvement Program 
(RTIP) and the Federal Transportation Improvement Program (FTIP), and 
has forwarded its approval to the San Bernardino Associated Governments 
(SANBAG) (see Attachment A).
    The project is consistent with and implements Regional 
Transportation Plan (RTP) policies supportive of goods movement and 
intermodal issues, and will have a positive benefit toward meeting the 
needs generated by the North American Free Trade Agreement (NAFTA).
    The project has been included in the Southern California 
Association of Government's (SCAG) list of projects for ISTEA II 
consideration per its Transportation and Communications Committee 
meeting of February 21, 1997.
    9. Is the project considered by the State and/or regional 
transportation officials as critical to their needs? Please provide a 
letter of support from these officials, and if you cannot, explain why 
not.
    The project is considered important by Caltrans as it has been 
defined as a needed improvement since the 1980's. Caltrans has approved 
and is the sponsoring agency for the RTIP/FTIP amendment request.
    SANBAG has not formally endorsed this project since the specific 
project proposal was in early stages of development at the time project 
submittals were due to meet SANBAG's deadline for Board action at the 
meeting of February 5, 1997. However, there has been extensive 
coordination with SANBAG staff, which has assisted in coordination 
between Kaiser and Southern California Association of Governments 
(SCAG) staff for presentation of this project funding request.
    The transportation improvement project contributes to meeting 
regional transportation goals for improvements to existing freeways and 
facilitating intermodal operations. The proposed combination of an 
intermodal facility and a large-scale truck stop to be served by the 
transportation project will also facilitate efficient movement of goods 
into and from the Southern California region.
    10. Does the project base regional or national significance?
    Yes. The project has regional significance relative to its location 
along I-10, 1 mile east of the I-10/I-15 interchange. By improving I-10 
operations in this segment, the project will facilitate the traffic 
movements from I-10 to I-15. The proposed improvement has national 
significance, since both I-10 and I-15 traverse the nation and are 
critical linkages in increased goods movement resulting from the NAFTA.
    The proposed intermodal rail yard to be served by the 
transportation project is intended to facilitate the movement of goods 
from throughout the nation into the Southern California region by 
creating a Southern California hub to which goods can be shipped by 
rail, and then be transferred onto trucks for local deliveries 
throughout the Los Angeles metropolitan area. The area adjacent to the 
I/10 Etiwanda interchange is the only location within Southern 
California that is served by both the BNSF and the UP/SP rail systems. 
As such, it is an ideal location for an intermodal facility, the 
development of which is dependent upon the proposed interchange 
improvements.
    11. Has the project encountered, or is it lively to encounter, any 
significant opposition or other obstacles based on environment tat or 
other types of concerns?
    There is no known opposition to this project, nor are there any 
environmental issues that would be an obstacle to project 
implementation.
    12. Describe the economic, energy efficiency, environmental, 
congestion mitigation, and safety benefits associated with completion 
of the protect.
    Economic benefits of the project will result by increasing the 
capacity of the regional transportation system to accommodate existing 
traffic as well as new traffic generated by new local and regional 
economic development. The project will improve energy efficient and 
assist in improving regional air quality by reducing traffic congestion 
and vehicle idling time, thus resulting in reduced fuel consumption. 
Environmental benefits of the project will result from reduction in 
vehicle emissions due to reduced idling time. Congestion mitigation 
will be achieved since the project will improve the level of service on 
west-bound I-10 by eliminating a mainline weaving section, as well as 
eliminating weaving movements on the collector-distributor roads for 
the Etiwanda/I-10 interchange. The proposed project will improve safety 
by reducing the potential for congestion related traffic accidents that 
occur in these short weaving sections. Each of these benefits will be 
further enhanced by facilitating the movement of goods into the Los 
Angeles metropolitan region from distant locations throughout the 
nation via rail for local delivery by truck.
    13. Has the propel received funding through the State's federal aid 
highway apportionment, or in the case of a transit project, through 
Federal Transit Administration funding? If not, why not?
    There have been no previous apportionments of federal aid funds for 
this project. Although the project need was identified in the late 
1980's, project funding was never pursued due to the backlog of other 
critical transportation needs in San Bernardino County, such as full 
funding of the State Route 30 freeway project.
    14. Is the authorization requested for the project an increase to 
an amount previously authorized or appropriated for it fit federal 
statute (if so, please identify the statute, the amount provided, and 
the amount obligated to date), or would this be the first authorization 
for the project in federal statute? If the authorization requested is 
for a transit project, has it previously received appropriations and/or 
received a Letter of Intent or has FTA entered into a Full Funding 
Grant Agreement for the project?
    This is the first federal funding authorization requested for this 
project.
                             [attachment a]
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                                 ______
                                 
 Prepared Statement of Allen Greenberg, Government Relations Director, 
                     League of American Bicyclists
    Mr. Chairman and members of the subcommittee, my name is Allen 
Greenberg and I am the Government Relations Director of the League of 
American Bicyclists and also represent our International Police 
Mountain Bike Association (IPMBA) division. The League also works very 
closely with the Youth Bicycle Education Network (YBEN), which serves 
at-risk inner-city youths.
    Last year I submitted a statement to this subcommittee to describe 
the national problem of bicycle crashes and the resultant injuries and 
fatalities. This year I will provide an update on federal activities 
relating to bicycling safety and will also address a new area: the 
potential for the bicycle to play a vital role in welfare-to-work 
transportation.
                             bicycle safety
    Annually, bicycle crashes are responsible for 800 fatalities and 
600,000 emergency room visits in the United States. This is more than 
the 600 annual railroad grade-crossing fatalities, and far more than 
the 30 or so children who have died because of air bags this decade. It 
is more than aviation, railroad, and maritime fatalities, to which the 
Clinton Administration proposes to dedicate $839 million, $57 million, 
and $804 million, respectively, in fiscal year 1998.
    Over the last year, Congress has held multiple hearings on air bag 
safety and the Clinton Administration is now proposing $8 million for 
air bag safety research and another $2 million to educate parents about 
the risks that air bags pose to children. Yet for every child who died 
because of airbags this decade, seventy children died in bicycle 
crashes, but there is no response. Last year, the House Transportation 
Appropriations Subcommittee told the National Highway Traffic Safety 
Administration (NHTSA), through report language, that ``greater efforts 
are necessary to insure that children are trained to be safe 
bicyclists.'' This made sense since NHTSA's ``Traffic Safety Facts 
1994'' reported that 82 percent of bicyclists under the age of 15 
killed during that year were at least partially responsible for their 
fatal crashes.
    So what's happened since last year? Senior NHTSA officials met with 
us and agreed that bicycle safety should get more attention. NHTSA's 
non-motorized program staff, whose dedication and professionalism are 
second to none, has been very helpful, but without new resources little 
has been or can be done.
    Washington is a town of rhetoric. But talk is cheap and we must 
follow the dollars to discern our true values. Are the 30 kids who have 
died from air bags in the U.S. more important than over ten times that 
number who die each year in bicycle crashes? If this subcommittee 
approves the Administration's fiscal year 1998 budget as proposed, your 
answer, regrettably, will be yes.
    We need to put resources into developing a system to enable every 
child to receive comprehensive bicycle safety education. NHTSA told the 
House Transportation Appropriations Subcommittee last year that it 
didn't have the data to demonstrate that bicycle education would work; 
however, the agency's own data shows that 82 percent of child bicyclist 
fatalities could have been avoided if the cyclist had behaved 
differently. NHTSA hasn't spent a dime to get the data it says it needs 
(despite a detailed proposal we submitted to do this) or to create a 
program and delivery system to teach our children what they need to 
know.
    There is a double standard being applied here and our children are 
paying the price. No one has provided data to show that the $800,000 a 
year ``Stay Out of the No Zone'' safety campaign to educate drivers 
about truck blind spots. And where's the Administration's data to show 
that the $2 million it is seeking to educate parents about air bag 
safety will work? In each case, education is designed to close a 
knowledge gap and to encourage people to think about things that 
they're not now thinking about. This is why we need bicycle safety 
education, and particularly on-road training, for children. Training 
serves to improve on-road bicycle handling and overall knowledge, 
encourages conformity to the rules of the road and to traffic laws, and 
more experienced and formally trained bicyclists are much more likely 
to wear helmets and to wear them properly. As the statement I submitted 
last year said, there is no other transportation safety investment that 
this subcommittee could make that would be nearly so cost effective in 
saving lives and reducing injuries.
                   bicycling to work and off welfare
    The League commends the Clinton Administration and Congress for 
their interest in providing transportation links to jobs for welfare 
recipients. The Clinton Administration's proposed fiscal year 1998 
budget includes $100 million for a national welfare-to-work 
transportation initiative. The League believes, however, that 
insufficient attention has been paid to the essential role the bicycle 
can play in providing such transportation. We are seeking funding from 
this subcommittee for an initiative to provide bicycles, training, and 
commuter support to interested welfare recipients seeking job 
opportunities that are not transit accessible.
    This initiative would entail social service agencies identifying 
clients who would benefit from bicycle transportation and who are 
willing to learn what is necessary to make it a viable transportation 
option for them. The initiative would involve the League's Effective 
Cycling (EC) instructors teaching EC Road I and Bicycle Commuting 
Courses, the Youth Bicycle Education Network (YBEN) refurbishing old 
bicycles, bicycle advocacy groups such as the Washington Area Bicyclist 
Association inviting welfare recipients to participate in their bicycle 
commuter mentoring programs, our Police on Bikes helping both YBEN find 
and collect used bikes and our EC instructors teach bicycle commuting 
skills, and National Bicycle Dealers Association members offering 
program participants timely repair services under contract (much as 
City Bikes in Washington does for bicycle messengers). Working with 
YBEN, a network of inner-city organizations serving disadvantaged 
youths, provides the added benefit of having already established 
credibility in neighborhoods and among populations that are targeted by 
this proposal.
    At the October 1996 People, Jobs and Transportation National 
Conference in Washington, the personnel director of the Boca Raton 
Resort Club (with 1,900 employees) said he began offering workers 
alternative commute incentives to help recruitment and reduce the need 
for new, costly car parking facilities. Incentives for bicycle 
commuting were included only as an afterthought, but they are now the 
most popular and least costly of all those offered. This result is 
consistent with a December 1994 national poll, commissioned by Rodale 
Press, which found that while nine percent of all American bicyclists 
commuted to work by bicycle at some point in their area's last mild-
weather month, 20 percent did so among households with incomes of 
$25,000 or less.
    Similarly, a Michigan transportation provider at the conference 
said that there is typically good fixed route transit service between 
central city homes and destinations within a couple of miles of 
suburban employers. Combining a bicycle with transit (such as through 
popular and inexpensive bike racks on buses) would allow welfare 
recipients to take advantage of such service and explore employment 
options beyond those within walking distance of bus routes that pass 
near their home.
    Welfare and job placement agencies often overlook bicycle commuting 
as a viable, low-cost option and even the few that might be open to it 
don't know where to begin in helping their clients realize this 
potential. This initiative would focus on individual welfare recipients 
who find jobs that either are inaccessible or difficult to access by 
transit. We would recruit local networks of bicycle clubs, advocacy 
organizations, and others in no more than ten partner cities to help 
welfare clients by: acquiring or preparing commuter-ready bicycles; 
supplying lights, apparel, and other equipment; helping with route 
selection; teaching Effective Cycling skills; ensuring readily 
available (and funded) repair services; and helping combine bicycle and 
transit commuting into a single trip, where appropriate. The network 
would also work with transit agencies, paratransit providers, taxi 
companies, employers, and others to identify or provide at least one 
alternative to bicycle commuting for snowy and icy weather and 
emergencies.
    The League and its local networks would work with job placement and 
welfare agencies in partner cities by taking full responsibility for 
meeting the complete range of bicycle commuting needs of welfare and 
low-wage clients. Once a welfare agency or other government entity, 
employer, or client determines that bicycle commuting services are 
needed, or at least should be explored, the League-led bicycle network 
would take over and provide the combination of services that I have 
outlined to make bicycle commuting a realistic option. Each client 
would be fully served for up to one year, and in that time period would 
acquire all of the equipment, skills, knowledge, and confidence that is 
needed for independent year-round bicycle commuting. We hope this 
subcommittee will support this important initiative.
    Thank you for this opportunity to submit this statement. I look 
forward to the opportunity to discuss it further.
                                 ______
                                 
       Prepared Statement of John West, California Department of 
  Transportation and Chair of the NAHSC Program Management Oversight 
        Committee, National Automated Highway System Consortium
                              introduction
    I am John West of the California Department of Transportation and 
Chairman of the National Automated Highway System Consortium (NAHSC) 
Program Management Oversight Committee. I represent a unique public/
private partnership that includes the U.S. Department of Transportation 
(USDOT) and the nine member National Automated Highway System 
Consortium (NAHSC). Our mission is to develop the specifications and 
prototype for automated highway system (AHS) deployment in the United 
States--the next major improvement in our surface transportation 
system. An integral part of this effort is to foster the development 
and early application of safety and control technologies to provide 
early benefits to all highway users. (See Appendix ``A'' for our 
complete Mission Statement.)
    We appreciate Congress's past support for the AHS mission and 
endorse the Administration's proposed budget request of $26 million for 
the continuing Federal share of this program in fiscal year 1998. This 
level of funding is essential to continue the established momentum and 
compares with our current year Federal funding level of $22 million.
    The Consortium Core and Associate Participants--now totaling more 
than one hundred transportation stakeholder organizations throughout 
the U.S. (see Appendix ``B'' for list of Associate Participants)--
collectively feel that this work is vital if this nation is to maintain 
its excellent transportation network so critical to economic vigor and 
international competitiveness. This is truly a pioneering effort to 
support and assist the driver by integrating vehicle and infrastructure 
technologies into a cooperative system with benefits to safety, traffic 
congestion and the environment.
                        national ahs consortium
    The NAHSC is a government-industry-academia collaboration working 
to apply automated control technology to the U.S. vehicle-highway 
system to greatly improve its safety and efficiency. In response to a 
provision of ISTEA-91, the USDOT, late in 1993, issued a request for 
applications for a cooperative research and development program leading 
to a prototype AHS. The Consortium was formed early in 1994 to prepare 
an application for this competitive solicitation. In December 1994, the 
Cooperative Agreement between the NAHSC's nine Core Participants and 
the USDOT's Federal Highway Administration (FHWA) was initiated. This 
agreement charges the NAHSC to carry out the systems definition phase 
of what ultimately could be deployed as the next major performance 
upgrade of the U.S. vehicle-highway system.
    The Core Participants of the Consortium are: Bechtel, the 
California Department of Transportation (Caltrans), Carnegie Mellon 
University, Delco Electronics, General Motors, Hughes Aircraft, 
Lockheed Martin, Parsons Brinckerhoff and The University of California 
Partners for Advanced Transit and Highways (PATH). Each contributes a 
high level of prior effort and expertise in technologies the automated 
highway will use as well as extensive program management experience. 
Collaboration of the roadway infrastructure designers with vehicle 
designers and leaders in the development and application of information 
and control technologies provides unprecedented opportunity to improve 
the safety and efficiency of our surface transportation. This 
collaboration, uniquely enabled by the consortium format, also provides 
vital support in providing an environment that encourages the 
development of a market for these technologies.
    The agreement by the National AHS Consortium to share at least 20 
percent of the total cost, without any profit or fee, underscores the 
commitment of the national transportation system stakeholders to the 
development of a socially, economically and technically viable AHS.
    In addition to the Core Participants, the NAHSC now includes one 
hundred and three Associate Participants representing nine categories 
of stakeholders in highway transportation: (1) local, state and federal 
government agencies, (2) transportation users, (3) public transit, (4) 
environmental interests, (5) the highway industry, (6) the automotive 
industry, (7) the electronics industry, (8) commercial trucking, and 
(9) the insurance industry. These stakeholder organizations have all 
pledged support for the goals of the AHS program and each category has 
a voting representative on the Consortium's Program Management 
Oversight Committee to ensure its interests are accounted for in the 
direction and conduct of the program.
               u.s. department of transportation (usdot)
    The partnership of USDOT with the National AHS Consortium makes 
possible the development of the fully integrated automated highway, 
capable of flexible deployment and interoperability between all states 
and municipalities. In developing AHS, a long-term view is necessary to 
fully realize the benefits to society. Interlinking the roadway 
infrastructure, which is generally owned and operated by the public 
sector, with vehicles, which are developed, owned and operated by the 
private sector requires the participation of both sectors from the 
early stages. This partnership must continue to maintain the effort.
    Leadership from USDOT in this longer-term research and development 
project is essential for timely and smooth evolution from research to 
the development of prototype automated highway lanes. In the nearer 
term, many advances in safety technologies being developed to support 
vehicle automation should spin off into improved driver aids and safety 
features on nearer term production vehicles. In addition, USDOT and 
NAHSC are working together to provide a framework so that Intelligent 
Transportation Systems technologies being deployed in the near term 
will be compatible with the later addition of vehicle-highway control 
technologies.
                         global competitiveness
    At the present time, the NAHSC is the sole focus of vehicle-highway 
automation development in the United States. Both Japan and Europe have 
active public-private cooperative development of vehicle-highway 
automation technologies.
    In Japan the major government sponsor of AHS is the Ministry of 
Construction. After a visit to the NAHSC Program Office in 1995, 
Minister of Construction Mori returned to Japan and significantly 
increased funding for AHS which has led to organization of the 
``Advanced Cruise Assist Highway System Research Association''. This 
organization, patterned after the NAHSC, was formally launched in 
September of 1996. The Association has public-private participation and 
is funded by the Ministry of Construction at $70M for fiscal year 1996 
and $105M for fiscal year 1997 with twenty-four private industry 
members supplying additional funding. Among these are: Toyota, Nissan, 
Honda, Mitusbishi, Oki, Sumitomo, NEC, Hitachi, Toshiba, and 
Nippondenso. Members of the Association have given public 
demonstrations of automated vehicle-highway technologies in November 
1995 and October 1996. The Association has an initial goal of deploying 
the first AHS roadway in Japan in 2010.
    In Europe the focus of automation is primarily on commercial 
vehicles with a consortium of fourteen organizations led by Daimler 
Benz with funding coming from the European Commission. A public-private 
project called Promote-Chauffeur, part of the much larger European 
ETHOS program, is developing automation technologies for heavy trucks. 
Initial development employs an ``electronic tow-bar'' that controls a 
tractor-trailer to follow one that is driver controlled. The project 
plans to progress into automated platooning of several automated trucks 
following a driven lead vehicle and eventually into fully automated 
platooning without a driver.
    The Dutch Ministry of Transportation is planning the development of 
an automated truck roadway to carry freight from the port of Rotterdam 
to central Germany. Freight operations within the port of Rotterdam are 
already fully automated.
    It is of vital importance that the public and private 
transportation sectors in the United States participate in the 
development of vehicle-highway automation. Only in this way can the 
U.S. ensure that the technical and operational standards for this 
future transportation option meet the needs of its citizens for 
efficient, convenient personal and commercial transportation. Only in 
this way can the U.S. maintain the vitality of its surface 
transportation system into the twenty first century.
     the relationship of ahs to intelligent transportation systems
    AHS is the most advanced component of the Intelligent 
Transportation System (ITS) plan--and the component that offers the 
most potential for major gains in safety, efficiency and the 
environment. The AHS program is building upon and integrating ITS 
services as they evolve to ensure overall compatibility. AHS activities 
are fully coordinated with other Federally-sponsored ITS programs and 
with development of the National ITS Architecture.
    The AHS program encompasses the planned evolution from today's 
vehicle-highway system to the ultimate deployment of automated lanes. 
The evolution has already begun with the introduction of limited 
sensing and control systems on vehicles, and simple sensing and 
communications systems in the roadway infrastructure. It will be 
spurred on by the integration of more advanced features in vehicles, 
more advanced capabilities in the infrastructure and by establishing 
communications and coordination linkages among the vehicles and between 
the vehicles and the roadway. Some of the initial enabling technologies 
are coming to market today; many more will be produced over the next 
decade. For vehicles, these include obstacle detection and collision 
warning to detect and warn of imminent crashes; adaptive cruise control 
to maintain safe following distance between vehicles; and lane keeping 
to warn of lane or roadway departure. For the infrastructure, these 
technologies include road condition monitoring, automatic toll 
collection and communications.
                            benefits of ahs
    Recent research in automated highways has clearly indicated that 
automated vehicle control technology can offer major improvements in 
safety and efficiency of existing highways. Approximately 40,000 lives 
are still lost each year on U.S. highways and more than 1.7 million 
people are seriously injured. The annual cost to the nation is 
estimated to be more than $150 billion. Dramatic increases in highway 
safety through AHS deployment will mean fewer fatalities and injuries 
with less property damage and should lead to a reduction in driver and 
shipper insurance costs. The efficiency of automated highways is also 
expected to greatly improve the mobility and convenience of highway 
travel. Today, the estimated loss of productivity due to traffic 
congestion in the U.S. totals more than $50 billion annually. AHS 
offers the opportunity to turn that loss into a direct gain in 
productivity by increasing the capacity of each highway lane for the 
transport of people and goods.
    Minimizing traffic congestion and maximizing highway safety are the 
more obvious benefits of highway automation. Other benefits will 
include reduced fuel consumption and lower exhaust emissions due to 
smoother traffic flow with no stop-and-go congestion, reduced driver 
stress and less fatigue due to safer, less congested highways. These 
positive effects will improve every aspect of highway travel, even for 
those not using the automated lanes.
    The NAHSC has defined necessary AHS system design characteristics. 
Characteristics such as ease of use, operation in inclement weather, 
affordable cost and economic feasibility, beneficial effects on 
surrounding conventional roadways, operation with non-AHS vehicles, 
progressive deployment, flexibility, modularity and the ability to 
support a wide rage of vehicle types were determined to be the baseline 
design requirements for successful AHS deployment and operation.
    Top level service objectives for system users were determined to 
facilitate intermodal and multimodal transportation, enhance operation 
for freight carriers, support automated transit operations, be 
adaptable to urban and rural highways for all vehicle types and to 
support travel demand management and sustainable transportation 
policies. Ultimately, the system will provide operation for the 
disengaged driver. However, this will not be available for some time to 
come. To paraphrase Secretary of Transportation Rodney Slater, if the 
AHS approaches the kinds of benefits expected, this program will 
represent one of the most productive transportation investments ever 
made.
                          1996 accomplishments
    AHS Concept Development.--During 1996 the Consortium completed 
phase two of AHS Concept Development. Five concept families produced by 
phase one were further developed and analyzed against the growing body 
of system requirements. This analysis work was tied to real-world 
issues through the use of three application scenarios: (1) the urban 
freeway network, working with the Southern California Council of 
Governments (SCAG); (2) the rural highway, working with Interstate 70 
and Colorado DOT; and (3) shared transit and high occupancy vehicle 
lanes, working with Houston Metro. The results of this analysis led to 
the definition of six key concept attributes that must be addressed to 
produce an AHS concept sufficiently adaptable to meet a wide variety of 
local and regional needs while still maintaining national 
interoperability. These key concept attributes will form the basis of 
much of phase three concept development:
    1. Mixed Traffic Operation--the issues surrounding the intermixing 
of automated and manually driven vehicles, including decisions about 
shared and/or dedicated lanes;
    2. Deployment Sequencing--the ordering and timing of the steps to 
evolve from the current vehicle-highway system to one which supports 
automated operation;
    3. Distribution of Intelligence--the allocation of sensing, 
computation, communications and decision making responsibilities among 
individual vehicles, groups of vehicles and the roadway;
    4. Vehicle Separation Policy--the rules governing the degree of 
coordination among AHS vehicles: whether they operate in closely 
coupled platoons or as independent, ``free agent'' vehicles;
    5. Obstacle Management--the degree to which the AHS relies on the 
ability of the vehicles and/or infrastructure to detect roadway 
obstacles and the ability of the infrastructure to prevent the 
intrusion of obstacles; and
    6. Driver Role--the issues associated with the division and 
exchange of responsibilities between the AHS and the driver, driver 
comfort and driver alertness.
    Planning for phase three of concept development was begun and the 
first draft of the report on phase two was finished. This report will 
complete Milestone 2 for the AHS Program.
    AHS Technologies and Analytical Tools.--As concept development 
activities matured, the development of technologies and tools have been 
brought more in line with the specific needs of AHS concepts being 
proposed.
    Technology development focused on the needs of (1) obstacle 
detection and identification using radar, laser and vision sensors, (2) 
lateral (steering) control using magnetic markers, radar reflective 
markers and vision, (3) longitudinal (throttle and brake) control and 
(4) other critical technologies including road friction estimation, 
actuator development, electromagnetic compatibility of radars with 
other vehicle electronics and software reliability. Significant 
progress was made in most of these areas, and it has become more widely 
recognized that these developments have near term applications to 
vehicle and highway safety features.
    Development continued on a suite of computer-based analysis and 
simulation tools. These tools are used for assessing different AHS 
concepts for: (1) safety effects of different sensors, control 
algorithms and vehicle characteristics, (2) capacity and throughput 
effects of different system architectures, roadway geometries and 
communications strategies, and (3) social benefits including increased 
safety, reduced travel time, less congestion, reduced fuel consumption, 
reduced emissions and improved freight delivery schedules.
    Societal and Institutional Viability.--Studies of the societal and 
institutional issues associated with the future deployment of AHS 
continued. Working sessions were held with many transportation agencies 
across the U.S. to understand their processes for introducing new 
transportation options and acquaint them with the potential for AHS. 
These included agencies in Denver, Houston, Pittsburgh, Seattle, New 
Jersey, Michigan, California and the Dulles Corridor in northern 
Virginia. Five Perspectives white papers were published on issues such 
as ``AHS in Transit Operations'' and ``Human Factors Issues in AHS''. A 
panel of experts on transportation effects on land use was convened to 
address the potential effects of AHS deployment. The panel concluded 
that AHS, as only one component of the surface transportation system, 
would not have any significant effect on land use.
    1997 Demonstration of Technical Feasibility.--Most of the planning 
for the Congressionally-mandated 1997 Demonstration was completed this 
year. The demonstration plan was developed, technical specifications 
and interface requirements were established, and risk analysis and risk 
mitigation plan was produced. Hardware and software development is well 
underway and the demonstration vehicles are in various stages of 
development. These will show increasing degrees of driver support 
features leading to full automation. The demonstration will take place 
on 7.5 miles of the high occupancy vehicle lanes of Interstate 15, 
north of San Diego, August 7-10. Enhancement of the roadway 
infrastructure to support the AHS demonstration was completed and 
additional support infrastructure work continues. The 1997 
Demonstration has already attracted international attention and will be 
attended by public sector and private sector leaders of the 
transportation world. A ``local'' kick off ceremony in San Diego for 
the roadway enhancements in June of 1996 attracted more than 350 guests 
and twenty five print and electronic media outlets, demonstrating the 
high degree of interest in the concept of highway automation. The on-
the-road demonstrations of partial and full automation features will be 
accompanied by a technical exposition and a conference on future 
transportation technology jointly sponsored by the Society of 
Automotive Engineers. The technical exposition will explain those 
aspects of the AHS program that cannot be shown in the demonstration 
such as institutional, social and economic issues, and show that AHS 
technologies have many near term transportation applications.
    Stakeholder Participation.--The Consortium has been particularly 
successful in attracting stakeholder interest in the AHS program and in 
providing ways for those stakeholders to participate in and shape the 
program. There are now 103 Associate Participants in the program in 
nine stakeholder categories. Each of these categories has selected a 
representative to the Program Management Oversight Committee where they 
serve in a role equal to the Core Participants' representatives in 
setting program goals and direction. Stakeholders also provided input 
to the program through the Stakeholder Forum held May 30-31, 1996 in 
Boston and the Concept Development Workshop held September 19-20, 1996 
in Minneapolis. The Consortium also communicates with the stakeholder 
community through its Internet site and through its quarterly 
newsletter AHS Update.
                         work planned for 1997
    The two major activities for 1997 are the continuation of concept 
development and the Congressionally mandated demonstration of technical 
feasibility.
    Phase three of concept development is a nearly three year activity 
to produce the AHS design concept that best meets national needs in 
terms of technical, economic, social and institutional aspects. In 
1997, concept development will address:
    1. Identification of user needs as seen by different categories of 
stakeholder;
    2. Development of an AHS system architecture compatible with the 
national ITS architecture;
    3. Producing an AHS operations concept that includes a multi-stage 
evolutionary path;
    4. Focusing of technology and tool development activities to 
support concept elaboration, analysis and evaluation and to encourage 
early deployment of advanced safety features;
    5. Development of practical AHS deployment strategies through a 
series of case studies carried out jointly with regional transportation 
authorities; and
    6. Development of a viable range of options for the key concept 
attributes of Mixed Traffic Operation, Deployment Sequencing, 
Distribution of Intelligence, Vehicle Separation Policy, Obstacle 
Management and Driver Roles.
    The development of technologies for vehicle-highway automation and 
the development of computer-based tools to support concept development 
and evaluation will continue, both becoming more focused on specific 
concepts as these become better defined.
    Investigation of the societal and institutional viability of 
automating highway travel will continue. These studies will address the 
economic, environmental and social benefits of AHS as well as providing 
a better understanding of the roles that will be played by the public 
and private sectors in providing and operating the infrastructure for 
AHS. The Consortium will work with USDOT to support an independent 
review of the AHS program goals and the value of the public-private 
consortium approach.
    The 1997 Demonstration will be completed. Preparations include 
development of the AHS demonstration vehicles, enhancements to the 
roadway and demonstration support infrastructure, logistics and 
production. There will be seven scenarios demonstrated on Interstate 
15: (1) free agent AHS transit buses and passenger cars, (2) platooned 
AHS passenger cars, (3) rural to urban freeway transition of AHS 
passenger cars, (4) an evolutionary path to AHS showing the potential 
for early spin off of safety features, (5) alternative lane sensing 
methods for AHS vehicle control; (6) tractor trailers with AHS 
precursor safety technologies, and (7) AHS maintenance operations. 
Together, these scenarios will demonstrate the evolution from near term 
safety features to full AHS for a variety of vehicle types. An AHS 
Exposition and Future Transportation Technology Conference will be held 
in conjunction with the vehicle demonstrations. The technology 
developed for the demonstration and the lessons learned from conducting 
the tests will be reported and will play an important role in the 
subsequent concept development activities.
                             plans for 1998
    The major focus will be on AHS concept development activities with 
the goal of completing the design of the AHS functional and physical 
architecture, incorporating the inputs from a broad range of 
stakeholders. Decisions will be made on the sensing, communications and 
control requirements for vehicles, the sensing, communications and 
decision making requirements for the roadway infrastructure, the level 
and method of Intervehicle coordination, the physical configuration of 
AHS lanes, entrances and exits and similar architectural issues. These 
decisions will be documented in a substantial set of draft AHS system 
specifications backed up by analytical and experimental validation 
supported by application of AHS technologies and tools now being 
developed. Technology development activities will be focused on the 
specific needs of the selected AHS architecture and will be used to 
produce prototype subsystems. Computer-based analytical and simulation 
tools will be tailored to evaluate concept and technology alternatives 
and to support specification development.
    The Consortium will fund a number of independent evaluations of the 
system specifications and the ability of the chosen architecture to 
meet those specifications. These evaluations will address performance, 
costs, benefits, safety and environmental issues, among others. These 
formal independent evaluations will supplement the continuing dialog 
with stakeholders through workshops, public forums and direct 
participation in the program.
    The development of specifications and designs for vehicle and 
infrastructure subsystems will begin as the key concept attributes are 
determined, leveraging from the physical properties developed for the 
1997 demonstration. The study of AHS applications to transit will 
continue with follow on work to the Houston Metro case study and other 
transit opportunities. The needs of Commercial vehicles will continue 
to play an important role.
                               1999-2002
    The preferred AHS system design will be selected in 1999 and a 
complete set of system and subsystem specifications will be developed. 
A subset of these specifications will be used to build and test a set 
of prototype AHS lanes with a variety of vehicle types. The success of 
these tests will be evaluated within the NAHSC and by independent 
organizations. The results of these tests and evaluations will be used 
to update the AHS system specification. This system specification for a 
deployable AHS, along with supporting studies of the path to 
evolutionary deployment, forms the key output of the program.
    If the prototype shows AHS to be technically, economically and 
socially viable, this will provide the basis for an operational field 
test deployment of AHS lanes shortly after 2002.
                                closure
    The AHS Program:
  --Is an important investment in the future;
  --Offers high potential for social benefits and international 
        economic competitiveness;
  --Provides significant opportunities for near-term payoffs in 
        improved highway safety;
  --Has the full commitment of all of its public and private Core and 
        Associate Participants; and
  --Deserves your continued full endorsement and support.
                              [appendix a]
                        NAHSC Mission Statement
    The NAHSC will specify, develop and demonstrate a prototype 
Automated Highway System. The specifications will provide for 
evolutionary deployment that can be tailored to meet regional and local 
transportation needs. The Consortium will seek opportunities for early 
introduction of vehicle and highway automation technologies to achieve 
early benefits for all surface transportation users. The NAHSC will 
incorporate public and private stakeholder views to ensure that the AHS 
is economically, technically and socially viable.
                              [appendix b]

                                        NAHSC U.S. Associate Participants                                       
                                                                                                                
                           Organization                                              City/State                 
                                                                                                                
3M, ITS Project............................................  St. Paul, MN                                       
Aaderaa Instruments, Inc...................................  Burlington, MA                                     
Air Force Development Test Center (AFDTC)..................  Eglin AFB, FL                                      
American Association of State Highway and Transportation                                                        
 Officials.................................................  Washington, DC                                     
American GNC Corporation...................................  Chatsworth, CA                                     
American Mobile Satellite Corporation......................  Arlington, VA                                      
American Public Transit Association........................  Washington, DC                                     
American Trucking Associations.............................  Alexandria, VA                                     
Argonne National Laboratory................................  Argonne, IL                                        
Aurora Exhibit Solutions Inc...............................  Columbus, OH                                       
Automobile Club of Southern California.....................  Los Angeles, CA                                    
Barrier Systems Inc........................................  Cherry Hill, NJ                                    
Battelle...................................................  Columbus, OH                                       
BRW, Inc...................................................  Phoenix, AZ                                        
California Highway Patrol (CHP)............................  Sacramento, CA                                     
Calspan SRL Corporation....................................  Buffalo, NY                                        
CCG Associates, Inc........................................  Silver Spring, MD                                  
CDW Consultants, Inc.......................................  Framingham, MA                                     
City of San Diego..........................................  San Diego, CA                                      
Concise Systems, Inc.......................................  Milford, MI                                        
Contract Compliance, Inc...................................  Philadelphia, PA                                   
Creative Controls, Inc.....................................  Warren, MI                                         
Creative Transit Alternatives..............................  Falls Church, VA                                   
Daniel Consultants, Inc....................................  Columbia, MD                                       
Digital Systems............................................  St. Clair Shores, MI                               
Diversified Risk Insurance Brokers.........................  Emeryville, CA                                     
Dunn Engineering Associates................................  Westhampton Beach, NY                              
Dynamic Technology Systems, Inc............................  Alexandria, VA                                     
Eaton Vorad Technologies, L.L.C............................  Cleveland, OH                                      
Enerdyne Technologies, Inc.................................  Santee, CA                                         
Enterprise Group--Colorado Dept. of Transportation.........  Denver, CO                                         
Epsilon Engineering, Inc...................................  Houston, TX                                        
F. R. Aleman & Associates, Inc.............................  Orlando, FL                                        
Federal Highway Administration--Office of Motor Carriers...  Washington, DC                                     
Federal Transit Administration (USDOT).....................  Washington, DC                                     
FPL and Associates, Inc....................................  Irvine, CA                                         
GERI, Inc..................................................  Huntsville, AL                                     
Global Embedded Technologies...............................  Oak Park, MI                                       
Harvard Design and Mapping Co., Inc........................  Cambridge, MA                                      
Haugen Associates..........................................  West Bloomfield, MI                                
Honda R&D North America, Inc...............................  Torrance, CA                                       
HP Microsystems Inc........................................  Rochester Hills, MI                                
I-95 Corridor Coalition....................................  Alexandria, VA                                     
Idaho National Engineering Lab.............................  Idaho Falls, ID                                    
IMRA America, Inc..........................................  Ann Arbor, MI                                      
International Bridge, Tunnel & Turnpike Association (IBTTA)  Washington, DC                                     
Iowa State University......................................  Ames, IA                                           
ITP/Fleet.Net..............................................  Boca Raton, FL                                     
ITS America................................................  Washington, DC                                     
ITS Consortium, Inc........................................  Washington, DC                                     
Jet Propulsion Laboratory..................................  Pasadena, CA                                       
L. S. Gallegos & Associates, Inc...........................  Englewood, CO                                      
Louisiana State University.................................  Baton Rouge, LA                                    
Maricopa County Department of Transportation...............  Phoenix, AZ                                        
Martin Enterprises & Associates, Inc.......................  Reston, VA                                         
Matrix Corporation.........................................  Raleigh, NC                                        
Metropolitan Transit Authority of Harris County............  Houston, TX                                        
Meyer, Mohaddes Associates, Inc............................  Seal Beach, CA                                     
Michigan Department of Transportation......................  Lansing, MI                                        
Michigan State University..................................  East Lansing, MI                                   
Minagar & Associates.......................................  Irvine, CA                                         
Montana State University, Western Transportation Insti-                                                         
 tute......................................................  Bozeman, MT                                        
National Institute of Standards and Technology.............  Gaithersburg, MD                                   
National Private Truck Council.............................  Alexandria, VA                                     
New Jersey Institute of Technology.........................  Newark, NJ                                         
New Jersey Transit Corporation.............................  Newark, NJ                                         
New York State Department of Transportation................  Albany, NY                                         
Oakland University.........................................  Rochester, MI                                      
Penn. Transportation Institute/The Penn State University...  University Park, PA                                
Pennsylvania Turnpike Commission...........................  Harrisburg, PA                                     
Public Technology, Inc.....................................  Washington, DC                                     
QST Electronics Inc........................................  Lajolla, CA                                        
Reason Foundation..........................................  Los Angeles, CA                                    
Red Zone Robotics, Inc.....................................  Pittsburgh, PA                                     
Rizzo Associates, Inc......................................  Natick, MA                                         
Robotic Technology Inc. (RTI)..............................  Potomac, MD                                        
Roper and Associates, Inc..................................  Santa Monica, CA                                   
Ruan Transportation........................................  Des Moines, IA                                     
SAE International..........................................  Warrendale, PA                                     
San Diego Association of Governments.......................  San Diego, CA                                      
San Diego Regional Transportation Technology Alliance                                                           
 (RTTA)....................................................  San Diego, CA                                      
Sarakki Associates.........................................  Foothill Ranch, CA                                 
Shell Oil Products Company.................................  Houston, TX                                        
South Coast Air Quality Management District................  Diamond Bar, CA                                    
State Farm Mutual Automobile Insurance Company.............  Bloomington, IL                                    
State University of New York--University at Stony Brook....  New York, NY                                       
Sumitomo Electric U.S.A., Inc..............................  Santa Clara, CA                                    
Technology Management, Inc.................................  San Diego, CA                                      
Texas Transportation Institute.............................  College Station, TX                                
The Institute of Public Policy--George Mason University....  Fairfax, VA                                        
The Ohio State University..................................  Columbus, OH                                       
Toyota Technical Center USA, Inc...........................  Ann Arbor, MI                                      
U.S. Army Aberdeen Test Center.............................  Aberdeen Proving Ground, MD                        
U.S. Army Tank Automotive Armaments Command (TACOM)........  Warren, MI                                         
University of North Carolina at Chapel Hill................  Chapel Hill, NC                                    
University of Florida--Transportation Research Center......  Gainesville, FL                                    
University of Massachusetts Transportation Center..........  Amherst, MA                                        
University of Minnesota....................................  Minneapolis, MN                                    
University of Wisconsin at Madison.........................  Madison, WI                                        
Utilicom, Inc..............................................  Goleta, CA                                         
Virginia Department of Transportation......................  Richmond, VA                                       
Virginia Polytechnic Institute & State University..........  Blacksburg, VA                                     
Volvo GM Heavy Truck Corporation...........................  High Point, NC                                     
Waveband Corporation.......................................  Torrance, CA                                       
Wayne State University.....................................  Detroit, MI                                        
Wilbur Smith Associates....................................  Columbia, SC                                       
William F. Bundy...........................................  Bristol, RI                                        
Zapata Engineering, P.A....................................  Charlotte, NC                                      
Aisin Seiki Company, Ltd...................................  Kariya, Japan                                      
ERTICO--European Road Transport Telematics Implementation..  Brussels, Belgium                                  
New Flyer Industries Limited...............................  Winnipeg, Canada                                   
Ontario Ministry of Transportation.........................  Downsview, Canada                                  
Rijkswaterstaat--Dutch Department of Transportation........  Rotterdam, The Netherlands                         
Toyota Motor Corporation...................................  Toyota, Japan                                      
                                                                                                                

                                 ______
                                 
   Prepared Statement of the Honorable Sharpe James, Mayor, City of 
                               Newark, NJ
    On behalf of the City of Newark, New Jersey, let me first thank the 
Chairman and other Members of the Subcommittee for all their diligent 
efforts in protecting and maintaining the transportation infrastructure 
of the City of Newark, as well as the entire State of New Jersey. Now, 
as you begin the difficult process of crafting the fiscal year 1998 
Transportation Appropriations Bill, I would like to bring your 
attention to a project of great importance to my City, the Urban 
University Heights Road Connector.
    This critical element in the overall transportation plan for Newark 
is needed to connect the regional highway network to the University 
Heights area, the County Complex and the Central Business District. In 
doing so, this project will contribute to the economic vitality of the 
core of New Jersey's largest city. The absence of this connector has 
had an extremely negative impact on residential neighborhoods, which 
are being strangled by backed up commuter traffic. If constructed, it 
would eliminate considerable congestion and diminished air quality 
caused by commuters exiting from I-280 to the local streets in order to 
get downtown and to the five institutions of higher education in the 
City.
    The purpose of the Urban University Heights Road Connector is to 
channel vehicular traffic directly to University Heights and the 
business district, thereby providing an improved distribution from the 
regional highway system to the City street system. The new highway 
connection would provide these connections along First Street, from 
that street's exit on I-280. Further, it will relieve peak hour traffic 
build-up presently being experienced on I-280 through Newark and reduce 
traffic exiting at the Martin Luther King, Jr. Boulevard ramp and the 
Harrison Exit.
    The project will, for the first time, provide the major 
universities in the City of Newark direct access and linkage to the 
Interstate system via I-280. The colleges and universities alone are 
visited by more than 50,000 people daily. Much of this traffic exits I-
280 at First Street, which currently empties onto a tertiary through 
street and residential grid.
    The University of Medicine and Dentistry of New Jersey (UMDNJ) is a 
national research hospital facility which receives federal research 
monies in conjunction with infectious disease research, AIDS research, 
trauma research and numerous other Federal research programs. Improved 
access to this facility via the Urban University Heights Road Connector 
is essential in order for UMDNJ to effectively provide safe and quality 
care to its patients.
    Further, this project will provide direct access to the New Jersey 
Institute of Technology (NJIT), Rutgers University, and Essex County 
College. NJIT's only campus is also located in the University Heights 
area of the City of Newark directly next to the urban campuses of 
Rutgers University and Essex County College. These institutions not 
only house students in the vicinity of this project but also receive 
daily thousands of commuters in and out of the City of Newark. This 
construction and widening project will improve access to these 
facilities.
    In conclusion, the Urban University Heights Road Connector has 
received strong support from the City of Newark and all the university 
communities throughout the City. This valuable project will Improve and 
increase mobility, improve air quality with decreased congestion, and 
support economic development. Therefore, the City requests $5.7 million 
from the subcommittee to complete design and construction of this 
project.
                                 ______
                                 
Prepared Statement of John T. Durbin, Executive Director, Pennsylvania 
                          Turnpike Commission
    intelligent transportation systems on the pennsylvania turnpike
    The Pennsylvania Turnpike Commission is committed to continued 
investment into Intelligent Transportation Systems (ITS). A $300,000 
ITS Early Deployment Strategic Plan, financed jointly by the Federal 
Highway Administration and the Pennsylvania Turnpike Commission, was 
completed on April 11, 1996. This comprehensive, coordinated, 
integrated and seamless ITS plan is the basis for implementing ITS on 
the Turnpike.
    Several elements of the intelligent transportation infrastructure 
will be the result of a number of private/public partnerships.
    One private/public partnership is the travelers information boards 
located in the 22 service plazas along the Turnpike that have been 
financed by the travel industry. It gives real-time pertinent 
information to the traveler as well as other necessary travel 
information such as lodging and attractions, and is controlled through 
leased telephone lines. Other potential private/public partnerships are 
being explored such as additional leasing of space on microwave towers 
to cellular phone companies. The Commission is also discussing a 
partnership with a firm to test a new technology to provide variable 
displays along the roadway. These displays will be capable of 
displaying information similar to that displayed on a computer monitor 
or television. This system will enable the Commission to provide 
valuable information to travelers in a number of different manners.
    A significant contributor to an efficient and cost effective ITS is 
the monitoring and availability of personnel on a 24-hour basis in the 
Turnpike's Operations Center. With individual ITS components supported 
by a microwave communication system and leased communication lines, 
real time information exchange could occur with all service plazas, 
maintenance yards, State Police barracks. highway advisory radios, 
travel boards, weather and traffic sensors. incident management (call 
boxes, *11, and radios), variable message signs, electronic toll and 
traffic management systems, traveler initiated phone calls, and 
interact access.
    This data, voice, and video communication ability, when all the ITS 
components are installed, will create a seamless transportation 
facility for real-time information and customer services on a 506-mile 
freeway facility that connects the largest five metropolitan areas in 
Pennsylvania, and will greatly assist intermodal transfers and just in 
time delivery systems. Rural and recreational areas of the Pennsylvania 
Turnpike will also be served. The new communication system will 
integrate and coordinate various independent components of ITS into a 
single, comprehensive system that will be controlled from a major 
transportation center in central Pennsylvania.
    Electronic toll collection (ETC), when implemented, will provide 
access through or around toll barriers for the toll agencies in New 
York, New Jersey, and Pennsylvania. It will provide real-time 
information for public or private companies as to the location of their 
vehicles and facilitate electronic transfer of information and 
collection of tolls by one organization for all members of the Inter-
Agency Group. ETC will provide a reduction in operating costs and 
reduction in air pollution and delays at toll plazas. ``Smart Card'' 
technology is currently being investigated for the next generation of 
electronic payment systems.
    Safety and costumer service are two of the most important goals of 
the Pennsylvania Turnpike Commission. Many ITS components already exist 
on the Turnpike and are currently operational. The Turnpike accident 
rates are lower than the Interstate Highway System and has a well 
established incident management program. Call boxes are located at 
every mile: cellular number *11 can be utilized for instant 
communication with our operations center: emergency services and 
response time have been integrated and coordinated for all sections on 
the Turnpike: radio communication can be transmitted on the 506 miles 
of toll road by the microwave communications system; and the Sonic Nap 
Alert Pattern (SNAP) installed in the shoulder of the highway has saved 
numerous lives. The Turnpike has committed to enhancing its 
communication system to provide the capacity for current and future 
ITS's.
    Portable highway advisory radio systems are currently available 
across the Turnpike, and travel boards are currently in all service 
plazas where pertinent travel, traffic, and weather information can be 
obtained by the traveler.
    Currently the Commission is installing five Highway Advisory Radio 
sites and three Travelers Information Displays in the Philadelphia area 
to provide travelers with information on construction, weather and 
delays both on the Turnpike and on the roadways adjacent to the 
interchanges. This $2 million system funded by the Turnpike will be 
operational by the summer of 1997. In addition, the Commission will be 
adding staff to the operations center to provide improved 24 hour 
operations of these and future systems.
    The Commission is preparing plans for the installation of 10 
additional Highway Advisory Radio sites, four additional Travelers 
Information Displays, two Closed Circuit Television cameras and an 
integrated control system. The Highway Advisory Radios will be 
installed at the Turnpike interchanges with Interstate Highways and 
will be used to provide information to travelers on the Turnpike as 
well as those traveling on the interstates. The Travelers Information 
Displays will be installed in advance of critical junctures on the 
Turnpike where alternate routing of traffic are available. The Closed 
Circuit Television Cameras will be installed at two of the Turnpikes 
largest interchange to allow operators to monitor backlogs, detect and 
verify incidents and provide immediate and appropriate response to 
these incidents. Finally, an integrated control system will be 
developed to provide integrated control of the Commission's existing 
and future travelers information components. These components of the 
Commission's ITS are being funded in part with the $3 million Federal 
appropriations provided in fiscal year 1997.
    Although financial resources are being maximized from public and 
private agencies, there is still a significant shortage of financial 
resources for deployment of ITS. It is anticipated that 10 to 15 years 
will be needed for full deployment. A federal-aid grant of $8 million 
would greatly assist the acceleration of the Commission's ITS program 
and will demonstrate a comprehensive, coordinated and integrated 
statewide system on a toll road. It will marry separate components of 
ITS systems into a universal system that will be comprised of advanced 
telecommunications, information and computer technologies with the 
transportation infrastructure. It is a consumer oriented system for 
information and traveler service that would benefit both intrastate and 
interstate transportation.
    The Commission would like to further expand its Travelers 
Information System to incorporate additional Highway Advisory Radio 
sites and Travelers Information Displays at tunnels and other 
interchanges with significant traffic volumes. In addition, additional 
Closed Circuit Television Cameras will be installed at major 
interchanges to monitor traffic flow, verify incidents and provide 
immediate and appropriate response to these incidents. This will help 
to lessen interchange area congestion and allow the Commission to 
provide accurate information to travelers.
    To obtain more timely and accurate information on traffic and 
weather conditions. the Commission would like to install traffic and 
weather sensors.
    Traffic sensors will be installed at interchanges and at 
intermitted locations between interchanges to monitor traffic flow and 
provide a means for Turnpike Operators to detect slowing traffic as a 
result of a disable vehicle, accident or heavy volume of traffic. 
Initial implementation will occur in the Philadelphia area where 
reoccurring congestion exists at interchanges and where a minor 
incident can create gridlock if not detected and cleared immediately. 
Traffic sensors will be installed on the exit ramps to these 
interchanges and will detect when traffic is beginning to backlog 
towards the mainline. This will provide a warning to the operations 
center as well as providing advanced warning to drivers to slow or 
stopped traffic in and around the interchange areas. This will provide 
an essential warning system when Electronic Toll Collection is 
implemented and higher speeds are anticipated in the interchange areas.
    Weather sensors will be installed in areas along the Turnpike where 
the roadway historically experiences recurring weather events such as 
fog, icing and extreme temperature variations. Initial implementation 
will occur in the mountainous sections of central, western and 
northeastern Pennsylvania where travelers (particularly Commercial 
Vehicles) rely on the Turnpike to provide safe and efficient travel 
during inclement weather. This system Will allow the Turnpike to 
anticipate and more quickly respond to weather events and provide 
maintenance crews with information to better maintain the highway. In 
addition, this system will allow travelers to obtain more accurate and 
timely weather information through the Commission existing and expanded 
Travelers information System.
    The Commission will be remodeling and expanding its operations 
center within the next few years as part of the rehabilitation and 
expansion of the Turnpike's Central Office located in Harrisburg, PA. 
To provide for a state of the art facility, the Commission will provide 
advanced technologies to provide and obtain real-time information such 
as traffic sensor data and Closed Circuit Television feeds with other 
public and private entities. This would include exchanging data with 
PennDOT's traffic control centers in Philadelphia and Pittsburgh and 
provide a link between the major operation centers across the state of 
Pennsylvania. In addition, it will allow for links with agencies in 
neighboring states and with private entities such as traffic reporting 
services and office parks.
    Other improvements to the operation center include development of a 
Geographic Information System or electronic map. This system will allow 
operators to identify on the map locations of incidents, the number of 
lanes opened at an interchange, lane closures, and will automatically 
identify the locations of call box calls and nature of the call, status 
of detectors and cameras, slow moving traffic when detected, weather 
sensor information and messages on the Travelers Information System 
components. This electronic map could be projected on to large screen 
TV so that all management personnel and operators could view everything 
that is occurring on and near the Turnpike at the same time. This will 
provide a more coordinated approach to day to day management of the 
roadway and during incidents. This system will also allow an operator 
an up-close view of a roadway segment so that he or she can provide 
emergency response vehicles with information on narrow shoulders, 
closest access gate, nearest water source and another features which 
could delay a response or effect the management of an incident.
    The Commission currently has Closed Circuit Television Cameras 
installed in three of its five Tunnels. Images from these cameras are 
currently only transmitted to the tunnel portal building located at 
each of the tunnels. The Commission would like to transmit these images 
to its control center better assist tunnel personnel during tunnel 
incidents and repairs.
    As Author Dan Cupper seated in his history of the Pennsylvania 
Turnpike. ``As America's first superhighway, the Turnpike sparked a 
revolution in the way motorist, truckers, engineers and consumers view 
highway transportation. Simply put it changed the American perception 
of time.'' Although we do not intend on changing the American 
perception of time by implementing ITS, the Turnpike will provide 
travelers with a timely perception of what is occurring on the roadway 
in order to provide, as it has for the last 56 years. the most 
efficient network for the movement of goods and people across the 
Commonwealth of Pennsylvania. Furthermore, by implementing proven 
technology in a phased approach, the Commission is demonstrating how 
ITS's can provide improved safety, efficiently, traffic flow and 
costumer service to all travelers.
    The Turnpike's mission is to ``Operate and manage in a fiscally 
responsible manner, a safe, reliable and valued toll road system.'' By 
providing appropriations for the implementation of ITS, the Turnpike's 
mission will drive us to deliver these services in an efficient and 
effective manner.
                                 ______
                                 
Prepared Statement of Kurt Weinrich, Director, Regional Transportation 
                     Commission of Clark County, NV
    Chairman Shelby, Senator Lautenberg, members of the Subcommittee, I 
am Kurt Weinrich, Director of the Regional Transportation Commission of 
Clark County, Nevada. I would like to thank you for the opportunity to 
submit this testimony to the Subcommittee.
    The Regional Transportation Commission of Clark County, Nevada 
(RTC) is a public entity created under the laws of the State of Nevada 
with the authority to operate a public transit system and administer a 
motor fuels tax to finance regional street and highway improvements. In 
addition, the RTC was designated by the Governor of Nevada as the 
Metropolitan Planning Organization (MPO) for the Las Vegas Valley. The 
RTC is not only a multimodal planning entity, but also a multimodal 
service provider. As well as funding over $150.0 million annually in 
new roadway construction, the RTC operates a mass transit system that 
moves more than 3 million passengers a month and recovers nearly 50 
percent of its operating and maintenance costs from the farebox. See 
Exhibit A.
    Over the last several years, the Las Vegas metropolitan area has 
experienced phenomenal growth. The economy of the Las Vegas Valley is 
characterized by a favorable business environment, including minimal 
government regulations, an absence of business and personal income 
taxes, and a comparatively low property tax by national standards. This 
environment has fostered an era of explosive growth that has fueled the 
creation of over 150,000 new jobs since 1990, and has witnessed the 
influx of over 400,000 new residents to the valley since 1990. As shown 
in Exhibit B, current projections indicate that population will exceed 
2 million residents and employment will exceed 750,000 jobs by the year 
2015. Currently, over 5,000 new residents move to the Las Vegas Valley 
each month. With Nevada's positive business climate, strategic 
location, and reputation as a tourist destination, it is clear why Las 
Vegas is the fastest growing urban area in the United States.
    Las Vegas welcomed over 29 million visitors in 1996. With over 
100,000 hotel rooms available, and 14,100 more rooms under 
construction, Las Vegas continues to remain a world class resort 
destination that affords a wide variety of recreational opportunities 
and unparalleled convention and meeting facilities. On any given day, 
the actual population of Las Vegas, defined as residents and tourists, 
exceeds 1.5 million persons. To maintain this position and serve the 
needs of the growing tourist economy, workers must staff the resort 
hotels in a variety of jobs over a twenty-four hour period.
    On December 5, 1992, the RTC initiated the Citizens Area Transit 
(CAT) system, the largest single start-up of new bus service in an 
urban setting funded entirely with local funds. CAT has proven 
extraordinarily successful. In only 4 short years, annual CAT ridership 
has grown from 14.9 million riders to over 35.0 million, equating to an 
average annual growth rate of 44 percent. See Exhibit C. This rate of 
growth is faster than the growth in population, employment, hotel 
rooms, visitor volumes, airport passengers, vehicle miles traveled, 
auto registrations, and new home sales in the same time period. While 
the CAT routes operating along the Las Vegas Strip provide service to 
over 800,000 passengers per month, this accounts for only 25 percent of 
the total monthly ridership. Clearly, many Las Vegas residents rely 
heavily on the CAT system to get to work, school, shopping, and 
recreational facilities. CAT has proven itself an integral part of the 
Las Vegas community.
    To respond to the huge demand for transit services, the RTC has 
continually increased bus service. Since startup, total annual hours of 
revenue service have increased by 46.7 percent; from 585,134 hours in 
1993 to 858,746 in 1996. See Exhibit D. Similarity, annual vehicle 
miles have increased by 76.7 percent, from 6,384,660 miles in 1993 to 
11,283,446 miles in 1996. However, CAT carries its phenomenal 
ridership, over 3 million passengers per month, on a total fleet of 
only 192 vehicles. As shown in Table 1, CAT transports up to three 
times the number of passengers per vehicle as compared to other peer 
cities.

                                 TABLE 1                                
------------------------------------------------------------------------
                                                               Average  
             System                 1996 total      Fleet     passengers
                                    passengers       size    per vehicle
------------------------------------------------------------------------
CAT.............................      35,044,533        192      182,523
Phoenix.........................      35,028,406        462       75,819
Orange County...................      44,700,000        425      105,176
Foothill Transit................      13,000,000        259       50,193
San Antonio.....................      36,284,571        519       69,912
Austin--Capital Metro...........      29,100,000        466       62,446
------------------------------------------------------------------------

    Even with the overwhelming success of CAT, only 36 percent of the 
current routes operate more frequently than once per hour. See Exhibit 
E. Many routes in the CAT system operate well in excess of the 150 
percent capacity standard. Additionally, with the continued growth and 
development of the Las Vegas Valley, numerous new residential 
developments are not yet included in the CAT service area. While the 
demands for service seem to increase daily, the RTC is severely 
constrained by a lack of rolling stock. Simply stated, additional 
vehicles are necessary to increase service within the community. To 
enhance the convenience and reinforce transit as a viable 
transportation option, increased frequencies on all routes are 
necessary.
    The RTC currently has 55 new vehicles on order for replacement and 
expansion of the CAT fleet. However, even this number of additional 
vehicles will be insufficient to meet the ever growing demands for 
expanded service. To meet this need, the RTC requests $9 million in 
Section 3 bus discretionary funds to allow the RTC to purchase 23 
additional vehicles which would be used to provide more frequent 
services on a number of heavily utilized routes. Consistent with past 
appropriations requests, the RTC will provide a substantial overmatch 
of 30 percent in local funding for these equipment purchases.
    Despite the dramatic growth and expansion of CAT, the Las Vegas 
Valley continues to experience rising congestion levels, especially in 
the area known as the Resort Corridor. The Resort Corridor defines the 
true Central Business District (CBD) of the Las Vegas Valley. While 
many American cities maintain central business districts of multiple 
city blocks, the Las Vegas CBD is in fact an eight mile long segment of 
the valley. The employment in this area is not just limited to the 
resorts. The University of Nevada-Las Vegas, the Hughes Business 
Center, McCarran International Airport, three regional shopping malls 
and the region's medical centers are also located within the defined 
Resort Corridor. Although it covers only 10 percent of the land area of 
Las Vegas, over 50 percent of the regional employment is located within 
the Resort Corridor, while 93 percent of the area residents live 
outside the corridor. In 1996, 70 percent of all trips in the Las Vegas 
Valley either traveled to, from, or through the Resort Corridor. To 
meet projected levels of travel demand without the addition of new mass 
transit services, the Las Vegas Valley would need to add 18 lanes of 
arterial capacity in the north-south direction and 21 lanes in the 
east-west direction.
    To frame the solutions to these growing problems, the RTC sponsored 
a Major Investment Study (MIS) for the resort corridor to evaluate the 
effectiveness of multimodal solutions to regional mobility issues. The 
MIS process led to the RTC's recent adoption of a Master Transportation 
Plan that includes a fixed guideway element as well as enhanced bus 
services. The objective of the fixed guideway system is to provide 
residents and visitors with environmentally clean, cost effective, 
public transportation services that will meet the dramatically 
increasing transportation needs of the Las Vegas Valley.
    As described in the Master Transportation Plan, the full fixed 
guideway system would consist of approximately 18 miles of double-
track, elevated, automatic guideway providing service to 28 stations 
and 3 major terminals. However, since the completion of the MIS, there 
has been considerable discussion locally about the possibility of 
dividing the project into two separate but complementary components: a 
privately funded monorail serving a portion of the resort area, and a 
publicly funded system extending north to the City of Las Vegas 
downtown area. Regardless of the specific outcome of these discussions, 
the RTC is ready to move forward to the next phase of project 
development on the public system by proceeding with system and 
technology refinements and initiation of a Draft EIS in calendar year 
1997. To this end, the RTC requests the sum of $5 million in Section 3 
new start funding for preliminary engineering and design of this 
project. We should also note for the committee's information that the 
RTC is requesting an authorization for this project in ISTEA II.
    The RTC appreciates the Subcommittee's continued support of transit 
projects in the Las Vegas Valley. Through a continued Federal 
partnership, the RTC will strive to meet the tremendous demands placed 
upon it through the rapid growth of Las Vegas.
[GRAPHIC] [TIFF OMITTED] T12NON.042

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[GRAPHIC] [TIFF OMITTED] T12NON.044

[GRAPHIC] [TIFF OMITTED] T12NON.045

    [Clerk's note.--Exhibit E could not be printed in the hearing 
record but is available for review in the subcommittee's files.]
                                 ______
                                 
                      Multimodal-Related Testimony
     Prepared Statement of the American Society of Civil Engineers
    The American Society of Civil Engineers (ASCE), founded in 1852, is 
the oldest national engineering society in the United States. 
Membership is held by more than 120,000 individual professional 
engineers, and is equally divided among engineers in private practice; 
engineers working for federal, state and local governments; and those 
employed in research and academia. The Society's major goals are to 
develop engineers who will improve technology and apply it to further 
the objectives of society as a whole, to promote the dedication and 
technical capability of its members and to advance the profession of 
civil engineering.
                       infrastructure investment
    ASCE has a longstanding interest in our nation's infrastructure 
system. As civil engineers, we have played an historic and significant 
role in building and maintaining the infrastructure that supported the 
development and prosperity of the Nation. We are deeply concerned about 
the nation's growing public works infrastructure investment needs. 
America's infrastructure system has been placed on hold for so long 
that it is now in immediate need of substantial investments and repair. 
The maintenance needs of the nation's highways and transit systems 
continue to outpace the rate of investment.
    The Administration's own studies reveal that annual surface 
transportation spending needs to be increased by $18.2 billion, or more 
than 40 percent, simply to maintain current highway, bridge, and 
transit conditions and performance. The United States, however, is 
investing less than $41 billion each year.
    Meeting these challenges is one of the greatest public policy 
issues facing our nation as we move into the 21st century. Failure to 
meet these needs will threaten our ability to compete in the global 
marketplace, and will ultimately jeopardize American jobs and our 
quality of life.
    In order to address these problems, the federal government needs to 
develop infrastructure investment programs which promote long-term 
economic growth. The current budget structure however does not 
highlight for decision making purposes the differences between spending 
for long-term investment and spending for current consumption. As a 
result, Congress is not encouraged to make decisions about how much 
spending overall should be devoted to programs having a direct bearing 
on long-term growth and productivity. To assist the federal government 
to more rationally account for the cost of physical infrastructure, 
ASCE supports the establishment of a multi-year capital budget that 
would create an infrastructure investment account within the unified 
federal budget.
    Instituting a capital budget would help eliminate the existing bias 
against investment in physical infrastructure and would better 
represent the value of government investment in infrastructure 
projects. It would also help focus public attention on the nation's 
physical infrastructure needs. Many state and local governments already 
use capital budgets to finance the orderly planning and financing of 
capital assets like transportation infrastructure. ASCE urges the 
federal government to look to those jurisdictions for guidance in 
setting up its capital budget.
    ASCE commends the efforts of the congressional leadership to 
control federal spending and reduce the federal deficit. However, we 
caution lawmakers to approach the deficit problem in an even-handed 
manner. Disproportionate cuts should not be applied to infrastructure 
investment programs in general, and transportation programs in 
particular.
    Moreover, the fact that key highway, transit and aviation 
investment programs are supported by dedicated user fees, such as the 
federal motor fuels tax and the airplane ticket tax, should be taken 
into account as Congress confronts the deficit problem. A failure to 
appropriate adequate funds for highway, transit and airport investments 
in fiscal year 1998 will further strengthen the case of advocates for 
moving the four federal transportation trust funds off-budget. ASCE is 
a strong proponent of H.R. 4. The Truth in Budgeting Act, which now has 
224 co-sponsors.
    There is strong, if not overwhelming, public support for capital 
infrastructure investment. Every public opinion survey we have seen on 
this issue shows strong support. Even proposals to raise the gas tax 
for infrastructure investment--but not deficit reduction--attract 
impressive support from the American people. But if transportation 
excise taxes continue to be used to mask the size of the federal 
deficit, or diverted to fund other non-infrastructure programs, public 
support for these dedicated user fees will begin to decline.
                    fiscal year 1998 budget request
    ASCE is very concerned about the direction of federal 
infrastructure investment. Under the Administration's proposal, federal 
spending on transportation programs would remain essentially flat under 
the fiscal year 1998 budget. The overall request of $38.5 billion for 
transportation programs next year amounts to a one percent reduction 
from the level that was appropriated by Congress in fiscal 1997. ASCE 
strongly opposes any cuts in key infrastructure investment programs and 
urges full funding of federal aviation, highway and transit programs in 
fiscal year 1998. Congress must recognize that cutting transportation 
funding will not cut transportation needs.
    In a major shin from previous policy, the bill also proposes--for 
the first time--to shift $4.8 billion from the Highway Trust Fund (HTF) 
to finance Amtrak's capital and operating expenses and moves another 
$250 million to the Washington, D.C.-area transit program. Such a move 
only puts further pressure on our existing highway and transit systems 
which are in critical need of repair and investment.
                        reauthorization of istea
    ASCE is committed to a leadership role in helping Congress rewrite 
a surface transportation bill that will not only meet the 
transportation needs of today, but will prepare the nation for the 
transportation needs of tomorrow.
    Recognizing that the reauthorization of ISTEA provides an 
opportunity to build and improve the existing framework, we support a 
continued federal role in the nation's surface transportation system. 
With billions of dollars in state highway funds threatened by any lapse 
in the program, we strongly recommend that the reauthorization of ISTEA 
be completed before the September 30. 1997 deadline and encourage 
Congress to reauthorize the program for a period of at least five 
years.
    We believe that the reauthorization should build on the principles 
of the original ISTEA legislation with increased emphasis on 
accelerating the implementation of technologies that will improve 
safety and efficiency on U.S. highways. The federal government should 
continue to focus on the essential elements of ISTEA: ensuring a 
balanced intermodal system; improving transportation safety; 
encouraging the development and use of advanced technologies; 
supporting research and education; enhancing U.S. economic 
competitiveness; and, protecting the environment.
    In addition to maintaining current activities and programs, the 
reauthorization of ISTEA should be enhanced by the following: 
increasing emphasis on proven and productive safety programs; 
encouraging efforts to use innovative financing, including public/
private partnerships; incorporating innovation and technology transfer 
as key components; removing barriers to the use of proprietary 
technology in federal-aid projects; and, strengthening research and 
development programs by providing adequate resources to implement and 
improve new and existing technologies.
    While ASCE commends the Administration for maintaining and building 
upon the core principles of ISTEA by providing increased funding for 
safety and research and development programs, we are deeply concerned 
that the six-year, $175 billion authorization proposal falls short of 
the funds needed to maintain and improve our existing transportation 
infrastructure system. We estimate that Congress will need to spend at 
least $220 billion in the next reauthorization bill just to maintain 
the nation's current highway and transit systems.
    Under the Administration's plan, annual highway spending would be 
between $20 and $21 billion over the next six years which translates 
into roughly a $1 billion increase over current levels. These figures 
do not take into account the eroding effects of inflation on purchasing 
power.
    A much greater portion of Highway Trust Fund revenues can and 
should be spent for transportation investments than is currently 
outlined in the Administration's fiscal year 1998 budget proposal. 
Reports show that the Highway Trust Fund could easily support annual 
highway spending of $26 billion. Currently, there is a cash balance of 
more than $20 billion in the Highway Trust Fund, and this figure is 
projected to grow to about $48 billion by 2002 under the proposed 
budget. The existence of this balance not only represents a breaking of 
the government's contract with American taxpayers, but also undermines 
our nation's ability to invest in critical transportation improvement 
projects.
    The proposed annual highway spending of $20 billion is unacceptable 
given our growing infrastructure needs. According to the Department of 
Transportation's 1995 biennial report to Congress, an estimated $57.2 
billion in capital investments would have been needed just to maintain 
1993 conditions and performance of our nation's highway, bridge, and 
transit systems. Instead, capital investments for that year amounted to 
only $40.5 billion. An estimated $80 billion would have been needed in 
1994 to improve the current infrastructure conditions; almost double 
current spending.
    When you compare these figures to the actual conditions of U.S. 
roads, where 59 percent of the nation's major roads are in need of 
repair or improvements, the arguments for increased infrastructure 
spending become even stronger.
    In order to increase overall spending for ISTEA programs, we 
strongly urge the Administration to follow through on its commitment to 
``rebuild America'' by supporting legislation to move the four 
transportation trust funds off-budget and to redirect the 4.3 cents-
per-gallon gasoline tax from deficit reduction to the Highway Trust 
Fund. Combined, the proposals would allow annual funding for ISTEA 
programs to grow to approximately $30 billion annually and would help 
to solve many of the difficult issues confronting the Administration 
and Congress, including the contentious issue of how to divide highway 
funding among states.
                          innovative financing
    Despite the widely recognized need for increased funding, it has 
become increasingly apparent that budgetary constraints limit the 
federal government's ability to adequately address our growing 
infrastructure problems.
    In order to close the gap between transportation needs and 
available resources, ASCE supports the development of new and 
innovative methods of financing infrastructure to attract new sources 
of capital.
    The Administration calls for more funds to be used to attract 
private investment in the highway system. In addition to the $150 
million proposed for the State Infrastructure Banks (SIB's), another 
$100 million would be set aside for a new Transportation Infrastructure 
Credit Program which would provide seed money to leverage new projects 
of ``national significance.''
    ASCE applauds the provisions in the President's proposal that 
encourage creative financing solutions and more private sector 
involvement in infrastructure improvement and management of America's 
transportation system.
                                aviation
    America's aviation system is a key component of the nation's 
transportation infrastructure. Since fiscal 1992, the number of airline 
passengers has grown by 100 million, an increase of 21 percent, while 
aviation infrastructure investments have significantly declined.
    The Federal Aviation Administration (FAA) would see a mix of cuts 
and increases in fiscal year 1998. Overall, the FAA would receive $8.46 
billion, a slight decline from current year spending of $8.56 billion. 
FAA's operating budget would be $5.4 billion, up from $4.8 billion this 
year.
    The biggest cut would be in the Airport Improvement Program (AIP) 
which would be reduced by 31 percent under the Administration's 
proposal, from $1.46 billion in fiscal year 1997 to $1 billion in 
fiscal year 1998. To make matters worse, while the AIP funding is cut, 
the administration is not proposing to allow airports to increase the 
maximum Passenger Facility Charge (PFC) to make up for the loss of 
federal funds. ASCE strongly opposes these cuts. The most recent data 
reveals that the Airport and Airway Trust Fund could support spending 
roughly $4.8 billion to finance programs like the AIP.
    The AIP helps fund necessary safety, security, noise and capacity 
enhancement programs at the nation's airports. Such cuts threaten the 
security and safety at our nation's airports.
    Tremendous capital needs remain to be addressed at the nation's 
airports. The FAA projects that the number of passengers will increase 
by 351 million in the next 12 years. Much more investment is needed if 
airport authorities are to come to grips with increasing numbers of 
customers.
    ASCE strongly believes that greater investment in our air transport 
infrastructure will be necessary to create a safer and more efficient 
U.S. aviation network
                 civil engineering research foundation
    Increasing public interest in, and reducing obstacles to, 
innovation is a formidable task. ASCE, as the representative body of 
the profession largely responsible for the design and construction of 
the manmade environment, is deeply concerned about the nation's growing 
infrastructure needs and believes that R&D programs leading to 
innovation are vitally important to help close the gap. In pursuit of 
this goal, ASCE established the Civil Engineering Research Foundation 
(CERF) in 1989 to foster a unified civil engineering research effort 
and create a coordinated R&D program that both addresses industry and 
profession needs and involves industry and the profession in planning 
and conducting appropriate research projects. CERF is now working with 
government, industry and academia to develop and finance new 
cooperative research initiatives in the infrastructure area.
    A major focus of CERF's activities is to assist practitioners in 
moving research findings into practice. Accordingly, CERF has 
undertaken numerous initiatives to attack existing barriers to 
innovation, both technical and institutional in nature. Likewise, it 
``coordinates and integrates'' the diverse elements of the design, 
construction and civil engineering communities to plan and conduct 
collaborative research to solve high priority real world.
    In order to move highway innovation into practice more quickly, 
CERF, under a cooperative agreement with the Federal Highway 
Administration (FHwA), established the Highway Innovative Technology 
Evaluation Center (HITEC) in 1994.
    As a nationally recognized service center, HITEC evaluates new and 
innovative products and technologies for the highway community. Working 
with a variety of public and private sector organizations, it serves as 
a national clearinghouse for a wide range of technologies which have 
application to all phases of the construction process--design, 
construction, operation and maintenance.
    In 1996, HITEC initiated over 25 new evaluations. Currently, HITEC 
is evaluating numerous other innovations, including: seismic isolation 
and dissipation devices, bonding agents for pothole repairs, a heated 
pavement system, a high retroreflectivity traffic sign system, and a 
precast segmental overpass system. HITEC illustrates the kind of 
public-private sector collaboration CERF promotes.
                        research and innovation
    ASCE has a long-standing position in support of greater education, 
research and development related to infrastructure facilities to foster 
innovation and increase productivity in design, materials, 
construction, maintenance and operations while maintaining engineering 
quality and structural integrity.
    Investments in surface transportation research have led to 
significant improvements in our nation's infrastructure system and have 
provided a great many benefits to users and the economy in the form of 
safer, faster and more efficient travel. These improvements are largely 
a result of innovative materials, technologies, and practices that were 
developed by federal research programs and implemented by 
transportation planning officials.
    Research and development are critical to finding effective and 
innovative solutions to the growing problems facing our transportation 
system. Failure to meet these challenges could slow our economic growth 
and reduce our ability to compete in the global marketplace. Research 
and development hold the potential to increase the quality and 
durability of future infrastructure investments as well as to improve 
the productivity of U.S. businesses which rely on a healthy 
transportation system for the movement of goods and services.
    America's historic decline in infrastructure investment over the 
past two decades has included an unfortunate under-investment in 
infrastructure R&D. The Department of Transportation has spent only 2 
percent of its total surface transportation budget on transportation 
research programs. Most of this funding has gone to the Federal Highway 
Administration which received $2.1 billion.
    In recent years, cuts in annual spending for research programs 
below the amounts authorized by ISTEA have had an adverse effect on the 
economy and our transportation system, including: increased commuting 
times and delays, additional cost from wear and tear, decreased 
industrial productivity and international competitiveness, and 
increased transportation costs for businesses. Driving on roads in need 
of repair costs American motorists $23.7 billion a year in extra 
vehicle repairs and operating costs.
    While ASCE commends the Administration for proposing significant 
increases in programs which support the advancement of technological 
innovation, much more work needs to be done.
    Implementation of research and development programs will enable us 
to achieve the following explicit strategic goals:
  --Reduce the large backlog of needed rehabilitation and renewal of 
        existing transportation infrastructure;
  --Improve performance of transportation infrastructure in terms of 
        life-cycle cost, safety, reliability, environmental impacts, 
        transportation service, capacity, efficiency and mobility and 
        access for all; and
  --Provide the infrastructure technology base that will be needed for 
        transportation systems of the future.
    For example, CERF, working in close coordination with ASCE, has 
brought together a broad-based coalition of experts from industry, 
government and academia to develop a specific strategy and program 
focusing on high-performance construction materials and systems. The 
initial cost of the transportation portion of this is roughly $70 
million per year; half of which, as originally envisioned, would be 
paid for by the federal government, and half by the private sector 
partners. Obviously, this is a substantial investment to make at any 
time and certainly at a time of unprecedented demand to reduce the 
federal deficit. However, we would like to emphasize in the strongest 
possible manner that these investments in research and development will 
ultimately reap dramatic reductions in construction costs and schedules 
and substantial improvement in overall system performance.
    The bottom line is that our nation's infrastructure needs must be 
satisfied now or later. If we are bold enough to invest in strategic 
research and development for new materials and construction systems, 
those long range needs will be met more quickly because our 
construction dollars will go farther and accomplish more. On the other 
hand, if we take the short sighted approach and reduce research and 
development, it will take longer and be more expensive to achieve the 
same levels of system performance.
                               conclusion
    ASCE believes that transportation infrastructure has been and will 
continue to be one of the best investments in America. When viewed from 
myriad perspectives, whether public safety, economic development, 
national productivity, jobs or international competitiveness, it is not 
difficult to see why there is such strong public support for 
infrastructure investment.
    We have deep concerns about the Administration's apparent retreat 
on infrastructure investment in general, and transportation in 
particular. This fiscal year 1998 budget request is a long way from the 
one proposed by Presidential Candidate Bill Clinton, who spoke about 
``Rebuilding America.''
                                 ______
                                 
  Prepared Statement of Kirk Brown, Secretary, Illinois Department of 
                             Transportation
    Mr. Chairman and Members of the Subcommittee, we appreciate the 
opportunity to submit testimony concerning fiscal year 1998 US DOT 
appropriations on behalf of the Illinois Department of Transportation 
(IDOT) to the Senate Appropriations Subcommittee on Transportation and 
Related Agencies. We thank Subcommittee Chairman Richard Shelby and the 
members of the Committee for their past support for a strong federal 
transportation program and for taking into consideration Illinois' 
unique needs. Our recommendations for overall funding priorities and 
our requests for transportation funding for special Illinois' interests 
are described below.
                     highway obligation limitation
    IDOT urges the Subcommittee to set an fiscal year 1998 obligation 
limitation at a level which will allow the full use of the federal 
resources of the Highway Trust Fund (HTF). At a minimum, IDOT supports 
an obligation limitation well above the fiscal year 1997 ISTEA level, 
preferably equal to the full authorization level that will be set by 
the Transportation and Infrastructure Committee in its surface 
transportation reauthorization bill this spring.
    In the past, revenues from the HTF have not been fully utilized and 
spending has been constrained because overall the obligation limitation 
has been less than authorization levels. In the six years of ISTEA, 
state and local transportation agencies have been unable to spend 
approximately $7 billion dollars in highway funds because of the 
disparity between authorized and appropriated levels. In fiscal year 
1997, the transportation appropriations bill set an obligation 
limitation of $18 billion--$338 million less than the ISTEA-authorized 
level. Due to restrictive obligation limitations in past years, 
Illinois has accumulated a balance of $296 million in highway 
apportionments that cannot be obligated for highway construction 
projects. Federal funds are a crucial element in the state and local 
highway preservation and improvement programs. An efficient highway 
infrastructure is in turn a crucial element supporting the state and 
national economies.
               intelligent transportation systems earmark
    If the Subcommittee earmarks Intelligent Transportation Systems 
(ITS) highway funds in fiscal year 1998, Illinois, along with Wisconsin 
and Indiana, requests an earmark of $16.5 million for projects in the 
Gary-Chicago-Milwaukee (GCM) corridor.
    Illinois supported securing the designation of the corridor 
extending from Gary, Indiana through Chicago, Illinois to Milwaukee, 
Wisconsin under a special ISTEA funding program formerly called the 
Intelligent Vehicle Highway System (IVHS) corridors program. The GCM 
corridor is one of four designated priority corridors. Illinois, 
Indiana, and Wisconsin are working together to coordinate ITS efforts 
for the corridor. The three states agreed to develop joint or 
coordinated efforts and pursue multimodal products and services to 
improve the traveling safety, mobility, and productivity of the 10 
million people who live and conduct business in the 16 counties 
connecting the metropolitan areas of the GCM corridor. Implementation 
of a carefully planned, multi-year program of projects is under way. 
The proposed earmark would support a complete program of multimodal 
projects for the upcoming year.
                      transit discretionary grants
Bus Capital
    IDOT, the Regional Transportation Authority (which oversees the 
planning and financing of transit in the six-county northeastern 
Illinois area), the Chicago Transit Authority (CTA), and PACE (which 
operates suburban bus service) jointly request an earmark of $34 
million in fiscal year 1998 Section 5309 bus capital funds for the CTA, 
PACE and downstate providers. This joint request is a demonstration of 
our mutual interest in securing funding for essential bus capital needs 
throughout the state.
    The joint request will be for funds for three downstate facilities 
and to purchase buses in order to replace over-age vehicles and to 
comply with federal mandates under the Americans with Disabilities Act. 
All of the vehicles scheduled for replacement are at the end of their 
useful life; many are well beyond their expected useful life. Downstate 
urbanized areas have 103 buses older than the standard 12-year design 
life and the CTA has 718 such buses. Illinois transit systems need 
discretionary bus capital funds since regular formula funding is 
inadequate to meet all bus capital needs.
New Systems and Extensions--MetroLink
    IDOT supports the Bi-State Development Agency's (the bus and light 
rail service operating agency serving the St. Louis region) request for 
an earmark of $120 million in fiscal year 1998 New System funding for 
the MetroLink light rail system which serves the St. Louis region. This 
amount is for the eastward extension from East St. Louis into St. Clair 
County to Belleville Area College including final engineering, land 
acquisition, construction and rail car acquisition. The line now in 
service has been a tremendous success and ridership has far exceeded 
projections. The Administration entered into a Full Funding Grant 
Agreement for the extension project in 1996.
New Systems and Extensions--Metra Commuter Rail Extensions
    IDOT supports Metra's (the commuter rail operating agency serving 
the six-county northeastern Illinois region) request for an earmark of 
$7.516 million in fiscal year 1998 New System funding for preliminary 
engineering to upgrade and/or extend service on three lines--the North 
Central, SouthWest, and Union Pacific-West. These planned improvements 
are in areas where significant population and development increases 
have already been experienced and are projected to continue well into 
the 21st century. The projects will improve and/or extend commuter rail 
service which will in turn reduce highway congestion and contribute to 
attaining clean air objectives.
                         transit formula grants
Section 5307 Urbanized Area Funds
    IDOT supports fiscal year 1998 funding for Section 5307 Urbanized 
Area Formula Grants at as high a level as possible. We urge funding 
higher than the fiscal year 1997 level of $1.978 billion, preferably 
equal to the full authorization level that will be set by the 
Transportation and Infrastructure Committee in its surface 
transportation reauthorization bill this spring.
    Section 5307 is a formula grant program for urbanized areas which 
provides capital and operating assistance for public transportation. In 
Illinois, these formula funds are distributed to 18 urbanized areas 
which provide approximately 560 million passenger trips a year. IDOT 
supports the continuation of operating assistance at least to the 
smaller, under 200,000 population urbanized areas. A further reduction 
in the current level of federal operating assistance would especially 
harm these areas, likely necessitating further fare increases and 
service cuts. Strong federal funding support for transit service in 
urbanized areas is necessary to enable transit to continue the vital 
role it plays in providing urban transportation service.
Section 5311 Rural and Small Urban Formula Funds
    IDOT supports fiscal year 1998 funding for the Section 5311 Rural 
and Small Urban program at as high a level as possible. We urge funding 
higher than the fiscal year 1997 level of $115 million, preferably 
equal to the full authorization level that will be set by the 
Transportation and Infrastructure Committee in its surface 
transportation reauthorization bill this spring.
    The Section 5311 program plays a vital role in meeting mobility 
needs in the nation's small cities and rural areas. Adequate federal 
funding assistance for this program is very important to transit 
systems in Illinois. The needs in these areas are growing yet their 
local revenue sources continue to be very limited. In Illinois, such 
systems operate in 41 counties and 7 small cities, carrying 
approximately 2.3 million passengers annually.
                          amtrak appropriation
    IDOT supports an fiscal year 1998 appropriation at least at the 
fiscal year 1997 level of $423.5 million to fund capital and operating 
expenses. IDOT also urges that all Amtrak funding come from general 
funds.
    Amtrak operates a total of 52 individual trains throughout Illinois 
as part of the nation's passenger rail system, serving approximately 3 
million passengers annually. Illinois subsidizes an additional 18 
state-sponsored trains which provide intrastate service in four 
corridors (Chicago to Milwaukee, Quincy, St. Louis, and Carbondale) 
which carried nearly 514,000 passengers in fiscal year 1997. Amtrak 
service in key travel corridors is an important component of Illinois' 
multimodal transportation network and continued federal capital and 
operating support is needed.
        airport improvement program (aip) obligation limitation
    IDOT supports an fiscal year 1998 AIP obligation limitation above 
the fiscal year 1997 level of $1.46 billion and as close as possible to 
the fiscal year 1998 authorization of $2.347 billion.
    The federal AIP program, which provides funding to states and 
airports for the development of a national system of airports, has 
suffered substantial reductions in appropriations since fiscal year 
1992. Obligation limitations have been reduced from a high of $1.9 
billion in fiscal year 1992 to $1.45 billion in fiscal year's 1995 and 
1996 and $1.46 billion in fiscal year 1997. In these three years alone 
there has been a disparity of $2.3 billion between the amounts 
authorized and the obligation limitations. There is inadequate federal 
funding support for airport expansion and improvements needed at 
general aviation airports and at commercial airports--which served 605 
million people flying on the nation's air carriers in 1996. 
Enplanements are expected to grow to nearly one billion by 2008 and 
airports must make improvements to safely and efficiently serve this 
rapidly growing demand. We believe that the AIP program has suffered 
disproportionate reductions and that there is a legitimate need to 
increase the obligation limitation.
    The recent underfunding of the AIP program has caused substantial 
problems, particularly for general aviation, reliever, commercial 
service and small primary airports. Larger primary airports have been 
able to more than replace reduced AIP funding with Passenger Facility 
Charge (PFC) revenue, but small airports are not able to generate 
sufficient additional revenue to offset the major reductions in federal 
support. Therefore, adequate AIP funding is especially important for 
these airports.
    This concludes my testimony. I am keenly aware of the pressures you 
face trying to meet demands for increased transportation funding given 
the tight federal budget constraints. However, an adequate and well-
maintained transportation system is critical to the nation's economic 
prosperity and future growth. Your recognition of that and your support 
for the nation's transportation needs are much appreciated. Again, 
thank you for the opportunity to discuss Illinois' federal 
transportation funding concerns.
                                 ______
                                 
       Prepared Statement of Louis M. Kodumal, City of Media, PA
    The statement of policy of the federal Intermodal Surface 
Transportation Efficiency Act of 1991 (ISTEA) expresses the following 
purposes of ISTEA (emphasis added):

        ``. . . to develop a National Intermodal Transportation System 
        that is economically efficient, environmentally sound, provides 
        the foundation for the nation to compete in the global economy 
        and will move people and goods in an energy efficient manner.''

    Ostensibly to satisfy such a broad mandate, Congress authorized 
approximately One Hundred and Fifty Five Billion Dollars 
($155,000,000,000) in funding over five years (fiscal years 1992-1997). 
Among the programs funded by ISTEA dollars are so called 
``transportation enhancements'' under the Surface Transportation 
Program (STP). Ten percent of all STP funds were set aside for these 
``transportation enhancements'', which the U.S. Department of 
Transportation has described as encompassing a ``broad range of 
environmental-related activities''.\1\ Another ISTEA component, the 
Congestion Mitigation and Air Quality (CMAQ) improvement program, 
would, in theory, reduce congestion and improve air quality. CMAQ funds 
were to be made available to areas that failed to meet air quality 
levels for ozone and carbon monoxide under the 1990 amendments to the 
Clean Air Act.
---------------------------------------------------------------------------
    \1\ ``Intermodal Surface Transportation Efficiency Act of 1991: A 
Summary'', U.S. Dept. of Transportation, at page 9.
---------------------------------------------------------------------------
    A basic question must be asked by the Congress in the ISTEA 
reauthorization debate: Have the costs incurred in funding so-called 
`transportation enhancements' been justified by commensurate benefits 
to the environment or to the infrastructure of our national 
transportation system?
    A careful examination of the facts leads to the conclusion that the 
answer to this question must be `NO'. An illustrative example will 
demonstrate that these `transportation enhancements' fail to satisfy 
the three objectives set forth in ISTEA's policy statement, i.e., (1) 
economic efficiency; (2) environmental soundness; and (3) energy 
efficiency. Consider a proposed conversion of an abandoned railway 
corridor to a pedestrian and bicycle trail (one of the listed 
``transportation enhancement activities'' defined by Section 101(a) of 
title 23 United States Code). Under 23 U.S.C. Section 217(a), a state 
may use both STP and CMAQ funds for constructing bicycle/pedestrian 
facilities.
    Assuming that the land needed for the ``rail to trail'' project is 
indeed abandoned (which may be an open question whose answer is far 
from certain given any reversionary rights of adjacent landowners and/
or the cost of eminent domain proceedings if necessary), it is likely 
that this land has returned to its natural state. Destroying what has 
become the home for various species of plant and animal wildlife over 
the years as part of the construction and operation of the 
``transportation enhancement activity'' hardly seems consistent with 
improving the environment. Moreover, disturbing this area may unleash 
long-dormant toxic chemical compounds, e.g. polychlorinated biphenyls 
(PCB's), which were often used as insulators in electrical equipment 
used by railroads. Would this improve the national ambient air quality?
    Moreover, are there any ascertainable standards as to the expected 
improvement in air quality that must be satisfied in advance of a 
project moving forward, or are STP/CMAQ funds being allocated and spent 
in practice on the basis of questionable assumptions or relaxed 
standards (e.g., ``likely to improve . . . the air quality'') without 
meaningful underlying scientific data? Does the estimate that a small 
group of bicyclists or a single cyclist may decide to travel this 
bicycle/pedestrian path automatically result in a rubber stamp 
determination that motorized vehicle miles are necessarily reduced and 
therefore the project must be a success, regardless of the per mile 
cost in terms of dollars or emissions reduced? Only a thorough 
investigation by the Congress will result in answers to these 
questions.
    Finally, once the ``rails to trails'' project has started 
operation, what of the benefits then? Would there be any monitoring to 
determine whether engine cold starts actually increased the congestion 
in the area as motorists started their cars in the morning, drove to 
the ``rails to trails'' project, parked their cars at a stationary 
point and cycled away, only to return later in the day to drive away 
(again)? While there may be some merit in having a designated bicycle/
pedestrian path as a form of inter-city travel within a major downtown 
area, surely it is beyond doubt that the vast majority of suburban 
commuters must travel distances longer than is feasible by walking and/
or biking. Wouldn't a designated high-occupancy vehicle lane (i.e. for 
vehicles carrying more than three passengers) or mass transit lane 
(i.e. bus or light rail) do more for the reduction of congestion than a 
bicycle/pedestrian pathway? Would such a bicycle/pedestrian pathway do 
anything to reduce congestion caused by commercial traffic (i.e. 
traffic necessary to move goods in significant quantities)? The above 
are valid questions pertaining to ``transportation enhancements'' which 
must be asked and answered in the course of ISTEA reauthorization.
    For all of the above reasons, it is respectfully submitted that the 
best interests of our nations transportation system and (more 
importantly) the people that use this system would best be served if 
the financing and environmental aspects of so called ``transportation 
enhancements'' activities are investigated by the Congress and 
subjected to audit, with funding for these ISTEA ``transportation 
enhancements'' activities to be deleted in the successor statute to 
ISTEA.
                                 ______
                                 
                Prepared Statement of the Navajo Nation
                              introduction
    Mr. Chairman and Members of the Subcommittee, the Navajo Nation 
greatly appreciates this opportunity to present our views and 
recommendations regarding fiscal year 1998 appropriations for the 
Department of Transportation. This testimony highlights several of the 
Navajo Nation's priorities for fiscal year 1998 appropriations.
    At the outset, we want to thank Chairman Mr. Shelby as well as the 
other Subcommittee Members for their attention to Navajo Nation's needs 
in the past years. We look forward to continuing our working 
relationship with the Subcommittee.
The Navajo Nation
    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 Connecticut, Delaware, Maryland, 
Massachusetts and Rhode Island combined. Unlike those states, however, 
the Navajo Nation is home to the poorest of America's rural poor and 
while the average unemployment rate in America today is about 5 
percent, the unemployment rate in 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. Basic ``necessities'' of 
life taken for granted elsewhere in the United States are sorely 
lacking in the Navajo Nation--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 
West Virginia, our 2,000 miles of paved roads compare to barely 11 
percent of West Virginia's 18,000 miles. Until recently, we had just 
three banking facilities within our entire 27,500 square mile area.
    Ironically, the Navajo Nation is perceived as one of the more 
prosperous Indian tribes. Tragically, these types of living conditions 
are mirrored at hundreds of other Indian reservations throughout the 
United States, with the nationwide Indian reservation unemployment rate 
averaging 56 percent.
    We respectfully urge the Subcommittee to address Indian country's 
economic deprivation by marshalling available federal resources in a 
dramatic, comprehensive, government-wide effort that can at last 
rectify the massive infrastructure deficiencies that prevent us from 
competing on a level playing field against even the most economically-
distressed non-Indian communities. Resolving our infrastructure 
shortfalls, through such redirection of federal resources, is perhaps 
the key component necessary to enhance Indian nations' efforts to 
develop self-sustaining reservation economies consistent with self-
determination and self-governance. The construction and maintenance of 
all weather roads is a start in the right direction. Adequate roads is 
important to economic and community development by providing quick and 
safe access to businesses, schools, health care and community services.
            requests for fiscal year 1998 budget inclusions
    The Navajo Nation requests funding for the following high priority 
programs. There are additional projects and programs which we would 
like to discuss with the Subcommittee; however, today we are merely 
presenting highlights of our overall requests.
Reauthorization of Intermodal Surface Transportation Efficiency Act of 
        1991
    Statistics show that the Navajo Nation has greatly benefited from 
the enactment of the Intermodal Surface Transportation Efficiency Act 
of 1991. From fiscal year 1992 to fiscal year 1996, the Navajo Nation 
has achieved a total of 950.8 miles of improved roads; 1,008 linear 
feet of newly constructed bridges; and 1,061.7 linear feet of bridge 
rehabilitation or replacement. The improvements have allowed for the 
enhancement of infrastructure development necessary for the continued 
and increase in economic development and employment opportunities.
    The Navajo Nation Council and its Transportation and Community 
Development Committee supports the reauthorization of ISTEA so that an 
adequate transportation system can be provided to the Navajo people. 
Faced with a total projected need of $1.4 billion for the Navajo Nation 
and an overall Indian Reservation Road (IRR) Program need of $5.5 
billion, the Navajo Nation strongly urges the following:
    1. Reauthorization of the Intermodal Surface Transportation 
Efficiency Act (ISTEA) in 1997;
    2. Increase ISTEA funds from $191 million to $300 million per year 
for Indian Reservation Road's Program;
    3. Funnel ISTEA funding directly to the Navajo Nation from the 
Federal Highway Administration (FHWA); and
    4. Distribute Indian Reservation Road Program Funding at one 
hundred percent (100 percent) in accordance with the established 
relative need formula based on three (3) factors: total Indian 
population, total vehicle miles traveled, and total cost of 
construction.
    Since the enactment of ISTEA, the Navajo Nation has received $235.9 
million for new road construction and new bridge and/or rehabilitation/
replacements. While Navajo receives funds for new roads, there is no 
comparable allocation in the Road Maintenance Program. fiscal year 1997 
had an allocation of $6.02 million, Navajo has to maintain 4,490 miles 
of gravel roads; 1,124 miles of paved roads, and 163 bridges of which 
16 are severely deficient. History shows that the program has always 
been underfunded, despite requests made by the Navajo Nation. Funding 
for the BIA Navajo Area Branch of Roads Maintenance Program was cut 
during 1996. The data shows that the level of funding for the Road 
Maintenance Program needs to be increased in order to maintain an 
adequate and safe transportation system on the Navajo Nation. The 
Navajo Nation is requests the subcommittee support an increase of $97 
million from the Bureau of Indian Affairs.
                 navajo transit system facility request
    The Navajo Transit System is in great need of a new maintenance and 
office facility and has submitted an application to the Federal 
Transportation Administration (FTA). We hope to secure your support 
with our application to the FTA. The Navajo Transit System has 
requested $900,000 for an 8,000 square foot facility. The facility 
would house a parts department, bus bays, offices, a concrete pad to 
wash busses, and a parking lot.
    For the past 16 years, the Navajo Transit System has provided much 
needed transportation to the Navajo people. However, the building which 
the Transit system works out of in Fort Defiance, Arizona was set up as 
a temporary site and has been determined to be unsafe and inadequate. 
Further, the Navajo Transit System has experienced problems with many 
staff members becoming ill due to ventilation problems within the 
existing building. The Navajo Transit System has selected a site for 
the new facility in Window Rock Arizona. The initial land acquisition 
and the environmental assessment work has been mostly completed with 
minor amendments remaining. While the Navajo Transit System has a 
relatively small fleet, the geographical area which is covered on a 
daily basis is enormous and includes Gallup, NM; Farmington, NM; 
Shiprock, NM; Crown Point, NM; Tuba City, AZ; Toyei, AZ; Kayenta, AZ; 
and Sanders, AZ.
    Both the New Mexico and Arizona Transportation Departments have 
expressed support for the construction of the new facility for the 
Navajo Transit System. The Navajo Nation appreciates your continued 
assistance to secure federal assistance.
Federal Aviation Administration
    Finally, the Navajo Nation requests $500,000 for the Federal 
Aviation Administration (FAA) to initiate formal consultation with the 
Navajo Nation under the National Historic Preservation Act (NHPA). The 
FAA has recently released new rules for overflights of the Grand Canyon 
National Park. These rules are, at least in part, a response to new 
regulations requiring that the natural ``quiet'' of the Park be 
restored. However, the action of the FAA and implementation of these 
new flight rules will result in the movement of some flight corridors 
from the Grand Canyon to Navajo lands outside the Grand Canyon National 
Park boundary. The Navajo Nation is requesting these funds because the 
FAA failed to comply with Section 101(d)(6)(B) of the NHPA in its 
preparation of the Environmental Assessment (EA) (Special Flight Rules 
in the Vicinity of Grand Canyon National Park). These funds will also 
be used to address the FAA's insufficient initial ``106'' consultation 
under the NHPA. According to correspondence received from the Arizona 
State Historic Preservation Office, there remains a concern that the 
effects and cumulative effects of overflights on historic properties 
have not been adequately considered by the FAA.
                               conclusion
    The Navajo Nation thanks the Chairman and Members of the 
Subcommittee for their leadership and support of Indian programs.
                                 ______
                                 
  Prepared Statement of the Niagara Frontier Transportation Authority
                              introduction
    The Niagara Frontier Transportation Authority (NFTA) appreciates 
the opportunity afforded by the Subcommittee on Transportation and 
Related Agencies Appropriations to present testimony in support of its 
project initiatives for transportation appropriations in federal fiscal 
year 1998. The Niagara Frontier Transportation Authority (NFTA) is a 
regional multi-modal transportation authority responsible for air, 
water and surface transportation in Erie and Niagara Counties. NFTA 
businesses include a bus and rail system, two international airports, a 
small boat harbor and transportation centers in Buffalo and Niagara 
Falls.
    In support of its transportation mission, the NFTA respectfully 
requests your consideration of the following transportation 
appropriations in fiscal year 1998. The appropriation requests are 
described in the following narrative.
Transit Project Appropriations
    FTA Bus Capital.--Appropriate $4 million for HUBLINK, the NFTA 
Transit Restructuring Program, in federal fiscal year 1998.
Aviation Project Appropriations
    Greater Buffalo International Airport (GBIA).--Appropriate 
$7,526,359 for GBIA Letter of Intent (LOI) in federal fiscal year 1998; 
or, appropriate $2,452,294 if NFTA's pending application for $5,074,065 
under the GBIA LOI agreement is approved in fiscal year 1997.
    Niagara Falls International Airport (NFIA).--Appropriate $1.8 
million for new taxiway at NFIA.
                 hublink--transit restructuring program
Legislative Request:
    Appropriate $4 million for HUBLINK, the NFTA Transit Restructuring 
Program, in federal fiscal year 1998. These funds will be used to fund 
capital infrastructure and start-up expenditures.
Project Background:
    Metro, the NFTA's public transit business center, is working to 
meet the difficult financial challenges that impact the viability of 
the transit system. Fundamental changes in the demographic 
characteristics of Western New York have altered transportation 
patterns in and around the urban area that have been prevalent for 
nearly 50 years. Population shifts to the suburbs have occurred but, 
for the first time, the loss of population in the central city has been 
accompanied by a similar migration of business activity as well. Metro 
is faced with a changing market of potential transit riders. Metro's 
current service radiates out from the COD to suburban areas and 
primarily meets that traditional travel demand. In order to remain 
competitive, Metro must redesign its system to meet the changing 
demands for service.
    A strategic business planning effort that recognized changing 
demographic characteristics for both population distribution and 
employment spawned the need to restructure local transportation 
services. Restructuring Metro is necessary in order to improve mobility 
for all Western New Yorkers and to meet national policy goals such as 
the Access to Jobs and Training initiative advanced in the 
Administration's 1998 budget proposal, as well as the provisions of the 
Clean Air and Americans with Disabilities Acts legislated by Congress.
    During the past year, technical work has been initiated to develop 
a new vision for Metro. ``HUBLINK'' is the term that has been coined 
for the restructuring effort. Simply stated, HUBLINK is a concept for 
comprehensive, coordinated public transportation. The preliminary 
concept divides the region into three service areas, urban, suburban 
and rural based upon geography, population density, and needs for 
public transportation. Each area would be served by the transportation 
that best suits its needs. Both traditional fixed route service and 
non-traditional service approaches will be considered in each area.
    The HUBLINK study also seeks to evaluate the opportunities for 
Health and Human Services (HHS) agency transportation coordination and/
or collaboration. The objective of this evaluation is to encourage 
efficient investment of all sources of transportation funding. This 
objective is consistent with Congressional intent adopted in fiscal 
year 1996 transportation appropriations legislation. The aforementioned 
Access to Jobs and Training program, whereby transit operators can be 
awarded discretionary funds for securing matching social service 
transportation funding in support of employment training initiatives, 
is a good starting point for transportation coordination. We suggest 
that the transportation appropriations committee consider enhancing 
both its prior Report language and the Administration initiative by 
providing such incentives to communities that identify and implement 
transportation coordination strategies between transportation providers 
and social service or labor agencies, regardless of trip purpose.
    The HUBLINK effort is structured to address the complex technical 
issues related to coordinating local public transportation services and 
developing a community consensus on a vision for such services in 
Western New York. Local participation and involvement are crucial to 
this project given its focus on coordinating local transportation 
services with Metro services to create a unique and cost effective 
transportation system. To date, Metro has introduced this concept to 
over fifty organizations at informal meetings and briefings. The 
enthusiastic response has demonstrated the importance of restructuring 
local transportation services. Also during the past year, a Policy 
Advisory Committee (PAC) and Technical Advisory Committee (TAC) have 
been formed. The membership of these committees demonstrates the broad 
involvement of the community's leadership in the process.
    The HUBLINK study is only the first step in the process of 
restructuring the region's mass transit system. The study effort will 
produce a financial plan to implement the program that will include 
capital improvements, such as transit centers, park and ride lots, 
passenger information equipment, and vehicles. Startup expenditures to 
demonstrate the new, non-traditional transit services will also be 
necessary.
    The initial financial plan is expected by June, 1997. At this time, 
the total estimated cost of full implementation of the HUBLINK system 
is $25 million over five years. In federal fiscal year 1998, we 
estimate project costs at $5 million. Thus, the NFTA requests your 
support of a $4 million appropriation to launch the HUBLINK system in 
federal fiscal year 1998. These funds will be used to fund capital 
infrastructure and start-up expenditures.
                    gbia airport improvement program
Legislative Request:
    Appropriate $7,526,359 for GBIA Letter of Intent (LOI) in federal 
fiscal year 1998; or,
    Appropriate $2,452,294 if NFTA's pending application for $5,074,065 
under the LOI agreement is approved in fiscal year 1997. NFTA will 
update the transportation appropriations subcommittee during fiscal 
year 1997 as to the status of the pending application for funds.
Project Background:
    The construction of the GBIA Airport Improvement Program (AIP) is 
approximately 58 percent complete, with over $101.2 million of 
construction projects underway. A principal NFTA objective in the 
coming months is completing the AIP on time and within budget.
    The completion of the AIP will enable the NFTA to provide quality 
aviation services and facilities in a manner which is both cost 
effective and enhances customer service. The new facilities will 
upgrade the region's ``Gateway Image'' and meet future service 
requirements.
    The total cost of the AIP is $157 million. The financial plan to 
implement the program consists of federal, state, and local resources 
that include passenger facility charges, airport revenue bonds, and an 
NFTA airport development fund allocation. Federal participation 
includes individual grant awards, and a multi-year Letter of Intent 
(LOI) commitment of both entitlement and discretionary funds.
    Fulfilling the projected federal commitment to the AIP is critical 
to completing the project. The LOI agreement totals $39,004,356 and 
includes discretionary and entitlement funding. Under the LOI, NFTA 
received six payments from fiscal years 1992-96. These payments include 
$6,629,398 entitlement and $14,787,410 in discretionary funding.
    In federal fiscal year 1997, NFTA applied for LOI Payment No. 7 in 
the amount of $13,427,791, including $13,317,538 in discretionary and 
$110,253 in entitlement funds. These funds are required to meet the 
cash flow requirements of the program. Congress recognized the 
importance of this LOI payment in the reauthorization of the Airport 
and Airways Improvement Act of 1996. However, the FAA has notified NFTA 
of a grant award in the amount of $8,393,726. This allocation creates a 
shortfall of discretionary funds of $5,074,065. The reduction of 
federal AIP appropriations in recent fiscal years has already affected 
receipt of funding committed under our original letter of intent by 
stretching out the scheduled receipt of entitlement and discretionary 
funding from the original financing commitment. Unless we are able to 
secure the currently unallocated funding, it will be necessary to 
further increase the use of revenue anticipation bonds and add 
unbudgeted borrowing costs to the program.
    In fiscal year 1998, our financial plan calls for discretionary 
funds in the amount of $2,452,294. However, in the event that the 
aforementioned shortfall in funding is not secured, the fiscal year 
1998 need is $7,526,359. Please support an allocation in this amount 
from fiscal year 1998 AIP transportation appropriations. We will update 
the transportation appropriations subcommittee during fiscal year 1997 
as to our initiative to secure the unallocated funds.
            niagara falls international airport new taxiway
Legislative Request:
    Appropriate $1.8 million for new taxiway at NFIA in fiscal year 
1998.
Project Background:
    The Niagara Falls International Airport (NFIA) is an integral part 
of the Western New York Regional Airport System. This airport serves as 
a reliever airport for Greater Buffalo International Airport (GBIA), as 
well as serving the charter needs of both the commercial and 
supplemental carriers. The airport is also the home base for the 914th 
Tactical Air Group in the United States Air Force Reserve, as well as 
the New York Air National Guard (NYANG) 107th Unit.
    A recently renovated passenger terminal building contains 
facilities to handle domestic and international scheduled air carrier 
and charter flights. Ground handling and security screening are 
provided by airport personnel. The 12,000 square foot terminal building 
contains all necessary facilities to accommodate international and 
domestic passengers, including U.S. Customs and Immigration offices.
    NFTA is striving to expand the airport's commercial service 
activity with a focus on charter service that can utilize NFIA's 
excellent runway system. Several factors, including the North American 
Free Trade Agreement (NAFTA) and ongoing initiatives to increase 
Niagara Falls tourism, could alter dramatically the role of the 
airport. We believe NFIA is ideally suited to capitalize on NAFTA.
    Joint marketing initiatives with Niagara County, including a 
comprehensive utilization study, are targeted at identifying specific 
markets that may be served most efficiently at NFIA. International air 
charter passengers, scheduled air carrier service, Canadian air cargo 
and aircraft maintenance opportunities are being pursued vigorously.
    In terms of future development plans, the location of the Niagara 
County Industrial Development Agency adjacent to the airport property, 
proximity to the Canadian border, and the international trade 
opportunities afforded by recent treaties suggest an expanded role for 
NFIA in Western New York business development. We request consideration 
of one project by the transportation appropriations subcommittee that 
will facilitate an expanded role for the airport, the construction of a 
new taxiway parallel to Runway 6/24.
    The current configuration of the airport's runways and taxiways 
limits the ability to develop the southeast corner of the airport. The 
southeast corner is adjacent to the Niagara County Industrial 
Development Agency buildings and its accessibility is critical to the 
future development of the airport. The construction of a new taxiway 
and the closing of other obsolete taxiways would open up a considerable 
area for aviation-related development, as well as create a more 
efficient taxiway system for aircraft.
    The design and construction of the new taxiway is estimated to cost 
$2,000,000. We request consideration of an appropriation in the amount 
of $1.8 million to construct the new taxiway under the fiscal year 1998 
AIP.
                    status of prior years' earmarks
1995 Bus Capital:
    Crossroads Intermodal Station, $800,000.
    Federal Transit Administration (FTA) grant awarded, March, 1996.
    Project Status: Design of Intermodal station will be completed 
during federal fiscal year 1998.
1996 Bus Capital:
    Crossroads Intermodal Station, $496,250.
    Project Status and Obligation Date: Application for FTA grant funds 
for construction will be submitted during federal fiscal year 1998.
1997 Bus Capital:
    Crossroads Intermodal Station, $992,500.
    Project Status and Obligation Date: Application for FTA grant funds 
for construction will be submitted during federal fiscal year 1998.
                                 ______
                                 
    National Highway Traffic Safety Administration-Related Testimony
Prepared Statement of John H. Siegel, M.D., F.A.C.S., F.C.C.M., Wesley 
  J. Howe, Professor of Trauma Surgery, Chairman of the Department of 
  Anatomy, Cell Biology and Injury Sciences, New Jersey Medical School
    Mr. Chairman, I respectfully present testimony on behalf of the 
University of Medicine and Dentistry of New Jersey-New Jersey Medical 
School. The University of Medicine and Dentistry (UMDNJ) is the largest 
public health sciences university in the nation. Its New Jersey Medical 
School (NJMS) is the academic medical facility for all of Northern New 
Jersey and its University Hospital serves as the Level I Trauma Center 
to coordinate the entire Northern region of the State.
    This testimony requests your continued support for the National 
Highway Traffic Safety Administration (NHTSA) Trauma Network composed 
of four university trauma systems functioning together in a consortium 
known as the ``CIREN:Human Crash Injury Project''. In addition to the 
UMDNJ-New Jersey Medical School in Newark, N.J., the consortium 
includes the Charles Mc Mathias, Jr. National Study Center for Trauma 
and Emergency Medical Services (EMS) of the University of Maryland in 
Baltimore, the William Lehman Injury Research Center of the University 
of Miami in Florida, and the Children's National Medical Center of 
Washington, DC. These four centers have been working together in the 
study of motor vehicle crash injury which affects both adults, as well 
as children. Individually and collectively, these studies have resulted 
in new knowledge which has enabled the identification of the patterns 
of specific injuries resulting from real motor vehicle crashes. They 
have pointed the way towards the deployment of the newer safety devices 
and enabled the evaluation of their impact in reducing the severity of 
these injuries or preventing their occurrence. In the proposed NHTSA 
Trauma Network which will support the ``CIREN:Human Crash Injury 
Project'', three additional centers designated under the agreement 
between NHTSA and the General Motors Corporation have also been 
established and linked to the already existing four operational Trauma 
Network Centers. These three additional centers are totally funded by 
the General Motors Corporation under an agreement which excludes 
funding for the four NHTSA centers
    Important information concerning the effect of motor vehicle 
crashes on car structural integrity has been learned from 
experimentally-staged motor vehicle crashes and from the use of inert 
motor vehicle crash-dummies. However, it is necessary to go beyond the 
behavior of crash-dummies back to the scene of the accident, in order 
to determine the real mechanisms of injury and to understand the 
variability of the impact on different types of real people. For 
instance, the sixty year old woman who has some degree of osteoporosis 
will likely have a different pattern and magnitude of lower extremity 
and pelvic fracture injuries for the same impact velocity of crash 
compared to a twenty-five year old male.
    The studies carried out so far, at the New Jersey Medical School 
have enabled the identification of different patterns of organ and 
extremities injury related to specific sites of passenger compartment 
intrusion and shown that these patterns are significantly different as 
a function of the direction of crash and its impact velocity (See 
attached reprint). Collaborative studies in Baltimore and New Jersey 
have identified, subtle but important, aspects of sex and body habitue 
related driver behavior which can result in more, or less severe 
injuries to the lower extremities resulting from the same crash forces. 
The New Jersey and the Miami studies have allowed recognition of the 
motor vehicle crash patterns which provide clues to occult injuries 
which would otherwise be missed by the emergency medical services team 
in triaging patients from severe motor vehicle crashes. These factors 
have important implications for safety design and creation of 
biomechanical test instruments to ensure driver and passenger 
protection. Also, studies carried out by the Children's Medical Center 
in Washington, DC have focused on the precautions necessary in 
designing and locating children's safety seats to prevent infant 
injuries in motor vehicle crashes.
    Most important, the net result of these studies has been to focus 
on the development of motor vehicle safety measures which reduce the 
chance of injury rather than solely on the prevention of death. For it 
is injury which is the most costly aspect of the motor vehicle crash, 
raising health-care costs and forcing insurance premiums upward, not to 
mention the personal catastrophes which occur daily when a family 
member is severely injured.
    The studies carried out by the New Jersey Medical School and 
Maryland components of the Human Crash Injury Group have already 
identified important characteristics of injury which were not 
previously recognized. These studies have focused on the importance of 
lower extremity injuries and pelvic fractures as major causes of 
disability and cost, and have focused on the importance of the air-bag 
in reducing the severity of brain injuries in high impact frontal motor 
crashes. In regard to this last observation (see attached reprint), 
investigations carried out jointly at the New Jersey Medical School and 
the Charles Mc Mathias National Study Center, have shown that air-bag 
deployment in frontal motor vehicle crashes significantly (p<0.01) 
reduced the incidence of severe brain injury (GCS12) from 67 
percent to 29 percent even though the total incidence of brain injuries 
remained unmodified (See attached reprint). Air-bags in these types of 
major force car crashes also reduced the incidence of shock, face 
fractures, and lower extremity fractures and as a consequence lowered 
the resulting need to extricate the patient from the motor vehicle, 
thus speeding the time to treatment. This type of study emphasizes how 
the ``Human Crash Injury Project'' (CIREN) and the NHTSA Trauma Network 
can develop information about the effect of protective devices that 
cannot be obtained from crash-dummy research, since crash-dummies have 
no brains and the crash impact on a crash-dummy's skull produces no 
discernible change in the dummy's intellect or problem solving ability.
    The prospective detailed medical:crash injury research 
investigations carried out under the ``CIREN:Human Crash Injury 
Project'' supplement and enhance the retrospective statistical studies 
now carried out by NHTSA under the NASS Program. It is a measure of the 
importance with which this project is viewed nationally that the 
present Administrator of the National Highway Traffic Safety 
Administration, Dr. Ricardo Martinez, M.D., has indicated that NHTSA 
wishes to integrate these research efforts into a national Trauma 
Network to include New Jersey Medical School:UMDM, The Lehman Center at 
Jackson Memorial Hospital in Miami, the Mc Mathias National Study 
Center in Baltimore, and the Children's Medical Center in the District 
of Columbia, and to link these four existing centers to the three new 
privately-funded GM Centers.
    Finally, there is a major new initiative occurring in the 
Department of Transportation (Federal Highway Administration), which is 
the development of an Intelligent Transportation System (ITS). As part 
of the ITS the Automobile Crash Notification System (ACN) program is in 
the process of developing an automatic crash notification micro-chip 
which could be inserted into motor vehicles so as to identify the 
location and nature of the crash. This new technology has the potential 
to enable the crash forces which are producing specific injuries and 
injury patterns to be identified and quantified so that improved safety 
measures including motor vehicle structural modifications and the 
deployment of additional air-bags-can be developed. The proper 
evaluation of the potential effectiveness of the ACN and the rate at 
which this new technology can be integrated with Emergency Medical 
Services (EMS) systems nation-wide could be most effectively determined 
by integration of the testing aspects of the ACN Program with the 
Trauma Network and its CIREN:Human Crash Injury Project. Not only can 
this combined program more rapidly evaluate the ACN system, but it will 
also result in its being implemented immediately in the six states of 
the Trauma Network, plus the District of Columbia, as a first phase 
effort.
    This effort could solve a very serious problem identified by 
studies of the Fatal Accident Reporting System (FARS). This is that 
while the death rate of trauma victims brought to Trauma System 
Hospitals is decreasing, there has been an increase in on-scene 
fatalities. This is due in part to delays in notification of EMS team 
to find and retrieve these injured patient especially in rural areas. 
The NHTSA supported by Trauma Network could also provide a mechanism 
for translation of this technology into true state-wide safety 
programs, since all of the regions mentioned and all of the 
participating trauma centers have excellent EMS systems which are 
closely linked to their network of trauma centers. The ACN technology 
has the potential to be an order of magnitude increment in motor 
vehicle safety. Its technical development and independent field testing 
should become integrated at an early phase, so that its value can be 
determined and a feedback relationship with the Department of 
Transportation's Highway Traffic Safety Programs and the state-wide EMS 
Trauma Services can be more rapidly accelerated. The value of allowing 
the Trauma Research Centers which form the CIREN:Human Crash Injury 
Project to provide this interactive feedback is that all of the 
principal investigators are not only experienced trauma surgeons, but 
are also recognized as trauma investigators with extensive experience 
in studying the mechanisms of motor vehicle crash injury.
    Speaking for myself, with the concurrence of the other directors of 
these affiliated programs, we request that the House Appropriations 
Subcommittee on Transportation and Related Agencies designate funding 
at the level of $500,000 per center to each of the four present NHTSA-
funded trauma research centers participating in the Human Crash Injury 
Project for a total of 2 million dollars. We also request that this 
appropriation be established on a multi-year basis to extend over a 
five-year period at the same annual rate adjusted for inflation, so 
that continuing evaluation and feedback can be provided by the Trauma 
Network. Also, we request that these Trauma Research Centers be used to 
evaluate the role of the Intelligent Transportation System's Automobile 
Crash Notification System in reducing excessive field mortality and 
injury exacerbation of motor vehicle crashes due to the prolongation of 
crash recognition by the present EMS system. This will take additional 
support to implement and test.
    This latter additional support should allow approximately 4,000 
cars per core center to be instrumented with appropriate communications 
equipment. This level of support would enable the evaluation of the 
effectiveness of the ACN Program in identifying potential serious 
injuries and in facilitating the rapidity with which Emergency Medical 
Services Advance Life Support Teams could be deployed to the scene of 
the crash. It is felt that this type of immediate crash notification 
and localization technology when fully developed and integrated with 
all of the Nation's regional Trauma Centers could have a major impact 
in reducing the mortality and injury complications resulting from rural 
motor vehicle crashes and from serious crashes occurring in urban areas 
at times when there are few bystanders to request EMS 911 services.
    In closing, I would like to express my personal gratitude for the 
past support of the House and its Appropriations Subcommittee on 
Transportation and Related Agencies of our group's collective research 
which, by identifying the mechanisms of human crash injury, has already 
resulted in improved safety and in a reduction in the incidence and 
severity of motor vehicle crash injuries. Motor vehicle crashes place 
all of us at risk, both personally as well as financially, and 
negatively impact on major segments of our economy. The development of 
safer motor vehicles and the invention of new and imaginative state-of-
the-art motor vehicle crash safety devices and notification systems has 
spawned a new industry with enormous growth potential, which has 
already begun to integrate the telecommunications and motor vehicle 
industries. The small amount of national resources directed into this 
type of research will pay enormous dividends, not only by the reduction 
of motor vehicle crash injury costs, but also by the creation of new 
technologies and new businesses which can stimulate employment and 
national growth.

    [Clerk's note.--The attachment to Dr. Siegel's statement are not 
printed in the hearing record but are available for review in the 
subcommittee's files.]
                                 ______
                                 
 Prepared Statement of Fraydun Manocherian, the Manocherian Foundation
                                summary
    The Manocherian Foundation is a non-profit organization dedicated 
to reducing accidents, deaths and disability on our highways. The 
Foundation was established in 1962 by Mr. Fraydun Manocherian, who as a 
high school student, lost two friends to a drunk driving crash.
    It is extremely important that the reality of highway fatalities 
not be overlooked when your Subcommittee makes important decisions 
about how to allocate the resources of the Department of 
Transportation. Highway fatalities have increased in recent years, the 
fatality rate based on vehicle miles traveled is stagnant, and the 
human tragedy of highway crashes continues to plague us all in epidemic 
proportions.
    Although great progress has been made over the past 15 years in 
reducing road trauma, our achievements are not the envy of the world 
and many other countries have achieved better results in critical areas 
like drunk driving and safety belt use.
    Funds spent on highway safety return more benefit to American 
taxpayers than many, if not most, government programs. Studies 
conducted by the National Highway Traffic Safety Administration 
conclude that $6 dollars in benefits are returned to the Nation for 
every federal dollar invested in the vehicle safety programs of the 
agency, and $30 for every dollar invested in the behavioral aspects of 
highway safety. Reductions in health care costs, lost productivity, job 
training, insurance costs, and police and emergency services costs are 
the result of this investment.
    Since progress has slowed in recent years, it is time to devote 
additional resources to this national health problem. In order to again 
achieve further gains and the historical return on investment in 
improving driver, passenger, pedestrian, and bicyclist behavior, new 
initiatives and approaches to spending federal dollars must be 
considered.
    Increases in the funds available for state programs, like those 
proposed by NHTSA for alcohol incentive and occupant protection grants, 
is money well spent. But it is time to aggressively attack the problem. 
We propose a five-point program to be achieved over five years that 
would have several features:
    1) require NHTSA to articulate national goals to be achieved in 
five years for safety belt use, percentage of alcohol-related 
fatalities, and the highway fatality rate,
    2) support traffic law enforcement directly with added resources,
    3) develop modern educational tools taking advantage of Internet, 
cd-rom and other technologies,
    4) conduct aggressive research to understand aggressive behavior on 
the highway and its relationship to other injury-causing behavior, and
    5) increase national advertising to create awareness of this 
national tragedy.
    Incremental increases in resources will simply not get the job 
done. By putting further resources into national research and outreach 
programs, the driving public will be assured that reducing highway 
death and injury is a national priority and that the appropriate 
research is conducted to understand behavior and to act on further 
gains.
    We propose that $34 million be added to the NEITSA budget in fiscal 
year 1998 to begin this important work, and that a longer term solution 
be considered in the ISTEA reauthorization. One additional single 
percentage point of funds from the Highway Trust Fund applied to 
national NHTSA programs would result in about $260 million additionally 
becoming available. We will propose to the authorizing committee that 
funds be increased to this level over the life of the next ISTEA 
reauthorization. But this committee can begin the process by adding 
badly needed funds to the fiscal year 1998 appropriations. Since over 
90 percent of all transportation-related fatalities occur on our 
nation's highways and 80 percent of those are attributable to driver 
errors, the additional amounts are appropriate and necessary.
    A full discussion is presented below.
                              the problem
    Despite large successes over the past 15 years, highway fatalities 
were about 42 thousand in 1996 with over 3 million reported injuries. 
Increases in fatalities have taken place in each of the last several 
years although slight reductions occurred in calendar year 1996. While 
the fatality rate, measured in fatalities per 100 million vehicle miles 
traveled, has been reduced dramatically over the past 15 years, the 
rate of approximately 1.7 is essentially unchanged since 1992.
    Although the United States has a solid record of achievement in 
reducing highway deaths and injuries, we are by no means the world 
leaders, particularly in important areas like drunk driving and safety 
belt use. In the United States, over 41 percent of highway fatalities 
were alcohol-related while other countries, Scandinavia countries in 
particular, routinely achieve alcohol-related fatality percentages of 
less than 30 percent.
    Safety belt use in this country is stalled at 68 percent while 
Canada, Australia, Great Britain, and other countries routinely achieve 
belt use over 85 percent with some, like Canada, over 90 percent. Since 
each 10 percent of safety belt increase saves nearly 2,000 lives per 
year, the potential for further improvement is enormous.
    The heart of the problem lies with the willingness of drivers and 
passengers in this country to aggressively engage in risk-taking 
behaviors. Not buckling up, driving drunk, driving too fast, not 
wearing a motorcycle helmet, and even jaywalking or not wearing a 
bicycle helmet are all manifestations of risk-taking. Right here in 
Washington, aggressive driving has taken its toll with several recent 
deaths being attributed to behavior that is unleashed in a vehicle.
                        highway safety economics
    According to a NHTSA report released in 1996, highway deaths and 
injuries cost the Nation over $150 billion in 1994, up from $137 
billion in 1990. That amounts to 2.2 percent of the Nation's Gross 
Domestic Product and $580 for every person living in the United States. 
Every fatality costs society $830,000 and each critically injured 
survivor $706,000.
    There are few of us who do not pay the bill in one of several ways. 
According to the NHTSA study, the costs of highway crashes are 
distributed as follows:

        Type of loss                                      Amount of loss
Productivity and workplace losses....................... $58,600,000,000
Property damage.........................................  52,100,000,000
Medical costs...........................................  17,000,000,000
Travel delay............................................   4,400,000,000
Legal and court costs...................................   5,900,000,000
Emergency services......................................   1,700,000,000
Insurance administration................................  10,500,000,000
Rehabilitation..........................................     156,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total............................................. 150,400,000,000

    Despite their enormous cost, highway crashes needn't extract this 
toll from the lives of families, government, and business. Highway 
crashes are not random events over which there is no control. Many 
highway crashes and the consequences of them are controllable.
    The bottom line is that highway crashes are still a huge economic 
and social problem in this country and the amount of resources we are 
devoting to reducing the toll is very small in proportion to the 
problem.
                     nhtsa's budget in perspective
    NHTSA's total budget request for fiscal year 1997 is $333 million. 
There are several ways to put this figure in perspective. The first is 
to compare this amount to the $150 billion lost each year in highway 
crashes. NHTSA studies have concluded that the return on investment 
ranges from $6 dollars for every dollar spent on vehicle programs and 
up to $30 dollars for each dollar spent on programs to alter driver and 
passenger behavior. With this solid return, further investment, 
particular in the behavioral programs, makes economic sense. The 
current levels of investment are far below that which is comparable to 
the problem and far below those needed to achieve effective economic 
gain and reducing the devastating effect on families from losing loved 
ones.
    The Highway Trust Fund collects $26 billion per year, and the NHTSA 
budget makes up just over 1 percent of that figure. The economics of 
highway safety demand a greater investment. And since about 80 percent 
of the cause of highway injury lies with driver and passenger behavior, 
that new investment should be weighed heavily towards changing 
behavior.
    Recent experience with air bag safety makes the effort more 
important. An extraordinary amount of attention has focused on changing 
Federal Motor Vehicle Safety Standard 208. The subject has become 
almost daily fare in the nation's newspapers and electronic media and 
NHTSA has come under increasing fire to alter the standard to allow air 
bags to become less aggressive and to promote the development of the 
so-called ``smart bags''. But the simple truth is that the majority of 
the deaths attributable to air bags could have been avoided through the 
use of safety belts and ensuring the children under 12 are seated in 
the rear seat. Again, the need is to increase efforts towards the 
appropriate use of safety restraints already available in every air bag 
equipped vehicle.
                              the proposal
    The traditional approach to changing behavior on our highways is to 
1) enact good state laws, 2) effectively enforce them, and 3) educate 
drivers and passengers on the importance of avoiding alcohol, buckling 
up, reducing speed, and other behaviors. When applied aggressively, 
effective reductions in fatalities and injuries will result. A number 
of state programs, including North Carolina's ``Click it or Ticket'' 
program, have repeatedly demonstrated the usefulness of this approach. 
Foreign success, particularly safety belt use programs in Canada, 
Australia, and Great Britain, and drunk driving programs in Scandinavia 
and Australia, is attributable to this approach.
    NHTSA's traditional role in promoting these programs is threefold: 
1) conduct national advertising and programs through national 
organizations to identify highway safety as a national priority and to 
create issue awareness, 2) develop and provide technical and 
educational support, both in a research and program development sense, 
and 3) administer the state and community grant program.
    In recent years, the state and community grant program has received 
increased funding from Congress, principally through the section 402 
grant program. An additional $12.5 million was provided in fiscal year 
1997 funds for the NHTSA section 402 program, a result of combining the 
Federal Highway Administration and NHTSA requests. The same amount is 
asked for by NHTSA for fiscal year 1998. In addition, NHTSA has asked 
for an addition $8.5 million for fiscal year 1998 in alcohol incentive 
grants and a new $9 million program for occupant protection incentive 
grants.
    But Americans want more. A recent poll conducted by Louis Harris 
for Advocates for Highway and Auto Safety concluded that 9 out of 10 
Americans want the federal government to display strong leadership in 
highway safety.
    For national level programs, however, conducted through the section 
403 program, only small amounts of additional money are being sought 
for an air bag safety campaign, for emergency services support, and a 
new youth drug initiative. The total amount of increase is $4 million, 
but occupant protection and alcohol program development efforts will 
actually receive less funding under the Administration proposal. The 
highway safety research request is flat at about $5 million.
    While progress is being made in funding state and community 
efforts, the amounts available for national level programs is 
inadequate, especially given the stagnation in reducing highway 
fatality and injuries and the Nation's mediocre performance in highway 
safety compared to the rest of the world.
    If the Nation is to commit resources commensurate to the problem, 
new investment in changing behavior should support state and community 
efforts and the need for national leadership in five areas:
    1) Set national goals to be achieved over the next five years
  --National leadership requires developing national expectations. 
        Aggressive goal-setting is an important facet of national 
        leadership and costs nothing.
  --The key areas for which goals should be set are: overall national 
        highway fatality rate, percentage of alcohol-related 
        fatalities, and safety belt use rates. On April 17, 1997, NHTSA 
        announced 5 and 10 year goals for safety belt use. This is a 
        positive step and NHTSA should follow with ambitious drunk 
        driving and fatality rate goals.
  --NHTSA should decide the goals to be reached and the time frame 
        without delay and in concert with the highway safety community.
    2) Develop an aggressive new program to support traffic law 
enforcement efforts nationwide directly through police organizations 
and state highway safety offices.
  --Less than $1 million in the NHTSA request supports traffic law 
        enforcement through national organizations and though financial 
        aid and technical assistance to the states.
  --An additional $19 million is needed to replicate the success of 
        programs like North Carolina's safety belt and drunk driving 
        programs. Additional resources should be provided to the law 
        enforcement community to reverse the trends of recent years 
        towards less traffic law enforcement.
    3) Develop and distribute aggressive education approaches using 
modern education and communication tools targeting high risk 
populations.
  --Fatality rate reductions among the highest risk populations are 
        stagnant, including the vulnerable risk-taking populations of 
        21-34 year-old males. Older drivers and new drivers need 
        special attention and program approaches need to be developed. 
        Less than $3 million in program development funds are requested 
        in the NHTSA budget and very few of the NHTSA programs designed 
        to reach youth, older drivers, and the 21-34 age groups have 
        been evaluated.
  --An additional $7 million is needed to develop innovative approaches 
        to reach the vulnerable populations, including full evaluations 
        of existing educational approaches to these problems and the 
        development of new technology using the latest Internet, cd-rom 
        and other electronic and motivational approaches.
    4) Conduct new research to better understand risk-taking and 
aggressive driving behavior on the highway.
  --Understanding why some drivers and passengers take risks by not 
        wearing safety belts, driving drunk, speeding, or engaging in 
        other behaviors is fundamental to developing effective 
        programs. Although NHTSA has made some progress in 
        understanding risk-taking, these fundamental understandings are 
        crucial to developing national leadership in highway safety. 
        The NHTSA highway safety research budget only contains $550 
        thousand devoted to this type of research.
  --An additional $5 million for risk-taking research is needed. 
        Understanding behavior and how driver and passenger risk-taking 
        behaviors are linked to other non-highway injuries is essential 
        if the NHTSA priority of establishing Safe Communities is ever 
        to reach its potential.
    5) Significantly increase public service advertising.
  --Of the total NHTSA budget request of $333 million, only about $1 
        million is devoted to national public service advertising for 
        highway safety.
  --An additional $4 million is appropriate to bolster current national 
        efforts and to assist states and communities in supporting 
        increased traffic law enforcement.
    The total added funds under these proposals is $34 million, roughly 
a 10 percent increase in NHTSA's budget and between one and two-tenths 
of one percent of the expected revenues in fiscal year 1998 to the 
Highway Trust Fund.
    Highway safety program spending should represent a larger portion 
of Highway Trust Fund revenues. Miles traveled on the Nation's highways 
is a direct measure of exposure to safety risks and directly affects 
the amount of money flowing to the Highway Trust Fund. The more miles 
traveled, the greater the risks, and the more resources that should be 
available to counter those risks and to make further progress in 
reducing these intolerable human and economic wastes. If an additional 
one percent of Highway Trust Fund money were dedicated to NHTSA 
programs, the programs described above and others could be funded 
easily. We believe it is time for Congress to consider such an 
approach. As Congress considers the next ISTEA reauthorization, the 
portion devoted to highway safety should be proportional to total 
revenues and should increase dramatically over the life of the bill.
    Thank you very much.
                                 ______
                                 
                         Rail-Related Testimony
 Prepared Statement of Harriet Parcells, Executive Director, American 
                        Passenger Rail Coalition
    Mr. Chairman, Members of the Subcommittee on Transportation 
Appropriations, thank you for the opportunity to provide testimony to 
the Subcommittee. My name is Harriet Parcells and I am the Executive 
Director of the American Passenger Rail Coalition (APRC), a national 
association of rail suppliers and businesses working for an efficient, 
safe and world class U.S. intercity passenger rail system.
    The U.S. stands at a crucial crossroads in defining the future for 
intercity passenger rail in this country. With a federal commitment to 
provide Amtrak with a more secure base for capital investments and the 
tools to operate in more businesslike and efficient fashion, Amtrak can 
become a world class national railroad and yield the country a strong 
return on its investment.
    Citizens from coast to coast have expressed their desire for more 
and improved intercity passenger rail service. At rail forums held 1\1/
2\ years ago, Amtrak and federal and state officials heard citizens, 
local officials and businessmen from New York to Texas to Washington 
state, call for improved, not reduced, Amtrak service and emphasize 
that Amtrak service is critical not only for mobility in congested 
metropolitan areas but for citizens of smaller communities as well, for 
whom Amtrak is often the only affordable and reliable means of 
intercity transportation.
    States increasingly view rail as a vital component of their 
transportation infrastructure. Over the past two years, sixteen states 
have entered into partnerships with Amtrak to initiate new rail service 
and preserve service that Amtrak would otherwise have been forced to 
eliminate or reduce for lack of adequate funding. States such as North 
Carolina, Virginia, Florida, Vermont, California, Washington, Oregon, 
New York, Pennsylvania and others are using state funds to purchase new 
rail rolling stock, to make strategic investments to increase rail 
speeds on key corridors and/or to improve the quality of rail service 
in other ways.
    Amtrak is taking strong actions to become a more efficient and 
customer-focused railroad. Last year, Amtrak was named the ``Most 
Improved in Customer Service'' among American transportation companies 
in a survey of business executives by Knowledge Exchange, a financial 
analysis and publishing firm. Amtrak has purchased new equipment--a new 
generation of Superliners, Viewliners and new locomotives--that has 
been greeted enthusiastically by rail riders and improved the 
railroad's efficiency and reliability. Amtrak is forming new 
partnerships to bring customers better service: partnerships with the 
states and the partnership announced in November between Amtrak and 
Greyhound to work together to improve connections between trains and 
buses. And, last year, Amtrak awarded a contract to a consortium of 
Bombardier/GEC Alsthom to build 18 high speed trainsets that will 
operate at top speeds of 150 mile per hour in the Northeast Corridor by 
the turn of the century and bring a new generation of rail travel to 
America.
    The federal investment in Amtrak is crucial to the success of these 
developments. A strong federal commitment to Amtrak and the advancement 
of high speed rail in key corridors in fiscal year 1998 is essential to 
keeping these developments on track.
 a dedicated source of capital investment: key to a healthy future for 
                                 amtrak
    In testimony provided by our association to the Subcommittee last 
year, APRC underscored the critical need to provide Amtrak with 
adequate capital funding and urged Congress to establish a dedicated 
source of funding for Amtrak capital investments, funded by \1/2\ cent 
of the federal gasoline tax. APRC appreciates the support of many 
members of this Subcommittee, and the support of other Senators, last 
year for the Sense of the Senate Resolution offered by Senator Roth to 
create a dedicated trust fund for Amtrak capital investments, which was 
approved 57:43 by the Senate on May 23, 1996.
    Yet, one year later, Amtrak remains without a dedicated funding 
source. Senator Roth and co-sponsors--including Senators Lautenberg and 
Specter, introduced S. 436, the Intercity Passenger Rail Trust Fund Act 
of 1997, on March 13, 1997, to create an Intercity Passenger Rail Trust 
Fund and dedicate \1/2\ cent of the federal motor fuels tax (a portion 
of the 4.3 cents per gallon now going to the General Fund) to Amtrak 
capital investments for a 5 year period. The country's five states 
without Amtrak service would receive funds that could be used to help 
initiate or improve intercity Passenger rail service or intercity bus 
service. Similar legislation was introduced in the House of 
Representatives yesterday, April 24, by a bipartisan group of Members 
from states around the country. APRC strongly supports these bills.
    A dedicated source of capital investment is essential to Amtrak's 
future viability and Amtrak's ability to become free of federal 
operating subsidies by 2002, as directed by Congress and the Office of 
Management and Budget. APRC asks the Subcommittee to provide Amtrak 
with $751 million in capital appropriations in fiscal year 1998 (the 
amount \1/2\ cent of gas tax would generate), as requested by Amtrak in 
its fiscal year 1998 budget request. We urge members of the 
Subcommittee to work with other Members of Congress to ensure that this 
year the nation puts Amtrak on a secure track to the future. Congress 
will write and enact legislation to reauthorize the Intermodal Surface 
Transportation Efficiency Act of 1991 (ISTEA) and the surface 
transportation trust funds. This presents the time and opportunity for 
Congress to enact S. 436 and ensure a healthy economic future for 
Amtrak that will provide multiple benefits for current and future 
generations of Americans.
    The fiscal year 1998 request for $751 million for capital will 
provide for Amtrak's general capital needs as well as critical 
investments in the Northeast Corridor. For Amtrak operations, APRC asks 
the Subcommittee to support Amtrak's request for $245 million and for 
railroad retirement, $142 million. Last year, Amtrak requested $250 
million for operations but was appropriated $200 million, a gap of $50 
million. We urge the Subcommittee to fully fund the operating request 
of $245 million this year to allow Amtrak to meet its operating needs 
and continue on its path to reduced reliance on federal operating 
subsidies.
    Amtrak is committed to reducing its operating costs and becoming 
more customer-focused. The Amtrak Board of Directors adopted in 1994 a 
Strategic Business Plan to guide Amtrak's actions and put it on a 
downward glide path to operating self-sufficiency by 2002. Amtrak has 
been taking the necessary and difficult steps (employee and management 
staff reductions; service adjustments and other actions) to reduce its 
operating expenses. Amtrak cannot, however, get there without key 
actions by Congress. Key to the successful outcome of the Strategic 
Business Plan is enactment of a dedicated source of capital funding, 
adequate operating funding to keep Amtrak on the glide path to zero 
federal operating subsidy and the implementation of high speed rail 
service in the Northeast Corridor, with service beginning in 1999.
high speed rail in the northeast corridor: amtrak's ``economic engine''
    The electrification of the Northeast Corridor from New Haven to 
Boston and implementation of high speed train service in 1999, to 
reduce trips times between Boston and New York to under 3 hours and 
reduce travel time along the entire Northeast Corridor, is vital to 
Amtrak's future. Federal Railroad Administrator, Jolene Molitoris, 
recently referred to the high speed rail investment as the ``economic 
engine'' of Amtrak. We are in complete agreement. We urge the 
Subcommittee to provide Amtrak with strong capital funding in fiscal 
year 1998 to ensure that needed capital investments in the Northeast 
Corridor are undertaken to ensure the high speed rail project is 
implemented on schedule.
    The electrification of the Northeast Corridor from New Haven to 
Boston, along with the purchase of 18 high speed trainsets, will bring 
a new generation of rail travel to the United States. The high speed 
rail service will attract an additional 2.6 million riders annually to 
Amtrak and is estimated to generate a net annual profit of $150 million 
that will benefit the entire Amtrak system. No other single investment 
is as strategic to Amtrak's future economic health. The high speed rail 
investment will provide relief to heavily congested airports and 
highways in the New York and Boston regions and speed travelers in 
safety and comfort to their destinations. The high speed rail project 
will create thousands of new jobs in communities throughout the 
country, as components for the high speed trains and other strategic 
infrastructure investments are supplied by manufacturers and businesses 
in over 20 states. A study by the Coalition of Northeastern Governors 
estimates the high speed rail investments will generate $440 million in 
new business sales in the region. And, the successful implementation of 
high speed rail in the Northeast Corridor will open opportunities for 
high speed rail developments in other key corridors of the country.
           investments in rail safety and high speed rail r&d
    Efforts to improve the safety of the country's passenger and 
freight rail systems must be a top priority of the Federal Railroad 
Administration (FRA). APRC urges the Subcommittee to provide FRA with 
strong funding in fiscal year 1998 to continue its vital rail safety 
work. APRC also supports funding for the valuable work of Operation 
Lifesaver, working with the states to educate the Public on railroad 
safety matters. And, APRC asks the Subcommittee to continue funding 
FRA's high speed rail research and development program and Next 
Generation High Speed Rail Program to carry forward the important work 
underway on positive train separation, advanced train control and grade 
crossing technologies, development of a high speed non-electric 
locomotive and other research and development critical to improving the 
safe operation of the nation's passenger and freight trains.
states see improved passenger rail service as cost-effective investment 
                             for the future
    As states around the country plan for the future mobility, economic 
health and quality of life for their citizens, they are entering into 
partnerships and making strategic investments with Amtrak, the federal 
government and each other to bring about improved intercity passenger 
rail service.
  --The benefits of investments by the state of Michigan and U.S. DOT 
        to upgrade the corridor between Detroit and Chicago were 
        showcased in October 1996 when a special Amtrak train was 
        operated over the corridor at speeds of more than 100 miles per 
        hour. Speeds will increase in 1997 from 79 to 110 miles per 
        hour over a 20 mile stretch of track.
  --Washington and Oregon are working cooperatively to increase train 
        speeds and quality of rail service over the ``Cascadia 
        Corridor'' extending from Eugene-Portland-Seattle-Vancouver, 
        BC.
  --Pennsylvania recently approved funding to purchase new, more 
        efficient equipment to operate on the Philadelphia-Harrisburg 
        rail corridor.
  --In New Jersey, New Jersey Transit, in cooperation with Amtrak, will 
        contribute $25 million per year for 5 years (Amtrak will 
        contribute an identical share) for important improvements in 
        the NJ portion of the Northeast Corridor.
  --The Missouri Department of Transportation and Amtrak on April 4, 
        initiated a three-week service demonstration of a Danish-built 
        Flexliner passenger train, operating between St. Louis and 
        Kansas City, with funds provided by the Missouri legislature. 
        The majority of seats for the demonstration service were 
        purchased weeks in advance of the train's arrival by an 
        enthusiastic public wanting to ride the versatile, new 
        passenger train.
  --The state of Vermont has made substantial investments in new 
        passenger rail service, working cooperatively with Amtrak to 
        establish the ``Vermonter,'' which features a menu with 
        specialities of the state and a baggage car retrofit to carry 
        bicycles and skis. More recently, Vermont initiated the ``Ethan 
        Allen'' to serve the west side of the state. Ridership has far 
        exceeded projections, with over 3,000 riders carried between 
        New York and Rutland in the month of December.
  --North Carolina used state funds to purchase railcars and 
        locomotives for operation on the Piedmont Corridor.
  --Most recently, the Texas legislature approved legislation--now 
        awaiting the Governor's signature--that would enact a loan 
        arrangement between Texas and Amtrak to keep the popular 
        ``Texas Eagle'' in service.
    Other states undertaking studies and infrastructure investments to 
improve the quality of intercity passenger rail service within their 
state and region.
    A healthy future for Amtrak is key to the success of these rail 
developments around the country. APRC urges the Subcommittee to provide 
a strong level of capital and operating investment for Amtrak in fiscal 
year 1998 and to work with other Senators and the House of 
Representatives to ensure that a dedicated source of investment for 
Amtrak capital needs is enacted this year.
    APRC thanks the Chairman and Members of the Subcommittee for the 
opportunity to provide our association's comments on fiscal year 1998 
appropriations for Amtrak and high speed rail developments to the 
Subcommittee.
                                 ______
                                 
        Prepared Statement of the Memphis Area Transit Authority
    Overview.--The Memphis Area Transit Authority (MATA) and elected 
officials are making a strong commitment to transit as a viable 
mobility alternative for citizens of the Memphis area. Priorities 
include: (1) completion of the downtown rail circulation system with 
additional financial assistance for the Medical Center Rail Extension, 
and (2) initiation of a regional rail system in accordance with the 
recommendations of the Memphis Regional Rail Plan.
    Background.--On April 29,1993 the downtown Main Street Trolley was 
inaugurated. This project was the first step in the development of a 
complete downtown rail transit and terminal system. The Main Street 
Trolley has carried 2 million passengers since its inception. Ridership 
continues to grow and the system averages 4 passengers per mile--more 
than twice the rate of the bus system.
    With federal support, two downtown transportation terminal projects 
are fully funded and under construction. The historic Central Station 
building will be restored and expanded to operate as a regional 
intermodal terminal at the south end of the Main Street Trolley line. A 
unique public-private partnership has been formed to blend $17.8 
million in federal and local funds with monies provided by a Developer. 
This partnership will insure that the project serves an important 
transportation function, and, in addition, becomes a vital commercial 
and residential center in downtown Memphis. The first phase of 
construction is underway with completion of the entire facility 
expected in May 1998. A new North End Terminal, at the north terminus 
of the Main Street Trolley is also under construction to be completed 
by the end of 1997.
    The Riverfront Loop extension to the Main Street Trolley is under 
construction as well. It will be in operation by Summer 1997. This line 
will serve existing and proposed developments along the Mississippi 
River and connect with the Main Street Trolley, Central Station and 
North End Terminal.
                     medical center rail extension
    With all of these projects under construction, only one link 
remains to complete the downtown rail circulation system. That link is 
a rail connection to the Medical Center. The Medical Center Rail 
Extension, in addition to completing the downtown system, can be the 
first phase of a regional light rail line.
    Congress provided $1.25 million of ``new start'' funds in fiscal 
year 1996 and $3.039 million in fiscal year 1997 for this project. 
These monies are being allocated to engineering, program 
administration, and utility relocation activities.
    The Medical Center Rail Extension involves new construction of a 
light rail line connecting the two largest activity centers in the 
Memphis region: the Central Business District (CBD), and the Medical 
Center. The line will be approximately 2.5 miles in length and will 
operate on-street in mixed traffic using Madison Avenue for most of its 
length. The line will be integrated with the Main Street Trolley and 
Riverfront Loop at the west end of the line (in the CBD). At the east 
end of the line, near the Medical Center, a major station will be the 
focal point for bus-rail transfers. Other stops will be spaced along 
the route and will have sheltered waiting areas and wheelchair ramps. 
The Medical Center Rail Extension is a key in MATA's five year plan for 
redesign of the bus system from a CBD-oriented radial system to a 
transit center-based system. A substantial number of bus trips 
currently made between the CBD and Medical Center will be reassigned to 
outlying areas since downtown demand will be handled by rail. The 
operating cost of the Medical Center rail extension will be more than 
offset by the reduction in duplication of bus service in the corridor. 
Projected daily ridership in the forecast year of 2020 is 4,200-6,100, 
depending upon the exact alignment.
    A Major Investment Study (MIS) and Environmental Assessment (EA) 
has been completed for this project. A contract is in place for 
engineering design which will begin immediately upon receipt of final 
approval of the MIS/EA by the Federal Transit Administration.
    The current cost estimate for design and construction is $30.4 
million, with a federal share of $24.3 million. Since the federal share 
is less than $25 million, this project is not subject to the new starts 
criteria in Section 5309(e)(2)-(7) of ISTEA. The fiscal year 1997 
funding request is for $5.3 million to cover the cost of the following 
activities: Trackwork fabrication and vehicle acquisition. MATA intends 
to continue the previous 80 percent federal/20 percent local funding 
split for this project. Remaining funds for construction of $14.7 
million will be requested in fiscal year 1999.
                           regional rail plan
    In addition to completing the downtown rail circulation system, 
Memphis is also prepared to begin the process of implementing a 
regional rail system. The recently-completed Regional Rail Plan 
includes recommendations for light rail in three corridors. The Medical 
Center Rail Extension project is included in the Germantown/
Collierville corridor. A summary of key characteristics of the 
corridors is presented below:

----------------------------------------------------------------------------------------------------------------
                                                                                                       Daily    
                            Corridor                              Length (miles)   Capital cost      ridership  
                                                                                                      (2020)    
----------------------------------------------------------------------------------------------------------------
Germantown/Collierville.........................................            24.8    $443,000,000          34,300
Whitehaven/Mississippi..........................................            19.0     330,000,000          21,200
Frayser/Millington..............................................            17.6     304,000,000           6,900
----------------------------------------------------------------------------------------------------------------

    A request will be made to the Senate Banking Committee to authorize 
the three corridors as a Program of Projects in the reauthorization of 
ISTEA.
    The next step is to prepare an MIS to aid in determining priorities 
and detailing the engineering and financial plans. The MIS will be 
funded entirely from local sources. The proposed federal/local split 
for subsequent requests to this committee for the Regional Rail Plan 
will be 50 percent federal/50 percent local. Additional funding 
requests will be dependent upon results of the MIS.
                            local commitment
    A strong local financial commitment results from a growing 
recognition among elected officials of the importance of a modern, 
efficient public transportation system in meeting mobility and economic 
development needs in the 21st century. One example of past financial 
commitment is The Main Street Trolley. It was largely financed with 
Interstate Substitution funds that local decision-makers chose to 
allocate to transit rather than highways. No Federal Transit 
Administration (FTA) Section 3 funds were used in the project. In 
addition, private funding commitments are being secured for restoration 
of vintage trolley vehicles. The fund-raising effort is continuing with 
additional corporate sponsors continually being added. Overall, the 
project was completed within 1 percent of budget. The Riverfront Loop 
Rail Extension is also being constructed without Section 3 funds.
    Commitment to the Regional Rail Plan is shown by recent actions of 
local governing bodies. The Memphis City Council and Shelby County 
Commission adopted identical resolutions supporting state legislation 
to change the formulas for distributing revenues from automobile 
registration fees and 6-cents of state gas tax. The changes would give 
local governments the authority to dedicate these revenues as a 
permanent funding source for public transportation.
                                summary
    With the support of local governments, MATA is building on the 
success of the downtown rail system and initiating major investments 
identified in the Regional Rail Plan. To continue to move forward, 
financial assistance is requested in fiscal year 1998 as follows: 
Medical Center Rail Extension, $5.3 million.
[GRAPHIC] [TIFF OMITTED] T12NON.046

   Prepared Statement of Ross B. Capon, Executive Director, National 
                   Association of Railroad Passengers
    We appreciate this opportunity to comment for the record. Our 
Association is supported by about 12,000 individual dues-paying members 
who believe that the nation needs a balanced transportation system.
    The committee's hearing book on the National Economic Crossroads 
Transportation Efficiency Act of 1997 contains the bulk of our comments 
about the current and potential future importance of Amtrak to the 
nation's transportation system.
    A fiscal year 1998 operating-grant appropriation of $245 million 
(vs. $200 million requested by the Administration) and a mandatory 
payments appropriation of $142 million (the Administration supports 
this) are essential if Amtrak is to survive and provide the benefits we 
anticipate.
    With regard to capital grants, we urge committee approval of 
Amtrak's request of $750 million, with the understanding that any 
``half-cent'' capital investment trust fund--as finally enacted--would 
replace Amtrak's regular capital appropriation.
    Amtrak now projects a fiscal 1997 year-end cash shortfall of $80 
million. This is a marked improvement from the $96 million projected a 
few months ago, but still substantial. It is one indication that an 
inadequate fiscal 1998 operating grant may cause Amtrak to cease 
operations sometime during that year.
    Amtrak is starting to benefit from recent restructuring efforts and 
stability in services offered. In the second quarter (January-March), 
passenger revenues were up 12 percent, passenger-miles up 4 percent 
compared with the year-earlier months. For the Intercity Business 
Unit--which operates the Chicago-based corridor services and almost all 
of the long-distance trains--second-quarter passenger revenues were up 
16 percent and passenger-miles were up 7 percent. Clearly, the public 
wants to ride trains.
    Thank you for considering our views.
                                 ______
                                 
     Research and Special Programs Administration-Related Testimony
Prepared Statement of David Albright, Research Bureau Chief, New Mexico 
              State Highway and Transportation Department
    Chairman Shelby and Members of the Subcommittee, I appreciate the 
opportunity to testify on the importance of a test facility for systems 
engineering in transportation, as part of the strategic planning 
efforts of the Research and Special Projects Administration (RSPA), US 
Department of Transportation.
    My testimony is presented in two parts. The first is an overview of 
a Systems Engineering for Transportation (SET) Test Facility. This 
includes the national need, the proposed response to the need, and 
basic attributes of a proof of principle to demonstrate that the 
response is equal to the challenge. The second part of the testimony 
details elements of success for the proposed proof of principle. 
Documents supporting the testimony are noted, perhaps most helpful 
among them the recently published Sandia National Laboratories 
Colloquium presentation, ``Systems Engineering for Transportation''.
                                overview
A National Problem: Fracture of the Transportation System
    In the past, transportation has progressed by optimizing one 
subsystem after another. Canals, railroads, and highways have each 
played important roles in different times and in different ways. 
Although there has been and continues to be an economic interest in 
making the connection among modes efficient, modal research, planning, 
implementation, construction, maintenance and evaluation mechanisms are 
characteristically separate rather than singular.
    Fracture exists within as well as among transportation modes. 
Separate, static design of vehicles and infrastructure creates 
inefficiency and unanticipated effects. In highway transportation, for 
example, this is seen in premature pavement failure from lack of 
cooperative vehicle and infrastructure design. It is seen in safety 
problems such as initial design of antilock braking systems not 
anticipating pavement deformation at intersections, and initial design 
of airbags not accommodating some passengers. The problem in fractured 
highway design is seen, too, in the negative impact of noise on some 
neighborhoods and communities. Fracture of transportation within modes 
separates vehicles, infrastructure, and users.
    The cost of fracture is high. Fracture optimizes parts of the 
system and results in secondary, negative effects. Unfortunately, the 
cost of secondary effects on the system may be as great or greater than 
the benefit from the optimized subsystem performance.
    In some instances, costs are significant, but difficult to express 
in economic terms. The cost of failure is expressed in loss of human 
life through accidents, environmental degradation and resulting impact 
on health. Some costs associated with failure of the transportation 
system can be more readily quantified. Cost of traffic congestion, for 
example, can be calculated in urban areas. Cost can be calculated in 
reduced competitiveness of transportation products and services due to 
inadequately understood system interface or product acceptance. 
Transportation products and services are needed not only to meet the 
current market, but that can help define future markets.
    The separation of functions within and among modes results in 
denial if not removal of responsibility for the negative system effects 
of transportation products and services. Public and private 
transportation investments should be based on system performance, 
rather than optimizing parts of the system then trying to mitigate 
unanticipated results that are secondary to the subsystem but primary 
to a sustainable transportation system.
    There is a need to move from system fracture to Systems Engineering 
for Transportation (SET). Systems engineering offers the potential to 
address the system as a system rather than as a collection of 
subsystems. Each transportation mode can benefit from such an approach 
to transportation. This is true for highways, rail and transit. In 
addition, the interconnections among modes may be more effectively 
assessed. There is the potential to enhance economic competitiveness 
and reduce unacceptable problems in safe, equitable and environmentally 
responsible movement of people, goods and ideas. There is a need to 
design and develop vehicles and infrastructure in an interactive 
environment, termed Simultaneous Vehicle and Infrastructure Design 
(SVID), and to analyze transportation problems in the same, integrated 
environment, termed Simultaneous Vehicle and Infrastructure Analysis 
(SVIA).
    This need has been explored with public and private vehicle and 
infrastructure interests, as well as non-governmental organizations 
concerned with energy, environment, and social equity. There is 
interest in the addressing the need, as presented in supportive 
testimony on SVID by Basil Bama, Idaho National Engineering and 
Environmental Laboratory, to the Senate Subcommittee on Transportation 
and Infrastructure ISTEA Reauthorization Field Hearing, March 22, 1997. 
While there is general agreement the need is urgent, and the systems 
concept may be helpful, there has not been a clear sense of how the 
concept could be put into practice beyond encouraging dialogue.
The Proposed Solution: Systems Engineering for Transportation (SET) 
        Test Facility
    How the concept could be put into practice was first suggested by 
Steve Roehrig, Sandia National Laboratories. It is an approach which 
lends itself particularly well to a proof of principle. Mr. Roehrig 
suggested developing a Systems Engineering for Transportation (SET) 
Test Facility. The facility would not duplicate existing capabilities, 
nor would it obsolete them. Rather, the SET Test Facility would 
integrate existing test centers, creating a virtual environment to test 
vehicle products in relation to the current and planned changes to 
infrastructure. The SET Test Facility would enable system performance 
questions to be addressed in a way currently beyond our test 
capabilities.
A Proof of Principle
    A proof of principle is recommended to demonstrate that the concept 
can be implemented. The technical proof must include the ability to 
integrate information from existing, separate facilities to dynamically 
assess proposed changes in vehicle and infrastructure design. The 
institutional proof must include the ability to bring together public, 
private and non-governmental organizations, employing the technical 
capability to improve transportation products and services. It is 
recommended the proof of principle be cooperatively selected and the 
scope agreed upon by the Research and Special Projects Administration 
(RSPA) and the proposed partnership. Because all modes can benefit, 
RSPA is well-positioned to advance a systems capability on behalf of 
each of the modal administrations.
The Proposed Partnership
    In cooperation with RSPA, a partnership will be needed to prove the 
principle and, if successful, move toward implementation. The idea for 
the SET Facility began with Sandia National Laboratories, which should 
lead the partnership. It should do so in cooperation with the Idaho 
National Engineering and Environmental Laboratory. These laboratories 
have collaborated on the concept, and have the technology and systems 
engineering experience to prove the technical principle.
    The Alliance for Transportation Research (ATR) Institute, the 
University of New Mexico, has convened an SVID workshop in Dearborn, 
Michigan, and conducted various meetings to bring together automobile 
manufacturers, representatives of state and federal government, 
institutes of higher education and non-governmental organizations. The 
ATR Institute is well-positioned to serve as the hub to bring together 
the additional, diverse partners required to prove the institutional 
principle. The ATR Institute should work with the Surface 
Transportation Policy Project (STPP) toward this purpose. STPP has 
helped refine the SET concept since its inception. This team, combined 
with the leadership of RSPA Administrator David Sharma and his fine 
staff, can demonstrate the benefit of a systems approach.
                  development of a proof of principle
The Benefit from a Proof of Principle
    The SET Test Facility is a response to urgent national need; but, 
there must be a clear demonstration of the team's ability to develop 
such a facility, and feasibility of the approach to meet the need. An 
important problem for consideration as the proof of principle is to 
analyze and begin to improve highway vehicle and pavement performance. 
A proof of principle requires agreement between the interested federal 
agency and the partnership. The agreement required is on the level of 
funding, term of the proof of principle, and if successful, the 
anticipated level of implementation funding.
    The sponsor and partnership must agree on what is, and what is not, 
a successful proof of concept. With agreement on how success is 
defined, an initial investment can be made to prove the concept. If 
unsuccessful, there is no further funding. If successful, funding is 
provided.
    Utilizing a proof of principle to initiate significant research 
such as the SET Test Facility is beneficial in several regards. A proof 
of principle reduces the funding risk. It also focuses on metrics of 
success, which is helpful in the transition from scientifically 
significant research to useful research products. Finally, a proof of 
principle initiates constructive communication between the sponsoring 
agency and the research partnership. This builds trust both in conduct 
of the proof of principle and in assessment of general capabilities 
that may be employed in other efforts.
Elements of A Successful Proof of Principle
    Elements of success for the proposed proof of principle are similar 
to proven elements of successful research utilizing the national 
laboratories and strong, diverse transportation partners. (Elements of 
Success: TRANSIMS, New Mexico State Highway and Transportation 
Department, March 1997) However, because the subject is the system 
rather than subsystem or specific technology or technologies, the 
elements of a successful proof of principle for the SET Test Facility 
are slightly different and perhaps more challenging.
    The five elements of success for the SET Test Facility proof of 
principle are: 1) base research in need; 2) address need from 
underlying science; 3) define both technical and program success; 4) 
build research partnership; and 5) build an effective team. These 
elements of a successful proof of principle are described below.
1) Base Research in Need
    Brilliant minds do not necessarily address the most pressing 
questions. Innovative technologies do not necessarily solve immediate 
and most critical needs. Research must be in response to well-framed 
questions and well-defined, challenging needs. We cannot afford our 
best researchers and best research capabilities addressing the wrong 
problems, or providing nominal solutions that induce incremental 
subsystem improvement. Fundamental research with the potential to 
significantly enhance the transportation system and its associated 
products and services must be based in enduring, challenging and urgent 
need. This is descriptive of transportation as well as other sectors of 
our society in which the nation's science and technology base may be 
meaningfully employed.
    It is for this reason the SET Test Facility partnership includes 
exceptional technical competencies combined with exceptional experience 
in public and private teamwork. Other public and private organizations 
may well be added to the team; but necessarily for specific strengths 
added to help meet the need, rather than for expediency.
    The need must be understood before technical competencies can be 
meaningfully employed. Understanding the need is necessary, but not 
sufficient. In the absence of exceptional technical competencies to 
resolve issues in an innovative and impartial manner, institutional 
barriers, intransigence and cynicism tend to constrict research, 
development and constructive change.
    The principle must be proven in response to significant 
transportation need. The principle must be proven in relation to the 
feasibility and desirability of implementing the response.
2) Address Need from Underlying Science
    Fundamental research is important to address the enduring 
challenges in transportation. The nation's science and technology base 
can and should address national needs from the underlying science. The 
proof of principle should not only propose to address a need; the proof 
of principle should identify the scientific challenges raised in 
attempting to address the need.
    The SET Test Facility will present scientific challenges. One set 
of challenges relates to considering transportation as a system rather 
than collection of subsystems. This will require the design and 
development of new processes and tools. Meeting the challenges 
associated with systems engineering may well identify another set of 
challenges to information science.
    Other scientific challenges will be associated with the specific 
problem addressed in the proof of principle. Highway vehicle and 
pavement design for improved performance was suggested as an example. 
The selected problem, as well as its associated scientific challenges, 
should be identified cooperatively by RSPA and the proposed 
partnership.
    The general systems and information science challenges, however, 
will be associated with any selected problem for the proof of 
principle. They are briefly described below.
Systems Science
    Systems Engineering for Transportation (SET) will provide a 
conceptual framework to represent the transportation system. In this, 
SET is concerned with systems science. From the SET framework, 
processes and tools are proposed to improve transportation analysis and 
design. The framework, boundary interface for the defined system, and 
relationship between the framework, processes and tools will require 
innovative theoretical work.
    Systems engineering is a discipline initially developed by the 
government of the United States to engineer large, complex, and 
multidisciplinary systems. Once a system has been defined, such as 
transportation, and a framework developed, systems engineering is a 
process by which elements of the framework may be designed or improved. 
The SET framework will require thoughtful processes and tools for 
integrated transportation analysis and design. This system framework 
and these tools do not now exist, and their feasibility must be part of 
the underlying science demonstrated in the proof of principle.
Information Science
    Transportation data are extensive, complex and changing. The SET 
framework will be required to integrate extensive and complex data, if 
the data are to serve as useful information in decision making. 
Transportation data needs change as new questions are asked about the 
system and new metrics are suggested to indicate system performance. 
The nature of transportation base data will present a challenge in data 
representation. This challenge is, in part, one of graphic integrity. 
It is also a challenge in rendering complex data accessible to 
individuals from diverse backgrounds. With development of innovative 
processes and tools, issues of information integrity and clarity will 
likely emerge. The SET Test Facility, whether used for design (SVID) or 
analysis (SVIA), will present difficult challenges to information 
science.
3) Define both Technical and Program Success
Technical Success
    Technical success for the proof of principle should include 
demonstration of the facility, with some specific problem addressed. A 
compelling example is highway vehicle and pavement interface. The 
facility could permit the simultaneous design of vehicle suspension, 
tire characteristics, and pavement design and maintenance procedures. 
With limited funds for highway construction and maintenance, it is 
imperative that roads be designed and built to last longer. The 
proposed test facility could allow the interactions of vehicle, tire, 
pavement and environment to be examined, understood, and performance 
specifications improved.
    The proposed highway vehicle and pavement interface example would 
require involvement of vehicle manufacturers, pavement designers, 
public and private construction companies, and a variety of other 
concerned organizations. This example would also serve to demonstrate 
public involvement in the process. A highly efficient interaction 
between vehicle and pavement must also be acceptable to the public in 
regard to noise and cost. The assessment of noise and impact on 
neighborhoods also helps describe the importance of placing the 
innovative work in the context of systems engineering. Any potential 
solutions to improve pavement performance must be assessed in relation 
to the environment; tracing the current design and proposed solution 
from extraction to recycling.
    A successful technical proof of principle should address the SET 
conceptual framework, and processes and tools for transportation design 
and analysis. A formidable technical challenge will be to advance the 
science and engineering of transportation and to do so in a way that is 
understandable to and involves the public. This should be established 
as a criterion for technical success.
Program Success
    Program success follows technical success. If the SET Test Facility 
can be built, whether or not it will be used will largely define 
whether or not the program is a success. Program success is public, 
private and non-governmental organization interest in participating in 
the process and providing or using resulting products and services.
    The potential value of the SET conceptual framework must also be 
the proven value of the SET Test Facility. An idea to change and 
hopefully improve some aspect of transportation must be placed in 
context of the system as a whole, and refined as a result. The 
recommended demonstration in the proof of principle is concerned with 
subsystem performance. The need is in the highway mode, and within this 
mode vehicle and pavement interface.
    The SET framework, and its design application, SVID, would permit 
alternative vehicle and pavement designs to be assessed in relation to 
system impact. Alternative investment and implementation strategies 
could be assessed within highway transportation, and could be assessed 
as well among modal strategies.
    The SET Test Facility would integrate vehicle and pavement tests to 
model improvement in design. Alternative improvements would be assessed 
in context of the how they would affect the transportation system. The 
impact on the user, as an individual and in community, on vehicle and 
infrastructure would be assessed. Technical success is the ability to 
make the assessment. Program success is the ability to implement the 
assessment.
4) Build Research Partnership
    National laboratories have the technology and personnel to lead in 
providing tools and processes for systems engineering in transportation 
design and analysis. The national laboratories can lead; however, their 
leadership will produce useful tools only to the extent their 
capabilities are guided through meaningful partnership.
    Universities are critically important to provide the connection to 
public and private organizations. An institute of higher education will 
be essential to serve as a hub for communication; and, other 
universities will be needed to work with the laboratories, improve the 
tools, and help apply the tools in cooperation with other public 
agencies and the private sector.
    The private sector is essential to the proof of principle. First, 
private companies involved in vehicles and infrastructure must be 
involved in developing the tools and processes for there to be 
technical success. The private sector defines program success in 
implementing the tools and moving toward system-supporting products and 
services.
    The SET Test Facility must include the public as a partner in 
research. The transportation system attempts to accommodate people in 
their interest to move themselves, their ideas and objects from one 
point to another. Diverse individuals, not just organizations 
representing groups of individuals, should have an opportunity to 
understand and advise the results. Each individual will be the most 
knowledgeable expert about how a change to the transportation system 
will affect them, their experience of mobility and access. Individuals 
form the public that public agencies intend to serve; and they form the 
market that private companies intend to serve. How broad-based, diverse 
individuals have an opportunity to interact with the SET Test Facility 
process and results during the proof of principle may well define how 
diverse individual insight is gained should the principle be proven, 
the facility built and operated.
5) Build an Effective Team
    In research projects, team building is concerned primarily with 
sustaining the technical team at a peak level of performance throughout 
the project. In a proof of principle, the concern is to bring the right 
persons together to prove, or disprove, the principle within the agreed 
upon time line.
    Sandia National Laboratories and the Idaho National Engineering and 
Environmental Laboratory have the capability to assemble the right 
technical team. In addition to working on the SET framework, transport 
within the US Department of Energy, the laboratories also share 
responsibility for a systems approach to hazardous waste.
    From the beginning, the Alliance for Transportation Research 
Institute, the University of New Mexico, supported this work. The ATR 
Institute developed and maintains a website specifically for dialogue 
on simultaneous vehicle and infrastructure design. Combined with its 
commitment to and experience in public involvement in transportation 
research, the ATR Institute can be an important part of the team. The 
Surface Transportation Policy Project (STPP) has worked with the ATR 
Institute on several national transportation research projects. In 
addition, Hank Dittmar and Don Chen of STPP made substantive 
contributions to the SET framework and potential implementation.
    Working with RSPA, with these organizations at the core, other 
organizational interests can be attracted to and meaningfully engaged 
to help demonstrate the proof of principle. Together, there is the 
potential to address the need from the underlying science, and to 
successfully produce technical and program results.
                               conclusion
    The value of the proposed SET Test Facility extends to all 
transportation modes. Each mode has user, vehicle and infrastructure 
issues that may be assessed within such an environment. The value of 
the facility holds potential for research, providing an invaluable tool 
for assessing the system impact of proposed modal change.
    Because the proposed SET Test Facility is a system performance 
capability, the proposed proof of principle should be coordinated by 
the Research and Special Projects Administration (RSPA). RSPA has 
responsibility for system level assessment and improvement of 
transportation. RSPA also helps integrate the work of critically 
important research partners in such an effort: federal laboratories and 
institutes of higher education.
    A sense of responsibility for system performance can be addressed 
by regarding transportation as a system, but the present fracture of 
transportation interests presents a formidable implementation issue. 
Fracture will only be overcome if public, private and non-governmental 
organizations recognize the potential benefit from a systems approach 
so significantly outweighs potential cost that historic resistance, 
resentment and mistrust can be set aside.
    There are several references that may provide helpful background. 
Introductory comments on simultaneous design were documented in a 
presentation, ``Simultaneous Vehicle and Infrastructure Design,'' Los 
Alamos National Laboratory, Los Alamos, New Mexico, October 1995. 
Discussion of simultaneous design with vehicle manufacturers, 
government agencies, and non-governmental organizations was documented 
in, ``Transportation Opportunities and High Purposes: The Right 
Persons. Compelling Problems and Appropriate Resources,'' Proceedings 
of the First Invitational Workshop on Simultaneous Vehicle and 
Infrastructure Design, Dearborn, Michigan, published by the Alliance 
for Transportation Research Institute, Albuquerque, New Mexico, March 
1996. Steve Roehrig outlined his concept of an innovative, virtual test 
facility in a presentation, ``SVID Test Facility,'' briefing document, 
Sandia National Laboratories, Albuquerque, New Mexico, January 1997. 
Finally, in April 1997, I presented a colloquium on ``Systems 
Engineering for Transportation,'' which is available through Sandia 
National Laboratories. The colloquium paper describes potential SET 
framework, SVID and SVIA processes and tools. It also proposes a proof 
of principle to implement the concept and address the national need.
    The nation has a Research and Special Projects Administration 
charged with and affirming responsibility for transportation systems 
level understanding and improvement. There is a concept that has the 
potential to significantly enhance this effort, Systems Engineering for 
Transportation Test Facility. There is a team that can work with the 
Administration to realize the concept and build the facility. The next 
step is a proof of principle. There is now the opportunity to refine 
the concept, build the tools, and prove the principle.
    Thank you.
                                 ______
                                 
                       Transit-Related Testimony
     Prepared Statement of the American Public Transit Association
                              introduction
    The American Public Transit Association (APTA) appreciates the 
opportunity to testify on the fiscal year 1998 Transportation 
Appropriations and Related Agencies bill. This testimony complements 
our April 10, 1997 statement before the Subcommittee on reauthorization 
of the Intermodal Surface Transportation Efficiency Act (ISTEA). 
Because Congress is likely to pass the fiscal year 1998 Transportation 
Appropriations Act before it finishes action on legislation to 
reauthorize ISTEA, we felt that it was important to comment on 
development of these bills separately.
    As we mentioned in previous testimony, APTA strongly supports 
ISTEA. We supported its enactment in 1991 and our experience over the 
last six years leads us to conclude that the new law is an effective 
way to address transportation needs. As a result, APTA has adopted a 
comprehensive ISTEA reauthorization working proposal that would 
preserve and build on the ISTEA and transit program structures, and 
expand opportunities for flexible funding.
    We welcome the acknowledgment--clearly demonstrated by transit 
funding increases in fiscal year 1997--that even though it is important 
to control federal spending, it is also vital to increase investment in 
the nation's transportation infrastructure. An efficient transportation 
system is the foundation on which we build economic growth. For fiscal 
year 1998, APTA urges the Subcommittee to provide the maximum funding 
possible for the federal transit program.
                         capital funding needs
    The U.S. Department of Transportation (DOT), APTA, and the American 
Association of State Highway and Transportation Officials (AASHTO) all 
agree that total capital funding needs are at least $13 billion 
annually. Based on an APTA study of the transit industry, these capital 
needs over the next decade include:
  --$38 billion for new vehicles, including 67,800 buses and 51,400 
        vans;
  --$25 billion for new bus facilities including parking lots for bus 
        passengers;
  --$13 billion to modernize bus facilities and equipment;
  --$23 billion to modernize and rehabilitate existing fixed guideway 
        rail and bus routes, stations, and maintenance facilities;
  --$46 billion for additional fixed guideway services that respond to 
        new customer demands; and
  --$5 billion to rehabilitate more than 14,900 buses, rail cars, and 
        other vehicles to extend their useful lives.
                    fiscal year 1998 transit funding
    In light of these critical needs, we urge you to approve the 
maximum possible funding for the federal transit program. APTA urges 
the Subcommittee, in developing its fiscal year 1998 bill, to consider 
the following priorities:
  --Increase funding for the federal transit program and all surface 
        transportation programs authorized under current law;
  --Retain operating assistance at no less than the current level if 
        the Subcommittee proceeds under current law;
  --Maintain balance within the federal transit program by funding 
        formula and discretionary programs in a manner consistent with 
        ISTEA authorization levels and relative funding shares, 
        including the 40:40:20 ratio among the Major Capital Investment 
        program's New Start, Fixed Guideway Modernization, and Bus/Bus 
        Facility components;
  --Fully use Mass Transit Account resources for their dedicated 
        transportation purposes;
  --Increase funding for the transit capital program and support 
        authorizing changes that permit a broader definition for the 
        use of formula funds for preventative maintenance activities, 
        as is currently allowed for highway activities under the 
        Federal Highway Administration (FHWA) program. We understand 
        that, as the FHWA program's eligibility extended beyond 
        construction to include maintenance, its outlay curve has 
        hardly changed, and we expect the same result on the transit 
        side. Indeed, we understand that FTA outlay rates have not 
        increased even as the eligible definition of capital has 
        expanded over the past few years;
  --Support APTA's authorizing recommendations that maximize spending 
        on transit capital and minimize reliance on federal operating 
        aid. Small urbanized areas (UZA's) should be given the 
        flexibility to use federal funding for operating or capital, as 
        is permitted in non-urbanized areas; and
  --Help transit systems fully implement service associated with the 
        Americans with Disabilities Act (ADA) without compromising 
        existing services.
                         continuing challenges
    The transit industry's future success requires a concerted effort 
to support economic development while protecting the quality of life in 
communities of all sizes. The availability of transit services will 
also have a significant impact on the success of welfare reform. At the 
same time, transit must comply with a variety of federal mandates.
Metropolitan Mobility and Economic Growth
    Transit is an effective tool for economic development. It returns 
three times its cost in business revenue to the communities it serves, 
according to a recent APTA study, and each $10 million invested in 
transit creates or maintains 550 full-time jobs. When cities add bus 
routes or build rail stations, they stimulate private investment around 
the new transit service in the form of housing, retail and other 
privately-financed, tax-generating development. In the Washington, D.C. 
area for example, the Washington Metropolitan Area Transit Authority 
has generated at least $15 billion in surrounding private development. 
A KMPG Peat Marwick study found that the Commonwealth of Virginia is 
expected to benefit from $2.1 billion in state tax revenue attributable 
to Metrorail between 1978-2010, a healthy return on a projected state 
investment of $940 million.
    The more people use transit, the less crowded urban and suburban 
roadways are. A full bus removes 40 cars from the road, and a full rail 
car removes 125 cars. Fewer cars on the road mean that commercial 
vehicles can move more efficiently, reducing transportation costs for 
business and minimizing need for additional highway construction that 
is often prohibitively expensive. Transit accounts for 20-50 percent of 
work trips in many of the nation's largest cities, including 54 percent 
in New York; 34 percent in San Francisco; 30 percent in Chicago; and 20 
percent in Atlanta.
    Sufficient funding for transit promotes efficient use of all 
transportation dollars by subjecting every proposed project to 
alternatives. From fiscal year 1992 through 1996, local officials chose 
to use almost $3 billion in flexible federal funding for their 
communities' transit needs. It is estimated that American businesses 
will lose $24.5 billion annually over the next 20 years because of 
traffic congestion. If the federal government fails to invest 
adequately in transit, gridlock and the corresponding losses in 
economic productivity will worsen.
Small Town and Rural Transit
    In the nation's small urbanized areas--those with fewer than 
200,000 people--and rural counties, the availability of transit service 
provides essential mobility and access to jobs, social and health 
services, church, and stores. An estimated 30 million non-drivers in 
rural America depend on transit; in some cases its availability allows 
the elderly to stay in the homes they cherish and out of more expensive 
nursing homes. APTA supports proposals to increase small UZA and rural 
transit funding. It is our position that all federal assistance to 
these areas should be available for capital or operating needs, so that 
transit operators in these communities will have the maximum 
flexibility to meet local needs.
Environmental Benefits
    Transit is also an effective tool in the fight against air 
pollution. Vehicle traffic is responsible for 40 percent to 60 percent 
of pollution that produces ozone and 70 percent to 80 percent of carbon 
monoxide emissions. Air pollution has enormous costs and is a major 
factor in a community's quality of life. A person using public transit 
for a year instead of driving an automobile, reduces hydrocarbon 
emissions by nearly 90 percent and carbon monoxide by more than 75 
percent.
Access to Jobs
    Transit is vital to the success of welfare reform. The cost of 
commuting to and from work by transit can be as low as 10 percent of 
the annual cost to own and operate an automobile. That can make a 
critical difference in an entry-level worker's budget.
    The American public understands that many welfare recipients do not 
own cars and must rely on public transit to get to work. In a recent 
nationwide public opinion survey, an overwhelming 83 percent of those 
asked agreed that the availability of public transit is very important 
to a welfare recipient who wants to get a job. Another 12 percent said 
that it is somewhat important, with only three percent saying that the 
availability of transit is unimportant.
    Because most new jobs are in the suburbs, transit operators must 
provide special ``reverse commute'' and suburb-to-suburb bus, rail and 
van services to match center city residents with suburban jobs. Since 
1989, JOB-RIDE, a reverse commute program in Wisconsin, has provided 
access to more than 3,500 suburban jobs and reduced the welfare and 
unemployment rolls. In cities like Philadelphia and Chicago, transit 
agencies use special buses, vans and other employer-supported programs 
to serve workers who live in one suburb and work in another. 
Coordination of transit service with other government functions can 
save tax dollars at all levels of government.
Federal Mandates
    APTA supports the goals of the Americans with Disabilities Act, the 
Clean Air Act, federal drug and alcohol testing laws, and the Clean 
Water Act. However, the costs of these goals add at least $1.5 billion 
each year to transit capital and operating costs--nearly four times the 
$400 million allocated for transit operating assistance in fiscal year 
1997. Absent sufficient federal funds to cover these costs, many 
transit systems are forced to sacrifice some existing services.
    Transit agencies met the January 27, 1997 compliance deadline to 
make paratransit service comparable to fixed-route service, but their 
ADA capital and operating costs may be $1.4 billion annually for the 
next several years. The demand for ADA paratransit service is expected 
to grow, and complementary paratransit service will still be required 
even after all fixed-route service is fully accessible. The noble 
vision of ADA must be fulfilled with the support of our entire society. 
The costs of compliance should not be placed disproportionately on 
transit riders, yet that is what happens if service is reduced, or 
fares are raised, or plans for expanded service are canceled, if ADA-
related costs should lead to cutbacks in other parts of a transit 
agency's budget.
          the administration's fiscal year 1998 transit budget
    While APTA is pleased that the Administration proposes to retain 
the ISTEA program generally, those of us who serve millions of transit 
customers each day are disappointed that the Administration has not 
sought higher funding for transit, highway, and rail programs in fiscal 
year 1998.
Capital Funds
    The Administration proposal to permit the use of capital funds for 
maintenance activities is a positive step, as is the provision to allow 
transit agencies in small UZA's (those with fewer than 200,000 people) 
to use all federal funds for capital or operating assistance. This 
proposal, which is similar to APTA's reauthorization proposal, would 
make it easier to preserve the value of federal capital investments in 
transit. Also, it is consistent with FHWA policy, which allows the 
expenditure of federal capital funds on maintenance of capital 
investments in highway projects.
Transit Program Structure Changes
    Within the transit program, the Administration has proposed 
significant shifts in funding. We support the ISTEA-authorized major 
capital investments program with its 40:40:20 funding ratio among the 
New Start, Fixed Guideway Modernization, and Bus/Bus Facility programs. 
We are very concerned about the Administration's proposal to reduce New 
Start and Fixed Guideway Modernization funds by 17 percent, so that 
each program would receive only $634 million in fiscal year 1998, 
compared to $760 million each in fiscal year 1997. In contrast, we note 
with pleasure that the Administration's NEXTEA authorization proposal 
call for $800 million in fiscal year 1998 for the New Start program and 
$800 million for Fixed Guideway Modernization, with funding increases 
in subsequent years. We believe that each of these programs address 
specific investment needs, that funding for each program should be 
retained and increased.
    The discretionary bus/bus facilities program is needed to address 
bus capital requirements that are not easily addressed through the 
formula program. The existing program structure is right for the 
transit industry and our customers. Small bus properties would be hard 
pressed to make substantial investment in bus and bus facilities if 
Section 3 bus funding is eliminated with the current prohibition on 
banking federal funds under the three year ``use it or lose it'' rule. 
In addition, we are concerned that the elimination of the discretionary 
bus/bus facilities program and the movement of this $380 million 
program into the formula program will result in the shift of about one-
third of the funds (the amount that goes only to rail properties under 
the formula program) from bus needs to rail needs.
    We also question the Administration's claim that its NEXTEA 
proposal would increase transit formula funding when these structural 
changes are analyzed. APTA has a long-standing policy to preserve the 
ISTEA-enacted funding relationship of $1.36 in formula funding for 
every $1 in major capital discretionary funding.
    Finally for rural transit providers the NEXTEA proposal reduces 
authorized funding and places service to customers at risk. The Non-
urban program (formerly section 18) would receive 3.75 percent of an 
expanded formula program--a lower percentage than the current 5.5 
percent of the combined total for urban and rural formula funds. 
Additionally, rural formula funding would be reduced because 4 percent 
of the total would go to the Rural Transportation Assistance Program, 
which is now funded through the Research program. The elimination of 
the Bus Discretionary Program would also take away a guaranteed 5.5 
percent share of that program for rural communities.
Access to Jobs and Training Initiative
    The proposed new Access to Jobs and Training Initiative recognizes 
that transit providers can help address a critical need. APTA believes, 
however, that this important new initiative should be funded with new 
resources and not supported with a takedown of the existing formula 
program as proposed in NEXTEA.
                               conclusion
    APTA strongly supports a continued federal role in funding surface 
transportation. ISTEA has worked well and must be continued. While we 
recognize the need to control spending and reduce the deficit, 
increased investment in the transportation infrastructure is needed to 
facilitate economic growth, international competitiveness, successful 
welfare reform, and other national goals. Putting off necessary 
investment will only increase federal costs in the long run. We urge 
this Subcommittee to fund the federal transit program at the highest 
possible level in fiscal year 1998.
                                 ______
                                 
  Prepared Statement of Bob Drewel, Chair of the Board, Central Puget 
                    Sound Regional Transit Authority
    Mr. Chairman and Members of the Subcommittee, as the Executive of 
Snohomish County in Washington State and the Chair of the Board of the 
Central Puget Sound Regional Transit Authority (RTA), I appreciate the 
opportunity to submit testimony about our Sound Move plan to improve 
mobility for the central Puget Sound region and the assistance we need 
from the federal government in fiscal year 1998 to expeditiously 
advance this plan.
    On November 5, the voters of our region approved our Sound Move 
proposal by a majority of 56.5 percent. Sound Move will increase the 
capacity of the region's transportation system through a mix of light 
rail, commuter rail, High Occupancy Vehicle Expressways, regional 
express bus routes and ``community connections'' such as park-and-ride 
lots and transit centers. Transit customers will be able to travel by 
local bus, regional bus, light rail and commuter rail under a single 
ticket.
    Our region's voters agreed to pay for most of this plan through a 
\4/10\ of one percent increase in the local sales tax and a \3/10\ of 
one percent increase in the motor vehicle excise tax. These tax 
revenues will provide a stable, dependable, dedicated source of local 
revenue for building, maintaining and operating the system.
    The RTA needs federal financial help, however, to successfully 
implement the light rail and commuter rail portions of this plan:
    Our light rail plan includes a 25-mile line with 26 stations 
between the University District of Seattle and the City of Sea-Tac via 
downtown Seattle and Sea-Tac Airport. If sufficient funding is 
available, we want to extend that line north from the University 
District to the Northgate region of Seattle. One of the most 
significant investment required for this line, the downtown Seattle 
transit tunnel and its five stations, is already in place. Our plan 
also calls for a 1.6 mile light rail line between downtown Tacoma and 
the Tacoma Dome train station. Last year, Congress appropriated $3 
million to begin preliminary engineering and environmental work on our 
light rail system.
    Our commuter rail plan calls for an 81-mile line between Everett 
and Lakewood, via Seattle and Tacoma, with at least 14 stations. The 
commuter trains will run on existing freight track. RTA funds, 
supplemented by funds from our public and private partners including 
the railroads, will help pay for track and signal improvements on this 
line in order to secure the speed and reliability necessary for quality 
commuter passenger service on this line. We have obligated $1.88 
million in federal funds for the environmental work on the Seattle-
Tacoma segment of this line and $1 million for the ``Tryrail'' 
Demonstration Project in 1995. We expect to obligate an additional $1.3 
million very shortly for the environmental work on the Everett-Seattle 
and Tacoma-Lakewood segments of this line.
    We will be seeking an authorization for federal funding for our 
light rail and commuter rail projects, in the bill reauthorizing the 
Intermodal Surface Transportation Efficiency Act (ISTEA), as the 
elements of a program of inter-related projects.
    For fiscal year 1998, we are seeking $22.7 million for our light 
rail project and $21.9 million for our commuter rail project:
    1) The light rail funds would be used for the capital costs of our 
preliminary engineering and environmental impact study work on the 
entire line between Northgate and the City of Sea-Tac. These tasks will 
include:
  --data collection on rights-of-way requirements;
  --environmental and geotechnical issues;
  --systems specifications for the procurements of vehicles, 
        electrification equipment, training signaling and 
        communications systems;
  --a project management plan;
  --a systems operation plan;
  --siting and design of the light rail transit maintenance base;
  --alignment and station design;
  --a Definition of Alternatives report; and
  --refined cost estimates.
    2) The commuter rail funds would be used for the capital costs of:
  --our environmental assessments/environmental impact statements on 
        the Everett-Seattle and Tacoma-Lakewood segments;
  --design and engineering of a vehicle yard and shop facility and 
        vehicle layover locations, possibly in coordination with Amtrak 
        and the Washington State Department of Transportation;
  --engineering and construction of railroad track, signal and capacity 
        improvements;
  --property acquisition;
  --station design for 14 stations, with special emphasis on the major 
        terminals in Everett, Seattle and Tacoma; and
  --the development of vehicle specifications.
    We are very pleased by the very broad support we have received for 
Sound Move from business, environmental and community leaders and 
especially the citizens of our region. We believe that Sound Move will 
help maintain the economic vitality and quality of life of the central 
Puget Sound region and all of Washington State. Because Washington 
State is the most trade-oriented state in the country, this investment 
in regional mobility will benefit the entire nation.
    We are convinced that any analysis of our project will conclude 
that it is a cost-effective investment. We anticipate strong ridership 
numbers and we expect our local match rate to be one of the highest in 
the nation for new start projects.
    This subcommittee can help us put our plans into action as promptly 
and efficiently as possible. We appreciate your consideration of this 
request and we look forward to working closely with you during the 
coming years. Thank you.
                                 p_____
                                 
      Prepared Statement of the Electric Transportation Coalition
                            i. introduction
    This statement is submitted by the Electric Transportation 
Coalition (Coalition), an organization of public and private groups 
joined together to advocate the use of electricity as a transportation 
fuel. A membership list is attached. A principal activity of the 
Coalition is to encourage the adoption of policies and programs to 
support the development and use of electricity as a ``fuel'' in the 
transportation sector.
    This statement addresses the fiscal year 1998 budget for the 
Department of Transportation. Since this year's transportation 
appropriations process will coincide with reauthorization of the 
Intermodal Surface Transportation Efficiency Act (ISTEA), the Coalition 
has included in this written statement recommendations for policy 
objectives and programs that we recommend be included in that 
legislation.
   ii. the role of electricity in the national transportation system
    The Coalition believes that electricity should be a principal fuel 
for the future to power the national transportation system. Electricity 
offers significant advantages in transportation applications. From an 
energy security standpoint, electric transportation presents our nation 
with an important means for reducing our dependency on foreign 
petroleum and increasing the diversity of fuels in the transportation 
sector. A wide variety of transportation modes--individual passenger 
and light-duty vehicles; heavy-duty vehicles, like buses and trolleys; 
light rail; commuter rail; high speed rail; and heavy rail services--
can be powered by an abundant, domestically produced energy resource 
generated from a variety of sources. That domestically produced energy 
resource is electricity.
    In addition to diversifying sources of transportation ``fuels,'' 
air quality considerations are requiring municipal transit operators to 
consider the use of alternative fuel technologies as a means to reduce 
emissions and achieve air quality goals. For many urban areas, electric 
transportation may be a particularly important means to substantially 
reduce emissions of mobile source pollutants, including volatile 
organic compounds and oxides of nitrogen, that are the precursors of 
smog.
    Electric vehicles (EV's) and electric buses, for example, are truly 
``zero emission'' vehicles in operation. They produce no tailpipe 
emissions and generate insignificant operation emissions. Also, unlike 
other vehicles, EV's are not subject to emission system deterioration 
over time and there is no danger of tampering with emissions controls.
          iii. electric bus deployment and evaluation program
    In order to focus government and public attention on the exciting 
possibilities that electric transportation holds, including a cleaner 
environment and economic growth and jobs creation, the Coalition is 
advocating the creation of an Electric Bus Deployment and Evaluation 
Program in this year's reauthorization of ISTEA. Specifically, the 
Coalition supports the enactment of a new five-year $50 million program 
to deploy and test various applications of electric bus technology in 
10 sites across the country. The members of the Coalition believe this 
program will assist the electric bus technologies--currently built by 
hand, at low volume--to reach commercialization and allow the American 
public to realize the full extent of benefits electric buses can offer. 
The Coalition urges the Transportation Appropriations Subcommittee to 
support the creation and initial funding for this program in fiscal 
year 1998.
    Today, much of the Nation's public transportation system depends on 
the use of buses in public transit, school and shuttle applications. 
Diesel powered buses produce noise and emit tailpipe emissions. In 
stark contrast, electric and hybrid-electric buses are both clean and 
quiet. Studies in California have concluded that electric buses are 90-
97 percent cleaner than diesel powered buses even when power plant 
emissions are considered. Furthermore, electric transportation 
technology is well suited for bus applications because buses typically 
operate over limited distances and the driving range achieved with the 
current generation of batteries is acceptable. Moreover, electric buses 
are centrally garaged, which allows for central charging, or quick 
change-out of the batteries, or ``opportunity charging'' (charging for 
10-15 minutes), all of which are techniques of conveniently 
``refueling'' an electric vehicle.
    Currently, electric shuttle buses are being operated across the 
country. For example, 30-foot electric shuttle buses have become 
operational for daily use in Santa Barbara, California and Chattanooga, 
Tennessee. In addition to the 30-foot battery shuttle buses, hybrid-
electric technologies have been used in 40-foot transit bus 
applications. Several different ``fueling'' options (batteries, hybrid-
electric systems, and fuel cells) are under development and available 
for different bus transportation applications (transit, shuttle or 
school bus applications). These examples highlight the potential for 
the use of electricity in bus-related applications to effectively and 
efficiently meet transportation needs while enhancing air quality, 
promoting energy security, and helping to create domestic jobs.
    Despite the potential benefits from electric buses, barriers exist 
to their expanded use and must be removed. Specifically, while electric 
buses currently in operation have demonstrated the opportunities and 
benefits from electric bus utilization, they also have illustrated that 
additional information and testing are required before the state-of-
the-art electric bus technology reaches commercialization. Further, 
because of the limited range associated with current and near term 
battery technology, additional costs are incurred to maximize the use 
of the bus in a transit application. These costs include spare battery 
packs for battery exchanges and/or fast charging devices. Greater use 
of these buses are expected to resolve some of these problems, bring 
down costs and further advance the technology.
    The new technology must be evaluated and deployed widely enough to 
give potential users an adequate set of experiences (including, for 
example, climatic and regional diversity) by which to make decisions 
regarding widespread utilization. Information must be collected and 
disseminated regarding training for this new transportation technology 
and systems integration issues regarding the vehicles and the 
supporting infrastructure must be resolved.
    As Congress considers the transportation needs of the country 
through the reauthorization of ISTEA, an opportunity exists for the 
federal government, in partnership with industry, and state and local 
governments, to work towards establishing a program and process which 
will ensure that the barriers to electrified bus transportation are 
overcome.
    Through the reauthorization of ISTEA, the Coalition seeks to enact 
a program for a federal government/industry cost-shared deployment 
program of electric and hybrid-electric bus technologies. The purpose 
of the program would be to promote the deployment and evaluation of 
buses and the infrastructure associated with the use of such buses. The 
program would be administered by the Department of Transportation, 
allowing for a consultative role for the Departments of Energy, 
Commerce, and Defense as well as the Environmental Protection Agency.
    As currently envisioned, at least ten (10) electric bus deployment 
projects would be selected to participate in the program. The proposals 
would represent a diversity of regional and climatic settings, as well 
as a variety of customer applications (including transit, shuttle, and 
school transport). Further, this program would be designed as an 
industry/government cost-shared endeavor. Cost-sharing will reduce the 
financial burden of the program for the federal government and ensure 
community participation and commitment to the success of the program. 
We would suggest that project costs also include the increased, or 
incremental, costs associated with the maintenance and operation of 
these buses.
    Finally, we would suggest that projects be selected on a 
competitive basis and that project participants produce reports on 
operation, performance, and maintenance. The program should also 
require project participants to host a limited number of presentations 
or visits for representatives of other communities. Participants would 
also be required to submit a post-program plan for continuing use of 
electric buses.
                       iv. istea reauthorization
    In 1991, Congress approved a six-year $151 billion surface 
transportation authorization bill, commonly known as ISTEA. On 
September 30, 1997, the authorization for ISTEA will expire. The 
Coalition realizes that the Appropriations Committee does not maintain 
jurisdiction over the reauthorization process of ISTEA. However, the 
Subcommittee on Transportation Appropriations plays a critical role in 
the implementation of transportation policy, and since the fiscal year 
1998 appropriations process and the ISTEA reauthorization process 
coincide this year, it is critical for Congress to support, through 
authorization and appropriations, the innovative tenets of ISTEA.
    ISTEA fundamentally restructured the manner in which transportation 
officials, and the public at large, think about transportation planning 
and operation. No longer is transportation development considered 
solely along modal lines; instead, intermodal planning is the 
reasonable approach now employed. In addition to connections between 
modes, today's transportation policy connects national goals through 
transportation policy as well. Enhancing air quality, promoting public 
safety, and improving land-use planning are all objectives of ISTEA.
A. ISTEA Should Continue To Pursue A Multi-Modal Strategy and Multiple 
        National Goals
    The Coalition strongly urges the Subcommittee to support a 
reauthorized ISTEA that promotes a multi-modal system and multiple 
national goals. It is vital that these connections among modes and to 
other national policies, especially the Clean Air Act, be supported and 
maintained. The Coalition supports expanding transportation development 
beyond a focus of traditional highway projects to include innovative 
transportation technologies, as well as to link transportation policy 
with other national goals such as energy security and efficiency.
    The Coalition also believes that federal efforts to link 
transportation development with improved community planning should be 
continued and that deployment of innovative transportation modes and 
infrastructure such as electric transportation should be encouraged. 
The Coalition supports the efforts of the Federal Transit 
Administration under the ``Livable Communities'' program to make 
communities more livable through improved transportation planning.
    The reauthorization of ISTEA also should continue to support such 
programs that encourage communities to consider, or integrate, multiple 
factors and goals into their development plans so as to create the most 
desirable and ``livable'' areas. Such factors include: clean, 
convenient, efficient and safe transportation development; energy 
efficiency; environmental conservation; and economic growth. For the 
transportation sector, this effort should focus on long-term solutions 
rather than quick-fix alternatives. Innovative, 21st century 
transportation technologies and infrastructure--such as electric 
transportation--should be showcased in this program.
B. The Congestion Mitigation and Air Quality Improvement Program (CMAQ)
    The Congestion Mitigation and Air Quality Improvement Program 
(CMAQ) is one such innovative program in that it promotes both greater 
efficiency and reduced pollution from the transportation sector. The 
Coalition supports continuation of CMAQ with increased focus on 
advanced transportation technologies.
    To obtain the greatest benefit from limited program funds, the 
Coalition urges the Subcommittee to consider a CMAQ project selection 
system which evaluates and competes projects of a similar nature but 
would not consider (and compete) dissimilar projects, e.g., projects 
which promote future, long-term benefits versus projects supplying more 
immediate returns; e.g., alternative fuel fleet conversions should not 
be ranked against HOV lane projects.
    The Coalition also supports a process whereby eligible CMAQ 
projects, which receive a portion of private funding, would be favored 
over projects funded only with public sector funds. Such a provision 
would not damage the quality of the program but would encourage 
private/industry support for community projects and stretch limited 
public resources. We also believe that non-attainment areas, 
redesignated as maintenance areas, should remain eligible for CMAQ 
funds. However, we believe those funds should be focused on projects 
that continue to address air quality concerns.
C. The Surface Transportation Program
    The Coalition supports continuing the funding flexibility 
established through the Surface Transportation Program. We urge the 
Subcommittee to support this important program and expand the project 
eligibility for STP funds to include fueling stations and supporting 
infrastructure for alternative fuel transportation technologies.
D. Federal Transit Administration Funding
    The Coalition also urges the Subcommittee to ensure that federal 
transit funds are adequately and fairly maintained. When transportation 
programs are considered for federal funding cuts, we urge the 
Subcommittee to make sure that transit programs do not receive a 
disproportionate share of those cuts. The Coalition also urges the 
Subcommittee to support the 20 percent allocation of the gas tax 
collected for transportation programs and all congressional efforts to 
focus these gas tax funds on capital projects.
    Furthermore, as ISTEA is currently written, the law provides a 
higher federal cost share for mass transit projects involving the 
acquisition of vehicle-related equipment required by the Clean Air Act. 
The standard federal cost share for mass transit projects is 80 
percent, but if the funds are required to purchase alternative fueled 
buses in order to comply with the Clean Air Act then the federal match 
increases to 90 percent. The Coalition supports this higher federal 
cost-share and urges the Subcommittee to support the link between 
federal transit programs and obtaining Clean Air Act goals by 
maintaining or increasing the federal match for mass transit projects 
required by the Clean Air Act.
E. Access to High Occupancy Vehicle Lanes
    We encourage the Committee to support efforts to seek, though the 
reauthorization of ISTEA, enactment of a provision to grant states the 
authority to provide non-fleet alternative fuel vehicles (AFV's)--
including electric vehicles--access to high occupancy vehicle (HOV) 
lanes without regard to number of vehicle occupants.
    Such an amendment would provide a budget-neutral incentive for 
purchasing and using AFV's and would provide sates with increased 
ability and authority to address Clean Air Act mandates through the 
promotion of AFV's, including electric vehicles which produce zero 
tail-pipe emissions.
F. Emissions Reduction Credits
    The Coalition urges the Subcommittee to encourage the consideration 
of innovative techniques that will facilitate the deployment of new 
electric transportation technologies. One such option is mobile 
emissions reduction credits (ERC's). This program would allow for the 
sale and trade of emission credits from the deployment of low or zero 
emission vehicles in a manner similar to the stationary emissions 
credit trading program. ERC's would allow market forces to encourage 
the attainment of cleaner air through deployment of low or zero 
emission electric transportation technologies.
G. Decrease Bus Size Requirements
    Many transit organizations currently follow a policy that only a 
40-foot bus will meet transit needs. However, data collected in Santa 
Barbara, California and Chattanooga, Tennessee, where smaller buses 
represent a majority of the transit fleet--prove that smaller electric 
buses can meet--and even surpass, the needs of a community. In Santa 
Barbara, for example, ridership has increased with the introduction of 
electric buses to existing and new service routes. Furthermore, the 
quieter buses have allowed transit officials to maximize capacity and 
operate satellite routes into neighborhoods thereby permitting more 
efficient and convenient transit service. For these reasons, we urge 
the Subcommittee to encourage transit officials to adopt a definition 
of transit buses which includes buses smaller than 40-feet. This 
seemingly insignificant step is vital to promoting innovative thought 
and technology into 21st century transportation policy and planning.
   v. other public transportation opportunities fueled by electricity
A. Electrification of Airports
    Airports are often one of the major sources of air pollution and 
noise in urban areas. The frequent idling and accelerating of diesel 
and gasoline powered off-road, airport and airline service vehicles 
contribute to the airport pollution problem. Airport electrification 
could provide for the replacement of conventional, fossil-fueled 
vehicles now used for air-side baggage handling and airplane service, 
as well as a majority of the land-side shuttle vehicles, with electric, 
zero emission counterparts. The characteristics of airport vehicle use 
are well suited to electric transportation technology.
B. Electric Station Cars
    Some urban communities are considering the emissions reduction 
benefits from the operation of so-called station cars. Station cars are 
non-polluting, battery powered vehicles linked to public transit 
service. They are used by transit riders between transit stations and 
the riders' destinations. As the concept is developed, the cars could 
be available for short trips during the day, evenings and weekends. 
Multi-passenger station cars can lead to significant vehicle congestion 
mitigation around stations. Station cars also will allow transit 
agencies to extend beyond station-to-station service to provide door-
to-door service. The expanded service, coupled with the electric 
vehicle technology, will greatly assist efforts to increase the 
accessibility of transit and to reduce urban emissions.
C. Electrified High Speed Rail
    Electric high speed rail (up to 185 mph) is a proven technology 
used in much of Europe, Japan, and Taiwan. This technology is being 
developed in the United States in various locations, including the 
Northeast Corridor and Florida. Operation of electric high speed rail 
systems offers a clean, efficient, and safe transportation alternative. 
In addition, this transportation mode offers several benefits for the 
nation including: domestic job creation in the areas of civil 
engineering, construction, and operation; emissions reduction (compared 
to airlines, electric high speed rail systems can reduce pollution 
emissions by as much as 98 percent); and traffic congestion alleviation 
on highways and at airports.
D. Electrified Rail
    In the heavy rail sector, imposition of NOX emissions 
limitations on rail sources could require significant emissions 
reductions. Currently available compliance strategies for rail 
operators include additional emissions controls or operating 
modifications. An attractive alternative, particularly in areas with 
significant air quality problems, is likely to be rail electrification.
                             vi. conclusion
    The Coalition appreciates this opportunity to make its concerns 
known to the Subcommittee and to submit for the record its funding 
priorities for the upcoming fiscal year. We look forward to working 
with the Subcommittee and the Congress to achieve these worthwhile 
goals.
                                 ______
                                 
  Prepared Statement of Father William L. George and Father T. Byron 
  Collins, Special Assistants to the President, Georgetown University
    Mr. Chairman and Members of the Committee: We are Father William L. 
George, S.J., and Father T. Byron Collins, S.J., Special Assistants to 
the President of Georgetown University, the Reverend Leo J. O'Donovan, 
S.J. We appreciate this opportunity to testify before the Subcommittee 
on the 40-Foot, Fuel Cell Powered Transit Bus Commercialization 
Program.
    The Federal Transit Administration continues to support the Fuel 
Cell Transit Bus Commercialization Program within its existing Research 
and Development budget. Previous funding provided by this subcommittee, 
coupled with the money supplied by the Department of Defense, has 
allowed us to demonstrate that liquid-fueled Fuel Cell buses are 
practical and the technology is truly ready to be designed and tested 
in industry. These buses are the herald of clean, efficient power for 
the transportation industry. We would like to thank the Committee for 
their continuing support of the Fuel Cell bus program as a means to a 
cleaner environment and as a way to reduce this country's dependence on 
petroleum fuels.
    In fiscal year 1998, we identify an absolutely necessary 
requirement of $8 million to demonstrate that fuel cell powered transit 
buses can be integrated into mass transit fleets. A portion of this $8 
million will maintain a basic program to develop two such buses and the 
remainder will provide for the inclusion of additional buses which are 
necessary to further the pre-commercialization process. Furthermore, we 
recommend that the FTA Research and Development budget should be 
supplemented by that amount to ensure that necessary resources will 
remain available for the Fuel Cell Transit Bus Commercialization 
Program within constraints of other priorities in the FTA budget. We 
are asking the Committee on Banking to authorize funds for this fiscal 
year and ensuing fiscal years in the amount of $27 million for the 
continuation of the development of these buses and to supply FTA with 
the necessary funds. Specifically, we are seeking $8 million in fiscal 
year 1998. $10 million in fiscal year 1999. and $9 million in fiscal 
year 2000.
    When Georgetown embarked on the development of Fuel Cell powered 
transit buses, that technology was little known outside of the space 
community. It took great imagination by this Committee among others to 
envision the vast benefits to be reaped by applying this clean, quiet 
power source to transportation. Now we see a world-wide effort to 
capitalize on the potential of Fuel Cells for automotive applications. 
Europe and Japan are pouring major resources to bring the technology to 
the marketplace. Those efforts are being matched by this country. Even 
so, the only successful liquid-fueled, Fuel Cell powered vehicles that 
have ever been demonstrated anywhere are the three, 30-foot Test Bed 
Buses built within this program and now being tested at locations 
across the country Georgetown has consistently stressed liquid fuel as 
the only energy source that can provide the range and refueling 
convenience necessary for commercialization in the foreseeable future. 
We are on the threshold of seeing a commercial version rolling off the 
assembly line this year.
    What has been accomplished with the funding provided by this 
subcommittee over the past year? We have scaled a commercially 
available, 40,000 pound, 200 kW utility Fuel Cell power plant to a 100 
kW version that weighs about 3,800 pounds and fits in the back of a 
bus. Equally significant, the reliability of that unit should exceed 
25,000 hours rivaling that of the electrical utility model fuel cell. 
The bus to house the Fuel Cell has been designed and is being 
fabricated as we speak. By this fall, a commercial version of a 40-foot 
Fuel Cell powered transit bus will be on the road. And we are not 
sitting still. Another 100 kW Fuel Cell of a newer variety is under 
development and will be available for installation into a transit bus 
by year's end. This will afford the opportunity to evaluate potential 
operational advantages of two candidate fuel cell power systems. All 
the elements are in place for a paradigm in propulsion systems for 
transportation.
    Georgetown is confident that the technology is truly ready for 
commercialization. However, it is not feasible to commercialize a 
product with only one of each type of vehicle. We must get transit 
buses into the hands of the operators to permit them to see the 
advantages of the technology and identify any necessary improvements. 
Short of this, we would have spent considerable resources and effort to 
simply demonstrate a technical curiosity. Multiple vehicles are 
absolutely essential to prove technology readiness.
    A key element of commercializing Fuel Cell powered transit buses is 
the establishment of a National Depository Fuel Cell Facility. It 
serves two purposes: (1) prototype monitoring and maintenance services 
for Fuel Cell powered transit buses, and (2) a Fuel Cell information 
depository for evaluation and transfer of Fuel Cell technology for 
transportation. Strategically located at Georgetown, this facility 
would be a national exemplar serving the needs of the nation to advance 
the introduction of fuel cells first into the transit industry and then 
to meet the general energy needs of the country. We are also asking the 
Committee on Banking to authorize $10 million for the facility in 
fiscal year 1998 and to authorize $7 million in fiscal year 1999 for a 
total of $17 million.
                                 ______
                                 
 Prepared Statement of the Metropolitan Atlanta Rapid Transit Authority
                           executive summary
    Metropolitan Atlanta is the fastest growing major metropolitan area 
in the nation, with a population that now exceeds 3.5 million. In order 
to provide transit service to this fast-growing region, the 
Metropolitan Atlanta Rapid Transit Authority (MARTA) is requesting 
Federal financial support for two major undertakings in fiscal year 
1998. These programs consist of the continued development of the North 
Line heavy rail extension to North Springs, and the purchase of 
alternative-fueled buses.
    MARTA respectfully requests the Appropriations Committees of the 
105th United States Congress to earmark $60,000,000 in fiscal year 1998 
FTA New Fixed Guideway and Extension funds for the continued 
development of the North Line Extension Project. This project was 
authorized in ISTEA and is the subject of a Full Funding Grant 
Agreement between FTA and MARTA. These funds will be utilized for the 
continued development of the heavy rail extension to the Sandy Springs 
and North Springs Stations.
    MARTA's North Line rail service will consist of over 9 miles of 
heavy rail transit and 5 stations upon completion in December 2000. 
Currently, there are 7 miles of track and three stations that opened 
for passenger service in June 1996. The opening of these initial North 
Line stations increased MARTA's total operating rail system to 46 miles 
of track and 36 stations.
    Additionally, MARTA has significant capital funding needs in 
support of our Bus program. As part of an effort to improve air quality 
in the Atlanta region, MARTA is committed to converting up to one-third 
of its bus fleet to compressed natural gas (CNG) operation by the year 
2000. Accordingly, we respectfully request the Appropriations 
Committees of the 105th Congress to earmark $12,300,000 in fiscal year 
1998 FTA Section 3 Bus and Bus Related funds for the purchase of 56 
CNG-fueled buses.
    The justification, rationale, and background supporting these 
requests are set forth in the following pages.
                     overview of the atlanta region
    Metropolitan Atlanta is the fastest growing major metropolitan area 
in the nation. The metro area's growth rate from 1990-1996 was 19.7 
percent--the growth leader of all metro areas over two million people. 
Metro Atlanta has added over 575,000 people since the 1990 census and 
now has a population of over 3,540,000. By the year 2020, the 
population of the Atlanta MSA should approach 5 million.
    Atlanta has become a major metropolitan area of international 
importance. Always a primary transportation hub, Atlanta is served by 
Hartsfield International Airport--the second busiest airport in the 
World. Atlanta currently ranks 10th among U.S. cities in the number of 
national corporate headquarters. The area's robust economic growth is 
expected to continue with recent forecasts calling for the addition of 
374,000 jobs in the 10-county region between 1995 and 2005.
    The area to be served by the North Line Extension Project is the 
fastest growing segment of the Atlanta region. The Atlanta Regional 
Commission projects that this corridor alone will have grown by 144 
percent between 1980 and 2005. Employment will grow even faster: up 422 
percent from 53,000 to 277,000 over the same time period. As the 
geographic center of the region migrates north, there is a visible need 
to improve access between the burgeoning north Atlanta suburbs and the 
central city and international airport to the south.
    Not surprising, given the growth in population and employment, the 
Atlanta region has a serious air quality problem. Atlanta is a non-
attainment area for ground level ozone and has not met the 1996 
deadline for air quality goals. The region is currently facing the very 
real possibility of having its road-building program frozen because of 
the inability to reduce ground level ozone levels.
    The region's air quality problem is directly tied to the elevated 
level of automobile exhaust emissions. Registered vehicles in the 13-
county area have increased 32 percent in the years 1986-1995.
    Vehicle miles traveled (VMT) in Metro Atlanta have increased 65 
percent over the last decade, due in part to the booming growth north 
of the City. Traffic congestion has reached crisis proportions, 
particularly in the northern suburbs to be served by the MARTA North 
Line Extension. Clearly, viable alternatives to single occupant vehicle 
travel must be implemented if the region is to continue to prosper. The 
provisions of both the Clean Air Act Amendments (CAAA) and ISTEA point 
to rail transit service as the solution to mobility problems in this 
major development corridor.
    Current projections indicate sustained growth north of the city, 
and MARTA transit services will be critical to meet the growing public 
transportation requirements. Atlanta's pressing transportation needs 
did not end with the 1996 Olympics. As the region goes forward into the 
new millennium, the mobility challenges are enormous. MARTA is ready to 
be the vehicle carrying metro Atlanta's citizens into the future.
                            overwew of marta
    In March 1965, the Georgia General Assembly, by a vote of 205 to 
12, passed the Metropolitan Atlanta Rapid Transit Authority Act, 
thereby creating MARTA. The sole purpose was to plan, build, and 
operate a public mass transportation system serving the metropolitan 
area, including the city of Atlanta and its five surrounding counties. 
The local referenda ratifying participation in the Authority succeeded 
in the city of Atlanta and all but one of the five counties. The 
following six years were devoted to technical studies, reports, forums 
and public hearings to confirm the need for a long range regional 
transportation plan.
    Voters in the City of Atlanta, Fulton, and DeKalb Counties approved 
the Rapid Transit Contract and Assistance Agreement (RTCM) in November 
1971. The RTCAA described in detail the planned service improvements 
for bus and rail, and authorized the local governments to impose a one-
cent MARTA sales tax.
    Additionally, MARTA bought and overhauled the Atlanta Transit 
System. New equipment, new maintenance and operating garages, passenger 
shelters, new bus routes, increased frequency of service, extended 
operating hours and improved customer information systems were vital 
improvements to the ailing bus system.
    MARTA currently operates a state-of-the art, intermodal regional 
transit system which fully integrates rapid rail, fixed route bus and 
paratransit service. At present, the combined bus-rail system carries 
67 million passengers annually over 53 million vehicle miles of service 
area. MARTA currently operates heavy rail service over 46 miles of 
track to 36 passenger stations, and bus service over 1,550 route miles 
using 156 routes. MARTA continues its progress toward the expanded 
RTCAA plan configuration.
    MARTA, in cooperation with the Federal Transit Administration 
(FTA), has served as a role model for others to follow.
  --Atlanta's modern transit system (MARTA) was a key factor in the 
        selection of the city for the 1996 Olympic Games and Paralympic 
        Games.
  --MARTA was designated as the Official Provider of Public 
        Transportation for the 1996 Olympic Games. For the first time 
        in Olympic history, public transit and Olympic venue 
        transportation were combined and included in event admission.
  --MARTA accelerated the opening of 7 miles of the North Line in time 
        for the Olympic Games in 1996.
  --MARTA's early compliance with the Americans with Disabilities Act 
        (ADA) was a factor in the selection of the city for the 1996 
        Paralympic Games.
  --Atlanta and MARTA were a showcase for American technology during 
        the summer of 1996 with the extensive deployment of Intelligent 
        Transportation Systems (ITS) infrastructure.
  --A new era has been ushered in with the advent of a public/private 
        partnership in which MARTA, Atlanta Gas Light Company and the 
        State of Georgia are jointly proceeding with, and funding the 
        use of, compressed natural gas (CNG) fueled buses.
  --MARTA is the best solution for compliance with ISTEA and Clean Air 
        Act Amendment requirements for the metro area's congestion and 
        air quality problems.
  --MARTA operates one of the most cost-effective heavy rail transit 
        systems in the country.
             update of the marta rapid transit rail program
    The current MARTA rail system consists of 46 miles, 36 stations, 
and 238 rail cars. At present, the network includes two (2) main trunk 
lines (North/South and East/West) that intersect in the Atlanta Central 
Business District, and two (2) branches (Northeast and Proctor Creek) 
(see map at Enclosure 1). The last three stations placed in revenue 
service--Buckhead, Medical Center and Dunwoody--were completed in June 
1996 as the initial phase of the new MARTA North Line. Through the 
completion of these North Line stations, the Federal share of MARTA's 
rapid rail development program has been 54 percent of the total $2.8 
billion invested. MARTA has been fortunate to obtain Federal funding to 
build one of the country's premier transit systems.
    Focus has now turned to the North Line Extension currently under 
development.
North Line Extension
    The central portion of the Atlanta northern corridor has become a 
dense urban center that rivals downtown Atlanta. It is the largest of 
the six edge cities in the metropolitan area. More than 20 million 
square feet of mixed use space exists now or is under development. Just 
north of this core, another 30 million square feet of commercial space 
either exists or is planned for development. This explosive growth has 
led to significant automobile traffic congestion and delays. Traffic 
counts on the GA 400 expressway serving the corridor already exceed 
those predicted for the year 2010. Additionally, the demand for public 
transit to transport workers from the central city to jobs in the 
corridor is increasing.
    Based on the existing and projected high rate of growth in this 
area, in the late 1980's local officials in the Atlanta region--after 
receiving extensive community input--determined that MARTA heavy rail 
was the preferred transportation alternative for the corridor. 
Following the completion of the environmental review process in 1991, 
the North Line Extension project was authorized in ISTEA. ETA 
subsequently entered into a Full Funding Grant Agreement with MARTA for 
the development of the 1.9 mile portion of the extension beyond 
Dunwoody Station through and including the Sandy Springs and North 
Springs stations, including the purchase of additional rail passenger 
cars.
    The new MARTA North Line begins at the junction with the Northeast 
Line 0.8 mile north of the Lindbergh Center Station. The initial 
portion of the new North Line was constructed in the median of Georgia 
State Highway 400 (``GA 400''), a six-lane toll road built to 
interstate standards connecting I-85 with the pre-existing GA 400 
freeway north of the Perimeter (I-285). This segment of 7.5 miles and 
three stations (Buckhead, Medical Center and Dunwoody) opened ahead of 
schedule in June 1996. This segment was financed with 26 percent 
Federal funds and 74 percent local funds. Now, MARTA requests $60 
million in fiscal year 1998 Federal funds to continue the North Line 
Extension Project beyond Dunwoody Station.
    The Dunwoody Station, which opened in June 1996, serves the large 
retail centers and office developments in the Perimeter Mall area and a 
number of upscale hotels nearby. (See Major Developments in North 
Atlanta map at Enclosure 2.) This station is located immediately north 
of the I-285 perimeter freeway. The North Line Extension for which 
funding is now requested begins at the end of the Dunwoody Station tail 
track and proceeds 0.9 mile northwest in subway to the Sandy Springs 
Station. (An aerial photograph of the Extension can be found at 
Enclosure 3.) From Sandy Springs Station, the line extends one mile 
north on the east side of GA 400 freeway to the North Springs Station.
    The Sandy Springs Station will be located at the hub of the 
extensive development of corporate office complexes and full service 
hotels north of the Perimeter Center area. The station, located one 
mile north of the Dunwoody Station, will also serve the local area with 
bus service as well as significant park/ride capacity (1,100 spaces). 
This will be an underground station with provisions for direct 
connections to the major transit oriented development planned for the 
immediate vicinity. According to year 2005 projections, Sandy Springs 
Station will be used by 11,332 patrons daily, including 2,692 during 
peak hours.
    The North Springs Station will be built adjacent to the Georgia 400 
freeway, thereby providing easy access for bus feeder routes as well as 
automobile commuters bound for intown destinations. This end-of-line 
station will include a 2,530 space park/ride facility divided into two 
areas: a six-level deck (2,230 spaces) for those coming in from GA 400 
and a 300-space surface lot for local neighborhood residents. North 
Springs Station will serve as an intermodal node and will alleviate the 
heavy traffic congestion on GA 400. One of the unique characteristics 
of the station is the exclusive entrance ramp from GA 400 directly into 
the station parking deck. According to year 2005 projections, North 
Springs Station will be used by 24,979 patrons daily, including 3,464 
during peak hours.
    The Sandy Springs and North Springs stations will be built in full 
compliance with the Americans with Disabilities Act (ADA): each station 
will include a visual public address system, tactile warning edge 
strips, accessible ramps, Braille and high contrast signage, and glass-
enclosed elevators. Both stations will open for revenue service in 
December 2000.
    The MARTA North Line Extension will result in significant long-term 
economic benefits to both individuals and businesses. This extension 
will encourage reverse commuting from areas of high unemployment in the 
central city to job-rich suburban employment centers. Several major 
international corporations are headquartered in the project area, 
including United Parcel Service (UPS), Holiday Inn Worldwide, and the 
Southern Company. Also, the regional offices of several high tech 
firms, including Hewlett Packard and MCI, are located in the North Line 
corridor.
    This extension will significantly improve mobility between this 
burgeoning growth area and major points of origin/destination to the 
south. The estimated economic benefit resulting from reduced congestion 
is projected to be $377 million, with an estimated benefit of $216 
million in travel time savings. The extension will provide a direct 
rapid rail connection to Hartsfield International Airport (24 miles to 
the south), which has a MARTA station inside the main terminal. 
Travelers' boarding the train at North Springs during rush hour will be 
at the Airport within 42 minutes.
Project Status
    The project is progressing on schedule towards the targeted 
December 2000 revenue service date. Final Design of the Sandy Springs 
Station is complete. Construction of the line section and station shell 
began in October 1996, and construction of the station interior work 
will start in January 1999. Final design of the North Springs Station 
is nearing completion, and initial earthwork construction activities 
are now underway at the station site. During CY 1997, two other 
facility construction contracts will begin--North Springs Line Section, 
and North Springs Station and Parking Deck. Detail design of systemwide 
work began in July 1996. All necessary right-of-way and real estate 
acquisition is nearing completion with prior year appropriated funds.
    MARTA's recent reevaluation of expanded customer service demands 
and estimated patronage growth in this rapidly growing area resulted in 
a decision to increase the number of rail cars to be acquired for this 
extension. The planned rail car requirement has been increased from 28 
to 54 passenger vehicles, a net increase of 26 cars. A Request for 
Proposals (RFP) was issued in December 1996 for the manufacture of 28 
rail cars under a base buy, with options to include an additional 26 
vehicles to reach the total of 54 cars needed for operation between 
North Springs and the Airport.
    Appropriations requested for fiscal year 1998 will primarily pay 
for the next year of construction activity at Sandy Springs (station 
and line segment) and initial construction activities at North Springs.
Financial Status
    The initial phase of the North Line through Dunwoody Station has 
been constructed at a cost of $362.3 million, with a federal share of 
only $92.5 million (26 percent). The balance of the North Line (North 
Line Extension) is budgeted at a cost of $487.7 million and is expected 
to be financed with 80 percent Federal ($390.2 million) and 20 percent 
local ($97.5 million) funds. Included in this cost estimate is the 
acquisition of 54 additional rail cars required to provide service on 
this extension.
    Taken together, the entire North Line--from the junction south of 
Buckhead through North Springs--is programmed at a total cost of $850 
million, of which $368 million, or 43 percent, will be locally funded. 
This sizable local contribution demonstrates the Atlanta region's 
significant commitment to this vital transportation improvement.
    Upon completion in December 2000, MARTA's North Line rail service 
will extend 9.4 miles in length, with five stations (Buckhead, Medical 
Center, Dunwoody, Sandy Springs and North Springs) and 5,188 park and 
ride spaces.
                      update of the marta bus plan
    MARTA's fixed-route bus fleet consists of 704 transit buses. There 
are 156 bus routes that cover 1,550 miles and, on a daily basis, MARTA 
buses travel 97,131 vehicle miles. Our buses operate a total of 30.3 
million annual vehicle revenue miles. During 1996, MARTA experienced an 
average daily bus ridership of 242,000.
    MARTA strives for safety in the operation of buses and successfully 
competes with other comparable systems for safety recognition. 
Recently, MARTA received the 1995 William T. Coleman Silver Award for 
bus safety from the American Public Transit Association.
    MARTA has committed to provide 100 percent accessibility of the bus 
fleet. Currently, the fleet is 80 percent wheelchair accessible, and 
all future bus purchases will meet ADA guidelines for accessibility.
    Due to the serious air quality problems in the Atlanta region, 
MARTA has embarked upon a program to convert up to one-third of our bus 
fleet to CNG operation by the end of the decade. Through the combined 
assistance of the Congress, the Federal Transit Administration, the 
State of Georgia and the Atlanta Gas Light Company, MARTA recently 
acquired 118 accessible low-floor, CNG-fueled buses. This was our 
initial procurement of compressed natural gas (CNG) buses with the 
ultimate goal of acquiring 200 CNG buses before the year 2000.
    These new buses will fully meet the emission requirements of the 
Clean Air Act Amendments. MARTA is introducing CNG-fueled buses to the 
Atlanta region through a significant partnership with the Atlanta Gas 
Light Company. A new $28 million CNG bus maintenance and refueling 
facility, paid for with private and MARTA funds, recently began 
operation. Cleaner fueled buses will help the Atlanta region meet its 
ambient air quality goals for 1997 and beyond.
                fiscal year 1998 federal funding request
    MARTA respectfully requests the Appropriations Committees of the 
105th United States Congress to earmark fiscal year 1998 ETA Section 3 
funds to address two specific transit needs: (i) $60,000,000 in New 
Fixed Guideway Systems and Extension funds to continue the North Line 
Extension Project; and (ii) $12,300,000 in Bus and Bus Related funds 
for the purchase of approximately 56 replacement CNG-fueled buses.
Section 3 New Fixed Guideway and Extension Funds
    The North Line Extension above Dunwoody, through Sandy Springs to 
North Springs Station, is estimated to cost $487.7 million. This 
estimate is based on completion of the project in the year 2000 and 
includes $152.6 million for the design and purchase of 54 additional 
rail car vehicles. This estimate is $106.4 million higher than the cost 
estimate submitted to Congress last year. The increase in the estimated 
cost of the project is due to the following factors: (i) an increase 
(from 28 to 54) in the number of rail cars required to meet heightened 
customer demand; (ii) scope enhancements, including the substitution of 
a parking deck structure at North Springs Station in place of a surface 
lot; (iii) added customer safety, security and convenience features 
(e.g., see-thru glass elevator enclosures in station facilities); and 
(iv) cost impacts resulting from Georgia DOT's proposed modifications 
to the adjacent GA 400 expressway. With the exception of the projected 
impacts from the GA 400 alterations, these changes were primarily made 
as the result of a comprehensive reevaluation of customer service 
demands and expectations, particularly in light of MARTA's role and 
experience during the 1996 Olympic Games. Other factors--such as 
increased development potential--led to the decision to change the 
parking at North Springs Station from a surface lot to a deck 
structure. While this change will result in an increased capital cost 
of $22.3 million, building a parking deck instead of a lot makes 
available a 10-acre site for future transit oriented development. 
Moreover, placing a surface lot on the current site would not 
accommodate initial projected demand and leave sufficient room for 
future expansion.
    MARTA is requesting $60 million in fiscal year 1998 FTA New Fixed 
Guideway and Extension funds. This level of funding will allow MARTA to 
undertake the following activities: complete construction of the subway 
section north of Dunwoody Station through Sandy Springs, including 
Stage I of the Sandy Springs Station; and proceed with construction of 
the North Springs line segment and station. Total MARTA contractual 
obligations for the construction of these segments through October 1, 
1998, are estimated to be $371.5 million. Thus, there is a clear 
justification for continued Federal funding during the upcoming period.
    Of the total proposed Federal contribution, $153.7 million has been 
secured to date either through previous Congressional appropriations or 
FTA reobligations to the Project MARTA expects to request total 
additional Federal appropriations of $236.5 million for the North Line 
Extension Project. This amount, when added to the $153.7 million 
appropriated and reobligated from previous years, will total $390.2 
million, or 80 percent of the cost of the Project.
    The balance of the proposed Federal contribution remaining to be 
funded in future years, assuming the appropriation of the full amount 
requested, will be $176.5 million [$390.2 million-$153.7 million (past 
years)-$60 million (this year)=$176.5 million]. These out-year funds 
will be needed to complete construction activities and procure the 54 
additional rail cars required for this extension.
Section 3 Bus and Bus Related Funds
    The requested $12.3 million in fiscal year 1998 Section 3 Bus 
Capital funds is required as the Federal share to purchase 56 new CNG-
fueled buses to replace aging, non-wheelchair accessible buses. This 
level of funding will enable MARTA to achieve our goal of placing 200 
CNG buses in operation by the end of the century.
    All buses being replaced will exceed the minimum FTA replacement 
criteria of 12 years or 500,000 miles of accumulated service, and are 
not wheelchair accessible. The new buses will fully meet the 
requirements of the Americans with Disabilities Act (ADA), as well as, 
the Clean Air Act Amendments (CAAA). Efforts to bring the bus fleet 
into full compliance with these two statutes are crucial to meeting the 
mobility, accessibility and air quality goals of the Atlanta region.
    The continued support of the Congress is critical if MARTA is to 
realize the promise of ISTEA, comply with the Clean Air Act Amendments 
and meet the future transportation challenges facing the Atlanta 
Metropolitan Region.
[GRAPHIC] [TIFF OMITTED] T12NON.048

[GRAPHIC] [TIFF OMITTED] T12NON.049

    [Clerk's note.--The aerial photo does not appear in the hearing 
record but is available for review in the subcommittee's files.]
                                 ______
                                 
Prepared Statement of Alex Penelas, Mayor, Metropolitan Dade County, FL
    Mr. Chairman and members of the Transportation Appropriations 
Subcommittee: I am Alex Penelas, Mayor of Metropolitan Dade County, 
Florida. I thank you for the opportunity to present a summary of our 
community's requests for 1998 Federal transit funds.
    Last year, we reported to this subcommittee that Dade County has 
been aggressively pursuing and creating innovative financing 
opportunities to reduce our dependence on Federal transit monies. While 
we continue to pursue such opportunities, despite our noteworthy 
successes through joint development, public/private ventures, capital 
leasing, and tax-increment financing, we still require a nominal level 
of Federal support for our much needed and ambitious transportation 
projects.
    In brief, our requests for 1998 Federal transit funds include $24.3 
million in discretionary bus and bus related funds to accomplish 
several specific projects that will substantially improve the 
efficiency, safety, and service quality of our existing bus system. 
Additionally, we are requesting $55.3 million in discretionary new 
start funds to continue our steady progress in three fixed guideway 
projects. One of these projects is nearing the end of the final design 
phase and the other two are finishing preliminary engineering and 
entering the right-of-way and final design phases.
    Over the past several years, we have reported to this subcommittee 
about the expected growth in both the economy and population of the 
south Florida region and Metropolitan Dade County, in particular. Those 
projections are becoming reality. Our phenomenal rate of growth is 
significantly impacting the mobility of our citizenry in the country's 
fourth most congested urban area.
    The prestigious Texas Transportation Institute annually ranks urban 
traffic congestion. For the third year in a row, the urbanized area of 
Dade County has achieved the dubious distinction of being ranked the 
fourth most congested urban area in the Nation. While we continue to be 
ranked just behind San Francisco, we are steadily narrowing the gap 
separating us from third place. Speaking on behalf of the people of 
Metropolitan Dade County, I can assure you that we would prefer not to 
achieve this distinction.
    Although our transit system is performing adequately, its capacity 
is being strained and expansion is now critical. During the past few 
years, the Metro-Dade Transit Agency has moved from the eighteenth 
largest to the thirteenth largest agency in the Nation, as measured by 
ridership--all while keeping our bus operating recovery ratio well in 
excess of forty percent. To accelerate this growth we are moving 
forward with a public transit initiative to reconfigure our service and 
expand our capacity to attract and serve new riders. One of my mayoral 
objectives is to expand our number of buses on the road to 800 per day 
from its present level of 563.
    Earlier this year, we opened a 8.5-mile exclusive busway linking 
our Metrorail line with the south Dade area along U.S. 1. you may 
recall that this is the area most heavily damaged by Hurricane Andrew 
in 1992. It is still undergoing economic recovery and we are counting 
on the busway to accelerate that recovery. Early statistics indicate 
that transit ridership in the busway corridor has already increased by 
over 30 percent.
    As part of the busway inauguration, Metro-Dade Transit concurrently 
introduced several new neighborhood circulator services with minibuses 
that feed to and from the busway and its Metrorail link. We are 
planning to expand this concept to other areas of Metropolitan Dade 
County, with municipal and community minibus circulators feeding 
reconfigured larger bus, mainline service. The additional minibuses 
will contribute to my expansion goal.
    This somewhat radical change in our historic service 
characteristics is a result of much public input and extensive travel 
demand pattern analysis. We strongly believe that this concept will not 
only serve to increase ridership, along with its concomitant mitigation 
of traffic congestion, but will also motivate our commission to 
introduce much-needed reforms in land use policy to further increase 
our utilization of public transit.
    But, as you well know, before we can persuade drivers to curtail 
their auto-dependence and switch to transit--the transit service must 
be there first. This is why Federal funding programs are so vital to 
our community. We need Federal assistance to acquire vehicles and 
facilities to implement additional transit service.
    You have heard, and probably have been involved in, discussions 
about donor State status, as it relates to returns of contributions to 
the highway trust fund. Although the methods of calculation and the 
level of computed ``donation'' ratios may differ among the discussing 
parties, there is no argument that Florida is indeed a donor State.
    Essentially all of the discussions and calculations about return on 
contributions have centered on the highway portion of the trust fund 
and few participants have looked at the corresponding transit donation 
status. Regardless of whose calculations are used, Florida is a larger 
donor of transit monies than it is for highway monies.
    The highway fund apportionment formula is at the heart of the issue 
in that its application fundamentally disfavors growth States--like 
Florida. such is not the case for Federal transit funds. The formulas 
used to distribute a portion of the transit funds are not being 
challenged. However, because nearly 30 percent of the transit funds 
distributed to States or transit properties are distributed by 
earmarking, this subcommittee has significant control over who ends up 
as donors or donees for transit funds.
    Although, during the life of ISTEA, this subcommittee has, with our 
sincere appreciation, granted discretionary transit funds to Dade 
County and other Florida communities, the results have not corrected 
the donor status of our State with respect to transit funds. By our 
calculation, even with the earmarks that have gone to any part of the 
State, Florida still receives less than 70 cents of the gas tax dollar 
it pays into the mass transit account. Typically, Florida contributes 
approximately 5 percent of the Federal gas tax revenues, yet the State 
gets back only 3 percent to 3.5 percent of the transit appropriation 
proceeds. Florida's contribution to the trust fund is larger than that 
of New York and is exceeded only by California and Texas.
    By assisting us with our bus and rail expansion programs, this 
subcommittee can simultaneously help improve our equitable return on 
trust fund contributions. Toward this end, the following is our fiscal 
year 1998 program:
              bus and bus-related program funding requests
    For 1998, Dade County is requesting $24.3 million in discretionary 
bus and bus related program funds to finance a set of projects designed 
to improve our existing bus system in several service quality 
categories. Most of these projects are carry-over from last year's 
request
Replacement buses
    The first two projects in the bus related package are for the 
purchase of buses. The first of these two requests is $5 million for 
replacement buses. As you may recall, we have requested discretionary 
funds from this subcommittee for this purpose for the past several 
years as installments for the replacement of a 260-vehicle sub-fleet 
which reached its regulatory retirement age in 1992. Monies that we 
have been granted in the past have been obligated to purchase these 
replacement buses but not enough to maintain the preferred replacement 
schedule. Although we have replaced most of the vehicles that we had 
targeted, the extended funding has delayed the actual replacement so 
that it has now overlapped into the retirement period of another 
subfleet of buses. This next group of buses is smaller than the 
previous group--187 coaches--and the requested funds are supplementary 
to the use of formula funds for replacement buses. A designation of $5 
million in discretionary transit bus funds is requested for an 
additional 25 of these replacement vehicles.
Expansion buses
    The second bus purchase request is for expansion buses. As I 
mentioned earlier, through the Metro-Dade Transit Agency, Dade County 
is initiating a bus service expansion program, primarily utilizing less 
expensive small buses to operate municipal and neighborhood circulator 
service to augment its mainline operations. Both county officials and 
the general public feel that this type of service will offer more 
convenient transit service and lead to an increase in ridership and 
significant improvement to our traffic congestion situation.
    In addition to a lesser capital acquisition cost, the smaller buses 
can be operated at a lesser cost per vehicle hour than the larger, 
conventional buses. Consequently, additional service can be provided at 
a much lower marginal cost. We propose to purchase 95 minibuses for the 
95.7 million requested in this line item. This request is the first of 
three to expand the existing bus fleet to support a peak vehicle 
requirement of 800 buses, compared with the current fleet which 
supports a peak requirement of 563.
Central garage expansion
    Another project included in our bus-related funding request 
involves the expansion and upgrading of bus servicing facilities. 
Recent reconfiguration of our bus service to accommodate changing 
ridership trends has necessitated garage reassignments of the bus fleet 
to minimize inefficient deadhead mileage. This reassignment has 
overburdened the agency's central operating and inspection garage. 
Using a capacity measure of assigned vehicles per maintenance bay, the 
central garage facility has a 40 percent higher ratio than the agency's 
other operating garages. This overcrowded condition requires central's 
buses to operate 7 hours longer between servicing which contributes 
significantly to in-service breakdowns and higher operating costs.
    The central garage site is conducive to reasonably low-cost 
physical expansion that will relieve the overcrowded condition and 
reduce operating costs while improving service performance. Specific 
features of the proposed expansion program include adding three 
maintenance bays, expanding the parts storeroom facilities and 
relocating an employee parking lot. We request $3.0 million in Federal 
transit funds to accomplish this garage expansion effort.
Bus security system
    Another bus related component project relates directly to improved 
safety and security for both bus riders and operators. Violent assaults 
and batteries on transit operating staff and passengers demand improved 
personal security measures. Such demands have come from the passenger 
community, transit employee bargaining units and elected officials. A 
systemwide solution must include over 600 vehicles.
    Utilization of security personnel is cost prohibitive for the whole 
fleet. The timing, however is conducive to implementing a security 
camera system in conjunction with the new federally funded 800 
megahertz radio and automated vehicle locating system currently being 
installed fleetwide. The security monitoring technology is available to 
operate any of a number of taping schemes, e.g. continuous 
transmission, periodic snapshot and tape, periodic snapshot and 
transmit, driver activated continuous or instantaneous, etc. Any of 
these capabilities can be incorporated into the existing on-board 
communication technology. We request $3.6 million in Federal transit 
funds to implement such a system across the entire bus fleet.
Northeast Dade Transit Activity Center
    A fifth proposed bus related project included in the requested 
package comes as a result of a federally funded area study just 
completed in the high-density northeast area of Dade County. The set of 
study recommendations serves to significantly improve the mobility 
characteristics of the residents of the area, increase public transit 
utilization and significantly involve the private sector in transit 
capital and operating support.
    Implementation of the recommended passenger transfer activity 
centers focuses on the operation of arterial, trunk-line transit 
service through major transfer ``hubs'' which are served by 
neighborhood or community-based circulator services with smaller 
transit coaches. These ``hubs'' would be integrated with commercial 
facilities, either existing commercial sites or new sites created using 
joint public/private development concepts. Three transfer hubs, located 
with or within shopping or residential complexes, would contain 
environmentally compatible passenger shelter facilities, public phones, 
intelligent transit kiosks, seating and other passenger amenities. Real 
estate and facility maintenance, along with community meeting space and 
day-care or after school care facilities, could be provided by the 
private sector or jointly with local public partners.
    We are requesting $4.0 million to implement a first phase of the 
transfer center concept, including bus facilities, furnishings and 
passenger amenities for at least one such center. State funds to 
provide operating assistance for the community-based circulator 
services have been requested.
Flagler Downtown Bus Station
    The final component project in the block of requested bus funds 
focuses on the Miami central business district--the second largest 
employment center in the county. The Miami Downtown Development 
Authority has developed and is pursuing a project to revitalize the 
central downtown area of the city of Miami. An integral part of this 
project is the reconfiguration of the downtown bus transfer center into 
an integrated transportation center linking bus routes, a new Flagler 
trolley, Metrorail, Metromover and taxi service. The proposed facility 
will include thirteen bus bays, a taxi area, Flagler trolley depot, 
automated transportation kiosks, and a covered promenade to the 
Metrorail/Metromover Government Center Station complex. The requested 
transit portion of this downtown intermodal transfer center is $3 
million.
    Each of these bus related projects contributes in its own way to 
the substantial betterment of the existing bus system. Already at a 42 
percent operating recovery ratio, the bus system is expected to 
experience a further reduction in subsidy requirements as a result of 
the implementation of these projects--either through reduced costs or 
by increased ridership due to the improvement of service quality.
                       new start funding requests
Palmetto Extension of Metrorail
    This project is a 1.4-mile extension of the existing 21.2-mile 
Metrorail system. The project extends Metrorail westward from its 
existing north terminus to intersect with the Palmetto Expressway. When 
completed, the extension will provide more accessible park-and-ride 
service to commuters from northwest Dade County and southwest Broward 
County. These two of the fastest growing residential areas in south 
Florida were not developed when the Metrorail line was constructed, but 
have grown substantially since then. The growth has substantially 
increased traffic congestion during commute periods with residents from 
these areas traveling to and from areas served by existing Metrorail. 
Natural barriers and limited-access roadways prevent easy access to the 
existing end-of-line station from these areas.
    The extension project is currently funded in-part with congestion 
mitigation and air quality improvement (CMAQ) funds and in-part with 
transit new start funds. The bulk of the transit new start funds being 
used for this project are project savings from funds previously 
appropriated for the Metromover extension project.
    In 1992, when it was first forecast that the Metromover extension 
project would be completed under budget, Congress authorized Dade 
County to use up to $25 million in savings for the Palmetto extension 
project. The funding package for that project was developed with a $25 
million transit contribution to an estimated $76 million total project 
cost (in 1992 dollars).
    Now that the Metromover project has been completed and most of the 
post-construction expenses and claims have been resolved, the actual 
project savings to be realized will be approximately $17.6 million. 
Additionally, project costs have escalated slightly due to both 
increases in scope and inflation such that the revised estimated 
project cost is now $84.6 million. The combined effects of these two 
factors have resulted in a funding shortfall of $16 million, $5.4 
million of which has been covered by additional State and local funds. 
The remaining $10.6 million is now being sought from new transit 
appropriations from the New Start Program over the next two years--$5.3 
million in 1998 and $5.3 million in 1999--to complete the funding.
    All project development and environmental work has been completed 
for the project. Final design is 60 percent complete and the right-of-
way acquisition activities have already begun. This project is 
scheduled to begin operation in 2001 with minimal effect on total 
system operating costs.
North Corridor Transitway
    One of the fixed guideway expansion projects that Congress has 
funded for the past two years is the Dade/Broward North Corridor 
Regional Transitway. This regional impact project has progressed, with 
previously appropriated Federal transit funds, through the alternatives 
analysis and selection of a locally-preferred alternative phases of a 
major investment study (MIS) and entered the preliminary engineering 
and environmental impact analysis phases. The estimated project 
implementation costs have been reduced from an initial estimate of $574 
million to a current estimate of $457 million. project implementation 
remains programmed at a 30 percent non-Federal share level.
    To further integrate this project into the Dade County program of 
interrelated projects, the final MIS activities for this project 
incrementally increased in scope. Additional analyses are being 
performed to evaluate the technical and economic feasibility of 
directly connecting this corridor with the proposed Miami Intermodal 
Center and with the Opa-Locka Airport, a reliever airport for Miami 
International Airport. Last year's appropriation of $1.0 million funded 
the final project development phases, including the expanded scope, the 
environmental impact statement and complete preliminary engineering.
    These tasks are expected to be complete during the first quarter of 
1998. At that time the final design and right-of-way acquisition phases 
of project implementation can begin. During the remainder of fiscal 
year 1997-98, the major project efforts will concentrate on advance 
acquisition of right-of-way. Therefore, we are requesting a fiscal year 
1997-98 appropriations of $26.5 million for this right-of-way 
acquisition phase of the project.
East-West Multimodal Corridor
    The third element of our 1997 New Start request is the centerpiece 
of Dade County's long-range program of interrelated transportation 
projects previously presented to this subcommittee. The East-West 
Corridor/Miami Intermodal Center project, on which we are now 
completing the major investment study developmental phase, has become a 
national showcase of inter-agency cooperation, at both the local and 
Federal levels.
    This $3.5 billion combined roadway and transitway project, of which 
less than a third is proposed to come from Federal transit sources, 
involves private interests, six local agencies and every modal 
administration in USDOT, all operating under a common written 
cooperation agreement. The project development team has just completed 
the draft environmental impact statement (DEIS) phase of this project. 
Preliminary engineering has begun and it, along with the final EIS, is 
expected to be complete by the end of summer, 1997. Once a subsequent 
record-of-decision has been granted, expected sometime in the fall of 
1997, final design and early right-of-way acquisition can be initiated.
    Recent reconfiguration of the financing profile for the Miami 
Intermodal Center (MIC) component of this project has minimized Federal 
transit funding for this facility.
    With no ``New Start'' funds needed for the MIC, transit funding can 
now be concentrated on the fixed guideway component of the project. 
Advance right-of-way acquisition can reasonably be expected to begin 
during the fiscal year 1997-98 period. The transit right-of-way part of 
the project is estimated to cost $229.0 million and is expected to be 
spent over a multi-year period. The projected funding flow requires 
$23.5 million in Federal transit funds, being requested for 1997-1998.
In closing
    The implementation schedules for these two New Start projects are 
intentionally staggered to preclude significant mutual competition for 
future Federal, State and local funding. The current funding requests 
will allow an orderly acquisition of right-of-way for both projects 
while maintaining the schedule stagger for the larger requirements of 
construction funds later in the implementation cycles of the projects.
    Dade County is eager to implement all of these proposed projects 
for the benefit of its residents and visitors. We are grateful for the 
past support from this subcommittee and pledge to continue our good 
stewardship over the increasingly scarce Federal funds. I sincerely 
appreciate the opportunity to present our requests to this subcommittee 
and I am hopeful that the results of your upcoming deliberations will 
enable us to move ahead with our critical and worthy public mobility 
projects. Thank you.
                                 ______
                                 
Prepared Statement of Jose Garcia-Pedrosa, City Manager, City of Miami 
                               Beach, FL
    On September 16, 1996 the Transportation Appropriations Committee 
approved funding for phase I of the city of Miami Beach Electric 
Shuttle Park & Ride Demonstration Project. The funding appropriated by 
Congress has been received towards the purchase of a fleet of 22-
passenger electric shuttle vehicles, the first seven (7) of which have 
already been acquired. The vehicles will serve a highly congested, 
urban-residential, and commercial historic district.
    The city is now requesting funding for phase II of the project. 
Phase II will include the design and construction of a multi-modal 
center and as been estimated at a cost of $21,000,000. The multi-modal 
center will provide a vital transportation hub for the area. The center 
will also serve as a link for the future east west corridor, that will 
link together the Palmetto Expressway, State Road 836, the Miami 
Intermodal Center at Miami International Airport, downtown Miami, the 
seaport, and the island city of Miami Beach. The second phase will 
provide for a commuting/transportation center that will bring together 
commuters, parking, the electric shuttle system, local transit 
services, maintenance and charging facilities for the shuttle vehicles, 
and a commuter/visitor store where commuters can catch the shuttle to 
area destinations, purchase transit passes, and obtain information 
about the surrounding area.
    The Miami Beach Transportation Management Association, the city's 
public private partnership has the financial support of the Florida 
Department of Transportation, the Dade County Metropolitan Planning 
Organization and Transit Agency, the Florida Environmental Trust, the 
Clean Cities Coalition, the Florida Department of Energy, the Florida 
Alliance for Clean Technologies, and the Florida Power and Light 
Company.
    The objective of this project is to reduce demanding traffic on the 
already over-capacity roadway system of this island community by 
providing a comprehensive park & ride system. The project is totally 
supported by the Miami Beach City Commission and the Miami Beach 
community. Your support of phase II is critical to the implementation 
of this city wide park & ride program.
                                 ______
                                 
Prepared Statement of Morris Fisher, Chairman, Monterey-Salinas Transit
                               background
    Monterey-Salinas Transit (MST) serves a 110 square-mile area of 
Northern Monterey County and Southern Santa Cruz County on the Central 
Coast of California. MST provides fixed-route transit service on 
twenty-eight lines and carries 3.8 million passengers per year. MST 
also operates the RIDES Program which provides paratransit services to 
individuals with disabilities. MST offers convenient and reliable 
public transportation to residents and to the many tourists who visit 
our community.
    Fort Ord lies in the middle of MST's service area. Fort Ord was 
established in 1917 and served as a training and staging facility for 
the United States Army until its closure in 1995. Fort Ord consists of 
44 square miles, which is approximately the same size as the City and 
County of San Francisco. Planning and implementing the reuse of Fort 
Ord is one of the biggest issues facing the region. The provision of 
transit services as reuse occurs is one of the most significant 
challenges MST must address.
             projects to be implemented in fiscal year 1998
    In order to maintain transit services to the residents and visitors 
to Monterey County and to begin the implementation of the reuse of Fort 
Ord, MST requests that funding be provided for two major projects 
during fiscal year 1998:
  --Replacement of 27 buses with Compressed Natural Gas Powered buses--
        $9.6 million.
  --Development of the Marina/Ft. Ord Intermodal Transit Center--$2.5 
        million.
                         critical project need
    MST is long overdue on bus replacement. MST's current bus roster is 
shown in the table below. All available capital funds from the federal, 
state, and local governments are being used to rebuild and replace the 
MST fleet, most of which is over 15 years old. Providing additional 
funds for fleet and capital replacement will allow MST to maintain 
existing transit services, meet high priority corridor transit needs, 
and continue to operate tourist shuttles.

                                       MONTEREY-SALINAS TRANSIT BUS ROSTER                                      
----------------------------------------------------------------------------------------------------------------
                                                                                     Years of      Average total
                    Fleet number/manufacturer                         Number          service      miles per bus
----------------------------------------------------------------------------------------------------------------
1201-1215, Flxible..............................................              15              21         890,000
601-605, Flxible................................................               5              20         624,000
301, 308, 309, 311, Flxible.....................................               4              18         636,000
501-521, Flxible................................................              21              16         732,000
701-716, Gillig.................................................              16               8         254,000
801-808, Flxible................................................               8               1          25,000
                                                                 -----------------------------------------------
      Total.....................................................  ..............              69  ..............
----------------------------------------------------------------------------------------------------------------

    The traffic and funding situation Monterey County faces is 
critical. Traffic conditions now and projections based upon expected 
growth result in the need to widen four U.S. Highways--highway 1, 68, 
101, and 156. Each of these roadways is on the National Highway System. 
At current rates of funding, such a widening program would require 56 
years to accumulate funds assuming no inflation or project cost 
increases. All of the federal and state highway funds for the next 20 
years will only pay for one-half of the Highway 101 Bypass and then 
funds are currently programmed. This is why MST and the Transportation 
Agency for Monterey County regard the institution of quality, frequent 
transit service to be a critical element of future mobility for 
residents, tourists, and goods.
    The Fort Ord transit facilities have been strategically planned as 
part of a comprehensive county-wide planning effort so that transit 
will assist in reducing traffic congestion, air pollution and delays 
while encouraging reuse of Fort Ord. MST has requested the conveyance 
of land for the Marina/Fort Ord Intermodal Transit Center through the 
public benefit conveyance process. MST expects to receive the title to 
this property in Spring 1997. Funding is requested to allow MST to 
develop this property, which will serve as a catalyst for the reuse of 
Fort Ord.
    The bus transit facilities on Fort Ord and the access they provide 
are critical to successful Fort Ord Reuse and to reducing traffic 
congestion. The military contribution to the local economy was 
approximately one-third of the total Monterey County economy. When the 
base closed in 1992, approximately 21,000 local jobs were lost. 
Following the closure of Fort Ord, local public agencies alone lost 
$188.6 million in tax revenues in 1992.\1\ The loss of military 
expenditures and wages need to be replaced as soon as possible with 
successful reuse of the Fort. The development of the Marina/Ft. Ord 
Intermodal Transit Center is critical to avoiding the traffic 
congestion that may develop as Fort Ord reuse occurs.
---------------------------------------------------------------------------
    \1\ Department of the Army, ``Environmental Impact Statement, Fort 
Ord Disposal and Reuse,'' Volume II, December 1992.
---------------------------------------------------------------------------
                         national significance
    Fort Ord Reuse is a national model of military base conversion to 
peacetime uses. The primary anchor for the reuse is the establishment 
of a Monterey Bay branch of the California State University which is in 
place and is expected to serve 25,000 students. The new campus 
currently contract with Monterey-Salinas Transit for bus service. As 
the campus grows along region, existing transit services must be 
maintained and expanded to provide critical transportation to students 
as well as the employees and residents who will make the reuse of Fort 
Ord a success. The implementation of alternative transportation 
programs will be an important component of the national reuse model 
that Fort Ord represents.
                         economic significance
    Bus service throughout the Monterey Peninsula, Watsonville, and 
Salinas carries an average of 12,000 daily passengers, one-third of 
whom have no other alternative means of transportation. Monterey-
Salinas Transit is among the top one-quarter of transit operators in 
California in on-time performance and cost effective service delivery. 
Our farebox recovery rate of 41 percent is among the highest in 
California.
    The Monterey Bay Sanctuary, numerous federal parks, 17 golf 
courses, Monterey Bay Aquarium, historic Monterey adobes, and 
communities like Carmel all contribute to the $1 Billion Monterey 
County Tourist Industry. The maintenance of transit services is 
critical in maintaining this major facet of Monterey County's economy. 
Transit provides access to tourist-oriented employment and provides 
transportation for visitors.
    Some of the buses purchased will operate in shuttle service on the 
Waterfront Area Visitor Express (The WAVE) route which connects 
downtown Monterey with Cannery Row, Fisherman's Wharf, and Pacific 
Grove. Each day it runs, The WAVE carries an average of 1,400 
passengers at significantly less public cost than other alternatives 
that were studied. In addition, The WAVE service is valued by the 
business community which helps fund its operating costs. The business 
community now directly funds one-third of the cost of this service.
    Exceeding the tourist industry as an employer and economic engine 
is the $2 Billion Monterey County Agricultural Industry where support 
infrastructure and services are needed to move both people and goods 
efficiently in order to minimize traffic congestion and travel delays 
for Central California Coast residents, tourists, businesses, and 
shippers. MST provides transportation for agri-business employees and 
reduces traffic congestion so that agricultural goods can move more 
efficiently to market.
                    proven high-technology equipment
    The buses to be replaced are high technology, low pollution, state-
of-the-art Compressed Natural Gas (CNG) buses, eight of which now 
operate in the MST fleet. CNG Fueling infrastructure will allow MST to 
efficiently fuel the new buses. This will result in lower operating 
costs and better service to existing residents and tourists.
    The MST system is currently operating mostly diesel buses that are 
long past the FTA's useful service life goal of 12 years. The MST fleet 
is one of the oldest transit fleets in the State of California. The 
oldest buses in the fleet are remanufactured 1977 Flxible coaches which 
are 20 years old. Each of these buses has traveled almost one million 
miles.
    MST plans to continue to purchase vehicles fueled by compressed 
natural gas. This new technology will allow MST to operate its service 
while producing significantly less air pollution than diesel buses. 
Each of the 27 CNG buses to be purchased will reduce air pollution by 
nearly a ton per year. The total CNG fleet to be purchased will reduce 
air pollution by nearly 23 tons per year.
                               conclusion
    The 27 buses and the CNG infrastructure will allow MST to continue 
to provide transit services to the residents of Monterey County and 
will support the reuse of Fort Ord. The federal funding requested for 
these buses is critical to MST's ability to support the economic 
vitality of our region and to maintain the quality of life of Monterey 
County residents.
    The Marina/Fort Ord Intermodal Transit Center will serve as a focal 
point for the reuse of Fort Ord. This project sits at the heart of a 
new, mixed-use development. In addition to being a valuable and 
relatively modest investment, this facility will serve as part of a 
national model for the reuse of military bases.
                                 ______
                                 
  Prepared Statement of Lori Holt Pfeiler, Chairman, North San Diego 
                    County Transit Development Board
    As Chairman of the North San Diego County Transit Development Board 
(NSDCTDB), I am pleased to have the opportunity to provide written 
testimony to the Subcommittee regarding the Oceanside-Escondido Light 
Rail Project. NSDCTDB is requesting an appropriation for fiscal year 
1998 of $13 million to proceed with final design and mitigation costs 
associated with the project.
                              introduction
    NSDCTDB serves a geographical area of 1,020 square miles extending 
from the northern boundary of San Diego County, south through the city 
of Del Mar and inland from the Pacific Coast to the city of Escondido 
and the unincorporated communities of Fallbrook and Ramona. As can be 
seen on the attached map, this service area includes Camp Joseph 
Pendleton Marine Corps Base (situated in extreme northern San Diego 
County adjacent to the Orange county line). The other cities in 
NSDCTDB's service area include the coastal cities of Oceanside, 
Carlsbad, Encinitas and Solana Beach and the inland cities of Vista and 
San Marcos. Total population of the service area is approximately 
720,000. NSDCTDB's operating agency, North County Transit District 
(NCTD), provides fixed route and demand response bus service, ADA 
paratransit service and passenger rail services via the Coast Express 
Rail Service (COASTER).
    The railroad right-of-way for the COASTER service and the proposed 
Oceanside-Escondido Light Rail Project was acquired from the Atchison, 
Topeka and Santa Fe Railway in 1993 by NSDCTDB and the San Diego 
Metropolitan Transit Development Board (MTDB), each agency owning the 
right-of-way in its service area. Shared-use agreements with Amtrak and 
Santa Fe provide revenues from these entities which are available to 
offset passenger rail operating costs, thereby reducing the amount of 
public operating subsidy required.
                          project description
    The Oceanside-Escondido Light Rail Project consists of the 
conversion of an existing twenty-two mile freight rail corridor into a 
light rail system running inland from the coastal city of Oceanside 
through the cities of Vista and San Marcos, to the city of Escondido. 
The project additionally includes a 1.7 mile realignment on new right-
of-way to serve California State University San Marcos. Passenger rail 
service will be provided to a total of fifteen stations including four 
at existing transit centers. The western most terminus, the Oceanside 
Transit Center, already serves a variety of transportation modes and 
has developed into a truly regional and intercity transportation hub, 
serving Amtrak, Metrolink (Southern California Regional Rail), COASTER, 
NCTD bus service, Greyhound bus and taxi. Horizon year 2015 ridership 
for the Oceanside-Escondido Light Rail Project is projected to be 
5,215,700.
    This project will include track work, signal, other right-of-way 
improvements, a maintenance facility, station construction and the 
purchase of diesel multiple unit (DMU) vehicles.
    The Oceanside-Escondido Light Rail Project was approved by the 
voters in San Diego County in 1987 through Proposition A, a local sales 
tax initiative. Proceeds from the proposition will fund 27 percent of 
the project. The remaining 18 percent of the local commitment will be 
funded with Proposition 108 and other state funds.
    The Oceanside-Escondido Light Rail Project is supported by the San 
Diego Association of Governments (SANDAG) based on the following series 
of actions adopted by their Board of Directors. The project is 
contained in the Revenue Constrained Regional Transportation Plan 
(RTP), 1996-2020. Additionally, the project is programmed in the 1996-
2003 Regional Transportation Improvement Program (RTIP). As part of the 
RTP and RTIP adoption process, the project has been certified as being 
in conformity with the planning requirements of the federal Clean Air 
Act.
                            economic benefit
    Studies conducted by the SANDAG in 1987 determined that the light 
rail alternative using self contained diesel multiple unit (DMU) 
vehicles was found to be the most cost effective because it 
demonstrated the lowest operating cost of the three alternatives 
studied. Additionally, the DMU alternative proved to have the lower 
capital cost when compared with the cost of the electrical powered 
system. The light rail alternative studied using electrical power cost 
twice as much as the alternative using the DMU vehicles. The proposed 
Oceanside-Escondido Light Rail Project will be using the DMU vehicles.
    This capital cost of the Oceanside-Escondido Light Rail Project, at 
$8.8 million per mile, compares extremely favorably to other Southern 
California rail projects. Comparative capital costs for other rail 
projects range from $31.7 million to $50 million per mile.
    The Federal Transit Administration requires that annualized cost 
per new transit rider be used to measure cost effectiveness of proposed 
rail transit project alternatives. The cost effectiveness indicator for 
the Oceanside-Escondido Light Rail Project is $4.61 per new rider. This 
number is less than the $5.00 figure that is considered to be a very 
effective project threshold.
    Projected subsidies for fiscal years 2001-2003 for the rail service 
range from $.59 to $.53 per passenger. The projected subsidies the 
fixed route bus service range from $2.03 per $2.14 for the same time 
period. As these comparisons indicate, the rail service in this 
corridor will be cost effective. Also, the fixed route bus service will 
eliminate one route that provides service in the same corridor and 
another route will be modified due to the reduced demand created by the 
service. The savings from these changes will be used to subsidize rail 
system operation.
    The majority of funds used to operate the rail service will be from 
passenger revenues. The farebox recovery ratio beginning in the first 
year of operation is projected to be 59.6 percent increasing to 63.3 
percent by the year 2003.
    Other benefits include an increase in employment expected by both 
the construction of the project and the operation and the maintenance 
of the service. Because of the multiplier effect additional secondary 
jobs will be created as well.
                         regional significance
    The Oceanside-Escondido Light Rail Project will be situated along 
the State Route 78 Corridor, which connects Interstate Highway 5 and 
15, and is the principal east-west corridor in Northern San Diego 
County. The closest parallel expressway is State Route 76, located 
fifteen miles to the south. State Route 78 carries inter-regional, 
intra-regional, commuter and recreational travel. The corridor contains 
a diverse mixture of residential, local commercial, light industrial 
and educational land uses, generating increasing volumes of trips.
    Existing major activity centers within the corridor include a 
regional shopping mall, two community colleges, a state university, a 
private university and two hospitals. Employment growth along the 
corridor is projected to increase progressively by a total of 58.6 
percent from the 165,725 jobs in 1990 to a total of 262,869 jobs by 
2015. This is over twice the rate of growth of the rest of the San 
Diego Region which is projected to increase by 25.8 percent during the 
same period. The majority of the increase in employment is expected to 
stem from lower-paying service and retail employment providing a 
growing market for this highly successful transit corridor.
    The region's economic growth could be hindered by current and 
projected congestion on State Highway 78. Currently operating at 
moderate to heavy congestion, traffic on the highway is projected to 
reach a heavy congestion level by 2015. According to the California 
Department of Transportation, widening this freeway to eight lanes is 
not economically feasible due to right-of-way constraints and bridge 
reconstruction costs. The Oceanside-Escondido Rail project has been 
developed to help alleviate this projected congestion.
    Regional land use policies recognize the importance of public 
transit to the region's quality of life and encourage an increase in 
the density of employment within walking distance of planned rail 
stations. Additionally encouraged is an increase in the density of 
single family and multiple family units around planned rail stations as 
well as mixed-use development.
    The cities in the State Highway 78 corridor are taking action to 
implement these land use guidelines. The city of Oceanside is currently 
conducting a study to determine opportunities for pedestrian oriented, 
mixed-use intense development around the six rail stations in the 
city's jurisdiction. The city of Vista's redevelopment project, located 
immediately adjacent to the planned rail station in downtown Vista, 
also recognized the opportunities for economic development provided by 
the project. The city of San Marcos considers the construction of a 
rail station as one of the critical elements to their 60 acre 
redevelopment project. The newly constructed San Marcos City Hall is 
situated within the redevelopment project and directly adjacent to the 
planned rail station. Just south of the city of San Marcos 
redevelopment project lies California State University San Marcos, 
which opened in 1993, and is already a major regional activity and 
employment center. In addition, three hospitals are planned for 
developed at cities adjacent to the University. The city of Escondido 
is already served by a major transit center in the downtown area. The 
Oceanside-Escondido Rail Line will serve a station directly adjacent to 
the existing transit center, making all of the downtown area, including 
the Escondido Center for the Arts, within walking distance or 
accessible by a short bus trip.
  energy efficiency, environmental benefits and congestion mitigation
    The Oceanside-Escondido Rail Project is expected to require a total 
energy demand of 43 billion Btu per year. This is a positive net effect 
compared to the No Action Alternative. If the project is implemented an 
annual reduction of 174 billion Btu could be achieved, relative to the 
No Action Alternative. The express bus alternative shows a comparable 
energy demand of 43.1 billion Btu annually.
    In terms of environmental benefits, studies indicate that this 
project would incrementally decrease pollution to the region airshed 
and therefore result in a beneficial impact to air quality. Vehicle 
miles traveled would be reduced by 57,728 daily as a result of this 
project.
    Mitigation of congestion will be realized by shifting the single 
occupant auto driver to the rail system. Primarily, the benefits will 
be to State Route 78 during commuter peak hour periods. Rail service 
would contribute indirectly to a reduction in commuter traffic along 
Interstate 5 and 15.
                             project status
    Between 1986-1992, a series of studies were conducted by SANDAG and 
the California Department of Transportation to determine the best way 
to accommodate current and future travel demands in the State Route 78 
Corridor. The studies recommended a multimodal approach to optimize the 
existing State Route 78 facility that focuses on State highway 
improvements, sub regional arterial network improvements and the 
provision of a passenger rail system operating over the existing 
railway to achieve a balanced intermodal east-west corridor. The 
results of this Alternative Analysis led NSDCTDB proceed with an 
Environmental Impact Report (EIR) in compliance with California 
Environmental Quality Act (CEQA). The EIR was later supplemented to 
provide for an alignment directly serving CSUSM. The EIR and 
supplemental EIR were certified in 1990 and 1991 respectively.
    In February, 1993, NSDCTDB acquired the right-of-way for this 
project from the Atchison, Topeka and Santa Fe Railway at a cost of 
$19.2 million, and to date, a total of $43.1 million of local and State 
funds have been invested in property acquisition for this project.
    In August, 1994, a regional consultation meeting was held with 
representatives of FTA, FHWA, SANDAG, Caltrans, City of San Marcos and 
NCTD in attendance. As a result, the Oceanside-Escondido Passenger Rail 
Project was determined to be a ``pipeline project'' in that the 
alternative analysis had been completed at the regional level.
    It was recognized that in order to qualify for federal funding, the 
project would have to undergo further environmental documentation in 
compliance with the National Environmental Policy Act (NEPA) ; however, 
NSDCTDB decided to defer further environmental work until the 
completion of an advanced planning study, which would provide refined 
capital cost estimates. Completed in December, 1995, the advanced 
planning study reviewed several operating scenarios, taking the basic 
system elements to as much as a 30 percent design level. This level of 
detail afforded the Board with confidence in the capital costs. The 
Board selected an operating scenario and directed staff to proceed with 
the NEPA process. A subsequent EIR was required under CEQA. A draft 
CEQA/NEPA document was completed in October, 1996. The NSDCTDB 
certified the CEQA document in February, 1997. NCTD is currently 
preparing the documentation required by FTA to issue a Finding of No 
Significant Impact (FONSI).
                                summary
    The Oceanside-Escondido Rail Line is a cost effective project which 
enjoys significant local support and will have important benefits to 
the economic health of the region. The current financial plan calls for 
a federal investment of approximately $107 million which is 55 percent 
of the total cost of $194 million. This request for $13 million would 
be the first appropriation towards the $107 million. If this 
appropriation is approved, the funds will be used for final design and 
costs associated with mitigation.
    The planned opening date of December, 2000 is driven by State 
mandate requiring projects funded by Proposition 108 (the state funds 
referenced above) be in service by fiscal year 2000. Design must 
proceed in fiscal year 1998 in order to comply with this state 
requirement.
    The current Amtrak and Santa Fe shared-use agreements, a variety of 
lease agreements and the high farebox recovery have afforded NCTD the 
benefit of using minimal local subsidies for its rail program. No 
federal operating assistance will be applied to NCTD's rail operations.
    I urge the Subcommittee to give favorable consideration to the 
Oceanside-Escondido Light Rail Project. Thank you for the opportunity 
to present this important transportation project.
                                 ______
                                 
   Prepared Statement of Paul P. Skoutelas, Executive Director, Port 
                     Authority of Allegheny County
    Chairman Shelby and members of the subcommittee, I am pleased to 
submit testimony on behalf of Port Authority of Allegheny County, the 
principal public transportation provider in the Pittsburgh urbanized 
area. Port authority provides 75 million public transportation trips 
annually within a 730 square mile area through a variety of services 
including bus, busway, light rail, incline, and the Nation's largest 
specialized paratransit system.
    I am Paul Skoutelas, newly named Executive Director of Port 
Authority of Allegheny County. It is my privilege to present this 
testimony regarding Port Authority's, phase I airport busway/Wabash HOV 
facility. This intermodal project provides an excellent example of the 
Federal-State-local partnership that has been so successful in 
financing public transportation investments.
    Port Authority is requesting $40 million for this project in fiscal 
year 1998. Port Authority is also requesting a ``bus/bus facility'' 
earmark of $12 million to be used to acquire approximately 55 buses in 
fiscal year 1998. Procurement of new buses will enable Port Authority 
to ensure reliable and comfortable service to its customers.
    With strong bipartisan support from this subcommittee, I am happy 
to report that the airport busway/Wabash HOV facility is now under 
construction and will be, when completed, a critical element of 
Allegheny County's busway system. The project will provide access to 
jobs through an essential transit link between downtown Pittsburgh and 
the new Pittsburgh International Airport. The airport busway/Wabash HOV 
facility will also cut travel time to the western suburbs bypassing 
traffic congestion at the Ft. Pitt Bridge and Tunnel, and along Parkway 
West (I-279). Accordingly, the project will provide a viable 
alternative to traffic gridlock anticipated during the upcoming 
reconstruction of the bridge and tunnel, a project to be undertaken by 
the Pennsylvania Department of Transportation.
    Through fiscal year 1997, a total of $130.9 million in new start 
funding has been provided for the project. In addition $19 million in 
section 3 bus/bus facilities funding and $15.8 million of intermodal 
funding pursuant to section 1069 of the Intermodal Surface 
Transportation Efficiency Act of 1991 (ISTEA) has also been earmarked. 
An amount of $76.5 million in ISTEA flexible funds has also been 
obligated, and $9.6 million in contract authority has been made 
available pursuant to section 1108 of ISTEA. In addition, Pennsylvania 
State Act 223 of 1990 authorizes $70 million for the project.
    At present approximately half of the length of the 8.1 mile 
intermodal project is under construction. By December, 1997 in excess 
of $271 million is scheduled to be encumbered. All funds obtained 
pursuant to the fiscal year 1998 appropriations bill will be encumbered 
in fiscal year 1998.
    The Federal Transit Administration (FTA) has ranked the airport 
busway/Wabash HOV facility among the most cost-effective projects in 
the Nation. The FTA negotiated a full funding grant agreement (FFGA) 
with Port Authority on the basis of that evaluation. However, due to a 
number of factors unknown in October 1994 when the FFGA was formalized, 
project costs are now expected to be higher than the estimates included 
in the FFGA. Amendments to the FFGA are currently being discussed by 
Port Authority and FTA.
    Port Authority is also requesting $12 million in the fiscal year 
1998 transportation appropriations bill to be used toward the 
procurement of approximately 55 buses, some of which may be powered by 
alternative fuels. The new buses will replace buses which have 
completed their useful service lives and are eligible for retirement by 
virtue of age or mileage standards. The buses will be used in Port 
Authority's overall route network which serves 255,000 riders each day, 
or about 75 million annually.
    I would now like to stress the importance of increasing the overall 
level of investment in transportation infrastructure. Traditionally, 
transportation has been a bipartisan program where both political 
parties have shared a belief in the national importance of 
infrastructure investment. The bipartisan work of this subcommittee has 
enabled undercapitalized and physically deteriorated public 
transportation systems in our great cities, suburban communities, and 
rural areas to be rejuvenated. Further, this subcommittee has helped 
create an Interstate Highway System and airport network that is the 
envy of the world. Now, it is imperative that all levels of government 
continue to develop our transit and surface transportation networks.
    Finally, I want to commend the subcommittee for including in recent 
transportation appropriations bills the provision allowing FTA to 
implement new guidelines for vehicle overhaul projects. This new 
initiative encourages maintenance and preservation of rolling stock 
while also helping mitigate the impact of cuts in Federal operating 
assistance. This offers a strategic direction to build on for the 
future of the Federal Transit Assistance Program. However, to take full 
advantage of this opportunity funds for the Urban Capital Grant Program 
(formerly section 9) must be increased.
    I look forward to an active and ongoing dialogue with the 
subcommittee in the coming years. I would be pleased to submit any 
additional information at this time as would be useful to the 
subcommittee.
                                 ______
                                 
 Prepared Statement of Dr. Carlos I. Pesquera, Secretary, Puerto Rico 
             Department of Transportation and Public Works
    Good afternoon, Mr. Chairman and Members of the Subcommittee. I am 
Carlos I. Pesquera, Secretary of Transportation and Public Works for 
the Commonwealth of Puerto Rico. I am honored to appear before you 
today to report on the progress of the transit system that we call 
``Tren Urbano.'' Since my last formal report to this subcommittee, we 
have entered a critically important and exciting phase of this project. 
Tren Urbano is under construction.
    While the groundbreaking ceremony on August 2, 1996, symbolized the 
launch of the construction phase, the awarding of major construction 
contracts has made the project a reality. To date, $720.8 million in 
contracts have been awarded for the first four packages. The remaining 
$529.5 million in contracts will be awarded by June of this year for 
the final three segments. We have established an aggressive schedule 
for final design and construction. System testing is scheduled for the 
year 2000, with system opening scheduled for the summer of 2001.
    Tren Urbano is evidence of our commitment to build a world-class 
transportation system. That commitment has also motivated our 
dramatically increased investments in highway construction 
rehabilitation, and maintenance over the past four years. By the end of 
1996, the Government of Puerto Rico had invested $1.1 billion in 
transportation infrastructure, compared to $815 million during the 
previous four-year period, an increase of 32 percent. We have also 
significantly increased investments in existing modes of public 
transportation, to build a transit ridership base and to prepare for 
integrating these modes as feeder systems for Tren Urbano.
    The Federal government has been our indispensable partner in our 
efforts to build a world-class transportation system. Back in 1993, the 
Federal Transit Administration chose Tren Urbano as one of four turnkey 
demonstration projects in the nation, and the only new start project 
among them. Aside from the technical merits of our project, the FTA has 
highlighted Tren Urbano's cost-effectiveness, which it estimates as 
0.67 per net new rider.
    The innovations in project management, financing, and procurement 
strategy developed for Tren Urbano are being closely followed and 
widely praised by the transportation industry. I believe that our 
vigorous and highly effective community participation program, the 
extraordinary measures we have taken to assure top-quality system 
design, and our search for ways to couple the project with urban 
redevelopment will one day present an instructive case study for 
transit planners, not only here in the mainland U.S. but around the 
world. In October of last year we cooperated with the Federal Transit 
Administration in hosting an international conference on turnkey 
transit systems and joint development. Over 150 representatives from 16 
countries gathered to discuss trends and recent experiences. We used 
the occasion to highlight the innovative turnkey procurement process we 
have devised for Tren Urbano.
    By the year 2010, the number of daily person trips by car within 
the San Juan Metropolitan Area is expected to increase by 45 percent. 
The high concentration of development and population in the 
metropolitan core precludes expanding existing roadway facilities 
without great cost, community disruption, and increased traffic 
congestion.
    In light of these factors, there is a pressing need for a high-
capacity rail system in the San Juan Metropolitan Area. To alleviate 
worsening gridlock and to avoid future inflationary cost, Tren Urbano 
is implementing a fast track, design/build procurement rather than the 
traditional method of procuring a public facility.
    Congress has recognized the importance of Tren Urbano to 
maintaining economic growth in Puerto Rico. The FTA and Puerto Rico 
Highway and Transportation Authority have entered into a full Funding 
Grant Agreement providing for FTA capital program funds totaling 
$307.34 million. Congress approved an initial earmark of $5 million for 
federal fiscal year 1995 and an additional earmark of $7.4 million for 
federal fiscal year 1996. FLEA has approved a grant application for 
this $7.4 million for federal fiscal year 1996. In addition, Congress 
has approved a $4.35 million earmark for fiscal 1997. This earmark has 
been supplemented by an additional $1.3 million of discretionary moneys 
awarded by the FTA.
    The financial analysis for Tren Urbano assumes that federal funds 
will be provided in accordance with the provisions of the Full Funding 
Grant Agreement which allocates federal funds over a six-year period, 
commencing in federal fiscal year 1996. Our Highway and Transportation 
Authority is also evaluating alternatives for the application of such 
FTA capital program funds in order to avail itself of the innovative 
financing techniques currently under consideration by FTA and DOT. In 
addition, during the Tren Urbano design and construction our Highway 
and Transportation Authority anticipates receiving $90 million in FTA 
urbanized area formula apportionments in accordance with the provisions 
of 49 USC 5307. These apportionments, in addition to the Full Funding 
Grant Agreement funds, will be devoted entirely to transit.
    I wish to emphasize that in the financial plan for Phase I of Tren 
Urbano, the funds provided by the FTA's Full Funding Grant Agreement 
amount to approximately one-third of the total cost of the project. 
Puerto Rico will finance the other two-thirds using the Highway and 
Transportation Authority's revenue sources. Last week, we proposed that 
the Legislature of Puerto Rico enact a number of transportation 
financing enhancements that will provide the Highway and Transportation 
Authority with an additional $120 million per year. These enhancements 
include giving the HTA more of the vehicle licensing fees and more of 
the 8-cents-per-gallon tax on diesel fuel now being collected. In 
addition, we will raise the gasoline tax by 2-cents per liter, which is 
about 7.6-cents per gallon. This tax increase will add approximately 
$80 million per year to the pledged revenues received by the Highway 
and Transportation Authority.
    We are here today to request that the Members of the Appropriations 
Subcommittee on Transportation continue their support for the Tren 
Urbano project by granting a fiscal year 1998 appropriation of $45 
million. These funds will help pay for ongoing construction. I look 
forward to keeping Members of Congress apprised of our progress on Tren 
Urbano.
    Thank you, Mr. Chairman and Members of the Committee for your time 
and consideration. And now, I welcome your questions.
                                 ______
                                 
 Prepared Statement of Leon Williams, Chairman, San Diego Metropolitan 
                       Transit Development Board
    Mr. Chairman and members of the Subcommittee, we appreciate this 
opportunity to provide testimony on the critical and cost-effective 
Metropolitan Transit Improvement Project in San Diego. The San Diego 
Metropolitan Transit Development Board (MTDB) is seeking an 
appropriation of $31 million which would allow us to proceed with final 
design and right-of-way acquisition for the San Diego Metropolitan 
Light Rail Transit (LRT) Program. This LRT project consists of two 
elements, Mid-Coast (3.4 miles initial phase) and Mission Valley East 
(5.9 miles completes the Mission Valley line), which would extend the 
existing San Diego Trolley system to a total of 64 miles.
    However, before I describe the project and its elements, let me 
offer some highlights of our record in San Diego:
    1. ``Intermodal'' Works in San Diego!--We continue to be a model 
for intermodal efficiencies. Since introduction of LRT in 1981 we have 
had a ``seamless'' transit network of buses, commuter rail, and LRT. 
The integrated and unified fare structure allows easy interchange 
between modes, and the bus services have been fully tied in with the 
LRT network through strategically located transit centers that serve as 
``hubs.''
    2. Light Rail Transit (LRT) Economies Have a 16-Year Proven Record 
in San Diego!--The metropolitan bus-LRT system performs well, and has 
an enviable farebox recovery rate of 51 percent, with the LRT portion 
being about 70 percent.
    3. Incremental System Development Works in San Diego!--Our LRT 
system has been developed incrementally in seven stages to date--which 
ensures relevancy of the system to the growing and changing needs of 
the metropolitan area.
    4. Local Funding is the Foundation for LRT Development in San 
Diego!--Therefore, as we explain our request please be aware that we 
have largely built the LRT system that is in place or under 
construction today with local and state funds. Of the $813 million 
investment in the LRT system development to date, only 8.5 percent has 
come from federal funds. Thus, with a proposed federal share of $323 
million of the total $409 million in costs for both elements of this 
project, the total federal participation in the overall San Diego 
Trolley LRT system would amount to only 32 percent!
    Now, let me turn to the two elements of the San Diego Metropolitan 
LRT project and describe their primary features. First, they share some 
common characteristics:
  --they would offer access to and connections between the four major 
        employment areas in San Diego (centre city, Mission Valley, the 
        ``Golden Triangle,'' and Otay Mesa at the International 
        Border),
  --they would continue and expand upon the seamless network of transit 
        services that have been developed, and complete a ``gap'' in 
        the present LRT system, and
  --they would offer a functional, attractive alternative mode to 
        travelers in parallel, heavily traveled interstate freeways.
    The Mid-Coast LRT Project is the first element of the appropriation 
requested today and would be used to undertake design for the Mid-Coast 
LRT Phase 1 to Balboa Avenue, which is a 3.4-mile segment of the 
corridor. This segment would be constructed on railroad right-of-way 
owned by MTDB, and establish a rail transit link with Mission Bay Park, 
the largest aquatic park in the United States. The Mid-Coast element 
has proceeded through the MIS and Draft Environmental Impact Statement 
with funding originally authorized in ISTEA, and the element is now in 
the Preliminary Engineering and Final Environmental Impact Statement 
(PE/FEIS) phase. The current schedule calls for completion of this 
phase in late 1997. Importantly, this element has received widespread 
community support.
    The locally preferred alternative for the entire Mid-Coast corridor 
was selected by the Metropolitan Transit Development Board of Directors 
as a result of an alternatives analysis and Major Investment Study 
(MIS). Today's request for 3.4 miles in the Mid-Coast element runs 
north from the Mission Valley West LRT extension (now under 
construction and scheduled to be completed late this year), roughly 
paralleling Interstate 5 (I-5) to Balboa Avenue.
    Our second element is in the Mission Valley East Corridor and is 
approximately 5.8 miles long paralleling Interstate 8 (I-8) from just 
east of Interstate 15 (I-15), terminating in the city of La Mesa. This 
LRT extension would complete the gap that will exist between the new 
LRT service starting this later this year, called the Mission Valley 
West extension, and the current East LRT Line. Thus, completion of this 
gap in the system will immediately allow travelers on the Mission 
Valley East extension to have rail transit access to the many activity 
centers in the area including major employment sites, San Diego State 
University (with a daytime population of approximately 35,000), and 
Qualcomm Stadium with a capacity of 70,000 seats and the host to year 
round events.
    The Mission Valley East element is an FTA ``pipeline'' Major 
Investment Study, and MTDB is currently studying no-build, best bus, 
and LRT alternatives for meeting the needs of the corridor. The LRT 
alternative would extend the locally funded six-mile Mission Valley 
West LRT extension which, mentioned previously, is currently under 
construction between the Old Town Transit Center and I-15. The 
extension would run through the I-8 corridor to connect with the 
existing East Line LRT in the suburban city of La Mesa.
    The Mission Valley East element is currently in the MIS and Draft 
Environmental Impact Statement (DEIS) process, with adoption of the 
locally preferred alternative scheduled in late 1997. The final 
environmental document and completion of preliminary engineering for 
the Mission Valley East element is scheduled for completion in fiscal 
year 1998.
    A major objective of these two elements is to reduce further 
congestion of the north-south (I-5) and east-west (I-8) corridors. The 
Mid-Coast element parallels I-5 which carries from 151,000 to 227,000 
vehicles per day. The Mission Valley East element parallels I-8 which 
handles between 185,000 to 302,000 vehicles on an average day. 
Interstate 8 is the most heavily congested freeway in the San Diego 
region. Existing bus service must contend with the same highway 
congestion as the private automobile. Other significant benefits 
include air quality improvements that would be continued in our region 
with the help of these elements, and land use integration at and around 
the station sites. Recognizing the importance of mass transit in 
dealing with congestion problems, the city of San Diego has adopted a 
transportation-land use policy that fosters transit oriented 
development.
    To summarize our request on behalf of MTDB, I am asking the 
subcommittee to take into consideration MTDB's multi-year, successful 
LRT development program. This program includes a total investment of 
$813 million dollars over the past 17 years, of which only 8.5 percent 
was from federal resources. Further, of the federal funds used, only 
$21.6 million were from the FTA discretionary program. MTDB's 
creativity in funding the system development is shown with the use of 
the following resources: state gas tax, state sales tax, local 
transportation sales tax, city hotel-motel room tax, sale-leaseback 
transactions, San Diego Unified Port District contributions, private 
developer right-of-way contributions, and city redevelopment funds. 
However, in order to get the system developed as soon as possible, 
using local and state resources, we have exhausted those resources. 
Now, we need your help to finish our system.
    Our request for fiscal year 1998 appropriation of $31 million is 
the first of a multi-year request totaling $323 million. We believe 
that this amount for our two elements makes cost-effective sense. Even 
if we ultimately receive our full request of $323 million in federal 
funding (currently pending consideration for authorization by the 
Subcommittee on Surface Transportation of the Committee on 
Transportation and Infrastructure), the total federal share would 
remain below one-third of the cost of the overall San Diego Trolley 
system. I also ask that the subcommittee, in considering this request, 
take note of MTDB's past performance in delivering projects in a timely 
and cost-effective manner and, importantly, the operating performance 
of the system. We at MTDB are very proud of our record in ridership and 
farebox recovery. The San Diego Trolley carries an average of 50,000 
riders per weekday and has gradually increased over its 15+ year 
history from an initial 11,000 daily riders in 1981.
    In addition to being cost-effective, as the agency responsible for 
development and funding of all transit in the San Diego metropolitan 
area, MTDB has been forced to be innovative and resourceful in funding 
operations during several years of diminishing operating revenues. As 
part of our current LRT system investment, we used $48.2 million of our 
federal formula funds towards the cost of LRT extensions without 
constraining our local bus replacement and capital program. We were 
able to issue Certificates of Participation to provide for the capital 
leasing of 130 buses in 1990. Then, subsequently, we used revenues from 
sale/leaseback of light rail vehicles to provide for both operating and 
capital needs. These funds have been used to leverage both state and 
federal funds.
    In conclusion, I would like to emphasize that the San Diego 
Trolley, under the policy direction of the Metropolitan Transit 
Development Board, has been an unqualified success, and the San Diego 
Metropolitan LRT Program, consisting of the Mid-Coast and Mission 
Valley East Corridor elements, would provide mobility to travel markets 
that rely upon public transit, offer a high capacity transportation 
alternative to two critically impacted corridors, and provide air 
quality benefits to residents in the San Diego region.



       LIST OF WITNESSES, COMMUNICATIONS, AND PREPARED STATEMENTS

                              ----------                              
                                                                   Page
Air Traffic Control Association, Inc., prepared statement........  1079
Albright, David, research bureau chief, New Mexico State Highway 
  and Transportation Department, prepared statement..............  1169
American Public Transit Association, prepared statement..........  1174
American Society of Civil Engineers, prepared statement..........  1143
Anderson, John H., Jr., Director, Transportation Issues, 
  Resources, Community, and Economic Development, General 
  Accounting Office..............................................   355
    Prepared statement...........................................   374

Barclay, Charles, president, American Association of Airport 
  Executives, also representing Airports Council International...   531
    Prepared statement...........................................   533
Barger, David, vice president-Newark, Continental Airlines.......   487
    Prepared statement...........................................   498
Bartholow, Steven, Deputy General Counsel, Railroad Retirement 
  Board, Department of Labor.....................................   561
    Prepared statement...........................................   567
Basso, Peter J., Deputy Assistant Secretary, Budget and Programs, 
  Federal Highway Administration.................................   123
Becker, Capt. Fred R., Jr., JAGC, USN (ret.), director, naval 
  affairs, Reserve Officers Association of the United States, 
  prepared statement.............................................  1095
Belger, Monte, Acting Deputy Administrator, Federal Aviation 
  Administration.................................................
  317, 487.......................................................
    Prepared statement...........................................   509
Bell, Gerald W., director, commercial and property lines, 
  National Association of Independent Assurers, prepared 
  statement......................................................   271
Blunt, Harry W., Jr., president, Concord Coach Lines, Inc., vice 
  chairman, American Bus Association.............................   256
    Prepared statement...........................................   257
Bolen, Edward, president, General Aviation Manufacturers 
  Association....................................................   531
    Prepared statement...........................................   552
Bouin, Remy, member, Cessna Owner Organization, letter from......   555
Boyer, Phil, president, Aircraft Owners and Pilots Association...   531
    Prepared statement...........................................   546
Brown, Henry, New York Systems Management Office, Professional 
  System Specialists [PASS]......................................   487
Brown, Kirk, secretary, Illinois Department of Transportation, 
  prepared statement.............................................  1147
Buzzi, Frank, Chief Actuary, Railroad Retirement Board, 
  Department of Labor............................................   561
    Prepared statement...........................................   567
Byrd, Hon. Robert C., U.S. Senator from West Virginia, letter 
  from...........................................................   326

Calkins, Charles L., national executive secretary, Fleet Reserve 
  Association, prepared statement................................  1090
Capon, Ross B., executive director, National Association of 
  Railroad Passengers, prepared statements.......................
  276, 1169......................................................
Carter, Ed, boating law administrator, Tennessee, president, 
  National Association of State Boating Law Administrators, 
  prepared statement.............................................  1092
Clower, W. Dewey, president and CEO, NATSO, Inc., prepared 
  statement......................................................   285
Collins, Father T. Byron, special assistant to the president, 
  Georgetown University, prepared statement......................  1183
Collins, John J., senior vice president, government affairs, 
  American Trucking Associations, Inc............................   240
    Prepared statement...........................................   242

D'Amato, Hon. Alfonse M., U.S. Senator from New York.............   461
Donohue, George, Associate Administrator, Research and 
  Acquisitions, Federal Aviation Administration..................   317
Donohue, Thomas J., president and chief executive officer, 
  American Trucking Associations, Inc., prepared statement.......  1098
Donovan, Dan, chief of staff, on behalf of Hon. Guy V. Molinari, 
  borough president, Staten Island, NY...........................   461
    Prepared statement...........................................   476
Downey, Mortimer L., Deputy Secretary, Innovative Transportation 
  Financing, Department of Transportation........................
  355, 573.......................................................
    Prepared statement...........................................   366
Downs, Thomas M., Chairman, President, and Chief Executive 
  Officer, National Railroad Passenger Corporation (Amtrak)......
                                                         391, 573
    Prepared statements..........................................
      400, 580...................................................
Drewel, Bob, chair of the board, Central Puget Sound Regional 
  Transit Authority, prepared statement..........................  1178
Durbin, John T., executive director, Pennsylvania Turnpike 
  Commission, prepared statement.................................  1136

Electric Transportation Coalition, prepared statement............  1179
Ellingstadt, Vernon, Office of Research and Engineering, National 
  Transportation Safety Board....................................   287

Fay, William D., president and CEO, American Highway User 
  Alliance.......................................................   232
    Prepared statement...........................................   235
Fisher, Morris, chairman, Monterey-Salinas Transit, prepared 
  statement......................................................  1196

Garcia-Pedrosa, Jose, city manager, city of Miami Beach, FL, 
  prepared statement.............................................  1196
Gardner, Guy S., Associate Administrator, Regulation and 
  Certification, Federal Aviation Administration.................   317
Garvey, Jane F., Acting Administrator, Federal Highway 
  Administration.................................................   123
    Prepared statement...........................................   133
George, Father William L., special assistant to the president, 
  Georgetown University, prepared statement......................  1183
Gillespie, Tim, Vice President, Government and Public Affairs, 
  National Railroad Passenger Corporation (Amtrak)...............   573
Greater Orlando Aviation Authority, prepared statement...........  1086
Greenberg, Allen, government relations director, League of 
  American Bicyclists, prepared statement........................  1126
Gruel, Frederick L., president and CEO, AAA New Jersey Automobile 
  Club...........................................................   247
    Prepared statement...........................................   249

Hall, James Evan, Chairman, National Transportation Safety Board.   287
    Prepared statement...........................................   296
Haueter, Tom, Office of Aviation Safety, National Transportation 
  Safety Board...................................................   287

Institute of Transportation Engineers, prepared statement........   283

James, Hon. Sharpe, mayor, city of Newark, NJ, prepared statement  1136
Johnson, Jack, president, Professional Airways System Specialists 
  [PASS].........................................................   487
    Prepared statement...........................................   502

Kenny, Michael P., executive officer, California Air Resources 
  Board, et al., California Industry and Government Coalition, 
  prepared statement.............................................  1109
King, Hon. Peter T., U.S. Representative from New York...........   461
Kodumal, Louis M., city of Media, PA, prepared statement.........  1150
Kohl, Hon. Herb, U.S. Senator from Wisconsin, prepared statement.   131
Krasner, Barry, president, National Air Traffic Control 
  Association....................................................   487
    Prepared statement...........................................   489
Kurland, Susan, Associate Administrator, Airports, Federal 
  Aviation Administration........................................   317
Lew, Hon. Jacob, Deputy Director, Office of Management and Budget   573
    Prepared statement...........................................   575
Linton, Gordon J., Administrator, Federal Transit Administration.   146
    Prepared statement...........................................   133
Maldonado, Raymond D., FAA Control Tower, Newark International 
  Airport........................................................   487
    Prepared statement...........................................   511
Manocherian, Fraydun, the Manocherian Foundation, prepared 
  statement......................................................  1159
Martinez, Ricardo, M.D., Administrator, National Highway Traffic 
  Safety Administration..........................................   144
    Prepared statement...........................................   133
Memphis Area Transit Authority, prepared statement...............  1165
Metropolitan Atlanta Rapid Transit Authority, prepared statement.  1184
Millar, William W., president, American Public Transit 
  Association....................................................   251
    Prepared statement...........................................   253
Molinari, Hon. Susan, U.S. Representative from New York..........   461
    Prepared statement...........................................   474
Molitoris, Jolene, Administrator, Federal Railroad Administration   391
Monaghan, Tom, FAA control tower, John F. Kennedy International 
  Air- port......................................................   487
Morgan, Linda J., Chairman, Surface Transportation Board, 
  prepared statement.............................................  1051
Morgan, Ron, Director, Air Traffic Service, Federal Aviation 
  Administration.................................................   487

Nagle, Kurt J., president, American Association of Port 
  Authorities, prepared statement................................   273
Navajo Nation, prepared statement................................  1151
Niagara Frontier Transportation Authority, prepared statement....  1153

Parcells, Harriet, executive director, American Passenger Rail 
  Coalition, prepared statement..................................  1162
Penelas, Alex, mayor, Metropolitan Dade County, FL, prepared 
  statement......................................................  1191
Pesquera, Dr. Carlos I., secretary, Puerto Rico Department of 
  Transportation and Public Works, prepared statement............  1203
Pfeiler, Lori Holt, chairman, North San Diego County Transit 
  Development Board, prepared statement..........................  1199
Phillips, Karen Borlaug, senior vice president, Association of 
  American Railroads, prepared statement.........................   267

Reagle, George, Office of Motor Carriers, Federal Highway 
  Administration.................................................   123
Redmond, Lee R., III, senior vice president-real estate, Kaiser 
  Ventures, Inc., prepared statement.............................  1118
Rensink, Darrel, director, Iowa Department of Transportation, 
  president, American Association of State Highway and 
  Transportation Officials.......................................   225
    Prepared statement...........................................   227

Sanders, David G., Deputy Administrator, St. Lawrence Seaway 
  Development Corporation, prepared statement....................  1033
Scheinberg, Phyllis, Associate Director, Resources, Community, 
  and Economic Development Division, General Accounting Office...   391
Shackelford, Wayne, commissioner, Georgia Department of 
  Transportation, prepared statement.............................  1110
Shane, Anne, chief of staff to Mayor Stephen Goldsmith, city of 
  Indianapolis, IN, prepared statement...........................  1118
Shelby, Hon. Richard C., U.S. Senator from Alabama, prepared 
  statements.....................................................
  125, 289.......................................................
Shelton, L. Robert, Associate Administrator for Safety 
  Performance Standards, National Highway Traffic Safety 
  Administration.................................................   880
Siegel, John H., M.D., chairman of the Department of Anatomy, 
  Cell Biology and Injury Sciences, New Jersey Medical School, 
  prepared statement.............................................  1156
Skoutelas, Paul P., executive director, Port Authority of 
  Allegheny County, prepared statement...........................  1202
Slater, Hon. Rodney, Secretary of Transportation.................     1
    Prepared statement...........................................    15
Stoll, Louise Frankel, Assistant Secretary for Budget and 
  Programs/Chief Financial Officer, Department of Transportation.     1
Valentine, Barry, Acting Administrator, Federal Aviation 
  Administration.................................................   317
    Prepared statement...........................................   320
Vogt, Carl, Fulbright & Jaworski, and member, White House 
  Commission on Aviation Safety and Security.....................   303

Webb, Wellington, mayor, city and county of Denver, prepared 
  statement......................................................  1082
Weinrich, Kurt, director, Regional Transportation Commission of 
  Clark County, NV, prepared statement...........................  1139
West, John, California Department of Transportation and chair of 
  the NAHSC Program Management Oversight Committee, National 
  Automated Highway System Consortium, prepared statement........  1128
Williams, Leon, chairman, San Diego Metropolitan Transit 
  Development Board, prepared statement..........................  1204



                             SUBJECT INDEX

                              ----------                              

                          DEPARTMENT OF LABOR

                       Railroad Retirement Board

                      DEPARTMENT OF TRANSPORTATION

                    OFFICE OF MANAGEMENT AND BUDGET

            NATIONAL RAILROAD PASSENGER CORPORATION (AMTRAK)

                                                                   Page
Adjusting railroad retirement policy.............................   570
Amtrak:
    Calculation of excess payments...............................
      570, 576...................................................
    Components of operating subsidy..............................   573
    Cost of bankruptcy...........................................   583
    Financial integrity..........................................   582
    National ridership...........................................   584
    Obligation under current law.................................   587
    Requirements.................................................   574
    Retirement and tax liability.................................   569
Budget:
    Accuracy of justification presentation.......................   577
    Clarity needed in presentation...............................   588
Increased clarity needed.........................................   578
Purpose of funds must be clearer.................................   586
Railroad retirement system explained.............................   565
Retirement expenses double-counted...............................   585
Tier I benefits in excess of Social Security benefits, 
  description of.................................................   566

                      DEPARTMENT OF TRANSPORTATION

Administration's surface transportation reauthorization, status 
  of.............................................................    41
Airport improvement funding......................................    42
Alcohol-impaired driving.........................................    31
Amtrak funding...................................................    24
Appalachian Highway system:
    Mileage of...................................................    33
    Status of....................................................    30
Atlantic City, FAA facility in...................................    25
Aviation computer systems procurement............................    36
Aviation trust fund..............................................    27
Commonsense Government...........................................    15
Departmental priorities..........................................    13
Driving while intoxicated........................................    23
Golf cars, regulation of.........................................    42
Highway trust fund, varied uses of...............................    35
Maryland, transportation issues for..............................    38
Proposed highway obligation levels...............................    20
Safety...........................................................    14
    Regulations..................................................    22
Strategic investment.............................................    14
Submitted questions..............................................    44
Traffic safety terminology.......................................    44
Transit new starts...............................................    21
    Funding......................................................    26
Transportation and welfare reform................................    41
Transportation-related employment................................    40
Trust funds, spending of.........................................
  27, 29.........................................................
Washington, DC, area parkways, safety of.........................    32
Woodrow Wilson Bridge............................................    38

                    Federal Aviation Administration

Accelerated modernization, cost of...............................   332
Airport funds:
    Best use of..................................................   330
    Transit projects.............................................   330
Airport improvement program......................................   319
Airspace, redesign of............................................   527
Air traffic control:
    Problems with................................................   513
    School.......................................................   517
Air traffic controllers..........................................   515
    Hiring of....................................................   518
    Increase.....................................................   508
    Staffing of..................................................   523
Automated surface observation systems............................   325
Bay Area Rapid Transit [BART]....................................   329
Better safety and security, cost for.............................   329
Canine teams.....................................................   318
Category X airports..............................................   328
Collision avoidance system, recommendation on....................   514
Commuter air carriers, safety performance of.....................   331
Contract weather observers:
    At smaller airports..........................................   327
    Paying for...................................................   327
    West Virginia................................................   326
CTX-5000.........................................................   334
Deregulation.....................................................   328
Domestic and foreign carriers, security measures for.............   333
Equipment failure................................................   515
FAA installation and procedures, problems with...................   496
Implementing safety and security recommendations.................   322
    Cost factors.................................................   323
Inspection and oversight methods.................................   332
Modernization, budget request for................................   333
Modernizing the national airspace system.........................   319
New entrant airlines, certification of...........................   325
New York:
    Controllers survey...........................................   468
    TRACON incident..............................................   528
90-day safety review.............................................   318
Operational errors...............................................   523
Out of date equipment, vulnerability of..........................   325
Passenger profiling..............................................   318
Secured areas, access to.........................................   324
Security equipment integrated product team.......................   318
Security, airlines cost for......................................   331
Staffing solutions...............................................   488
Submitted questions..............................................   335
User fees:
    Fuel taxes...................................................   550
    Tax..........................................................   557
White House Commission on Aviation Safety and Security...........   317
Wide area augmentation system....................................   334

                     Federal Highway Administration

             National Highway Traffic Safety Administration

                     Federal Transit Administration

Aggressive driving...............................................   153
Appalachian corridors............................................   162
Appalachian development highway system...........................   162
CMAQ flexibility.................................................   161
Definition of capital, changes in................................   157
Ferryboat funding................................................   160
Flexibility......................................................   146
Gas tax revenues.................................................   147
Highway apportionment formulas...................................   150
Innovation and welfare reform....................................   147
Interstate:
    Reimbursement costs..........................................   164
    Tolls........................................................   166
ITS role in transit..............................................   152
ITS technology...................................................   151
    Use in trucking industry.....................................   154
New starts.......................................................   149
NEXTEA:
    Formulas.....................................................   156
    Transit funding under........................................   148
Olympics.........................................................   159
Predictability...................................................   147
Puget Sound regional transit plan................................   160
Streamlining.....................................................   146
Submitted questions..............................................   168
Utah I-15 project................................................   158
    Design-build.................................................   159
Welfare reform and coordination between agencies.................   157
Zero tolerance law...............................................   152

                    Federal Railroad Administration

            NATIONAL RAILROAD PASSENGER CORPORATION (AMTRAK)

                       GENERAL ACCOUNTING OFFICE

Amtrak:
    Administration's budget request for..........................   411
    Federal Government's liability if liquidated.................   405
    Federal subsidy on per passenger basis.......................   407
    Financing....................................................   387
    Long-term funding needs......................................   407
Aviation user fees...............................................
  372, 384.......................................................
Gore Commission recommendations, cost of implementing............   387
Labor-related costs..............................................   410
Northeast corridor...............................................   413
Other proposed transportation user fees..........................   385
Privatization, opportunities for.................................   406
Route profitability..............................................   409
Submitted questions..............................................   416
User fees coverage of costs......................................   388

                  NATIONAL TRANSPORTATION SAFETY BOARD

Commuter airline safety..........................................   308
Flight data recorders............................................   312
Gore Commission recommendations..................................
  304, 310.......................................................
Insurance company responsibilities...............................   302
Investigation financing..........................................   302
Most wanted......................................................   294
Navy costs.......................................................   305
Submitted questions..............................................   317
Supplemental request.............................................
  295, 305.......................................................
TWA Flight 800...................................................   295
    Costs........................................................   306