[House Hearing, 106 Congress]
[From the U.S. Government Publishing Office]



 
 H.R. 1142, TO ENSURE THAT LANDOWNERS RECEIVE TREATMENT EQUAL TO THAT 
     PROVIDED TO THE FEDERAL GOVERNMENT WHEN PROPERTY MUST BE USED

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

                                HEARING

                               before the

                         COMMITTEE ON RESOURCES
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED SIXTH CONGRESS

                             FIRST SESSION

                               __________

                     APRIL 14, 1999, WASHINGTON, DC

                               __________

                           Serial No. 106-23

                               __________

           Printed for the use of the Committee on Resources



 Available via the World Wide Web: http://www.access.gpo.gov/congress/
                                 house
                                   or
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                                 ______


                    U.S. GOVERNMENT PRINTING OFFICE
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________________________________________________________________________

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                                20402



                         COMMITTEE ON RESOURCES

                      DON YOUNG, Alaska, Chairman
W.J. (BILLY) TAUZIN, Louisiana       GEORGE MILLER, California
JAMES V. HANSEN, Utah                NICK J. RAHALL II, West Virginia
JIM SAXTON, New Jersey               BRUCE F. VENTO, Minnesota
ELTON GALLEGLY, California           DALE E. KILDEE, Michigan
JOHN J. DUNCAN, Jr., Tennessee       PETER A. DeFAZIO, Oregon
JOEL HEFLEY, Colorado                ENI F.H. FALEOMAVAEGA, American 
JOHN T. DOOLITTLE, California            Samoa
WAYNE T. GILCHREST, Maryland         NEIL ABERCROMBIE, Hawaii
KEN CALVERT, California              SOLOMON P. ORTIZ, Texas
RICHARD W. POMBO, California         OWEN B. PICKETT, Virginia
BARBARA CUBIN, Wyoming               FRANK PALLONE, Jr., New Jersey
HELEN CHENOWETH, Idaho               CALVIN M. DOOLEY, California
GEORGE P. RADANOVICH, California     CARLOS A. ROMERO-BARCELO, Puerto 
WALTER B. JONES, Jr., North              Rico
    Carolina                         ROBERT A. UNDERWOOD, Guam
WILLIAM M. (MAC) THORNBERRY, Texas   PATRICK J. KENNEDY, Rhode Island
CHRIS CANNON, Utah                   ADAM SMITH, Washington
KEVIN BRADY, Texas                   WILLIAM D. DELAHUNT, Massachusetts
JOHN PETERSON, Pennsylvania          CHRIS JOHN, Louisiana
RICK HILL, Montana                   DONNA CHRISTIAN-CHRISTENSEN, 
BOB SCHAFFER, Colorado                   Virgin Islands
JIM GIBBONS, Nevada                  RON KIND, Wisconsin
MARK E. SOUDER, Indiana              JAY INSLEE, Washington
GREG WALDEN, Oregon                  GRACE F. NAPOLITANO, California
DON SHERWOOD, Pennsylvania           TOM UDALL, New Mexico
ROBIN HAYES, North Carolina          MARK UDALL, Colorado
MIKE SIMPSON, Idaho                  JOSEPH CROWLEY, New York
THOMAS G. TANCREDO, Colorado

                     Lloyd A. Jones, Chief of Staff
                   Elizabeth Megginson, Chief Counsel
              Christine Kennedy, Chief Clerk/Administrator
                John Lawrence, Democratic Staff Director



                            C O N T E N T S

                              ----------                              
                                                                   Page

Hearing held April 14, 1999......................................     1

Statement of Members:
    Thomas, Hon. William M., a Representative in Congress from 
      the State of California....................................    15
        Prepared statement of....................................    16
    Miller, Hon. George, a Representative in Congress from the 
      State of California, prepared statement of.................    51
    Young, Hon. Don, a Representative in Congress from the State 
      of Alaska..................................................     1
        Prepared statement of....................................     3

Statement of Witnesses:
    Clark, Jamie Rappaport, Director, U.S. Fish and Wildlife 
      Service, U.S. Department of the Interior, Washington, DC...    35
        Prepared statement of....................................    37
    DeGennaro, Ralph, Executive Director, Taxpayers for Common 
      Sense, Washington, DC......................................    89
        Prepared statement of....................................    91
    Gordon, Robert E., Jr., National Wilderness Institute and 
      Grassroots ESA Coalition, Washington, DC...................    29
        Prepared statement of....................................    30
    Heissenbuttel, John, Vice President, Forestry and Wood 
      Products, American Forest and Paper Association, 
      Washington, DC.............................................    85
        Prepared statement of....................................    86
    Loop, Carl B., Jr., Vice President, American Farm Bureau 
      Federation, Washington, DC.................................    26
        Prepared statement of....................................    27
    Marzulla, Nancie G., Defenders of Property Rights, 
      Washington, DC.............................................    77
        Prepared statement of....................................    78
    Shimberg, Steven J., Vice President for Public and 
      International Affairs, National Wildlife Federation, 
      Washington, DC.............................................    41
        Prepared statement of....................................    43
    Smith, Bruce, Vice President, National Association of Home 
      Builders, Washington, DC...................................    51
        Prepared statement of....................................    53
    Whitman, Richard M., Attorney-in-Charge, Natural Resources 
      Section, Oregon Department of Justice, Salem, Oregon.......    73
        Prepared statement of....................................    74

Additional material supplied:
    Text of H.R. 1142............................................     4



HEARING ON H.R. 1142, TO ENSURE THAT LANDOWNERS RECEIVE TREATMENT EQUAL 
 TO THAT PROVIDED TO THE FEDERAL GOVERNMENT WHEN PROPERTY MUST BE USED

                              ----------                              


                       WEDNESDAY, APRIL 14, 1999

                          House of Representatives,
                                    Committee on Resources,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 11:01 a.m., in 
Room 1324, Longworth House Office Building, Hon. Don Young 
[chairman of the Committee] presiding.

STATEMENT OF HON. DON YOUNG, A REPRESENTATIVE IN CONGRESS FROM 
                      THE STATE OF ALASKA

    Mr. Young. The Committee will come to order.
    We are going to go ahead with the process. The original 
intent, for the members that were told there was going to be a 
disputed subpoena issued, that is no longer the case. Secretary 
Babbitt has agreed to appear before Mr. Doolittle, and I think 
that is the right step forward, and I want to compliment him, 
the Department of Interior.
    So this is really the first hearing by the Committee on 
Resources on H.R. 1142, the Landowners Equal Treatment Act of 
1999. I introduced this bill because I believe the Supreme 
Court was right when it said in the Dolan case that it is wrong 
to force some people alone to bear public burdens which, in all 
fairness and justice, should be borne by the public as a whole. 
This is the primary purpose of the 5th Amendment takings 
clause.
    I think this bill is especially appropriate today, on April 
the 14th, the eve on the day on which Americans have to turn 
over increasing amounts of their hard-earned income to the 
Federal Government. Private property owners pay more in taxes 
than any other group in this country. Property taxes are paid 
over and above the income taxes levied by the Federal and State 
governments and the various sales and use taxes paid. And by 
the way, may I suggest that the Federal Government owns over 
835 million acres and doesn't pay a nickel in taxes.
    Property taxes pay for our local schools, and the 
government does not do that. Property taxes pay for our roads, 
our police, the fire protection, and many other vital services 
that are provided for all of our citizens, not only to property 
owners, but to every citizen--even those who do not pay 
property tax receive the benefits of property tax. Our private 
property owners are the backbone of our society. They pay the 
bills. We ought to afford them some respect and gratitude. And 
may I suggest any other society that does not have privately-
held property, their governments have failed miserably. Private 
property is the soul of our conscious, the soul of our 
Constitution.
    I support the purposes of the Endangered Species Act. 
However, when I voted for ESA--and one of the few remaining 
Members that did vote for ESA--in 1973, Congress was not told 
that this law would be used to force private property owners to 
set aside land for habitat, for species, against their will and 
without being compensated for the loss of their property. For 
the good of all, these private property people are suffering 
the burden of the ESA Act. If they aren't willing to set aside 
their land, the Federal Government threatens to put them--and, 
in fact, has put them in jail.
    The Landowners Equal Treatment Act amends the Endangered 
Species Act to require, first, that the Federal Government 
avoid using the ESA to take away private property owners' right 
to use their own land. May I suggest that if there is 
endangered species on that private land, that person must have 
been doing something right, or the species wouldn't be there. 
But under the present law we punish; we do not reward.
    Then, if the land is so important as habitat for endangered 
or threatened species, the use of the land cannot be avoided. 
The bill requires the government to minimize the impacts on 
landowners' right. If that is not possible, it simply requires 
the government to mitigate for the impacts by compensating the 
owner of the land for using it.
    This is a very simple concept and almost identical to the 
process used by the Fish and Wildlife Service for its own 
compensation when their land is used by other Federal agencies. 
If the noise from an airport is a ``use'' of Federal lands, 
then certainly forcing landowners to provide habitat for 
federally-protected species is an even more intrusive ``use'' 
of private lands by the public.
    The Fish and Wildlife Service is being compensated in the 
amount of $26 million simply because they say that noise from 
overflights is a ``use'' of their refuge property. According to 
the 5th Amendment, private property owners have a right to be 
compensated when their property is used by the Federal 
Government for Federal public benefit.
    Federal agencies do not have the right; yet, they have the 
power and clout to force other agencies and private landowners 
to pay them millions of dollars. What's good for the Federal 
Government is even better for the private citizen. Under H.R. 
1142, we will ensure that landowners receive the fair and equal 
treatments they deserve.
    I would suggest that, if everybody will listen to this bill 
and get out of the political rhetoric, that this is a solution 
to a very serious problem, and that is a problem that the ESA 
is failing. It has not been successful, and it has made the 
enemy of the government for the private property owners.
    So this is the beginning of a series of a hearings. Mr. 
Pombo will be chairing it a little later on and as we go forth.
    [The prepared statement of Mr. Young follows:]

  Statement of Hon. Don Young, a Representative in Congress from the 
                            State of Alaska

    Good morning. Today the Committee on Resources will hear 
testimony on H.R. 1142, the Landowners Equal Treatment Act of 
1999.
    I introduced this bill because I believe that the Supreme 
Court was right when it said in the Dolan case that--it is 
wrong to force some people alone to bear public burdens which--
in all fairness and justice--should be borne by the public as a 
whole. This is the primary purpose of the 5th Amendment takings 
clause.
    I think this bill is especially appropriate today--April 
14--the Eve of the day on which Americans have to turn over 
increasing amounts of their hard earned income to the Federal 
Government.
    Private property owners pay more in taxes than any other 
group in this country.
    Property taxes are paid over and above the income taxes 
levied by both the Federal and state governments and the 
various sales and use taxes paid.
    Property taxes pay for our local schools, roads, police and 
fire protection, and many other vital services provided, not 
only to property owners, but to every citizen--even those who 
do not pay property taxes. Our private property owners are the 
backbone of our society. They pay the bills. We ought to afford 
them our respect and gratitude.
    I support the purposes of the Endangered Species Act. 
However, when I voted for the ESA in 1973, Congress was not 
told that this law would be used to force private property 
owners to set aside land for habitat for species against their 
will and without being compensated for the loss of their 
property.
    And if they aren't willing to set aside their land, the 
Federal Government can put them jail.
    The Landowners Equal Treatment Act amends the Endangered 
Species Act to require first that the Federal Government avoid 
using the ESA to take away private property owners right to use 
their own land. Then, if the land is so important as habitat 
for endangered or threatened species that the use of the land 
cannot be avoided, the bill requires the government to minimize 
the impacts on the landowner's rights. If that is not possible, 
it simply requires the government to mitigate for the impacts 
by compensating the owner of the land for using it.
    This is a very simple concept that is almost identical to 
the process used by the Fish and Wildlife Service for it's own 
compensation when their land is used by other Federal agencies. 
If noise from an airport is a ``use'' of Federal lands, then 
certainly forcing landowners to provide habitat for federally 
protected species is an even more intrusive ``use'' of private 
lands by the public.
    The Fish and Wildlife Service is being compensated in the 
amount of $26,000,000 simply because they say that noise from 
overflights is a ``use'' of their refuge property. According to 
the 5th Amendment, private property owners have a right to be 
compensated when their property is used by the Federal 
Government for a public benefit.
    Federal agencies do not have that right, yet they have the 
power and the clout to force other agencies and private 
landowners to pay them millions of dollars. What's good for the 
Federal Government, is even better for private citizens. H.R. 
1142 will insure that landowners receive the fair and equal 
treatment that they deserve.
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    Mr. Young. Are there any other opening statements by 
anybody on the Committee?
    [No response.]
    If not, at this time I do welcome my good friend, the 
Honorable Bill Thomas, a Republican from California, for being 
the first panel up. You are up, Mr. Thomas. Congratulations for 
appearing before the Committee.

   STATEMENT OF HON. WILLIAM M. THOMAS, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Mr. Thomas. Thank you very much, Mr. Chairman. I would ask 
unanimous consent that my written statement be made a part of 
the record.
    Mr. Young. Without objection, so ordered.
    Mr. Thomas. And I do want to go on record indicating that I 
strongly support the chairman's bill, H.R. 1142, and every time 
we have a hearing I can present you with additional stories 
which reinforce our concern.
    But let me say at the outset, in examining this issue, I 
have, notwithstanding the full support of the chairman's bill, 
decided to introduce three separate bills in an attempt to 
break the logjam which appears present if we deal with an 
omnibus bill. I just want to briefly mention H.R. 494, which 
deals with the process, trying to create a transparency and 
openness and the requirement that good science be used to list 
and delist. Then H.R. 495, which deals with land management, 
and a point that the chairman made, in terms of the societal 
desire, but the private property-holder having to pay society's 
desire should be just compensation. And then, finally, H.R. 
496, which deals with the accidental taking and the habitat 
maintenance, which now appears to be totally criminal every 
time you take an action.
    Let me say they are going to have testimony later about, if 
in fact we require compensation, that there are going to be 
people playing games and trying to beat the system. It cannot 
be worse than the current situation.
    I brought just one picture to show you what occurred as the 
snowmelt from the very heavy snows in the Sierra began coming 
down. We have, as you know, a great depression in the Central 
Valley called the Tulare Lake Basin, and if the various rivers 
did what they wanted to do, they would refill that every year. 
So we have dams along these streams, Lake Success being one of 
them.
    The problem is we have never been able to get Lake Success 
and the Corps of Engineers to build the height of the dam high 
enough so that in heavy runoff years we can sustain it. We have 
to sandbag it as a temporary dam.
    In trying to sandbag it, of course, you back the water up 
behind it. What was discovered was these elderberry bushes 
which supposedly were the habitat for the elderberry longhorn 
beetle. We examined the plants. There was no evidence. Bore 
holes and the rest can be done by the biologists. However, our 
friends at Fish and Wildlife said, notwithstanding that, if the 
water raises, there could potentially be beetles. Having looked 
and decided there were none, nevertheless, the private owners 
who didn't want that land flooded out in the basin, 
agricultural land, had to pay $130,000 to sandbag these bushes 
when the lake backed up. And, of course, upon further 
examination, there were no beetles.
    In another instance a fellow wanted to run a landfill. You 
have to realize that for over a decade I represented a county 
that was 93 percent government land, and it happens to be the 
second largest geographic county in the United States. 
Notwithstanding totally surrounded by Federal land, every time 
somebody wants to start a private property project, they have 
to mitigate acres. In this instance it was an attempt to create 
a landfill, a 20-acre landfill plot, and the initial mitigation 
was 3 acres for 1, or 60 acres. By the time they finished the 
negotiation, he was going to have to put up 380 acres to 
mitigate the 20 acres, at about $1,000 to $1,500 an acre. So he 
simply decided that the project could not go forward--not 
because there isn't a whole lot of Federal land, but because of 
this extortion requirement in terms of meeting exorbitant 
private property contributions to be able to conduct private 
property activities.
    Mr. Chairman, it is long overdue that, if society truly 
wants to preserve truly endangered species, then the society 
ought to pay for it. Right now it is being sustained on the 
back of private industry, not that private industry shouldn't 
pay its fair share, but 3-to-1 acres, 6-to-1 acres, 10-to-1 
acres, when, in fact, most of the area is already owned by the 
Federal Government, is simply wrong.
    I want to congratulate the chairman on his attempt to break 
logjam. As I indicated, if we can't break it by dynamiting it, 
perhaps we can operate in several different areas, and move 
bills that address particular areas, and find commonality among 
those who would like to make some changes, but an omnibus bill 
won't approach it.
    With that, I want to thank the chairman for the opportunity 
to testify.
    [The prepared statement of Mr. Thomas follows:]

Statement of Hon. William M. Thomas, a Represemntative in Congress from 
                        the State of California

    Mr. Chairman, thank you for the opportunity to give this 
statement to the Committee and to discuss the concerns of my 
Kern and Tulare County constituents from California's 21st 
District. I strongly support the letter and spirit of the 
Chairman's bill, H.R. 1142. It is an important step in making 
the Federal Government accountable for its actions and 
ultimately in building a real and effective species 
conservation system.
    I have two goals today. First, I want to add to the record 
a few new ``horror'' stories to those which I have related in 
the past. Those stories reveal more ongoing, arbitrary and 
wasteful decisions by Federal authorities. Second, I want to 
suggest some ideas that are introduced in my three reform bills 
that may help the Committee build a broader coalition to create 
a fairer and more effective law to conserve endangered species.

New Tales from the 21st District

    My District has been deeply affected by over 20 Federal 
endangered and almost 100 candidate species. Kern County 
embraces more than 8,000 square miles of desert, mountain and 
valley terrain (equal to the size of Massachusetts) including 
two important military facilities, Edwards Air Force Base and 
the Naval Air Warfare Center at China Lake.
    During the heavy flooding of last May in Tulare County, 
visitors to Success Lake would have been struck by a remarkable 
sight--workers diligently placing sandbags around Elderberry 
Trees that line the edge of the Lake. Why? Because despite 
entire communities being underwater, U.S. Fish and Wildlife 
Service was more concerned about the possible existence and 
protection of Elderberry Longhorn Beetles, which might be 
injured by local efforts to raise the level of the Lake to hold 
back more flood water. The fact that local biologists informed 
the Service that no beetles were present did not dissuade the 
Fish and Wildlife Service. So, private landowners spent 
$130,000 to sandbag 140 Elderberry Trees and are buying 
mitigation land and replanting new trees in order to satisfy 
the bureaucracy. What alternative did these landowners have? 
None, but to pay the extortion money so they can go about the 
emergency sandbagging activity and save their farms.
    That is how the Fish and Wildlife Service acts during 
emergencies. This is how it acts day-to-day. One of my 
constituents was starting a recycling business on a 20-acre 
plot of land in McKittrick, California. He obtained a permit 
from U.S. Fish and Wildlife Service with the proviso that he 
mitigate for the presence of endangered species by providing 
three acres for every one acre used. No sooner did he do so, 
then the Service increased the mitigation requirement from 60 
acres to 380, each acre costing $1,000 in the area. How does a 
family afford to buy and run a wildlife refuge for the 
satisfaction of government bureaucrats? This is simply 
extortion, plain and simple.

We Need Real Conservation

    To rural landowners, our government is no longer a 
protector of rights and freedom. It has become a garbled 
operation that collects illegitimate ``protection'' money for 
its pet projects, money that can't be collected by legitimate 
means, i.e., the appropriations process. It is evidence that 
the current system of endangered species protection simply is 
not working. Why should rural landowners pay if so-called 
wildlife conservationists living in the city aren't paying to 
protect species? So, to my colleagues who have resisted reform 
of the Endangered Species Act, I issue this challenge: give 
landowner incentives a chance. Chairman Young's bill is an 
excellent and fair method of accomplishing this.

Other Needed Reforms of the Endangered Species Act

    I want to leave with you with some general comments on 
other reforms that are needed. As you know, I have introduced 
three Endangered Species Act reform bills, H.R. 494--The ESA 
Fair Process Reform bill, H.R. 495--Fair Land Management Reform 
bill, and H.R. 496--The Liability Reform bill.
    The Fair Process Reform bill will ensure open and equal 
access to information relied upon by Federal agencies when 
making decisions on endangered species. Perhaps the single 
worst complaint I have heard about the current Federal system 
is that the people who are directly affected by government 
decisions and bear the burden and cost of compliance are left 
out of the decision process. In their view, it is ``taxation 
without representation.'' Landowners are now stuck with paying 
the cost of preserving species; yet, they do not have access to 
the same information held by the Federal Government and their 
input is ignored.
    My bill includes provisions for an open access to the 
public for scientific studies and underlying study data. It 
also replaces the secret listing process with an open hearing 
so landowners can participate in the decision making process, 
and landowner representatives can cross-examine agency 
personnel and experts. My bill also includes provisions to 
improve the scientific basis of government decisions such as 
minimal information requirements for petitioners, peer review 
of multiple scientific studies used to support listing or 
government action, and economic impact analysis of its actions 
required for listings.
    The Fair Land Management Reform bill will ensure that the 
government pays for obligations it imposes on landowners. This 
bill includes a provision to compensate landowners for 
significant government takings. Similar in spirit to Chairman 
Young's bill, H.R. 1142, I also include a provision that limits 
the mitigation requirements that can be imposed by government. 
As described in my example above, a hapless landowner must 
sometimes buy nineteen acres in order to use one of his own and 
then manage this new ``biology project'' for the government by 
putting up fences and hiring biologists for years to look after 
the habitat. My bill would limit how much mitigation the 
government can require.
    The Liability Reform bill will stop unfair government 
penalties against landowners. Rural landowners are frustrated 
enough at having their lands confiscated for government use. It 
adds insult to injury when no species are even on the land, yet 
the government continues to impose these onerous burdens and 
even the threat of penalties on landowners. Criminal and civil 
penalties should be limited to actual and intentional takings 
of an endangered species, not accidental or hypothetical ones. 
My bill also includes ``Safe harbor'' and ``No surprises'' 
provisions to end the string of broken promises and added 
obligations put on landowners by the government such as those 
mentioned in my example above. It is sad that we need a law to 
ensure government honesty, but apparently that is needed.
    Until such steps are taken, the Act will continue to fail 
to achieve its goal of Federal wildlife protection, which 
reflects the will of the American people. Chairman Young's 
bill, H.R. 1142, will begin to address the fundamental 
unfairness in the current system. Rural landowners must now 
bear the whole weight of protecting endangered species. H.R. 
1142 will restore the balance and spread that responsibility to 
all Americans, who benefit from conserving our precious 
wildlife.

    Mr. Young. Thank you, Mr. Thomas. If I am correct now, the 
sandbags cost the private property owners $150,000?
    Mr. Thomas. Well, what happened was that they weren't going 
to sandbag the lake unless the private property owners were 
willing to foot the bill of sandbagging the bushes. So you were 
faced with either letting the government flood you or to pay 
for the sandbagging, which would then allow them to sandbag the 
dam to hold back the water, so that these bushes wouldn't be 
damaged.
    It was the regional office that said they had to do it. The 
people on the ground said there are not beetles in these 
bushes. They are probably hosts, but they were not actual 
hosts. So the agreement was sandbag bushes, so we can sandbag 
the dam, so that we are not flooded.
    Mr. Young. But there was no science saying there were bugs? 
There was no longhorn elderberry beetle?
    Mr. Thomas. That is correct. They are a host bush, but 
there was no evidence of beetles being there.
    Mr. Young. And what did the Fish and Wildlife say about 
that?
    Mr. Thomas. That they are potential; therefore, you sandbag 
them or we won't allow the dam to be sandbagged. So you are in 
the position of having your land flooded or putting up $130,000 
to sandbag the bushes so you can sandbag the dam. If it weren't 
government doing it, this would be called blackmail.
    Mr. Young. The gentleman from Utah.
    Mr. Hansen. Thank you, Mr. Chairman. I just want to thank 
you for bringing this up. If there has ever been a bill that is 
past overdue, it is this one.
    Let me just say in the State of Utah, in an area called 
Washington County, we have the desert tortoise. Just north of 
that we have the prairie dog. We have thousands of acres of 
ground that is now being used for retirement homes. I happened 
to be in a place with the Secretary of Interior when he offered 
these people, ground that goes normally for $22,000 an acre, 
$600 an acre because the desert tortoise was on it or the 
prairie dog.
    Most of us here come out of local government. I remember as 
a city councilman when I had to practice imminent domain; 
didn't like to do it, but you had to do it to put in a water 
system. We paid the person for the property or we went to court 
and adjudicated the matter.
    When I was in the State legislature and speaker of the Utah 
House, we had to take big chunks of ground for the State of 
Utah. We paid the person or, if we didn't do that, we 
adjudicated it through the court. One way or another, it had a 
land trade.
    Now we find these things, and people have had ground for 
years after years after years, and what do they find? They find 
something on it, and we have found instances in Washington 
County where Fish and Wildlife has actually picked up a desert 
tortoise and carried it to the ground that someone had. And 
they have confused to that. We have got that down in statement 
form, and it really disturbs me that they have done that. 
Therefore, the ground becomes almost useless at that point, and 
they say, ``Oh, hey, this ground that is now worth $20,000, 
$30,000 an acre for one of the best retirement areas in 
America, we will give you $600.''
    So what can you do with your ground? Yes, I'll tell you, 
folks; you can do one thing. You pay taxes on it. You can keep 
paying those taxes. If you don't, the county is going to take 
that ground back.
    And we find ourselves in a situation all over America--now, 
Mr. Chairman, I know this piece that you are doing is very 
good. Personally, I feel the listing, delisting, peer review, 
and a number of other things--but this is a good stroke into 
it. And I just want to compliment you because, as I read the 
5th Amendment, I don't know it reads any other way when it 
says, ``nor shall private property be taken for public use 
without just compensation.'' If this isn't a taking, I don't 
know what is, and it is about time Congress acted on it.
    And thank you for letting me have that outburst.
    [Laughter.]
    Mr. Young. That was on Bill Thomas' time.
    [Laughter.]
    Mr. Thomas. Yes, since my light is still green--in your 
opening statement you talked about people who preserve the 
land, and then being punished for preserving it. Just in the 
break while we were home, the court ruled that Lake Isabella, 
which is another dam and a lake behind it on the Kern River, 
will not be allowed to fill to its height. Last season, again, 
during this enormous runoff, it was more than 500,000 acre feet 
behind Isabella Dam. The court has said that it can raise no 
higher than 350,000 feet. Why? Because up one fork of the Kern 
River is the southwest willow flycatcher. There are only about 
two places left in the United States--one outside Phoenix in 
Arizona, up in the mountains, and in this area.
    For more than 100 years, the southwest willow flycatcher, a 
very small bird, has been compatibly mingling with the cattle 
grazing in the area, but once it was discovered that this was 
one of that last few habitats, government moved in. The Corps 
has not purchased land to mitigate, and folks have gone to 
court and gotten a restraining order. We are now in danger of 
flooding if the runoff is greater than 350,00 acre feet. We 
have been told by court order we can't let the reservoir fill 
to its natural height when for over 100 years this little bird 
has gotten along just fine with the people who were there, 
private property, and the way in which the property has been 
used. But now, because someone discovered it and government 
stepped in, we may, in fact, flood areas, which of course we 
will be here asking for taxpayers' help for flooded areas.
    Mr. Young. The gentleman from Virginia, Mr. Pickett.
    Mr. Pickett. I don't have any questions at this time, Mr. 
Chairman. I want to compliment you for introducing this bill, 
and I hope you will get the support you need to make sure it 
gets passed. Thank you.
    Mr. Young. The gentleman from Colorado.
    Mr. Hefley. I don't have any questions, either, but, you 
know, I remain dumbfounded, Bill, when I hear stories like you 
have described to us this morning. It makes me ashamed of our 
government that we do not exercise both science and common 
sense. I think everybody in this room would say the Endangered 
Species Act has done a lot of good things. When I was out in 
Colorado and see the bald eagles feeding on the Arkansas River 
again, I say it has done a lot of good things. But it is 
carried by extremists to such ridiculous extents that it just 
makes me ashamed of the government, and I appreciate you 
bringing this to us.
    Mr. Thomas. In California it is not just the Federal 
Government; the State has learned the game as well. And it is, 
in fact, extortion of the rankest kind in requiring people to 
put up private acres for the private acres that they want to 
use, especially when you have got those Federal and State lands 
reserved right next to it.
    Mr. Young. Mr. Abercrombie, do you have any questions?
    Mr. Abercrombie. I am here to learn, Mr. Chairman.
    Mr. Young. Very good. Mr. Smith, no questions? The 
gentleman from Maryland.
    Mr. Gilchrest. Thank you, Mr. Chairman.
    Real quickly, Bill, a quick question and a quick comment. 
The elderberry trees, which is what I guess are in the 
picture----
    Mr. Thomas. Yes.
    Mr. Gilchrest. [continuing] elderberry bush----
    Mr. Thomas. Bushes, yes. And those pass for trees, too, 
though.
    Mr. Gilchrest. Okay. Now those are the trees that had to be 
protected?
    Mr. Thomas. Right.
    Mr. Gilchrest. Did they grow up from seed?
    Mr. Thomas. There are a lot of elderberry bushes in the 
area. In fact, they were willing to plant a lot of additional 
elderberry trees higher up, above the normal waterline, but 
that was not sufficient. What they had to do was protect those 
that were down in the flood plain that, if they held back the 
water, would have, in fact, been flooded, notwithstanding the 
fact that there was no evidence of the presence of beetles. And 
we have a lot of elderberry trees that grow wild in that area.
    Mr. Gilchrest. The way you present the story really shows a 
significant disconnect between people and the ability to 
exchange information and come to a reasonable conclusion. I 
would agree with Mr. Hefley from Colorado that the Endangered 
Species Act has really some significant, positive things, one 
of which Joel says there are bald eagles now in certain areas 
of his district. I have a bald eagle's nest about a half a mile 
from my house that wasn't there even 10 years ago, and there 
are more bald eagles coming through. There are even some golden 
eagles coming through. So something is beginning to happen. But 
we can't break the cycle of a positive, reasonable, respectable 
exchange of information between people, the public sector and 
the private sector, to fix this problem.
    So, Bill, I appreciate your testimony.
    Mr. Young. I tell the gentleman from Maryland that all of 
us are in support of reasonable and rational conservation, and 
that where there is clear evidence, backed by good science, we 
have no problem. But what has happened under this is that, 
frankly, there is a degree of arrogance. When you have local 
biologists on the ground identifying the fact that there are no 
beetles present, but 300 miles away the bureaucrat in Fish and 
Wildlife says, ``We want these trees sandbagged or you are not 
going to get the sandbagging of the dam.'' Notwithstanding what 
I think would pass for anybody's examination of good science, 
they simply made that kind of a decision. It is a degree of 
arrogance on their part that we find most difficult to deal 
with.
    If, in fact, it is a societal desire to preserve, it ought 
to be a societal requirement to pay. If there is mitigation 
involved, it ought to be not just private sector mitigation. 
There ought to be some way that society and the private sector 
can work together. But what we have got in the current law, as 
the chairman indicated, is an almost impossible working 
relationship. To say to someone that you want to use 20 acres 
for a landfill and you have got to go buy us, the public, out 
of your private dollars, 380 acres, notwithstanding the fact 
that they looked at the 20 acres and there were no endangered 
species on it--but it has the potential--that is just wrong.
    Of course, the gentleman from Hawaii I think has every 
right to be concerned because, I mean, they are first in terms 
of endangered species. California is second. As you move east, 
there are fewer, since most of those have been killed or eaten, 
and all, virtually all of the mitigation concerns are in the 
West.
    Mr. Abercrombie. Mr. Chairman, I am sure Mr. Thomas knows 
that, in terms of endangered species in Hawaii, we go 
alphabetically.
    Mr. Thomas. Exactly.
    Mr. Young. I would like to make one comment before we get 
too far away, and I hate to do this because it is going to stir 
somebody up. The eagle was never saved by the Endangered 
Species Act. Mr. Gilchrest and Mr. Hefley, the eagle was never 
saved by the Endangered Species Act. The eagle was saved by the 
lack of use of DDT and pesticides.
    Mr. Thomas. Exactly.
    Mr. Young. But there has never, ever been a shortage of 
eagles, but they were dying because of the use of those two 
pesticides, or the DDT, but even the scientists will tell you 
that the eagle was not saved because of the Endangered Species 
Act. And it is always thrown up in my face, ``Look what they 
have done with the Endangered Species Act.''
    Secondly, I can't understand how Fish and Wildlife can say 
that flooding an elderberry tree is going to hurt the beetles. 
When I was a young man, most of California was flooded most of 
the time, and those elderberry bushes thrived beautifully, and 
the beetle, by the way, thrived beautifully, too. I mean, I 
can't figure where the science comes in. That is my big 
argument, not in my bill, that there is no applyable good 
science. So you use the best science available, which is none, 
and then they make the private property owner bear the burden 
of mitigating and trying to make up for the expenditure or 
loss.
    I know we get in arguments on the eagles, but check your 
scientists and they will tell, it was not the Endangered 
Species Act.
    The lady from California.
    Mrs. Napolitano. Thank you, Mr. Chair. I am very interested 
in the bill because it does have some great parameters--not 
from my area because I don't have a lot of those endangered 
species in my area that need saving. But I am concerned about 
the cost to the agency; the Endangered Species Act would have 
to pay the landowners fair value for the property. What will 
that do to the funding mechanisms, and how would the agency be 
able to perform their normal course of duties for other areas 
that need to be addressed? That kind of leads me to believe 
that somewhere along the line we are addressing a part of the 
issue. And I agree, there is a big issue, but what about the 
funding mechanisms to be able to carry this forth? And given 
that we have to be fair to the landowner, how do we address 
that, sir?
    Mr. Thomas. I would tell the gentlewoman that there is a 
very wide continuum in which this discussion can take place, 
since the position now is that you get nothing, and in fact you 
have to pay something as a private individual. The gentleman 
from Utah indicated that a lot of local governments--and I know 
you are familiar with the activities that go on in terms of 
imminent domain. There are a number of us who would be willing 
to say we would even let government determine the fair value of 
the land, rather than the private person, if, in fact, that is 
what is needed to move it off the dime. But even if you do 
that, there will be a cost involved.
    But one of the difficulties with this legislation having 
been passed in the 1970's with a goal of where you wanted to go 
without a clear idea is that, basically, where we are today is 
that there are people who want to use this statute to deny 
people legitimate use of private property. If society wants it, 
they ought to provide the minimum compensation, and then 
however much that is, we ought to have the guts to fund it. So 
that you have an orderly process. If society thinks this is 
important enough to preserve, and it belongs to someone, and 
has value, whatever that minimal value is ought to be 
compensated.
    It is the idea that right now there are people who want to 
run this public project with not just pure private funds, but 
extorted private funds beyond what is reasonable, because they 
are funding additional programs out of the requirement that 
people pay them. That is the problem with the law today.
    Mrs. Napolitano. Right, but does this actually address a 
mechanism where it can happen?
    Mr. Thomas. You will have to ask the chairman in terms of 
his particular bill. What I have done is break it down into 
three different segments and address the cost of reimbursement 
in a separate bill, and I give a number of options in which we 
deal with it.
    I would tell the gentlewoman that, if that is of interest 
to her, I am quite sure we can create a dialogue to come up 
with an appropriate way in which we not only determine the 
amount that is necessary, but that we create a funding stream 
as well.
    Mrs. Napolitano. Yes, I am interested, and the unfortunate 
part is that I don't know as much as I should on the rest of 
California's need for something of this nature.
    Mr. Thomas. I will tell the gentlewoman, if she sits on 
this Committee for any length of time, she will know more than 
she wants to about it.
    [Laughter.]
    Mrs. Napolitano. I am learning.
    Mr. Young. The gentleman from California.
    Mr. Pombo. Thank you, Mr. Chairman. I don't have any 
questions for Mr. Thomas. Just I think in answer to my 
colleague's question, the example that Mr. Thomas brought out I 
think is an example of what happens when there is no cost to 
the agency. A lot of times that is the problem that we run 
into. If there is extorted funds out of the private sector in 
order to pay for their regulation, then there is nothing 
stopping them from requiring whatever they can dream up. This 
just happens to be one example of something that the scientists 
would tell you makes no sense, and your own common sense would 
tell you it doesn't make any sense. But when there is no cost 
to the agency to require it, they can do whatever they want.
    We found with our landowners in the Central Valley, 
particularly, that if they have the ability to extort the cost 
of their regulation from the individual private property owner, 
there is just nothing to stop them from doing that. I think 
that with me one of my greatest objections to the way the Act 
is being implemented today is that there is no cost to the 
public for the public's demands on individual property owners.
    In our Constitution, the Bill of Rights of our Constitution 
was designed to protect the individual's rights from the will 
of the majority and from the government. And the 5th 
Amendment--``nor shall private property be taken for public use 
without just compensation''--is completely ignored under the 
current application of the Act because we can just require 
whatever we want of an individual property owner. I think that 
is why a lot of these debates are stirring in Congress and 
throughout the country right now.
    But thank you, Mr. Chairman.
    Mr. Young. Who is up next on that side of the aisle? Go 
ahead.
    Mr. Kind. Thank you, Mr. Chairman. I just had a couple of 
questions for Mr. Thomas, just to clarify the story that he 
painted for us today.
    First of all, was there any finding that there were 
elderberry beetles anywhere in this proximity, perhaps not on 
this property itself, but in the near vicinity?
    Mr. Thomas. I am told that, as you follow the stream--and I 
know it is difficult to believe that would create flooding at 
this time, but when the snows melt and the rains come, they do 
fill up--that a significant distance upstream there were some 
elderberry trees, but they were way above the flooding line of 
the lake.
    Mr. Kind. That contained some beetles?
    Mr. Thomas. That did contain beetles and bore holes.
    Mr. Kind. Okay. The other question is, was your office 
informed in regards to what Fish and Wildlife was considering 
before they issued their final decision requiring the sandbags 
and----
    Mr. Thomas. Actually, we intervened in an attempt to try to 
get a dialogue going between the Corps of Engineers that have 
control over Success Dam and Fish and Wildlife, so that we 
could mitigate the battle between the two agencies to get the 
dammed sandbags up, and that we tried to get Fish and Wildlife 
down there on the ground, and that we had local biologists make 
the decision to try to speed up the process, and that they 
simply refused to go along and said, ``We are not going to 
sandbag the dam unless you protect the trees.'' So 140 trees 
were sandbagged.
    Mr. Kind. Well, how far away was Fish and Wildlife's 
office?
    Mr. Thomas. I think they are in Sacramento? Yes, 
Sacramento. That is 200 miles.
    Mr. Kind. Two hundred miles? Okay, thanks for that 
clarification.
    Mr. Thomas. Yes. Part of the difficulty is that, even when 
we get them on the scene, they really are simply there in a 
passive way. You can't engage them in a dialogue and quiz them 
about why they did this or what they want to do or why they 
want to do it. They are simply there to listen, and it is very 
frustrating for the locals because it is a one-way comment 
structure. And that is one thing, I think, that has to change; 
that these people are unwilling to explain why they believe 
certain things need to be done. It is very frustrating for 
people when a decision comes down like this.
    But in the timeframe, I mean, the landowners had nothing to 
do. They said, do it, because we need the dam sandbagged.
    Mr. Young. Jim----
    Mr. Thomas. Excuse me, Mr. Chairman. The long-term 
solution, of course, is to raise the height of the Success Dam 
by 20 feet, and we have had this bill in asking the Corps of 
Engineers to raise the height of the dam. The gentleman from 
California, Mr. Radanovich and I share the area. And if we 
could raise the dam height by 20 feet, we wouldn't have to make 
these kinds of decisions, but that has not been possible in the 
recent days, given the money concerns.
    Mr. Young. The gentlelady from Idaho, Mrs. Chenoweth.
    Mrs. Chenoweth. Thank you, Mr. Chairman. This is a 
phenomenal story, Congressman Thomas.
    So the Corps of Engineers was in charge of the reservoir 
pool level?
    Mr. Thomas. Yes.
    Mrs. Chenoweth. Well, was there any evidence that you know 
of that the Fish and Wildlife Service and the Corps consulted 
with one another, or did anyone do a NEPA or an EA with regard 
to the impact?
    Mr. Thomas. We made sure they communicated with each other 
because our timeline was so short; we kind of used our offices 
to facilitate the communication between the Corps and Fish and 
Wildlife to try to resolve this, as the waters continued to 
rise. So there was communication; there was consultation, and 
the answer was Fish and Wildlife was not going to let the Corps 
sandbag the dam unless something was done about these bushes, 
notwithstanding the local biologists saying that the bushes 
that were threatened to be flooded, and in fact would have been 
flooded, they had no evidence that they contained a beetle.
    Mrs. Chenoweth. That is phenomenal. Thank you. Thank you, 
Mr. Chairman.
    Mr. Young. Mark Udall, any questions?
    Mr. Udall of Colorado. Mr. Chairman, I have no questions at 
this time. Thank you.
    Mr. Young. Okay. The gentleman from California, Mr. 
Radanovich.
    Mr. Radanovich. Thanks. I have nothing to add other than my 
support for the bill, and this is but a number of stories that 
seem to happen to us in California. Thank you.
    Mr. Young. Okay, Tom Udall.
    Mr. Udall of New Mexico. Mr. Chairman, I don't have any 
questions at this time, either.
    Mr. Young. Mr. Thornberry?
    Mr. Thornberry. No.
    Mr. Young. Mr. Underwood?
    Mr. Underwood. No.
    Mr. Young. Mr. Simpson?
    Mr. Simpson. No.
    Mr. Young. Mr. Inslee?
    Mr. Inslee. No.
    Mr. Young. Mr. Sherwood?
    Mr. Sherwood. No, thank you, Mr. Chairman.
    Mr. Young. Mr. Souder?
    Mr. Souder. Did you mean Noah when you said California was 
flooded?
    Mr. Young. Pardon?
    Mr. Souder. You said that back when you were young and 
California was all under water----
    Mr. Young. The valley was flooded. A slip of the tongue 
maybe, but Mr. Thomas to get the ``dammed bags built.'' Now I 
don't know whether he meant--which way he meant that--
[Laughter]--but I caught----
    Mr. Thomas. I will provide a written statement.
    Mr. Young. People don't know the history of the California 
valley; it used to be flooded actually up until in the 1930's. 
Now it, of course, no longer occurs unless they have a dam that 
breaks or something else happens.
    But the elderberry bushes, which I am well acquainted with 
because I have them on my ranch there, we used to get flooded 
all the time, and they grew beautifully. We didn't know 
anything about beetles. We used the elderberries to make wine 
out of it. It made good wine, by the way. I don't know whether 
you know that. I don't know whether that is invading the thing 
or not.
    But if there are no others, I would thank Mr. Thomas and 
hope we will continue to have your support as we go through 
this process. I know the administration is not happy with this 
bill, but we have to get this to the forefront, to the people, 
what is really happening with this act with the Fish and 
Wildlife.
    This is one vote on the rule on the budget. I would suggest 
everybody who can be back here no later than 12 o'clock. It 
shouldn't take you that long. By 12 o'clock, we will reconvene. 
Thank you.
    Mr. Thomas. Mr. Chairman, thank you very much for the 
opportunity, and thank you for the bill.
    Mr. Young. Thank you, Mr. Thomas.
    [Recess.]
    Mr. Young. The Committee will come to order.
    We have panel two: Mr. Carl B. Loop; Mr. Robert Gordon; the 
Honorable Jamie Clark; Mr. Steven Shimberg; Mr. Bruce Smith. If 
you would take your seats--I would respectfully request that.
    I hope we will get other members here very soon. If not, we 
will still continue and proceed.
    All right, Mr. Loop, you are vice president of the American 
Farm Bureau Federation. Welcome to the Committee, and we look 
forward to your testimony. We will hear testimony from all the 
witnesses. Then we will have a series of questions. Thank you, 
Mr. Loop.

 STATEMENT OF CARL B. LOOP, JR., VICE PRESIDENT, AMERICAN FARM 
               BUREAU FEDERATION, WASHINGTON, DC

    Mr. Loop. Good afternoon, Mr. Chairman and members of the 
Committee. My name is Carl Loop. I am president of Loop's 
Nursery and Greenhouses, Incorporated. It is a wholesale plant 
operation in Jacksonville, Florida. I am also president of the 
Florida Farm Bureau and vice president of the American Farm 
Bureau.
    We are pleased to offer our support for H.R. 1142, the 
Landowners Equal Treatment Act of 1999. This Nation's farmers 
and ranchers feed the country and much of the rest of the 
world. They also provide food and shelter for most of our 
Nation's threatened and endangered species. More than 78 
percent of listed species are found on privately-owned lands, 
with more than 34 percent being on privately-owned lands 
exclusively.
    The thrust of the Endangered Species, ES, and its current 
administration is that private landowners, through onerous land 
and use regulations and broad, far-reaching statutory 
prohibitions, are made to bear the entire cost of protecting 
listed species that occur on their property. Farmers and 
ranchers and small landowners across the country are restricted 
from using their property in ways that they have traditionally 
used it because of alleged presence of listed species or 
because it might someday be habitat for listed species.
    We are told that there is a public interest in protecting 
these species and that their survival will benefit all of us, 
and we agree with that. Farmers and ranchers understand and 
appreciate the need of biodiversity and the protection of 
plants and animal species. Farmers and ranchers are willing to 
further the public interest, so long as the public pays its 
fair share. Payment of just compensation for decrease in 
property values and restriction on land use caused by ESA 
action is a method prescribed in the U.S. Constitution. The 5th 
Amendment requires that when private property is taken for 
public purpose the cost must be borne by the public through 
just compensation to the private landowner. Yet, in many cases 
private landowners are told to bear the entire cost of species 
preservation through land use restrictions and prohibitions.
    The Farm Bureau has led the fight in Congress and the 
courts to have the government recognize its responsibilities to 
provide just compensation for property values lost as a result 
of protecting listed species on private property. Government 
agencies such as the Fish and Wildlife Service have steadfastly 
refused to recognize this responsibility and have fought every 
effort along the way.
    You know, we were shocked and amazed to learn that the Fish 
and Wildlife Service had demanded, and will receive, more than 
$20 million in compensation just because planes will fly 500 
feet lower over a wildlife refuge due to the renovation at the 
Minneapolis airport. The payments will be made by air 
passengers traveling through Minneapolis.
    There is no conceptual difference in what the agency 
demanded than in what farmers and ranchers have been asking for 
for years. If anything, the claims of private landowners are 
much stronger because they are constitutional. The 5th 
Amendment specifically addresses a landowner's claims, giving 
them constitutionally-protected private property rights. The 
only real difference between the two situations is that the 
agency received compensation without having to fight a lengthy 
and costly court action. This is in marked contrast to what the 
agency forces small, private landowners to do, if they want to 
protect their rights.
    That is why the enactment of H.R. 1142 is important and why 
the American Farm Bureau Federation supports it. It reinforces 
a constitutional guarantee to just compensation, and it also 
provides a private landowner should at least be treated no 
differently than Federal agencies that receive compensation 
when constructive use of the property they manage is adversely 
affected.
    The bill also sets forth a fair and uncomplicated procedure 
that allows private landowner claims for compensation to be as 
easily processed as was the demand from the Fish and Wildlife 
Service. Procedural equity is as important as recognition of 
equal rights. Having equal rights means little if small, 
individual private property owners with limited resources 
cannot afford to enforce those rights, either financially or in 
length of time it takes to receive satisfaction.
    H.R. 1142 does not add any new rights not already provided 
by the Constitution. Further, it does not do for private 
landowners anything that the Federal Government is not already 
doing for itself. It merely puts all parties on equal footing 
with respect to compensation for regulatory takings.
    Mr. Chairman, I have got examples in my written report. In 
Florida, as was noted earlier, we are just behind California 
and Hawaii in the number of endangered species and have 
examples of where the authority of ESA has been abused and has 
really been harmful to some of our private landowners.
    [The prepared statement of Mr. Loop follows:]

     Statement of Carl Loop, Vice President, American Farm Bureau 
         Federation, President, Florida Farm Bureau Federation

    Mr. Chairman and members of the Committee: Good morning. My 
name is Carl Loop, Jr. I am president of Loop's Nursery and 
Greenhouses, Inc., a wholesale plant nursery operation in 
Jacksonville, Florida. I am President of the Florida Farm 
Bureau Federation, and also serve as Vice President of the 
American Farm Bureau Federation.
    We are pleased to offer our support for H.R. 1142, the 
Landowners Equal Treatment Act of 1999. This nation's farmers 
and ranchers feed the country and much of the world. They also 
provide food and shelter for most of our nation's threatened 
and endangered species. More than 78 percent of listed species 
are found on privately owned land, with more than 34 percent 
being on privately owned land exclusively. The vast majority of 
open, private land is owned by farmers and ranchers.
    The thrust of the Endangered Species Act (ESA) and its 
current administration is that private landowners, through 
onerous land use regulations and broad, far-reaching statutory 
prohibitions, are made to bear the entire cost for protecting 
listed species that occur on their property. Farmers, ranchers 
and small landowners across the country are restricted from 
using their property in ways that it has traditionally been 
used because of the alleged presence of a listed species or 
because it might someday be habitat for a listed species that 
is not presently there.
    We are told that there is a ``public interest'' in 
protecting these species, and that their survival will benefit 
all of us. As stewards of the land, farmers and ranchers 
understand and appreciate the need for biodiversity and the 
protection of plant and animal species. Farmers and ranchers 
are more than willing to further the public interest, so long 
as the public pays its fair share.
    Payment of just compensation for diminution in property 
values and restrictions on land use caused by ESA actions is 
the method prescribed in the United States Constitution for 
achieving this. The Fifth Amendment to the Constitution 
requires that when private property is taken for public 
purposes, the costs must be borne by the public through just 
compensation to the private landowner. Yet in many cases 
private landowners are told to bear the entire costs of species 
preservation through land use restrictions and prohibitions.
    A number of examples of the types of restrictions can be 
found in my home state of Florida, which has the second largest 
number of listed species within the continental United States. 
A couple of years ago, more than a hundred landowners received 
letters from the U.S. Fish & Wildlife Service advising them 
that their private property had habitat that could house the 
Florida scrub jay, a listed species. Landowners were also 
advised that any activity that might alter the scrub habitat on 
their property could be a violation of the Endangered Species 
Act, subjecting the owner to steep fines or even prison. A few 
years earlier, owners of five acre lots near Cross Creek were 
advised that they could not use the majority of their property 
because of the presence of a bald eagle's nest. In both cases, 
little or no regard was given by the Fish & Wildlife Service to 
the loss of use or value of the property.
    Farm Bureau has for many years led the fight in Congress 
and the courts to have the government recognize its 
responsibilities under the Fifth Amendment to provide just 
compensation for property values lost as a result of protecting 
listed species on private property. Government agencies such as 
the Fish & Wildlife Service have steadfastly refused to 
recognize this responsibility and have fought this effort every 
step of the way.
    We were therefore both shocked and amazed to learn that the 
Fish & Wildlife Service itself demanded and will receive more 
than $20 million in compensation just because planes will fly 
500 feet lower over a wildlife refuge due to renovations at the 
Minneapolis airport. The payments will be made by air 
passengers traveling through the Minneapolis airport. We are 
not sure whether to be pleased that the agency has finally seen 
the error of its past position and recognized the just 
compensation requirement of the Fifth Amendment, or to be 
outraged that the very same agency that has for years refused 
to recognize compensation for lost private property uses now 
suddenly turns the table completely when the property it 
manages is impacted. The agency seems to be telling farmers and 
ranchers, ``Do as I say, not as I do.''
    If actions speak louder than words, as they invariably do, 
the Fish & Wildlife Service can no longer argue with any 
credibility that compensation should not be paid to private 
landowners when ESA actions adversely impact the value or use 
of their property. Any claims to the contrary are belied by the 
agency's behavior in similar circumstances.
    There is no conceptual difference in what the agency 
demanded than in what farmers and ranchers have been asking for 
years. If anything, the claims of private landowners are much 
stronger than the claims of the agency, because the Fifth 
Amendment to the Constitution specifically addresses the 
landowners' claims, giving them a Constitutionally protected 
property right. There is, however, no Constitutional right for 
compensation to Federal agencies in cases when one public use 
has been substituted for another as it was in the Minneapolis 
case. The actions of the Fish & Wildlife Service can only be 
construed as accepting and reinforcing the argument that we 
have been making for years that the Fifth Amendment requires 
just compensation in cases where Federal regulations result in 
lost property value.
    The only real difference between the two situations is that 
the agency received compensation without having to fight a 
lengthy and costly court action. This is in marked contrast to 
what the agencies force small private landowners to do if they 
want to protect their rights.
    Should government be able to demand and receive 
compensation for its lost property values, and deny it in cases 
when it causes the loss in value?
    Should government, whose duty it is to uphold the rights of 
its citizens, be allowed to ignore those rights, yet also be 
allowed to assert similar rights when it is affected?
    The answer is no. What is good for one should be good for 
all.
    That is why the enactment of H.R. 1142 is so important, and 
why the American Farm Bureau Federation wholeheartedly supports 
it. Not only does it reinforce the Constitutional guarantees to 
just compensation, but it also provides that private landowners 
should at least be treated no differently than Federal agencies 
that receive compensation when constructive use of the property 
they manage is adversely affected.
    The bill also sets forth a fair and uncomplicated procedure 
that allows private landowner claims for compensation to be as 
easily processed as was the demand from the Fish & Wildlife 
Service. Procedural equity is as important as recognition of 
equal rights. Having equal rights means little if small, 
individual private property owners with limited resources 
cannot afford to enforce those rights, either financially or in 
the length of time it takes to receive satisfaction.
    H.R. 1142 does not add any new rights not already provided 
by the Constitution. Further, it does not do for private 
landowners anything that the Federal Government is not already 
doing for itself. It merely puts all parties on equal footing 
with respect to compensation for regulatory takings.

    Mr. Young. Thank you, Mr. Loop.
    Mr. Gordon.

    STATEMENT OF ROBERT E. GORDON, JR., NATIONAL WILDERNESS 
     INSTITUTE AND GRASSROOTS ESA COALITION, WASHINGTON, DC

    Mr. Gordon. Thank you, Mr. Chairman. On behalf of the 
Grassroots ESA Coalition and the National Wilderness Institute, 
I am Rob Gordon. I am executive director of the National 
Wilderness Institute, a private conservation organization, and 
a member of the Grassroots ESA Coalition.
    The Grassroots ESA Coalition is a diverse and large 
coalition of organizations representing everybody from 
environmental groups and property owners to ranchers, loggers, 
miners, and outdoor recreationists. The coalition is dedicated 
to changing the current approach for recovery of endangered 
species from the adversarial command-and-control process under 
today's ESA to an incentive-based program that encourages 
private landowners and citizens to provide habitat for wildlife 
and fosters a cooperative relationship between regulators and 
the regulated, resulting in long-term benefits to wildlife and 
society.
    The Grassroots ESA Coalition strongly supports H.R. 1142 
and commends you for addressing one of the fundamental flaws of 
the current ESA. Today counterproductive Federal regulations 
have created disincentives for conservation by preventing 
private property owners from using all or portions of their 
land if it is considered habitat for a federally-listed 
species. The ESA makes wildlife habitat a liability.
    Without property rights protection, disincentives are 
created for both the property owner and the regulator. The 
property owner has a disincentive to maintain and create 
wildlife habitat, while the regulator that is not required to 
compensate the landowner will take the property owner's land 
because it is cost-free, rather than engage in the active 
management that is essential for the recovery of endangered 
wildlife.
    Ultimately, what is lost is more than the trust and respect 
for Federal agencies and the loss of personal property. It is 
the loss of habitat and a year-round source of food and water 
for wildlife and endangered species. Landowners are rewarded if 
they manage their land in a way that does not attract 
endangered species and are punished for providing endangered 
species habitat.
    In 1997, NWI completed a peer-reviewed study that measured 
the degree to which implementation of the ESA has conserved 
federally-endangered and threatened species. This study, which 
was based entirely on U.S. FWS data and National Marine 
Fisheries Service data, concluded that regulatory mechanisms of 
the ESA have entirely failed to recover endangered and 
threatened species.
    We have created a law which pits rare plants and animals 
against property owners. As a result, both lose. The taking of 
private property for some environmental public benefit, 
likewise, adversely affects the behavior of land managers. The 
owner is forced to bear the price of some public good or 
benefit, such as preservation of a governmentally-defined 
wetland, or even retaining theoretical endangered species 
habitat. Because of the perverse incentive structure created by 
such regulations, there are often less desirable management 
decisions than would otherwise be made.
    As a result, the unintended consequence of a policy to 
provide some public benefit at a property owner's expense, or 
that the resource, and--because it is the sum of cumulative 
good deeds--conservation as a whole suffer. At NWI we believe 
protecting property rights is the single most important step we 
could now take to improve our Nation's conservation efforts.
    Current programs create perverse disincentives that devalue 
land if it contains rare wildlife or habitat--the last thing 
you should do, if you want to make something more plentiful. It 
is no accident, I think, that our wildlife and habitat 
management successes--and there are many--are the result of 
voluntary efforts, not governmental regulation of private 
property.
    Successful wildlife programs almost invariably occur where 
private incentives are allowed to work or, as in our sportfish 
and game programs, where consumption or harvesting is used 
either as a management tool or as a way to make a government 
program pay its own way.
    Government environmental regulations which take private 
property hurt conservation. If private property were better 
protected, each resource manager would be encouraged by 
enlightened self-interest to ensure that his resource is not 
only valuable today, but in the future as well. As a result, 
the individual closest to the resource would have an incentive 
to actively engage in determining what are the best practices 
for his particular site and situation, as no government 
regulator will ever be able to do.
    Successful conversation is dependent upon protected private 
property. The Grassroots ESA Coalition supports the passage of 
this bill, and it would correct one of the fundamental flaws in 
the current law that prevents us from having a successful 
endangered species conservation effort. In fact, the Grassroots 
ESA Coalition favors a complete rewrite of the Endangered 
Species Act and anticipates the introduction of an incentive-
based conservation bill for endangered species that benefits 
wildlife and people later this year.
    We would like to thank you again and submit the mission and 
principles of the Grassroots ESA Coalition for the record.
    [The prepared statement of Mr. Gordon follows:]

     Bob Gordon, Executive Director, National Wilderness Institute

    On behalf of the Grassroots ESA Coalition I would like to 
thank you, Mr. Chairman, for this opportunity to appear before 
the Committee on Resources to testify on H.R. 1142, The 
Landowners Equal Treatment Act of 1999.
    My name is Rob Gordon. I am the Executive Director of the 
National Wilderness Institute, a private conservation 
organization and member of the Grassroots ESA Coalition.
    The Grassroots ESA Coalition is a diverse and large 
coalition of organizations representing everyone from 
environmental groups and property owners to ranchers, loggers, 
miners and outdoor recreationists.
    The Coalition is dedicated to changing the current approach 
for recovery of endangered species from the adversarial command 
and control process under today's ESA to an incentive based 
program that encourages private landowners and citizens to 
provide habitat for wildlife, and fosters a cooperative 
relationship between regulators and the regulated resulting in 
long term benefits for wildlife and society.

H.R. 1142 The Landowners Equal Protection Act of 1999

    The Grassroots ESA Coalition strongly supports H.R. 1142 
and commends the Chairman for addressing one of the fundamental 
flaws of the current ESA. Today counterproductive Federal 
regulations have created disincentives to conservation. By 
preventing private property owners from using all or portions 
of their land if it is considered habitat for a federally 
listed species, ESA makes wildlife habitat a liability.
    Without property rights protection, disincentives are 
created for both the property owner and the regulator. The 
property owner has a disincentive to maintain and create 
wildlife habitat while the regulator that is not required to 
compensate the land owner will take the property owners land 
because it is cost free rather than engage in the active 
management that is essential for the recovery of endangered 
wildlife.
    Ultimately what is lost is more than the trust and respect 
for Federal agencies and the loss of personal property, it is 
the loss of habitat, and a year round source of food and water 
for wildlife and the endangered species. Landowners are 
rewarded if they manage their land in a way that does not 
attract endangered species and are punished for providing 
endangered species habitat. A well known example is Ben Cone, a 
North Carolina timber land owner, who testified before this 
Committee a few years ago.
    Mr. Cone had always tried to harvest trees in a way that 
provided habitat for wildlife. Campers, hunters and fishermen 
used his land because he believes wildlife, tree farming and 
outdoor recreation are compatible. But when the endangered red-
cockaded woodpecker arrived on his property, the Endangered 
Species Act put 1,000 acres of his property off limits to him. 
He spent $8,000 on biologists to make sure he was following the 
stringent rules, and figures he lost $1.8 million dollars in 
timber that was tied up in the area he could not harvest. He 
was prohibited from harvesting these trees because they had 
reached an age at which they attracted red-cockaded 
woodpeckers. As these trees become older the inner wood often 
becomes softer and thereby good insect hunting ground for 
woodpeckers.
    Because of the perverse incentives of environmental 
regulation, Mr. Cone was forced to ensure that no more of his 
property was taken because his trees had become old enough to 
attract woodpeckers. To protect himself, Mr. Cone harvested his 
remaining trees at an earlier age. The end result was that all 
parties lost. Mr. Cone had lost part of his property and 
reduced management options on the remainder. The red-cockaded 
woodpecker lost because once the trees now off limits to Mr. 
Cone are gone there will be no more habitat generated on Mr. 
Cone's property because he could not afford to allow his trees 
to get too old. And, the taxpayer lost because dollars spent on 
regulators ended up harming the very bird they were spent to 
protect.
    Mr. Cone was one of the fortunate land owners that had the 
resources to take legal action against the agency administering 
the ESA. Eventually a settlement was reached between the two 
parties.

Awakening to the Adverse Conservation Impact of the Act

    Not only are those who have long been critics of the Act 
pressing this point but also some who have, until recently, 
argued that the law functioned the way it should. Michael Bean 
of the Environmental Defense Fund, for example, told a U.S. 
Fish and Wildlife Service employee training session:

        There is, however, increasing evidence that at least some 
        private landowners are actively managing their land so as to 
        avoid potential endangered species problems. The problems they 
        are trying to avoid are the problems stemming from the Act's 
        prohibition against people taking endangered species by adverse 
        modification of habitat. And they're trying to avoid those 
        problems by trying to avoiding having endangered species on 
        their property. . . . Now it's important to recognize that all 
        of these actions that landowners are either taking or 
        threatening to take are not the result of malice towards the 
        red-cockaded woodpecker, not the result of malice towards the 
        environment. Rather, they're fairly rational decisions 
        motivated by a desire to avoid potentially significant economic 
        constraints. In short, they are really nothing more than a 
        predictable response to the perverse incentives that sometimes 
        accompany regulatory programs, not just the endangered species 
        program but others. So that's point one, that the strategies 
        that have been used to date to conserve this species, the red-
        cockaded woodpecker, on private lands have probably contributed 
        to the loss of the ecosystem upon which that bird depends.
    Similarly, Larry McKinney of Texas Parks and Wildlife Department 
recently stated:

        I am convinced that more habitat for the black-capped vireo and 
        especially the golden-cheeked warbler has been lost in those 
        areas of Texas since the listing of those birds than would have 
        been lost without the Endangered Species Act at all.
    Clearly there is increased recognition that the Act is not only 
failing in some incentives but resulting in the opposite of what was 
intended.

Conservation Under the Endangered Species Act

    In 1997 NWI completed a peer reviewed study that measured the 
degree to which implementation of the ESA has conserved or is 
demonstrably leading to the conservation of federally endangered and 
threatened species.
    This study, that was based entirely on USFWS and National Marine 
Fisheries Service (NMFS) data, concluded that:

        The ESA's process for determining whether a species is 
        endangered or threatened is subjective and often leads to 
        incorrect determinations. Over 60 percent of listed species are 
        considered declining or are of unknown status. The regulatory 
        mechanisms of the ESA have entirely failed to lead to the 
        recovery of endangered or threatened species. Only two species, 
        the Aleutian Canada goose and the Virginia round-leaf birch can 
        be considered as having been reclassified from endangered to 
        threatened primarily because of the ESA. Although, in both 
        instances, the beneficial management practices could have been 
        conducted under other existing authorities. More than half of 
        the species which are considered to have reached 75 percent or 
        more of their recovery objectives have reached that point for 
        reasons other than the successful implementation of the ESA. 
        Vertebrate species clearly receive a disproportionate share of 
        funding. Expenditure reports reveal that expenditures by 
        governmental agencies other than the primary implementing 
        agencies, the USFWS and the NMFS, account for the majority of 
        Federal expenditures.
        Given the inconsistency and inaccuracy of the USFWS reports, 
        the agency's ability to conduct meaningful analysis of this 
        program is questionable. Inaccurate reporting and inconsistent 
        methodology complicates and decreases the potential for 
        analysis of the program. The USFWS's lack of collection and 
        reporting of quantitative data on species over time 
        substantially frustrates an important means of measurement. The 
        Department of Interior's inability to collect, maintain, and 
        make available reliable data for the near 1,000 domestic listed 
        species casts profound doubt on the notion that the same 
        Department could reasonably manage a ``national biological 
        survey'' (Fretwell 1997) of all flora and fauna as has been 
        recently instituted.
        The problems within the ESA are profound and require drastic 
        revisions or wholesale replacement to create an endangered 
        species program that will result in real conservation 
        achievements.

We Can Conserve Species In Peril

    The poor record of the current Endangered Species Act does not mean 
that we cannot conserve endangered wildlife. Compare the results of the 
ESA's regulatory and punitive approach with the record of voluntary, 
incentive based efforts which benefit greatly from private property. 
Wood ducks and bluebirds came back from very depressed numbers because 
thousands of people built artificial nesting boxes that were placed on 
private property.
    Wood duck boxes built by duck hunters and placed in swamps are 
actually better than hollow trees at keeping out predators such as 
snakes and raccoons, and as a result of these boxes there are now over 
three million wood ducks in America--enough to support an annual 
harvest of over eight hundred thousand ducks.
    When bluebird fanciers discovered that their favorite bird was 
declining primarily because the English starling, an aggressive, 
introduced species, was taking too many of the bluebird's nesting 
cavities, they designed bird houses with openings too small for 
starlings. In the last 15 years, over one hundred thousand bluebird 
houses have been built and bluebirds are on the rebound.
    Wild turkeys have been restored from severely depleted numbers to 
their original range and beyond at the impetus of turkey hunters. 
Today, wild turkeys are found in every state except Alaska. The turkey 
population is at an all time peak and growing. And the hunters who 
organized the restoration effort are now able to harvest five hundred 
thousand birds annually.
    Why are these private efforts so much more successful than the 
Endangered Species Act? Consider the difference between incentives and 
regulation. Suppose the Endangered Species Act had been adopted early 
in this century--wood ducks, bluebirds and wild turkeys would have been 
added to the Federal list and regulated under this law.
    How could one convince a landowner to give permission to put a 
nesting box on his property?
    How many landowners could afford to let the Wild Turkey Federation 
release birds on their land if the presence of an endangered species 
meant they could no longer use their land?

Conclusions

    We have created a law which pits rare plants and animals against 
property owners. As a result, they both lose.
    Of particular interest to the Grassroots ESA Coalition and NWI is 
the relationship between private ownership of land and conservation. 
Private land is actually more important to the conservation of rare 
wildlife than government land. Although the Federal Government owns 
vast amounts of land, private land is often richer in wildlife, plants 
and water. When I speak of private conservation I do not refer only to 
not-for-profit environmental organizations but also commercial 
activities--ranching, farming, forestry, recreation industries and 
others--that make tremendous contributions to conservation as a 
byproduct of business activity. The North Maine Woods land, for 
example, is a vast area--over two million seven thousand acres--of 
privately owned commercial forest land that provides not only extensive 
wildlife habitat and public recreation opportunities, but contributes 
to our economy. Much of this land is still owned by the many 
descendants of the original landowners who got the land when Maine 
became a state in 1820.
    In some cases, conservation is directly related to a business 
enterprise. Sea Lion Caves, a for-profit organization, protects the 
only mainland rookery of the Steller sea lion. It is a major tourist 
attraction on the Oregon coast and receives over 200,000 visitors 
annually. Had not the area been privately owned, developed and 
protected, especially when the State of Oregon paid a bounty for 
slaughtered sea lions, the sea lions caves area would undoubtedly be 
void of sea lions and other marine life and this natural wonder would 
probably not exist today.
    The opportunities to improve the quality of our environment by 
creating incentives for property owners are not limited to the case of 
Sea Lion Caves but are vast. In Utah, Deseret Livestock's land produce 
elk that have a higher calving ratio, preferable bull to cow ratio and 
a higher average weight that on adjoining public land. In Texas private 
ranchers are providing habitat and thereby maintaining a total number 
of a rare African antelope that is greater than in Africa itself. In 
these cases not only are the landowners and the species benefiting from 
private conservation activities but also the public. If any of these 
activities made the property owner vulnerable to taking of his 
property, they would surely be reduced in size and scope and might not 
occur at all.
    Unfortunately, in some environmental circles it is assumed that the 
best thing we can do for the environment is to set aside the maximum 
amount of land and lock it up from any human influence, preserving 
resources from people rather than for them. It is assumed that 
governments make good land use decisions and private landowners make 
bad land use decisions. But these assumptions are not based on sound, 
objective science, and are not verified by human experience.
    Many years ago biologist by the name of Garret Harden described a 
flaw in the foundation of the thinking of many influential 
environmental circles. Hardin argued that when something is owned 
communally, each possible user will try to maximize to his benefit to 
the detriment of the resource rather than working to make sure the 
resource would be increased in value as is the case with private 
property. Hardin termed this phenomenon ``the Tragedy of the Commons.''
    The taking of private property for some environmental ``public 
benefit'' likewise adversely affects the behavior of land managers. The 
owner is forced to bear the price of some ``public good or benefit'' 
such as preservation of a governmentally defined wetland or even 
retaining theoretical endangered species habitat. Because of the 
perverse incentive structure created by such regulations there are 
often less desirable management decisions than would otherwise be made. 
As a result, the unintended consequences of a policy to provide some 
``public benefit'' at a property owner's expense are that the resource 
and, because it is the sum of cumulative good deeds, conservation as 
whole, suffer. At NWI we believe protecting property rights is the 
single most important step we could now take to improve our nation's 
conservation efforts. Current programs create perverse disincentives 
that devalue land if it contains rare wildlife or habitat the last 
thing you should do to make some more plentiful.
    It is no accident, I think, that our wildlife and habitat 
management successes--and there are many--are the result of voluntary 
efforts, not governmental regulation of private property.
    Successful wildlife programs almost invariably occur where private 
incentives are allowed to work--or as in our sport fish and game 
programs--where consuption or harvesting is used either as a management 
tool or as a way to make a government program pay its way.
    Government environmental regulations which take private property 
hurt conservation. If private property were better protected, each 
resource manager would be encouraged by enlightened self interest to 
ensure that his resource is not only valuable today but in the future 
as well. As a result, the individual closest to the resource would have 
an incentive to actively engage in determining what are the best 
practices for his particular site and situation as no government 
regulator will ever be able to do. Successful conservation is dependent 
upon protected private property.
    The Grassroots ESA Coalition supports the passage of H.R. 1142. It 
would correct one of the fundamental flaws in the current law that 
prevents us from having a successful endangered species conservation 
effort. In fact, the Grassroots ESA Coalition favors a complete rewrite 
of the endangered species Act and anticipates the introduction of an 
incentive based conservation bill for endangered species that benefits 
wildlife and people later this year.
    [The information follows:]
                        GRASSROOTS ESA COALITION

Mission

    A diverse and large coalition of organizations representing 
everyone from environmental groups and property owners to ranchers, 
miners, loggers and outdoor recreationists has publicly unveiled 
principles for establishing a new way to conserve our nation's 
endangered species.
    The Grassroots, ESA Coalition organizations united to promote these 
principles so that the old Endangered Species Act could be reformed in 
a way that benefits both wildlife and people, something the old law has 
failed to do.
    The old law has been a failure for endangered species and for 
people. It has not led to the legitimate recovery of a single 
endangered species while costing billions of dollars and tremendous 
harm. The old way destroyed trust between people and our wildlife 
officials. We need to reestablish trust so we can conserve wildlife--no 
program will succeed without the support of our farmers, our ranchers, 
our citizens.
    The old law failed because it is based on flawed ideas. It is 
founded on regulation and punishment. If you look at the actual law by 
section you see it is all about bureaucracy--consultation, permits, law 
enforcement there isn't even a section of the law called 
``conservation,'' ``saving'' or ``recovery.''
    It is a bureaucratic machine and its fruits are paperwork and court 
cases and fines--not conserved and recovered endangered species. What 
the Grassroots ESA Coalition and all Americans want to see is a law 
that works for wildlife, not one that works against people.
    The future of conservation lies in establishing an entirely new 
foundation for the conservation of endangered species--one based on the 
truism that if you want more of something you reward people for it, not 
punish them. The debate that will unfold before the public is one 
between methods of conservation.
    The old way is shackled to the idea that Washington bureaucrats can 
come up with a government solution through national land use control. 
Its supporters do not want to acknowledge that the law has failed 
because doing so would mean an end to the influence and power they have 
under the old system.
    The Coalition sees a new way that can actually help endangered 
species because it stops punishing people for providing habitat and 
encourages them to do so. It creates an opportunity for our officials--
for government--to reestablish trust and work with and earn the support 
of citizens. The Grassroots ESA Coalition is working to promote this 
new way.
    If you think that government bureaucracy works, that welfare stops 
poverty and does not need reform or that the DMV and Post Office 
operate the way they should, then the old endangered species program is 
for you. If you do not, and you want to conserve endangered species 
without wasting money, intruding on people's lives and causing more 
pain and problems, then the Grassroots ESA Coalition is for you.
Statement of Principles Regarding Endangered Species

    The Endangered Species Act has:
        failed to conserve endangered and threatened animals and 
        plants;
        discouraged, hindered, and prohibited effective conservation 
        and habitat stewardship;
        created perverse incentives, thus promoting the destruction of 
        privately owned endangered species habitat; and wasted scarce 
        conservation resources.
    The Endangered Species Act has failed in large part because it has 
engendered a regulatory regime that has:

        violated the rights of individuals, particularly property 
        rights;
        destroyed jobs, devalued property, and depressed human 
        enterprise on private and public lands;
        hidden the full cost of conserving endangered species by 
        foisting those costs on private individuals; and
        imposed significant burdens on State, county, and local 
        governments.
    We therefore support replacing current law with an Endangered 
Species Act based upon these principles:

        Animals and plants should be responsibly conserved for the 
        benefit and enjoyment of mankind.
        The primary responsibility for conservation of animals and 
        plants shall be reserved to the States.
        Federal conservation efforts shall rely entirely on voluntary, 
        incentive-based programs to enlist the cooperation of America's 
        landowners and invigorate their conservation ethic. Federal 
        conservation efforts shall encourage conservation through 
        commerce, including the private propagation of animals and 
        plants.
        Specific safeguards shall ensure that this Act cannot be used 
        to prevent the wise use of the vast Federal estate.
        Federal conservation decisions shall incur the lowest cost 
        possible to citizens and taxpayers.
        Federal conservation efforts shall be based on sound science 
        and give priority to more taxonomically unique and genetically 
        complex and more economically and ecologically valuable animals 
        and plants.
        Federal conservation prohibitions should be limited to 
        forbidding actions intended to kill or physically injure a 
        listed vertebrate species with exception of uses that create 
        incentives and funding for an animal's conservation.

    Mr. Young. Thank you, Mr. Gordon.
    Before I go to Ms. Clark, for those of you in the room, if 
you have a mobile phone, shut it off or put it on a shaking 
mode, because it is not allowed in this room. It is very 
impolite for a person giving testimony to have the shrill ring 
of a phone that comes into this room. So keep that in mind, 
because you are my guests; I expect you to respect that.
    Jamie.

  STATEMENT OF JAMIE RAPPAPORT CLARK, DIRECTOR, U.S. FISH AND 
WILDLIFE SERVICE, U.S. DEPARTMENT OF THE INTERIOR, WASHINGTON, 
                               DC

    Ms. Clark. Good afternoon, Mr. Chairman. I appreciate this 
opportunity to discuss H.R. 1142, the Landowners Equal 
Treatment Act.
    The administration is strongly opposed to enactment of H.R. 
1142. This legislation will seriously and needlessly undermine 
endangered species conservation under the guise of protecting 
private property rights. The Secretary of the Interior will 
recommend a veto of H.R. 1142, if it is presented to the 
President.
    Mr. Chairman, since I am not an attorney, I will focus my 
testimony on our highly successful efforts to make the 
Endangered Species Act more friendly to landowners, and how 
H.R. 1142 will compromise those efforts.
    Before I begin, though, there has been a lot of discussion 
about Minnesota Valley National Wildlife Refuge, and I would 
like to briefly address the situation at the refuge, upon which 
H.R. 1142 appears, in part, to have been based.
    Section 4(f) of the Transportation Act provides that park 
and wildlife areas, whether they are Federal, State, or local, 
may be utilized for transportation projects only when there is 
no viable alternative, and that the project engage in all 
possible planning to minimize and mitigate impacts if such an 
area should be used or must be used.
    When Congress enacted this provision, they intended to 
discourage the use of our refuges and parks for transportation 
projects and, thankfully, they succeeded. Unlike private 
property, public lands have no constitutional protections. 
Although section 4(f) does not require payment as if the lands 
were private lands taken for governmental purposes, it does 
require the action agency to consider all feasible 
alternatives, and in the event there are none, to minimize and 
mitigate those effects. The mitigation requirement could 
generally be met in many ways that don't necessarily involve 
cash payments, such by altering designs, changing timing or 
location of activities, or other similar measures.
    There is no relationship between a statute that 
appropriately limits the use of public park, recreation, and 
wildlife areas for transportation projects and the provisions 
of H.R. 1142, which requires the Service to compensate 
landowners from its budget for its statutorily-required efforts 
to protect endangered species.
    This administration has gone to great lengths to harmonize 
endangered species conservation with the protection of private 
property rights. We have instituted bold reforms that have 
provided greater flexibility and certainty to businesses and 
private landowners. We streamlined the consultation and 
permitting components of the Endangered Species Act. We are 
proud that our efforts have accelerated species conservation 
and recovery, while promoting cooperation rather than 
confrontation. Key landowner-oriented reforms are discussed in 
some detail in my formal statement and in previous testimony 
before this Committee.
    Increased funding support is essential to continue our 
successful record of reform. The President's Fiscal Year 2000 
budget request for endangered species is an extremely important 
step in providing adequate funding to allow the Service to 
provide technical and financial assistance to landowners, to 
support candidate conservation agreements, to speed up the 
consultation program that assists other Federal agencies, and 
to increase and accelerate recovery actions.
    The administration has taken great efforts to ensure that 
our implementation of the Endangered Species Act is both 
scientifically sound and consistently enforced throughout the 
country. We believe that, with full implementation of our 
reforms and provision of adequate provisions, the Endangered 
Species Act will, indeed, protect the biological resources of 
our Nation and the constitutional rights of American citizens.
    H.R. 1142, if enacted, would likely have drastic 
consequences for the public as well as for the Fish and 
Wildlife Service. Many agency actions which have not considered 
takings by the courts in the past would appear to be 
statutorily defined as such by H.R. 1142.
    The bill's provision that the funding for the required 
compensation program for these new takings is to come from the 
annual appropriation of the Fish and Wildlife Service could 
well result in a diversion of most, if not all, of the funds 
appropriated for the endangered species program into 
compensation for landowners. We would have little control over 
this result because most of the agency actions that would 
trigger the compensation are not discretionary under the 
Endangered Species Act. The section 7 consultation and the 
section 10 incidental take requirements are law. They don't 
become inoperable or suspended because the Service has 
insufficient funds to conduct the consultation or evaluate the 
HCP.
    The work of the Service would grind to a halt. Developers 
or landowners whose project might affect a listed species would 
have the unhappy choice of postponing their project or 
attempting to proceed without the Service's involvement, a 
violation of the law subject to suit and injunction by any 
interested party and prosecution by the Department of Justice. 
Similarly, other Federal agencies would be unable to proceed 
with their own projects which might affect listed species or 
grant permits of permission to private developers for such 
projects.
    As a result of the administrative reforms to craft a new 
Endangered Species Act, the ESA now produces cooperation 
instead of confrontation, and conservation rather than chaos. 
Enactment of H.R. 1142 would reverse this situation, to no 
one's benefit.
    Mr. Chairman, this concludes my testimony, and I would be 
happy to answer any questions.
    [The prepared statement of Ms. Clark follows:]

    Statement of Jamie Rappaport Clark, Director, Fish and Wildlife 
                  Service, Department of the Interior

    Mr. Chairman, I appreciate this opportunity to discuss H.R. 
1142, the Landowners Equal Treatment Act.
    The Administration is strongly opposed to enactment of H.R. 
1142. This legislation will seriously and needlessly undermine 
endangered species conservation under the guise of protecting 
private property rights. The Secretary of the Interior will 
recommend a veto of H.R. 1142 if it is presented to the 
President.
    I have a letter from the Department of Justice, which I 
understand has also been provided to the Committee, addressing 
the aspects of the bill relating to ``takings,'' and the 
operation of the section 4(f) programs of the Department of 
Transportation. I will accordingly focus my testimony on our 
highly successful efforts to make the Endangered Species Act 
(ESA) more friendly to landowners, and how H.R. 1142 will 
compromise those efforts.
    Before I begin, though, I would like to briefly address the 
situation at the Minnesota Valley National Wildlife Refuge, 
upon which H.R. 1142 appears, in part, to have been based. The 
Committee held a hearing on this issue February 3, at which 
both the Service and the FAA testified. It is essential to note 
that there was no requirement that the Metropolitan Airport 
Authority in Minneapolis compensate us for the impacts their 
airport expansion. Section 4(f) of the Transportation Act 
provides that park and wildlife areas--whether Federal, State 
or local--may be utilized for transportation projects only when 
there is no viable alternative, and that the project ``engage 
in all possible planning'' to minimize and mitigate impacts if 
such an area must be used.
    There is no requirement in this statute that compensation 
be paid when conservation lands must be utilized for a 
transportation project. Government lands have no constitutional 
protection against being taken for use by other governmental 
projects, and section 4(f) does not require payment as if the 
lands were private lands taken for governmental purposes. The 
requirement to minimize and mitigate impacts could generally be 
met in many ways not involving cash payments, such as by 
altering designs, changing timing or location of activities, or 
similar measures.
    In this particular case, the Department of Transportation 
was in a position to fulfill its statutory obligation under 
Section 4(f) to avoid harm to public park land by accepting the 
local airport authority's decision to replace the refuge 
recreational and environmental education facilities which would 
no longer be useable by the public after the airport was 
expanded. This was presumably due to the popularity of the 
refuge public use and environmental education programs with the 
local residents, to whom the airport authority is responsible.
    Similarly, there was no connection between the decision to 
replace the facilities and the Endangered Species Act, for the 
simple reason that there are no listed species impacted by the 
new runway. The Service had concurred in a ``no effect'' 
determination under Section 7 of the ESA long before any 
decisions were made on replacement of the refuge public use 
facilities.
    We cannot see any relationship between a statute that 
limits the use of park, recreation and wildlife areas for 
transportation projects and the provisions of H.R. 1142, which 
requires the Service to compensate landowners, from its budget, 
for its statutorily-required efforts to protect endangered 
species which are already present on their property.
    This Administration has gone to great lengths to minimize 
the impacts of the ESA on landowners. We have instituted bold 
reforms that have provided greater flexibility and certainty to 
businesses and private landowners. We have streamlined the 
consultation and permitting components of the Federal 
Endangered Species Program. We are proud that our efforts have 
produced better species conservation and recovery, while 
promoting cooperation rather than confrontation.
    Key landowner-oriented reforms include streamlining 
processes for Habitat Conservation Plans, the use of new tools 
like ``No Surprises'' assurances and ``Safe Harbor'' 
agreements, and greater use of Candidate Conservation 
Agreements and special rules under section 4(d) of the ESA.

Habitat Conservation Plans

    Section 10 of the ESA accommodates landowners by 
authorizing the government to permit ``taking'' of individual 
endangered or threatened species by a landowner or local 
government incidental to otherwise lawful activities, when the 
effects of the taking are mitigated and minimized by 
conservation measures. The statutory requirements are 
interpreted and detailed in the Service's implementing 
regulations, administrative guidelines in the Services' Habitat 
Conservation Planning Handbook, and the final ``No Surprises'' 
rule. For those who are not familiar with it, a copy of that 
Handbook is Appendix I to my statement. The statutory 
requirements include provisions requiring an applicant to 
develop a conservation plan before an incidental take permit 
can be issued. Conservation plans under the ESA have come to be 
known as ``habitat conservation plans'' or ``HCPs'' for short.
    In order to encourage HCP development, the Service has 
streamlined the development and application process and 
produced the previously-mentioned HCP Handbook as a guide. The 
handbook makes a number of improvements over the prior process. 
First, it establishes a category of ``low-effect HCPs'' 
applying to activities that are minor in scope and impact. 
These HCPs receive faster handling during the permit processing 
phase. Second, the handbook provides clear guidance to Service 
personnel about section 10 program standards and procedures. 
Third, the handbook outlines numerous mechanisms to accelerate 
the permit processing phase for all HCPs. Finally, specific 
time periods are established in the handbook for processing an 
incidental take permit application once an HCP is submitted to 
the Service:

        HCP With an Environmental Impact Statement--less than 10 
        months;
        HCP With an Environmental Assessment--3 to 5 months; and
        Low-effect HCP--less than 3 months.
    In addition, the Service has proposed a Draft Addendum (otherwise 
known as the 5-point policy guidance) to the HCP Handbook, so that the 
HCP process can even better conserve wildlife while ensuring certainty 
for landowners and other applicants. The proposal would improve the way 
HCPs are developed and administered in five areas: establishment of 
measurable biological goals and objectives, use of adaptive management, 
monitoring, public participation and determination of the duration of 
the incidental take permits. Explicit goals and objectives will provide 
clear guidance for both the applicant and the Service regarding the 
purpose and direction of the HCP's operating conservation program. 
Incorporating adaptive management into an HCP gives applicants 
certainty about what we will require them to do under changing 
circumstances and allows the applicant to better assess the potential 
economic impacts of such adjustments before agreeing to the HCP; all 
parties are assured of a suitable outcome and the HCP process is not 
needlessly delayed. Provid-

ing opportunities for education and input in the development of HCPs 
will lead to plans having stronger public support.

Regulatory Certainty

    In just a few years, the HCP process has been transformed from 
relative obscurity to one of tremendous prominence in species 
conservation. Prior to 1992, only 14 HCPs were in place. The Service 
has now implemented more than 240 HCP's with landowners and is 
developing about 200 more. For example, International Paper, a 
privately owned forest products company, recently completed an HCP for 
the red-cockaded woodpecker that will allow the company to continue its 
timber harvest operations by voluntarily expanding and enhancing the 
woodpeckers' habitat on the company's own property. HCP's are proving 
to be a popular voluntary conservation tool for both the private 
property owner and the Service.
    In addition to the streamlining of procedural requirements for 
developing and approving HCPs, another major reason for the vast growth 
in the use of HCPs by landowners is the incentive provided through the 
``No Surprises'' policy. This policy guarantees certainty for private 
landowners who provide conservation benefits to species. It was 
developed to reduce the concerns and fears of private landowners that 
further regulatory restrictions might be imposed if they enter into an 
agreement with the government.
    The Services' No Surprises final rule (February 23, 1998, 63 FR 
8859) establishes a simple principle. The Federal Government will not 
require, without the consent of the permittee, the commitment of 
additional land, water or financial compensation or additional 
restrictions on the use of land, water, including quantity and timing 
of water delivery, or other natural resources beyond the level 
otherwise mutually agreed upon for the species covered by the 
conservation plan. These assurances will be provided if the permittee 
is abiding by all of the permit terms and conditions in good faith or 
has fully implemented their commitments under an approved HCP when 
negotiating provisions for unforeseen circumstances.
    HCPs have evolved from a process adapted primarily to address 
single developments, to one that includes broad-based, landscape-level 
planning tools utilized to achieve long-term biological goals. Large-
scale, regional HCPs have significantly reduced regulatory burdens on 
small landowners by providing efficient mechanisms for compliance, 
distributing the economic and logistical impacts of endangered species 
conservation, and bringing a broad range of landowner activities under 
legal protection of HCPs.
    One of the great strengths of the HCP process is its flexibility. 
Conservation plans vary enormously in size and scope and in the 
activities they address--from half-acre lots to millions of acres, from 
forestry and agricultural activities to beach development, and from a 
single species to dozens of species. Another key is creativity. The ESA 
and its implementing regulations to establish basic biological 
standards for HCPs but otherwise allow creativity on the part of the 
applicants. As a result, the HCP program has produced remarkable 
innovation. The booklet ``The Quiet Revolution'' provides many HCP 
examples (this is Appendix 2 to my statement).
    The Safe Harbor Policy will soon be finalized and will create an 
incentive for non-Federal landowners willing to proactively conserve 
listed species by providing them with regulatory certainty. Landowners 
who restore, enhance or maintain habitats for listed species will 
receive assurances that the conservation work they undertake will not 
result in additional regulatory restrictions on the use of their land. 
Landowners are currently implementing almost 40 Safe Harbor agreements 
encompassing over 1 million acres for such species as the red-cockaded 
woodpecker in the Southeast, the Attwater's greater prairie-chicken in 
Texas, and the Aplomado falcon, also in Texas. The Service believes 
that this policy will provide substantial benefits for both endangered 
species and landowners.
    The Service is emphasizing the use of Candidate Conservation 
Agreements (CCA's), to conserve declining species before they have to 
be listed. Early conservation preserves management options, minimizes 
the cost of recovery, and reduces the potential for restrictive land 
use policies in the future. Addressing the needs of species before the 
regulatory restrictions associated with listed species come into play 
often allows greater management flexibility to stabilize or restore 
these species and their habitats. For example, two CCA's with Federal 
and State agencies and coal companies allowed the Service to withdraw 
the proposal to list the southern population of the copperbelly water 
snake.
    For species which do need to be listed, the Service is expanding 
its use of Special 4(d) Rules to minimize the regulatory impact on 
landowners of listing species as threatened while providing the 
protection necessary for the species' conservation. Section 4(d) of the 
ESA authorizes the Secretary to issue such regulations as he deems 
necessary and advisable for the conservation of threatened species, 
which need not include all of the protections the ESA provides for 
species listed as endangered. As an example, the Service is pursuing a 
Special 4(d) Rule for the Preble's meadow jumping mouse in Colorado and 
Wyoming to allow continuation of certain on-going activities (such as 
agriculture) and a level of new development in the mouse's habitat 
consistent with the species' conservation needs. The flexibility to 
accommodate landowners provided by this section was rarely used by 
prior Administrations.
    Through its Pilot ESA Private Landowner Incentives Program, the 
Service is encouraging the conservation of listed and non-listed 
species on private lands. This $5 million program provides incentives 
for private landowners to enter into Safe Harbor Agreements and 
Candidate Conservation Agreements with Assurances (CCAA).
    A significant number of private landowners have expressed an 
interest in receiving assurances and in helping to implement 
conservation and recovery activities for listed and nonlisted species. 
The Safe Harbor and CCAA program will respond to the needs of private 
landowners who are interested in managing their lands in an 
environmentally-friendly manner and are concerned about the potential 
of future land- or resource-use restrictions that may result because of 
their proactive initiatives. We expect that during FY 1999, the 
majority of the funds and efforts will go to Safe Harbor programs since 
many are already underway, but we also will strongly encourage more 
active use of CCAA and the expansion of the Safe Harbor program to new 
parts of the Nation.

Critical Funding Needs

    The Administration recognizes that increased funding support is 
essential to continue our successful record of reform. Last year we 
requested significant funding increases to carry out these reforms, to 
provide greater technical assistance to private landowners and to 
greatly expedite recovery of species and their eventual delisting.
    The President's FY 2000 Budget Request for Endangered species is 
another very important step in providing adequate funding to allow the 
Service to provide technical assistance to landowners, to provide for 
financial incentives for private landowners to enter into Safe Harbor 
Agreements, for candidate conservation agreements, increases in the 
consultation program to assist other Federal agencies and to increase 
recovery actions.
    A copy of our complete budget justification for the Endangered 
Species program is Appendix 3 to my statement.
    The Administration has taken great efforts to ensure that their 
implementation of the ESA is scientifically sound and consistently 
enforced throughout the country. We believe that with the full 
implementation of our reforms and provision of adequate appropriations, 
the Endangered Species Act will protect the biological resources of the 
Nation without imposing undue burdens on individual citizens.

Effect of H.R. 1142

    Unfortunately, H.R. 1142 does not contribute to these objectives. 
It instead undercuts the entire Act. It goes far beyond the 
Constitutional standards for takings, instead reviving the more 
expansive concepts brought forth in the 104th Congress. The 
Administration has testified before this Committee and other committees 
of the Congress repeatedly in opposition to these concepts, and I will 
not repeat those arguments here.
    I would point out that the bill, if enacted, would likely have 
drastic consequences for the public as well as the Service. Many agency 
actions which have not been considered ``takings'' by the courts would 
nonetheless require payment of compensation under H.R. 1142. The bill's 
provision that the funding for this compensation program comes from the 
annual appropriation of the agency could well result in a diversion of 
most, if not all, of the funds appropriated for operation of the 
endangered species program into compensation for landowners.
    We would have little control over this result because most of the 
agency actions which would trigger the compensation are not 
discretionary under the ESA; we have no choice but to list, to deny 
permits, or to suggest reasonable and prudent but alternatives to 
development projects needing Federal permits if that is where the facts 
take us. If we were to not take these actions when they were warranted 
out of concern for budgetary impacts, we would be in violation of the 
law, and could be subject to citizen suit and court orders compelling 
us to take the action in question. The adoption of requirements for 
compensation does not alter our responsibilities under the ESA.
    Taxpayer money spent on compensation for legally required agency 
actions is money not spent protecting and recovering the species 
needing the protections of the ESA. But the impacts of this legislation 
would go far beyond this. While the operation of H.R. 1142 might well 
result in no new listings, section 7 consultations or HCP approvals, 
the net result would be chaos and paralysis in significant elements of 
the development community.
    The ESA section 7 requirement that Federal agencies consult with us 
before issuing permits for or funding projects which may affect listed 
species, and the section 10 requirement for an incidental take permit 
for non-Federal actions which might take listed species, are permanent 
law. They do not become inoperable because the Service does not have 
sufficient funds to conduct the consultation or evaluate the HCP. Any 
developer or landowner with a project which might affect a listed 
species would have the unhappy choice of postponing their project or 
attempting to proceed without the Service's involvement, a violation of 
the law subject to suit and injunction by any interested party and 
prosecution by the Department of Justice. Similarly, other Federal 
agencies would be unable to proceed with their own projects which might 
affect listed species, or grant permits or permissions to private 
developers for such projects.
    Employing the flexibility that past Congresses have built into the 
law, the Clinton Administration has used innovation and administrative 
reforms to craft a ``New Endangered Species Act.'' As a result, America 
now enjoys the success of an ESA that works much better. Major steps 
have been taken to make the ESA more effective in conserving endangered 
and threatened species while enhancing its flexibility for businesses 
and private landowners. The ESA now produces cooperation instead of 
confrontation and conservation rather than chaos. Enactment of H.R. 
1142 would reverse this situation, to no one's benefit.
    Mr. Chairman this concludes my prepared testimony. I would be 
pleased to respond to any questions you might have.

    Mr. Young. I certainly wasn't surprised, Jamie, what you 
were going to say.
    The next witness is Mr. Shimberg.

STATEMENT OF STEVEN J. SHIMBERG, VICE PRESIDENT FOR PUBLIC AND 
     INTERNATIONAL AFFAIRS, NATIONAL WILDLIFE FEDERATION, 
                         WASHINGTON, DC

    Mr. Shimberg. Thank you, Mr. Chairman and Members of the 
Committee. Thank you for this opportunity to testify here 
today.
    My name is Steven Shimberg. I am here on behalf of the 
National Wildlife Federation, the Nation's largest member-
supported conservation advocacy and education organization. My 
written prepared statement details some of the threats to 
private property, people, public resources, and endangered 
species that are posed by this bill, H.R. 1142, and I ask that 
my full statement and the attachments to it be included in the 
Record.
    Mr. Young. Without objection.
    Mr. Shimberg. So that there is no misunderstanding about 
our position, the National Wildlife Federation--I am sure it is 
no surprise to the Chairman and the Members here--is opposed to 
this bill. Instead of proposing meaningful improvements to the 
Nation's landmark 25-year-old safety net for its species, this 
bill would effectively repeal the Endangered Species Act's 
application to private property.
    When introducing this bill, the Chairman said, ``The most 
effective way to protect endangered species is through the 
cooperative and voluntary efforts of private property owners.'' 
Mr. Chairman, we agree with that statement 100 percent.
    The National Wildlife Federation has repeatedly advocated 
that the Endangered Species Act can and should be improved with 
targeted, common-sense amendments to make the Act work better 
for both private landowners and wildlife. Many of these changes 
are included in H.R. 960, the Endangered Species Recovery Act, 
which was introduced by the Ranking Member of this Committee, 
Rep. Miller, and 67 original co-sponsors on March 3 of this 
year.
    These needed amendments include building in real financial 
incentives to private landowners to go beyond the Act's bare 
minimum requirement and to take affirmative actions for the 
benefit of imperiled species. This can be done through 
relatively inexpensive tax law changes and funding initiatives 
targeted toward habitat restoration and active management of 
habitat.
    In addition, as Mark Van Putten, the President and CEO of 
the National Wildlife Federation, testified before this 
Committee on March 10, we strongly support another alternative 
to this bill. I am referring to H.R. 701, the ``Conservation 
and Reinvestment Act of 1999,'' and H.R. 798, the ``Permanent 
Protection for America's Resources 2000 Act''--proposals by the 
Chairman and Rep. Miller that have the potential to establish a 
permanent dedicated funding source for early intervention 
measures that will prevent the decline of ``nongame'' species 
and, in turn, minimize the need for costly endangered species 
recovery actions. Nongame species, as you know, Mr. Chairman, 
are the roughly 90 percent of species that are not hunted or 
fished, nor classified as threatened or endangered. Although we 
do have some concerns with some of the details of those two 
bills, we are confident we can work out those differences, and 
we look forward to working with you, Mr. Chairman, and the 
others on this Committee to pass a bill this year.
    In short, H.R. 1142 is not necessary. The Endangered 
Species Act already has numerous provisions to ensure that 
agencies have the flexibility they need to give due respect to 
private property interests. Agencies routinely allow economic 
activities in and around endangered species habitats to go 
forward. They use tools such as ``4(d) rules'' for threatened 
species, reasonable and prudent measures, reasonable and 
prudent alternatives, and incidental take permits, along with 
Habitat Conservation Plans, HCPs.
    In over 25 years since enactment of the Endangered Species 
Act, courts have decided only four Endangered Species Act 
``takings'' cases on the merits, and all of those have found 
that the Act did not take private property. In the unlikely 
event that private property rights are infringed, despite the 
availability of the flexible tools in the Act, the courts 
provide adequate remedies for property owners to enforce the 
Constitution's 5th Amendment ``takings'' clause.
    We strongly support the 5th Amendment's balanced protection 
of private property. If a court determines that a government 
limit on the use and value of private property goes so far to 
be a taking of private property for public use, just 
compensation must be paid.
    The National Wildlife Federation strongly opposes H.R. 1142 
and other ``takings'' bills because they threaten a wide range 
of protections of private property, people, and public 
resources--protections which do not take private property 
rights.
    As explained in detail in my prepared statement and the 
attachments, this bill should be rejected for a number of 
reasons. I will recite quickly six of those reasons:
          One, it would create radical, sweeping, new rights--
        new rights to extinguish species by giving private 
        property owners the right to wipe out every acre of a 
        species' habitat. Under this bill, unless we pay 
        companies to obey the Endangered Species Act, they will 
        be free to exterminate endangered species by destroying 
        the habitat those species need.
          Two, this bill would impose unworkable notification 
        requirements that would needlessly block and delay a 
        wide variety of emergency actions to save species.
          Three, this bill would require windfall payments to 
        corporations, developers, and other individuals under a 
        standard that, according to every member of the Supreme 
        Court, does not warrant compensation.
          Four, these windfall payments would bust the budget. 
        You will hear more about that from another witness on 
        the second panel.
          Five, this bill unjustifiably singles out the 
        Endangered Species Act.
          And six, as Director Clark has mentioned, this bill 
        would chill enforcement of the Act by requiring that 
        windfall payments be made from agencies' annual 
        appropriations.
    Mr. Chairman, I will conclude with that. My statement lays 
out the extent of opposition to compensation bills that this 
Congress has seen on a number of occasions--State and municipal 
governments, a wide range of interests. We look forward to 
working with you on realistic alternatives to this bill--both 
amendments to the Endangered Species Act and the conservation 
funding bill that you have proposed.
    Thank you.
    [The prepared statement of Mr. Shimberg follows:]

Statement of Steven J. Shimberg, Vice President, Office of Federal and 
          International Affairs, National Wildlife Federation

    Mr. Chairman, and Members of the Resources Committee, thank 
you for this opportunity to testify before you. My name is 
Steven J. Shimberg; I am here on behalf of the National 
Wildlife Federation (NWF), the Nation's largest conservation 
advocacy and education organization, with over 4 million 
members and supporters, 46 state affiliates and 10 field 
offices.
    My testimony outlines some of the threats to private 
property, people, public resources, and endangered species 
posed by this Endangered Species Act (ESA) ``takings'' bill, 
H.R. 1142, the ``Landowners Equal Treatment Act of 1999.'' 
Unfortunately, instead of proposing meaningful improvements in 
the Nation's landmark 25 year old safety net for species, this 
bill essentially would result in a back-door, indirect repeal 
of the ESA's application to private property.
    The American people have made it clear, over and over 
again, that they support the ESA. The ESA plays a unique, 
invaluable role in preserving our biological heritage for our 
children and grandchildren to enjoy. It also protects the 
biological storehouse that provides current and potential cures 
for cancer, benefits to crops, scientific, aesthetic, and other 
values.
    As NWF has repeatedly advocated, the ESA can and should be 
improved with the targeted, common sense amendments discussed 
below to make the Act more effective at working with private 
landowners. This bill, however, is a shotgun blast that would 
cripple the ESA and the irreplaceable fish, wildlife and plant 
species that depend upon it.
    NWF strongly supports the Fifth Amendment's balanced 
protection of private property. If a court determines that a 
government limit on the use and value of private property goes 
so far as to be a taking of private property for public use, 
just compensation must be paid.
    In over 25 years, however, courts have only decided four 
ESA ``takings'' cases on the merits, all of which have found 
that the ESA did not take private property.
    NWF strongly opposes H.R. 1142 and other ``takings'' bills 
because they threaten a wide range of protections of private 
property, people, and public resources which do not take 
private property rights. As discussed below, this and other 
takings bills would delay, block, or be so prohibitively 
expensive as to force the government to stop implementing (in 
effect, repealing) these protections. A comprehensive 
discussion of the major points raised in this testimony 
regarding takings bills is contained in the article by NWF 
Senior Counsel Glenn P. Sugameli, Takings Bills Threaten 
Private Property, People, and the Environment, 8 Fordham Envtl. 
L.J. 521 (1997-98), a copy of which is submitted as an 
attachment for the Committee's record.
    Since 1990, NWF and our state affiliates have been in the 
forefront of the broad coalition to protect the property rights 
of all people by opposing state and Federal takings bills that 
elevate the interests of a few over the rights of all. NWF and 
others who oppose takings bills and support the Constitution's 
balanced approach are the genuine private property protection 
movement.
    As explained in detail below, this bill should be rejected 
because:

         it would create radical, sweeping, new rights to 
        extinguish species by giving private property owners the right 
        to wipe out every acre of a species' habitat;
         it would result in the extermination of species by 
        imposing unworkable notification requirements that would 
        needlessly block and delay a wide variety of emergency and 
        other actions that are essential to save species;
         it would require windfall payments from taxpayers to 
        corporations, developers and individuals whose property has not 
        been taken, according to every member of the Supreme Court;
         these windfall payments would create a precedent that 
        would bust the budget and would create perverse incentives by 
        rewarding proposals to apply for unrealistic development 
        permits in especially sensitive habitat in order to receive 
        payments;
         it unjustifiably singles out the ESA--in over 25 
        years, courts have only decided four ESA ``takings'' cases on 
        the merits, all of which have found that the ESA did not take 
        private property--this reflects the ESA's flexibility, which 
        routinely allows economic activities in and around endangered 
        species habitats to go forward;
         it would chill enforcement of the ESA by requiring 
        that windfall payments be made from the annual appropriation of 
        the agency that took mandatory or discretionary action to save 
        a species. This would unjustifiably pressure agency employees 
        to protect their jobs and programs by always erring on the side 
        of not protecting endangered species;
         the only times that the issue has been presented 
        directly to voters in statewide referenda or initiatives, 
        voters have overwhelmingly rejected takings bills;
         widespread opposition to takings bills includes the 
        National Governors Association, National Conference of State 
        Legislatures, National League of Cities, U.S. Conference of 
        Mayors, and other state and local government organizations that 
        have approved resolutions opposing takings payment bills; and a 
        wide range of national religious denominations, labor, 
        taxpayer, conservation and other organizations; and
         there is a better way--common sense amendments to make 
        the ESA work better for landowners and wildlife and funding to 
        prevent species from becoming endangered.

CREATING NEW RIGHTS TO EXTINGUISH SPECIES

    Under H.R. 1142, unless we pay companies to obey the ESA, they 
would be free to exterminate sea turtles, salmon, grizzlies, manatees, 
whooping cranes, and other endangered species.
    The bill's alleged purpose is incorrect, it does not ``ensur[e] 
that'' private property owners' ``constitutional and legal property 
rights will be honored . . .''
    H.R. 1142 would create radical, sweeping, new rights to extinguish 
species by giving private property owners the right to wipe out every 
acre of a species' habitat. Developers could bulldoze sea turtle and 
shorebird nesting beaches, and companies could chop down eagle nesting 
trees--unless we pay them not to do something they never had the right 
to do in the first place.
    The unprecedented new rights under this bill would be created at 
the expense of public property rights. The laws of each of the 50 
states recognize that wildlife within the state's borders represents 
property owned by the state for and on behalf of the people of each 
state. This public property right has always been understood to limit 
the rights of people and companies to use their property at the expense 
of wildlife--from hunting season and bag limit restrictions on 
landowners' ability to hunt for game on their land to rules designed to 
safeguard endangered species. This bill appears to be based on the 
mistaken idea that public rights in wildlife should be completely 
disregarded.
STRANGLING SPECIES WITH RED TAPE

    H.R. 1142 would also create a separate, sweeping immunity from 
enforcement of ESA safeguards for species unless and until Federal 
agencies have somehow ``given 30 days notice to each owner of the 
property directly affected.'' Specifically, the bill provides that: 
``An agency may not take any action that is a Federal use of non-
Federal property unless the agency has given 30 days notice to each 
owner of the property directly affected.'' The term ``Federal use of 
non-Federal property'' is very broadly defined.
    This limitation on ESA implementation is absolute and without 
exception. Failure to identify, locate, and notify each of many partial 
owners of property could permanently bar needed actions to save 
species. Apparently, it would not matter if the majority of owners 
requested the agency action, or if the one owner who did not receive 
notice would have consented, or if the agency was ready and able to 
provide the windfall payments required by the other provisions of this 
bill.
    Even emergency actions would be subjected to this 30 day notice 
straightjacket. Agencies would have to stand by helplessly while the 
last of a salmon run, for example, is exterminated. This absolute 
requirement appears to allow a property owner to take advantage of the 
30 day delay to take actions that would wipe out a species. Conversely, 
it would seem to apply where an agency action would enhance the 
property value while incidentally resulting in, for example, ``any 
diminution in the quantity of water received or available for use.''
    If this bill had been law, it would have blocked the emergency 
action to save the desert tortoise when it was suffering a lethal 
respiratory disease several years ago. Today, the community of Clark 
County, Nevada is working to implement a conservation plan to save this 
ancient reptile--an opportunity that arguably would have been denied if 
emergency action to list had not been taken.
    Ironically, to fulfill the notification requirement, the bill could 
require the Federal Government to inventory every acre of private land 
for potential habitat. This draconian notification mandate apparently 
requires an unworkable, unjustifiable, gigantic bureaucratic burden to 
compile a comprehensive, nationwide Federal database of all owners of 
all potentially affected property. Notifying current owners would 
require continually updated access to the ever-changing mix of 
corporate, partner, and individual owners.
    H.R. 1142 would result in the extermination of species by 
needlessly blocking and delaying a wide variety of actions that are 
essential to save species. Extreme bureaucratic burdens and red tape 
would even apply to actions that do not diminish property value (or 
even increase the value), if they result in a ``substantial diminution 
in'' uses of property that are either ``normal or reasonably 
expected.'' Agencies would have to ``make every possible effort to 
avoid, minimize, or mitigate'' even extremely minor impacts on property 
value or use.

WINDFALL PAYMENTS

    Essentially every payment from taxpayers under H.R. 1142 to 
corporations, developers and individuals would be a windfall--because 
the payments would be required in situations that would not constitute 
a taking under the Fifth Amendment as that provision has been read by 
every member of the Supreme Court. The Court has repeatedly and 
unanimously rejected the purported takings test that is contained in 
H.R. 1142 as contrary to the balanced Fifth Amendment approach, holding 
that a law does not ``take'' private property solely because it 
diminishes the property's value, and that takings analysis must look at 
an overall parcel of property, not just the affected portion.
    In contrast, H.R. 1142 would pay companies when there is a 25 
percent reduction in the value of a ``portion'' of property. This would 
require payments where there is almost no effect on the overall 
property value. For example, allowing condominiums or a strip mine on 
99.9 percent of a 1,000 acre tract would not be enough, payments would 
be required for the one acre wetland buffer zone next to a salmon 
stream.
    As more than 370 law professors wrote Congress regarding the 
similar test in the 1995-96 House and Senate takings bills: ``Not only 
has the Court never adopted that radical view of the Fifth Amendment; 
no single past or present Justice on the Court has.'' (Copy submitted 
for the Committee's record). In 1993, the Supreme Court's Concrete Pipe 
ruling (508 U.S. at 642-45) relied upon landmark zoning and land use 
cases in unanimously reaffirming the Court's long-standing rejection of 
three premises and standards that lie at the heart of those bills and 
of H.R. 1142. The Court ruled that because regulatory takings decisions 
must consider many factors, including impacts on neighboring homeowners 
and the public, ``our cases have long established that mere diminution 
in the value of property, however serious, is insufficient to 
demonstrate a taking.'' Second, the Court reaffirmed that takings 
analysis must focus on the overall property, not just the affected 
portion. Third, the Court reiterated the importance of looking at 
specific facts, including what the property owner reasonably expected.
    In contrast, H.R. 1142 requires payments when there is: a specific 
diminution in the value of any affected portion of property, regardless 
of reasonable expectations or other factors. This radical redefinition 
of takings fails to consider impacts on other people and property.
    Corporations would be paid under the bill even if:

         they paid little, or nothing, for the property;
         the prohibited uses would harm neighboring property 
        and the public health (as in ESA protections for wetland 
        habitat that prevents downstream flooding or an aquifer habitat 
        that serves as a drinking water supply);
         they never had a reasonable expectation that they 
        could violate the ESA; and
         they can still make a massive profit on permissible 
        uses of the property.
    H.R. 1142's definition of property extends to impacts of a broad 
sweep of Federal actions on ``land, an interest in land, the right to 
use or receive water, and any personal property . . .'' The bill 
applies to actions that limit the uses of any of these types of 
property either to protect habitat on private or public land or as a 
condition of a Federal permit. So-called ``personal property'' is owned 
by corporations and individuals and essentially means tangible property 
that is not real estate. Thus, the bill would cover, for example, 
Federal permits that limit use of offshore oil drilling equipment to 
protect whales. While a Federal grazing permit has always been held to 
be a privilege, not a right, this bill could be read as granting 
permittees new rights to be free from limits on their personal property 
(livestock) to protect streamside overgrazing on public lands.
    Senator Russ Feingold (D-WI) detailed how similar water language in 
the 1995-96 Senate takings bill ``could expand the rights of 
agricultural water users at considerable cost to the taxpayer.'' ``Fair 
market value payments of $100 to $250 per acre foot could be required 
if Federal reclamation projects reduced the subsidized water for which 
users pay from $3.50 to $7.50 per acre foot. (S. Rep. 104-239, at 82 
(additional views of Sen. Feingold)).
    Enactment of this bill would cause a flood of costly litigation. 
Looking at only the ``affected portion'' would trigger a flood of 
claims. For example, claims could be filed whenever erosion or flooding 
threats to endangered species (and downstream homes) require one acre 
of streamside or floodplain buffer out of a 10,000 acre development. As 
Joseph L. Sax, then-Counselor to the Interior Secretary, testified 
during the Senate Judiciary Committee hearings on the 1995-96 takings 
bills: ``[A]nybody who thinks when you pass a law that says you can be 
compensated by the Federal taxpayers when . . . any affected portion of 
your property, is reduced by 33 percent, thinks that isn't going to 
create a great burgeoning of lawsuits must be smoking something pretty 
strong.'' (S. Hrg. 104-535, at 226).
    While H.R. 1142 focuses on the ESA, the history of the 1995-96 
takings bills demonstrates the immediate, powerful pressure to expand 
such bills to cover all Federal laws. While the House passed bill was 
limited to the ESA, wetland protections and certain irrigation and 
water laws, Senate proponents immediately extended their bills to cover 
all laws (S. 605) or nearly all (S. 1954). The absurd and draconian 
payments to polluters and others that would have resulted clearly 
revealed that the purported property rights principles they embodied 
are contrary to the Constitution's balanced approach and to the views 
of the American public.

TAKINGS BILLS ARE BUDGET BUSTERS AND CREATE PERVERSE INCENTIVES

    Like prior takings bills, H.R. 1142 would force repeal, or block 
implementation, of basic protections for people, property, and natural 
resources by making them too expensive to enforce.
    Then-Office of Management and Budget (OMB) Director Alice M. Rivlin 
testified that the OMB estimated that direct spending costs of the 1995 
House-passed ESA and wetlands takings bill would be $28 billion over 
seven years, with the broader Senate bill costing several times that 
amount: ``I want to emphasize that these are not estimates of Fifth 
Amendment `takings' due to Federal activities, but instead reflect the 
costs of implementing a radical, harmful, and expensive compensation 
scheme that would likely encourage unmerited claims.'' (S. Hrg. 104-
299, at 142).
    Director Rivlin's estimate was highly conservative. She testified, 
for example, that while OMB recognized that the bills would encourage 
people to ``game the system, potentially resulting in an enormous 
number of claims,'' OMB's estimate ``did not include an estimate of the 
number of land owners that, for example, would want to get under the 
regulation so that they could make a claim.'' (Id. at 145). The late, 
former Senator Paul Tsongas, a strong advocate of a balanced budget, 
testified on this precise issue: ``I can tell you as a former real 
estate developer who lost money, this is a bonanza because all I would 
have to do now is figure out where wetlands are before they are 
designated, buy it, submit an application for a shopping center, after 
it gets denied, I submit a bill to you and it doesn't cost me 
anything.'' (Id. at 147).
    Under H.R. 1142, claims would be even easier. For example, 
speculators could buy land for $50 an acre, a price that fully and 
openly reflects the applicability of the ESA. A week later, they could 
then demand payment because the land was ``only'' worth $75 an acre. 
Under H.R. 1142, a 50 percent real world gain would appear to be a 25 
percent ``reduction in fair market value,'' because the artificial 
``fair market value'' of $100 an acre would be calculated ``without 
regard to the presence of any species protected under'' the ESA.
    H.R. 1142 would distort the economy and investment. Professor 
Richard J. Lazarus' testimony regarding the 1995-96 takings bills 
logically applies to this bill as well: ``Perverse incentives will 
abound. Property owners will propose activities not because of any real 
interest in their undertaking, but rather simply so that the holder of 
the property right can be denied permission and thus be entitled to 
compensation. The law would create an economic incentive for land 
owners to engage in the most environmentally destructive activities 
possible, short of a classic common law nuisance, in order to force the 
land owner not to do so.'' (S. Hrg. 104-299, at 220).
    Similarly, then-EPA Deputy General Counsel Gary S. Guzy repeatedly 
testified that takings bills would ``create perverse incentives that 
discourage cooperation between property owners and regulators to find 
ways of allowing development while protecting the environment. . . . 
Even more perversely, the bill rewards proposals that are not realistic 
or feasible.'' (Id. at 200).
    Thus, for example, developers would apply for permits to fill in 
especially sensitive habitat in order to collect payments when the 
permits are denied. H.R. 1142 would strongly encourage these 
applications to be filed even where the alleged development plan would 
not make economic sense, as in cases where the overall profit from the 
tract would be enhanced by retaining a lake and marketing luxury upland 
lakefront acreage.
    The Congressional Budget Office (CBO) estimated only the costs of 
administering the 1995-96 House and Senate takings bills, stating that: 
``CBO has no basis for estimating the additional amount of compensation 
that the government might have to pay for cases where property owners 
choose to pursue larger claims in court. . . . CBO expects that the 
majority of the new suits would involve relatively large claims against 
agencies that regulate the use of land or water, particularly the U.S. 
Army Corps of Engineers and the Department of the Interior (DOI).'' (S. 
Rep. No. 104-239, at 40, 43).
    Taxpayers for Common Sense, a budget watchdog group, issued a May, 
1996 report stating that the cost of S. 605 could be $100 billion over 
seven years, or, more likely, a virtual blank check. A study by the 
University of Washington Institute for Public Policy Management 
revealed that Washington State's defeated takings legislation 
(Referendum 48) could have cost local governments up to $1 billion 
annually for takings studies alone and exposed them to payments of as 
much as $11 billion.
    If H.R. 1142 were to pass, the vast majority of payments would be 
to large corporations and developers who are the subject of most of the 
regulations and who have the lawyers, appraisers and experts necessary 
to demonstrate a ``right'' to payment under the bill's vague standards. 
The ingenuity and greed of some giant corporations that oppose limits 
on their ability to profit at the expense of others was dramatically 
illustrated by a May 1996 Exxon subsidiary's lawsuit claiming that the 
$125 million Exxon Valdez tanker had been taken.\1\ The claim 
challenged a provision of the Oil Pollution Act of 1990, which was 
passed after the Exxon Valdez had spilled 10.6 million gallons of crude 
oil, that allowed the ship to operate anywhere in the world except 
Prince William Sound, where the spill had occurred. A separate March 
11, 1999 Court of Federal Claims decision deferred ruling on the merits 
of a Maritrans, Inc. takings claim for more than $200 million to cover 
the loss of 37 single-hull tank barges that would be phased out of 
service in 2003 by the double-hull requirements of the same Act. 
(Docket No. 96-483 C).
---------------------------------------------------------------------------
    \1\ See David Whitney, Exxon Wants Notorious Tanker Back on Duty in 
Alaska Waters, Anchorage Daily News, Apr. 5, 1996, at A-1.
---------------------------------------------------------------------------
    Professor C. Ford Runge's testimony about the 1995-96 takings bills 
demonstrated how payments regarding land would reflect the highly 
concentrated nature of land ownership: ``[I]f one combines the land 
holdings of the large farm operators and timber operators, 2.1 million 
land owners own 1,035 million acres of land. That means that 2.65 
percent of all private land owners own 78 percent of all private land. 
Their size also implies a likely sophistication in dealing with 
government programs.'' In contrast, the roughly sixty million owners of 
residential property own 3 percent of all private land. (S. Hrg. 104-
299, at 205). Takings bills would benefit the former, large landowner 
group to the general detriment of homeowners who depend upon clean air, 
safe drinking water, zoning and other laws.
    As a practical matter, H.R. 1142 would create an unlimited budget-
busting entitlement; the bill's ``subject to the availability of 
appropriations'' language would be overwhelmed by pressure to pay all 
those who meet the bill's radical new payment standard. Surely, those 
who support this bill would favor paying everyone who they encouraged 
to file claims. The alternative would be a cruel hoax. After 
encouraging those who have not lost any property rights to spend the 
time and expense to hire a lawyer and an appraiser to file and prove a 
claim under H.R. 1142, not paying would place them in a worse position 
than they are now. Paying only the first claims would ensure that the 
biggest companies with the fastest and most expensive lawyers would 
drain all available funds.
    As a result, H.R. 1142 would compel avoidance of these costs 
through repeal or non-enforcement of ESA protections that benefit 
people, neighboring property, and public resources. The cost of takings 
analysis and notifications mandated by H.R. 1142 would have a similar 
effect.

``TROJAN HORSE'' ATTACK ON THE ESA

    This bill unjustifiably singles out the ESA. In over 25 years, 
courts have only decided four ESA ``takings'' cases on the merits, all 
of which have found that the ESA did not take private property. (A copy 
of NWF Senior Counsel Glenn Sugameli's legal analysis of the ESA and 
takings claims is submitted for the Committee record). This paucity of 
cases reflects the fact that the ESA's safeguards that affect land use 
are in fact very flexible (indeed, only one of these four cases 
involved limitations on the use of land). Congressional Budget Office 
and Congressional Research Service reviews of takings claims against 
the Federal Government have consistently found that the vast majority 
of pending and recently decided cases have nothing to do with 
environmental protection laws.
    The potential value of property is affected by the enactment, 
amendment and enforcement of every kind of Federal, state and local 
law: from Antitrust, Bankruptcy, Copyright, Drug, Energy, Food safety, 
through the alphabet all the way to Zoning. As Justice Holmes' opinion 
for the Court in the first ``regulatory taking'' decision warned, 
``[g]overnment hardly could go on if to some extent values incident to 
property could not be diminished without paying for every such change 
in the general law.'' (Pennsylvania Coal Co. v. Mahon, 260 U.S. 393, 
413 (1922)). In deciding what is a taking, the Supreme Court has 
consistently used a balanced approach that reflects this warning.
    Harvard Law Professor Frank I. Michelman explained that there is no 
``remotely principled basis'' for the approach of limiting the scope of 
the 1995 House bill [or the current H.R. 1142] to ``land value losses 
stemming from agency actions under two or three selected laws.'' (6 
Fordham Envtl. L.J. at 416-17). Prominent ideological supporters of 
Federal takings bills agreed with this analysis. For example, Jonathan 
H. Adler of the Competitive Enterprise Institute testified that: ``Any 
bill that seeks to protect the property rights of Americans must cover 
all Federal laws that deprive land owners of the reasonable use of 
their land. There is no principled basis upon which to pick and choose 
which laws, environmental or otherwise, should be covered.'' (S. Hrg. 
104-299, at 222). He repeated this passage in subsequent testimony, but 
italicized ``all'' to emphasize the point. (S. Hrg. 104-535, at 205). 
See also id. at 82 (``There are a huge number of Federal regulations 
which have the effect of taking private property . . . .'') (statement 
of Nancie G. Marzulla, President of Defenders of Property Rights).
    Narrowing takings bills like H.R. 1142, without any principled 
basis, to certain laws reveals that the issue is not property rights, 
but a Trojan Horse attack on laws that supporters of the bill do not 
like and that are too popular to repeal directly. Under the guise of 
protecting property rights, H.R. 1142 would make the ESA too expensive 
to enforce.
    H.R. 1142 is not necessary. The ESA has numerous provisions to 
ensure that the Federal wildlife agencies have the necessary 
flexibility to give due respect to private property interests. Agencies 
routinely allow economic activities in and around endangered species 
habitats to go forward, using tools such as separate ``4(d) rules'' for 
threatened species, reasonable and prudent measures, reasonable and 
prudent alternatives, and incidental take permits and Habitat 
Conservation Plans. In the unlikely event that private property rights 
are infringed despite the availability of these flexible tools, the 
courts provide adequate remedies for property owners to enforce the 
Constitution's Fifth Amendment clause ``nor shall private property be 
taken for public use, without just compensation.''
CHILLING ENFORCEMENT OF THE LAW

    H.R. 1142 would chill enforcement of the ESA and harm a wide range 
of agency programs by requiring that payments ``shall, notwithstanding 
any other provision of law, be made from the annual appropriation of 
the agency that took the agency action giving rise to the payment . . 
.'' This would apply to mandatory agency actions where the agency has 
no legal choice except to follow the Congressional mandate. Especially 
where there is any question whether a necessary action to save a 
species could lawfully be delayed, H.R. 1142 would impose a Hobson's 
choice upon agency officials. Implementing the ESA in one case could 
result in windfall payments that would divert scarce agency resources, 
forcing massive layoffs and cutting off funds needed to enforce the ESA 
and other laws. Protection of National Wildlife Refuges, Army Corps of 
Engineers flood control activities and Environmental Protection Agency 
enforcement of air and water pollution laws could all suffer.
    H.R. 1142 would unjustifiably pressure agency employees to protect 
their jobs and programs by always erring on the side of not protecting 
endangered species. These species often have no room for delay or 
error. Extinction is forever. It neither waits for delays nor forgives 
errors.

VOTER REJECTION OF TAKINGS BILLS

    In statewide referenda, voters have overwhelmingly rejected 
legislatively approved takings bills. By the same 60-40 percent margin, 
voters repealed a Washington State takings payment bill in November, 
1995, and an Arizona takings impact assessment bill in November, 1994. 
(In each state, takings bill supporters outspent opponents by 2-to-1).
    Supporters of takings recognize that the American people oppose 
these bills: the Seattle Times reported that ``R.J. Smith of the 
conservative Competitive Enterprise Institute, a Washington, D.C. think 
tank, said the defeats in Washington and Arizona may have taught 
another lesson--that property rights leaders shouldn't take the issue 
directly to voters through initiative or referendum.''\2\ Indeed, there 
have been no more statewide ``takings'' initiatives or referenda.
---------------------------------------------------------------------------
    \2\ Eric Pryne & David Postman, Ref 48 Defeat Has Louder Echoes: A 
Property Rights Stall in Congress, Too?, Seattle Times, Nov. 9, 1995, 
at A1.
---------------------------------------------------------------------------
    Grassroots opposition to takings bills reflects the fact that these 
bills would force taxpayers either to give up needed protections or to 
pay billions of dollars to maintain health, safety and other measures 
that do not take any property.

WIDESPREAD OPPOSITION TO TAKINGS BILLS

    The radical nature of the similar, failed 1995-96 Contract with 
America ESA and wetlands takings bill generated bi-partisan opposition, 
a Presidential veto threat and strong opposition from a wide range of 
national religious, labor, taxpayer, conservation and other groups.
    The National Governors Association, National Conference of State 
Legislatures, National League of Cities, U.S. Conference of Mayors, 
National Institute of Municipal Law Officers (now the International 
Municipal Lawyers Association), National Black Caucus of State 
Legislators, International Association of Fish and Wildlife Agencies, 
and Western State Land Commissioners Association all have approved 
resolutions opposing takings payment bills.\3\
---------------------------------------------------------------------------
    \3\ NGA 1995 Annual Meeting Resolution 18; NCSL policy resolution 
passed July 28, 1994; NLC Resolution #1 adopted Dec. 4, 1994; USCM 
Resolution Adopted Jun. 1995; NIMLO Resolution adopted Apr. 8, 1995; 
NBCSL Resolution adopted Dec. 1995; IAFWA Resolution adopted Mar. 1996; 
WSLCA Resolution adopted Jan. 12, 1995. The NLC, NCSL and WSLCA 
Resolutions are reproduced in House Rep. 104-46, at 69-72.
---------------------------------------------------------------------------
    A distinguished Member of this Committee, Rep. Tom Udall (D-NM), 
was Attorney General of New Mexico when he submitted testimony to the 
House Committee on the Judiciary opposing takings bills. He attached a 
letter to Congress from Republican and Democratic Attorneys General 
representing thirty-three states and territories describing how takings 
bills: ``purport to implement constitutional property rights 
protections, but in fact they promote a radical new takings theory that 
would severely constrain the government's ability to protect the 
environment and public health and safety.'' (Reproduced in House Rep. 
104-46, at 64-68).
    Takings bills have ignited broad opposition on all levels of 
government, across political parties, and among a broad range of 
groups. Opponents of takings bills include citizens and groups 
representing civic associations, labor, taxpayer, planning, historic 
preservation, public health, hunting, conservation, and fishing 
industry organizations; state and local government officials; and child 
welfare, civil rights, religious and senior citizen groups. (S. Rep. 
No. 104-239, at 68). These opponents, who are working to protect 
people, property and natural resources, range from the League of Women 
Voters to the United Steelworkers of America, to the American Public 
Health Association. (S. Rep. No. 104-239, at 68).
    A broad range of religious denominations have opposed takings bills 
from a moral and theological perspective. These include detailed 
written testimony submitted by the United States Catholic Conference; 
(S. Hrg. 104-535, at 154-158) statements submitted by the National 
Council of Churches of Christ in the USA, and by numerous Christian 
denominations, including the Evangelical Lutheran Church in America, 
United Methodist Church, Presbyterian Church USA, Mennonite Central 
Committee U.S., and United Church of Christ; (Protecting Private 
Property Rights, H. Jud. Comm. Hrg. 104th Cong. at 41-42, 128-33).
    President Clinton promised to veto the 1995-96 House, Senate or any 
similar takingscompensation bills. The description in the President's 
December 13, 1995 letter to the Senate Judiciary Committee applies 
equally to this takings compensation bill: ``S. 605 does not protect 
legitimate private property rights. The bill instead creates a system 
of rewards for the least responsible and potentially most dangerous 
uses of property. It would effectively block implementation and 
enforcement of existing laws protecting public health, safety, and the 
environment.'' (See S. Rep. 104-239, at 55). Strong bipartisan 
opposition repeatedly blocked Senate consideration of takings 
legislation in 1996.

A BETTER WAY--COMMON-SENSE ESA REFORMS AND ENACTMENT OF NEW WILDLIFE 
FUNDING LEGISLATION

    NWF fully supports reauthorizing the Endangered Species Act to 
incorporate what we have learned since the last reauthorization in 
1988. Four changes should be made to make the ESA work better for both 
landowners and wildlife. These changes are included in H.R. 960, the 
Endangered Species Recovery Act, which was introduced by the 
distinguished ranking Member of this Committee, Rep. George Miller (D-
CA), with 67 original cosponsors on March 3, 1999.
    First, Congress should build in real financial incentives for 
private landowners to go beyond the Act's bare minimum requirements and 
to take affirmative actions for the benefit of imperiled species. This 
can be done through relatively inexpensive tax law changes and funding 
initiatives targeted toward habitat restoration and active management 
of habitats.
    Second, Congress should update the Act's habitat conservation 
planning (HCP) provisions, so that HCPs work for private landowners and 
species. The Clinton Administration has launched a revolutionary change 
in the ESA through its use of HCPs--locking in long-term land use plans 
for over 7 million acres in just 5 short years. According to several 
recent scientific studies, these plans may be undermining the ESA's 
recovery goal. Congress will need to clarify that HCPs may not 
undermine recovery, and that they must be sufficiently adaptive so that 
we can take effective action when they fail to achieve their promised 
conservation objectives.
    Third, Congress should enhance Federal agencies' accountability for 
achieving recovery. Too many species are not making sufficient progress 
toward recovery, and agencies have become focused on avoiding jeopardy 
rather than fulfilling their statutory obligations to promote recovery. 
Agencies with activities affecting imperiled species must make specific 
and enforceable commitments to help implement recovery plans.
    Finally, Congress should increase citizen participation in key 
decisiomaking processes. NWF recently sponsored a study of HCPs by the 
University of Michigan, which demonstrated conclusively that plans with 
major implications for our biological heritage are being designed 
behind closed doors, without input from conservationists, neighboring 
landowners, expert scientists and other concerned citizens. Congress 
should identify ways for these stakeholders to provide their ideas and 
input early in the process, rather than merely inviting comment after 
the deal has been struck and after it is too late for any significant 
changes to be made.
    In addition, NWF strongly supports establishing a permanent, 
dedicated funding source for ``nongame'' species (the roughly 90 
percent of species that are neither hunted nor classified as threatened 
or endangered). Several bills pending before Congress, including H.R. 
701, the ``Conservation and Reinvestment Act of 1999,'' and H.R. 798, 
the ``Permanent Protection for America's Resources 2000 Act,'' have the 
potential for establishing such a permanent funding source. Although 
NWF has concerns about certain features of these bills, both could 
provide funding for early intervention measures that prevent nongame 
species' decline and avoid more costly recovery measures that are 
frequently incurred once a species has been listed. We look forward to 
working with the sponsors of those bills to ensure the two proposals 
are merged in a way that brings out the best in both of them and allows 
the broad support necessary for passage.
CONCLUSION

    H.R. 1142 would harm the property and other rights of average 
Americans because it would impose standards that are contrary to the 
Fifth Amendment's balanced protection of private property. The result 
would be massive costs to taxpayers, a litigation explosion, more 
bureaucracy and inability to enforce the ESA's protections that benefit 
people, private property and public resources. We strongly urge that 
H.R. 1142 be set aside in favor of common sense ESA amendments and 
separate legislation to provide a permanent, dedicated funding source 
to prevent species from becoming endangered, both of which can make the 
Act work even better for both landowners and wildlife.

    Mr. Vento. Mr. Chairman, I would ask unanimous consent to 
place Mr. Miller's statement in the record.
    Mr. Young. Without objection, so ordered.
    [The prepared statement of Mr. Miller follows:]

Statement of Hon. George Miller, a Representative in Congress from the 
                          State of California

    Mr. Chairman, I think it is unfortunate that the Committee 
will spend time today debating legislation that even its 
proponents have acknowledged is not going to become law. We 
could be making much better use of the Committee's time by 
discussing substantive issues related to the reauthorization of 
the Endangered Species Act, instead of once again trying to gut 
the law under the guise of protecting private property.
    Congress has debated the private property rights and 
takings issues repeatedly over the past several years, and the 
outcome is always the same. We hear the horror stories about 
the impacts of the Endangered Species Act and other 
environmental laws. We research these horror stories and find 
that the law is usually not to blame, and these bills go 
nowhere. Why are we debating this issue yet again?
    The bottom line is this; the Courts have repeatedly found 
that the implementation and enforcement of environmental laws 
to protect the public good do not constitute a taking of 
private property and do not warrant compensation under the 5th 
Amendment of the Constitution.
    As such, H.R. 1142 and bills like it are not, as they are 
characterized, a mere protection of private property rights 
under the Constitution. Instead, they establish a new statutory 
threshold for compensation that is independent of the 
Constitution and will, in effect, pay people to comply with the 
laws that require the protection of species and the 
environment. In this particular case, H.R. 1142 creates a new 
taxpayer-funded entitlement for property owners that is not 
available under other environmental laws. Moreover, by 
requiring that compensation be paid from appropriated funds, it 
ensures that the agencies responsible for implementing the ESA 
will have little money left to perform their statutory duties 
to recover species.
    The overwhelming majority of Americans support recovering 
endangered species, just as they support laws that ensure we 
have clean water and clean air. The Resources Committee should 
stop wasting time and money on endless debate on these 
peripheral issues which more often than not involve mis-
characterization of the law, and instead do its job and write 
legislation to reauthorize the Endangered Species Act that will 
ensure that we recover species and get them off the list. That 
is the real way to reduce the restrictions on landowners as you 
seek to do with this legislation.
    I have introduced H.R. 960 which has over 70 co-sponsors to 
date; a similar version in the last Congress had over 100 co-
sponsors. And yet we have never even held a hearing on that 
legislation. We should move beyond the anecdotal stories and 
concentrate on the more difficult but also more important work 
of improving the ESA.

    Mr. Young. Mr. Smith.

STATEMENT OF BRUCE SMITH, VICE PRESIDENT, NATIONAL ASSOCIATION 
                OF HOME BUILDERS, WASHINGTON, DC

    Mr. Bruce Smith. Good morning, Mr. Chairman. My name is 
Bruce Smith, and I a custom builder from Walnut Creek, Califor-

nia. I am also the National Association of Home Builders' 1999 
vice president and treasurer. Formerly, I served as chairman of 
the National Association of Home Builders' Endangered Species 
Subcommittee.
    I appreciate the opportunity to testify before you today on 
H.R. 1142, the Landowners Equal Treatment Act of 1999. H.R. 
1142 goes to the heart of three issues that the National 
Association of Homebuilders has long advocated: better 
communication between Federal agencies and landowners; timely 
negotiations between the two parties, and compensation for an 
agency taking under the Endangered Species Act.
    The National Association of Home Builders' and its 197,000 
member firms support this important legislation. We believe 
H.R. 1142 is a reasonable and fair bill that offers room for 
the agency and the landowner to negotiate an agreement on the 
use of private land. We are pleased that the bill sets out 
timelines for compensation payment and ending negotiations, and 
timely notice to a property owner affected by an agency's 
action.
    NAHB strongly believes that the restoration of public 
confidence on wildlife conservation laws requires assuring 
individual private property owners that their rights will be 
respected and protected in the process of attaining the goals 
of the Endangered Species Act. Further, we believe it is only 
fair that private landowners be given the same consideration 
and treatment that the Federal Government agencies are given 
when their land is being used for public purposes. It is time 
the Congress insists that private landowners receive 
compensation as mandated in the 5th Amendment to the 
Constitution. H.R. 1142 is the right thing to do for this 
country.
    Property loss is particularly difficult in our industry for 
the small-volume homebuilders. Nearly 60 percent of our members 
build fewer than 10 homes a year. These small businesses can 
rarely afford the economic impact of losing most, or even part, 
of the use of the property they own, and even fewer can afford 
the expenses associated with a long court battle to try to 
preserve their rights under the 5th Amendment. And none of them 
can afford excessive mitigation requirements. In California we 
have seen up to 160-to-1 ratio being used against these small-
volume builders in America.
    Further, while NAHB appreciates the opportunity to address 
these problems in the context of the Endangered Species Act, we 
also advocate that similar compensation provisions should be 
extended to takings under any Federal environmental statute, 
including the Clean Water Act, various national heritage acts, 
or any other Federal attempt to regulate land use.
    H.R. 1142 is just a first step, but it is a very, very good 
step. However, there are other important ESA reform items that 
need to be addressed by this Congress. As many members of this 
Committee remember in the 104th Congress, H.R. 2275 was 
reported by this Committee and addressed many of the reforms 
that NAHB continues to seek. These reforms are long overdue and 
need to be addressed again and again, until they are passed by 
Congress.
    To ensure that ESA works at its best, Congress must address 
peer review, better availability of scientific data to the 
public, the mandating of critical habitat of a species to be 
identified at the time a listing decision is made, better 
public notice, and codifying the administration's policies such 
as no surprises.
    ESA needs to be a proactive, rather than reactive, Act. 
Citizens and landowners need to be a part of the process, not 
punished. This is the only way ESA will be successful and the 
only way we can protect and recover important species. These 
reforms, including H.R. 1142 here today, are a start to 
bringing the American citizen in the process of saving our 
species.
    Thank you for this opportunity.
    [The prepared statement of Mr. Bruce Smith follows:]

    Statement of Bruce Smith, National Association of Home Builders

    Good Morning Mr. Chairman and members of the House 
Resources Committee, my name is Bruce Smith. I am the 1999 Vice 
President and Treasurer of the National Association of Home 
Builders (NAHB), and formally served as Chairman of NAHB's 
Endangered Species Subcommittee. I am a custom builder in 
Walnut Creek, California. I appreciate the opportunity to 
testify before you today on behalf of NAHB's 197,000 members, 
regarding H.R. 1142, the ``Landowners Equal Treatment Act of 
1999.''

Bill Overview

    First, let me address H.R. 1142. This is a reasonable, fair 
bill that offers room for the agency and landowner to negotiate 
an agreement on the use of private land. We are pleased that 
the bill sets out time lines for compensation payment--within 6 
months after an agreement is reached between the landowner and 
agency--and time lines ending negotiations if no agreement is 
reached. Further, we are pleased that the legislation requires 
the Federal Government to give 30 days notice to a property 
owner affected by an agency's action, and provides the owner 
with the proper information to be compensated. NAHB has long 
advocated better public notice to property owners from Federal 
agencies regarding the impact of environmental regulations. 
These proposed amendments fairly address such concerns and 
enhance the certainty in the regulatory process that our 
members deserve.
    We would suggest two improvements to the bill. The bill 
defines ``constructive use'' to include ``the imposition or 
enforcement of a prohibition of use of non-Federal property, 
the purpose of which is to provide or retain habitat for any 
species of wildlife or plant.'' The Federal Government may not 
enforce the ESA in a manner that renders an entire plot 
unusable; nonetheless, substantial portions of property can be 
deprived economically viable uses and rise to the level of a 
taking. This question is sometimes referred to as the 
``denominator problem.''\1\ The Supreme Court has never fully 
addressed this question, although lower courts have held that 
the portions of the property to be considered are those for 
which certain uses have been denied.\2\ We would thus suggest 
adding language defining ``constructive use'' to encompass 
``the prohibition of use of non-Federal property or any portion 
thereof.''
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    \1\ See Keystone Bituminous Coal Association v. DeBenedictis, 480 
U.S. 470, 497 (1987); Frank I. Michelman, Property, Utility, and 
Fairness: Comments on the Ethical Foundations of ``Just Compensation'' 
Law, 80 Harv. L. Rev. 1165, 1192 (1967).
    \2\ Loveladies Harbor, Inc. v. United States, 28 F.3d 1171 (Fed. 
Cir. 1994).
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    Along the same lines, the bill defines ``constructive use'' 
as ``the denial of a permit under section 10 that results in 
the loss of the ability to use non-Federal property in order to 
provide habitat for wildlife or plants.'' Our builders have 
found that the Federal Government often grants permits with 
conditions. These conditions may diminish the market value of 
the land by 25 percent or more and should also be defined as 
``constructive use.'' We would urge language be added defining 
``constructive use'' to include permits that are granted with 
conditions that trigger the need for compensation.
    NAHB appreciates that the Committee is addressing these 
problems in the context of the Endangered Species Act. However, 
we would also advocate that similar compensation provisions 
should be extended to takings under any Federal environmental 
statute, including the Clean Water Act, various national 
heritage acts, or any other Federal attempt to regulate land 
use. It has been our experience that once Federal agencies got 
into the business of regulating land, they have rarely paused 
to consider what impact its regulations have on private 
landowners and small businesses.
    NAHB is pleased to see the introduction of this 
legislation. H.R. 1142 is the right thing to do for this 
country. NAHB believes strongly that restoration of public 
confidence in wildlife conservation laws requires assuring 
individual private property owners that their rights will be 
respected and protected in the process of attaining the goals 
of the Endangered Species Act. Further, we believe it is only 
fair that private landowners be given the same consideration 
and treatment that the Federal Government agencies are given 
when their land is being used for public purposes.

ESA Reform Overview

    H.R. 1142 is a first step and a good step. However, there 
are other important ESA reform items that need to be addressed 
this Congress. Compensation is a major element in any reform; 
however, there several other reforms we would like to see 
addressed by this Committee and Congress. The ESA imposes some 
of the most stringent restrictions on the use of private 
property of any Federal statute. The Act's provisions are 
mandatory, inflexible, and absolute. Indeed, unlike most 
legislative schemes, the statute's requirements are not 
moderated by ``where practicable'' or ``where the benefits 
exceed the costs.'' There are many reforms that can be 
addressed to rectify these inadequacies. Reforms are long over 
due and deserve to be addressed by this Committee.
    The following reforms of the Endangered Species Act are 
important to NAHB:

         Require a stricter scientific basis for listing 
        species and peer review of the science.
         Mandate that critical habitat of a species should be 
        identified at the time the listing decision is made.
         Allow for private citizens to play a greater role in 
        the decision making process and allow for better public notice 
        of listed species.
         Codify the Administration's policy on ``no 
        surprises,'' ``safe harbor'' and ``candidate conservation 
        agreements.''
         Requiring recovery plans to be finalized under strict 
        deadlines for each listed species.
    NAHB supported S. 1180, the Endangered Species Recovery Act of 
1997, introduced by Senators Dirk Kempthorne (R-ID), John Chafee (R-
RI), Max Baucus (D-MT) and Harry Reid (D-NV) in the 105th Congress. The 
bill addressed many of the reforms NAHB seeks this Congress. S. 1180 
would have provided reasonable balanced reform of the ESA. As a result 
it enjoyed support of the Administration, some environmental 
organizations, and many industry groups. NAHB was disheartened to see 
the bill fail. S. 1180 contained several important ESA reforms that 
would have promoted both economic development and species conservation. 
NAHB believes this Committee should promote many of the provisions in 
the bill again in the 106th Congress.
    I would like to discuss in further detail the reforms NAHB believes 
should also be addressed in legislation this Congress.

Scientific Data

    Currently, the Fish and Wildlife Service (FWS) and the National 
Marine Fisheries Services (NMFS) base their listing decisions upon 
``best scientific or commercial data available,'' This is vague 
language prescribed by the Act but not defined anywhere by law or 
regulation. Congress must ensure that FWS extends the Act's protections 
only to those species that are truly threatened or endangered, based 
upon all appropriate documentation and research. The listing process, 
therefore, should be reformed to require a stricter scientific basis 
for listing species. NAHB believes that Congress should define ``best 
available science'' to include the minimum viable population of 
species, the minimum habitat necessary for the species survival, the 
species geographic distribution, population, and percentage decline, 
and the actual threats to the species. NAHB also believes that an ideal 
formal, systematic peer review process would require evaluation of the 
methodologies used in the collection of the data. This would assure 
that researchers follow appropriate methodologies for gathering and 
analyzing data. All data should be field-tested, verifiable, and peer 
reviewed. Listing of species affects communities and landowners across 
our country every day. It is imperative that listings be made from 
sound science.
    Data should also be made available to the public. It is important 
that a landowner be able to obtain information on a species that may be 
on their property.

Critical Habitat

    FWS routinely fails to designate critical habitat for listed 
species. Congress mandated that the critical habitat of a species 
should be identified at the time the listing decision is made ``to the 
maximum extent prudent and determinable.'' Only those areas essential 
to the protection and recovery of the focal species are considered its 
critical habitat. The agency's failure to designate critical habitat 
creates severe and unnecessary problems for private landowners. As a 
result of FWS' failure to designate critical habitat, FWS regulates 
development on all potential habitat. Congress needs to make a 
collection of sufficient and appropriate date for critical habitat 
designation a requirement and a priority. NAHB also believes that the 
Federal Government must weigh the socioeconomic consequences before 
critical habitat designations are proposed. It is only fair to the 
species and affected communities that critical habitat be identified.

Public Notice/Involvement

    Current law has no public notice requirement outside of a Federal 
Register notice of proposed listing, and the requirement that a hearing 
be held in each affected state if requested within 45 days of final 
notice. NAHB believes a system must be established whereby the FWS 
would maintain a mailing list of interested parties who would receive 
notification of any and all petitions to list, proposed listings and 
draft recovery plans. Currently, the Army Corps of Engineers maintains 
such a list for proposed actions under the Section 404 program. In this 
way, landowners, environmental organizations, and other interested 
parties would have sufficient opportunity to comment on these proposed 
agency actions. Most individuals, including NAHB members, do not have 
the resources to follow every listing that appears in the Federal 
Register.
    Further, private citizens and communities--especially those 
directly affected by conservation decisions--should have a greater 
stake and a more prominent role during the ESA decision making 
processes. Congress should provide for earlier and more meaningful 
opportunities for citizens to participate, more citizen involvement in 
recovery plans, and a more prominent role in the consultation process 
for applicants for Federal licenses and permits. NAHB has repeatedly 
suggested that FWS and NMFS notify private landowners when critical 
habitat is proposed on their property. Stakeholder participation in the 
process is critical whenever agencies propose to implement significant 
changes to existing regulatory processes.

No Surprises/Candidate Conservation Agreements

    NAHB believes it is important for Congress to codify three 
important administration policies: ``no surprises,'' ``candidate 
conservation agreements,'' and ``safe harbor.'' These policies provide 
much needed assurances that when a deal is struck between landowners 
and their local, state or Federal governments that provide for both 
species conservation and the ability of the landowner to use his or her 
property, the government cannot come back with new information that 
requires further mitigation. This is a critical component in getting 
the landowner to the table and providing him or her with much needed 
incentive to preserve species. Codifying these policies as law will 
neutralize the negative affects of third party lawsuits that challenge 
the reasonable efforts of participants and government officials to 
cooperate in protecting species.

Recovery Planning

    Congress should fortify the recovery planning process envisioned in 
the Act by requiring the preparation and use of timely, comprehensive, 
effective and cost-effective recovery plans. Presently, many species 
are without a viable financially feasible recovery plan. A recovery 
plan should be required and finalized under strict deadlines for each 
listed species. We also would advocate that the requirement for peer 
review of the biological goals within a recovery plan be as least as 
stringent as that for listing and delisting decisions. Further, FWS 
should adopt a ``least-cost'' alternative in recovery plans, and be 
prohibited from adopting a plan until all financial expenditures are 
identified. The overall goal is to save species. It is important that 
an emphasis is put on recovery.

ESA/CWA Memorandum of Agreement

    NAHB submitted comments to the Environmental Protection Agency for 
the proposed memorandum of agreement (MOA) with the Fish and Wild 
Service and the National Marine Fisheries Service. The intent of the 
MOA as stated in the proposed rule is to streamline agency efforts 
during ESA Section 7 Consultation. NAHB supports efforts to streamline 
the process but opposes the attempt to expand agency authorities under 
the Clean Water Act (CWA) and ESA. The Water Quality Standards (WQS), 
National Pollutant Discharge Elimination System (NPDES) program, and 
the ESA Section 7 Consultation process have existing standards that 
should not be complicated. The MOA as proposed establishes too many 
levels of involvement and subsequently complicates the WQS, NPDES, and 
ESA consultation programs. NAHB's comments focus on recommendations 
that adhere to the congressional intent of both the CWA and ESA. 
Congress should make clear that ESA considerations should not over ride 
the CWA programs.
Fifth Amendment Rights Overview

    Finally, let me take a moment to focus on the issue of property 
rights. One of NAHB's long-standing policies is to ensure that 
landowners are paid just compensation when government takes private 
property through onerous and excessive land use regulation. The right 
of private property owners to use their land is one of the most valued 
tenets of the U.S. Constitution and a bulwark of our democracy. Supreme 
Court rulings since the 1980s have reaffirmed the basic principle that 
the property rights safeguarded by the Fifth Amendment must be 
vigilantly protected and are as important as the speech and privacy 
rights protected by the First and Fourth Amendments. None deserve any 
less protection compared to the others.
    Federal and state governments continue to take private property for 
a variety of reasons, thus triggering the requirement that just 
compensation be paid to the affected landowner. The Endangered Species 
Act (ESA), in particular, continues to be enforced in such a way as to 
cross that line drawn by Justice Oliver Wendell Homes nearly seventy 
years ago. ``If regulation goes too far,'' he wrote, ``it will be 
recognized as a taking.'' \3\ Often,enforcement of the ESA by the U.S. 
Fish and Wildlife Service (FWS) does, indeed, ``go too far'' and 
deprives property owners of all or a substantial portion of the use of 
their property.
---------------------------------------------------------------------------
    \3\ PENNSYLVANIA COAL CO. v. MAHON, 260 U.S. 393 (1922)
---------------------------------------------------------------------------
    This loss is particularly difficult for the small volume 
homebuilder. Over 60 percent of NAHB's membership build fewer than ten 
homes per year. These people can rarely afford the economic impact of 
losing most of the value of a property they own, and even fewer can 
afford the expenses associated with a protracted court battle.
    I am not here to argue against the position that the preservation 
of endangered species is of national importance. It is of national 
importance; however, individual property owners should not bare the 
burden of species preservation for the whole nation. As Justice Black 
wrote in Armstrong v. United States, ``[t]he Fifth Amendment's 
guarantee that private property shall not be taken for a public use 
without just compensation was designed to bar Government from forcing 
some people alone to bear public burdens which, in all fairness and 
justice, should be borne by the public as a whole.''\4\
---------------------------------------------------------------------------
    \4\ ARMSTRONG v. UNITED STATES, 364 U.S. 40 (1960)
---------------------------------------------------------------------------
    NAHB is pleased that Chairman Young and other members of the 
Committee have addressed this issue in terms of the Endangered Species 
Act in H.R. 1142. Unfortunately, as mentioned earlier, this represents 
only part of a larger problem. Many other Federal statutes that 
regulate land use, such as the Clean Water Act or Superfund, also raise 
the specter of taking private property. These statutes should be 
similarly assessed to ensure that property owners who suffer 
unconstitutional takings are fairly compensated. We hope that Congress 
will look at other aspects of our struggle to realize our members' 
Fifth Amendment rights, particularly the need for procedural reforms in 
order to guarantee fair access to property owners to the Federal 
courts, so their Fifth Amendment takings claims can be resolved on the 
merits.
    Expeditious access to the Federal Courts remains a priority for the 
building industry. Private property owners still lack the ability to 
have the merits of a Fifth Amendment claim heard before a Federal court 
in a timely manner. NAHB strongly believes that along with compensation 
we need to address judicial reforms for private property rights cases. 
Last year, NAHB and many members of this Committee supported a bill, 
H.R. 1534, the Property Owners Access to Justice Act, which passed the 
House of Representatives in October of 1997. The bill was designed to 
clear many of the judicial and administrative hurdles property owners 
currently face when trying to bring their takings claim to court. The 
legislation gave a property owner access to Federal court without 
having to spend years in an endless cycle of administrative appeals 
with government agencies.
    The requirement that property owners should exhaust ``all 
administrative remedies'' with an agency before getting their day in 
court often results in endless rounds of appeals with the relevant 
agency. Property owners have a legitimate expectation to know with some 
degree of certainly what rights they have on their own property. H.R. 
1534 required the property owner to make at least two applications for 
a permit at the local level before going to court, but offered a clear 
ending to the process. It is important that a ``final agency'' action 
is defined in terms of a private property rights case, otherwise the 
process becomes endless for the property owner. Many times the property 
owner simply gets out of the process either because it is too expensive 
or time consuming to pursue, and hence loses the use of their property. 
This is wrong. Private property owners deserve to be heard in court on 
takings cases.
    The key elements of NAHB's property rights policy include the 
following:

         Federal legislation and regulation should fully 
        compensate landowners in an expeditious manner for the value of 
        their property that is taken or deemed unusable.
         Legislation should initiate and/or support appropriate 
        litigation in Federal and state courts involving takings issues 
        and other protections of private property rights.
         Legislation should adopt a clear statutory definition 
        of a taking to include not only physical occupation or use, but 
        regulated uses and/or diminished value.
         Federal legislation and regulation should ensure 
        private property owners the right to exclude people from their 
        property, including those who wish to enter onto property to 
        gather data on environmental issues.
         Federal legislation should allow property owners more 
        expeditious access to Federal District Court review of takings 
        cases.

Conclusion

    There needs to be new, proactive approaches developed to protect 
endangered species habitat on nonFederal lands in order to achieve the 
ESA's goals. There needs to be adequate incentives for non-Federal 
landowners to factor endangered species conservation into their day-to-
day land management activities. In fact, recent studies show that, for 
species found entirely on private property only 3 percent are 
improving, and the ratio of declining species to improving species is 9 
to 1. The current ESA is reactive rather than proactive regarding 
private land conservation. That is why it is important to reform the 
ESA and offer landowner incentives to conserve. In order for the ESA to 
be successful the private landowner needs to be vested in the 
conservation not punished for owning good species habitat.
    NAHB commends Chairman Young and other members of this Committee 
for addressing the important issue of compensation for private property 
takings. NAHB will continue to fight for landowners' Fifth Amendment 
rights under the United States Constitution, and will continue to 
advocate further ESA reforms.

    Mr. Young. I want to thank the panel for the excellent 
testimony and taking the time.
    It interesting, I actually have two private people sectors 
and one quasi-private, Mr. Gordon, and two, they are basically 
government officials. If this Act is working so well, why would 
the private sector say it is not working so well, Jamie? Jamie? 
And Mr. Thomas certainly doesn't think it is working well. I 
mean, where is this cooperating attitude? Does it exist at all?
    Ms. Clark. Well, Mr. Chairman, I am certainly--and you and 
I have had many discussions about this--well aware that there 
are instances that need attention, but the administration has 
worked very hard over the last few years to provide incentives 
into the current Endangered Species Act, to solicit and 
advocate appropriations that allow us to respond more 
efficiently and more effectively, to address the technical 
assistance responsibilities that we have to implement the 
Endangered Species Act.
    I get positive feedback all the time from----
    Mr. Young. From whom?
    Ms. Clark. From private landowners, from States, from other 
organizations that are really working with us to protect our 
biological heritage.
    I am sure that there are instances where it is not working 
well, and we have all heard horror stories, many of which the 
Fish and Wildlife Service spends a great deal of time refuting. 
I am not here to contest or to debate the stories that we are 
hearing today or in previous hearings, but I am convinced that 
we have worked very hard, in many reauthorization attempts and 
certainly administrative, to address the needs of private 
landowners.
    Mr. Young. Again, my problem is I am not hearing that same 
story, and I am concerned that we have a case in Alaska now 
where your Department turned down the Corps of Engineers' 
recommendation and raised it to another level, which cost not 
only a considerable amount of money; it cost my people money. 
The end results may be the same thing, but it is a year's 
delay. I don't see any working relationship there at all, and 
that disturbs me.
    In your testimony, Jamie, you say that the Service has gone 
to great lengths to minimize impacts of ESA on private 
property. If that is true, would you object to language that 
requires the Service to avoid and minimize impacts, similar to 
the 4(f) Transportation Act language in the starting point?
    Ms. Clark. Well, from my perspective, the 4(f) language, 
the Transportation Act, is not a compensation language. The 
4(f), the Transportation Act, was, indeed, to protect parks and 
refuge lands for the public benefit. The Minnesota Valley----
    Mr. Young. But you didn't answer the question. Would you 
object to that language if it applied to the private property 
owner?
    Ms. Clark. The current Endangered Species Act in areas has 
us minimize and mitigate. We----
    Mr. Young. Not on private property, you don't. You require 
that private property owner to mitigate by putting property 
into your hands, at a tremendous amount of disproportion 
acreage. That is what you do with the private property owner.
    Again, I go back, do you object to rewarding a private 
property owner for having endangered species on his property? 
That is the thing that you----
    Ms. Clark. Absolutely not. That is the theme behind----
    Mr. Young. Then why don't we do it?
    Ms. Clark. [continuing] safe harbor; that is the theme 
behind a lot of the incentives programs that we have been 
developing. We just funded a whole host of projects nationwide 
to acknowledge landowners and to provide incentives to conserve 
endangered species on their land. We can cite many examples--I 
would be happy to do that for the record--where it has been 
very positive in the relationship between the Federal 
protective requirements of the Endangered Species Act and 
private landowners stepping forward to conserve species on 
their land.
    Mr. Young. But to yield back to me, how does requiring 
mitigation reward the owner? If he has an endangered species on 
his or her property, and he has been doing an activity and that 
species is live and well, and you find the species. In order to 
continue to let him continue to do what he has been doing, you 
require mitigation, additional acreage. Now how does that 
reward? How does that relate to working with one another? That 
is big government beating up on the private property owner.
    Ms. Clark. Well, the Endangered Species Act does, in fact, 
require anyone, whether it is a private landowner or a Federal 
agency, to address the taking of endangered species and to 
address and to overcome the notion of take of an endangered 
species.
    Mr. Young. But if I have----
    Ms. Clark. You can call it mitigation or call it whatever 
you like, but the fact of the matter is, I am kind of mandated 
in my position to prevent the extinction of species. We work 
with the landowners; we work with Federal agencies; we work 
with whoever to ensure that species don't go extinct. And if 
that involves affirmatively obligations on behalf of the 
private sector or the Federal sector, we try to be as judicious 
and as realistic as----
    Mr. Young. You and I have had this discussion before. I 
just don't like your Service, very frankly. I don't like the 
way they conduct themselves and the attitude, ``We're the 
Government, and you're the private property owner. We can do to 
you whatever we wish to do, and you can't do much about it.'' 
Now that is what has happened in many cases. You may call them 
horror stories and everything else, but that is not the 
attitude any agency should have within our democracy and under 
our Constitution.
    And I have talked to you about this before, and you are not 
the only one, but this has gotten progressively worse in the 
last six years, where there is, I think, a lack of respect for 
the private property owner and his problems or her problems. 
When he has a species on that property, there is not much to 
give him credit for or reward him to keep the species. I think 
Mr. Gordon said it correctly; I think Mr. Loop said it 
correctly. I just really think you are leading this country 
down to a revolt against you, against the Federal Government.
    There is nobody happy with the Federal Government today. I 
mean, that is the sad part about it, and that weakens our 
democracy and it strengthens this democracy. There is nobody--I 
can guarantee, if you walk down the street any other place than 
Washington, DC, and ask anybody, ``What do you think about the 
Federal Government?'', and there will be a negative response. 
That is not healthy.
    My time is up. Mr. Vento.
    Mr. Vento. Thanks, Mr. Chairman.
    Director Clark, does the Fish and Wildlife Service 
compensate public agencies for actions that they take to 
respond to the Endangered Species Act.
    Ms. Clark. No, Congressman, we don't.
    Mr. Vento. You have never done that. Do you know what the 
scope of the existing Endangered Species Act is as to the 
amount of land that might be covered, private land that might 
be covered by the Endangered Species Act today?
    Ms. Clark. Well, I would agree with one of the statistics 
that I heard in earlier testimony that we say that up to 70 
percent of endangered species depend on private land for their 
existence, but regarding the amount of acreage that endangered 
species occupy that is non-Federal, I don't have a good number. 
I could check our records, but I don't believe we have a 
specific acreage number.
    [The information may be found at the end of the hearing.]
    Mr. Vento. And it is my understanding that the Airports 
Commission payment in Minnesota, my State, was made on the 
basis of the recreation and education activities, not on the 
basis--and, of course, this overflight issue that takes place--
not on the basis of any type of impact on species, endangered 
or otherwise.
    Ms. Clark. The 4(f) requirement was made, or the 4(f) 
mitigation package was made in response to the Secretary of 
Transportation's obligation to minimize and mitigate adverse 
effects to public parks and refuges.
    Mr. Vento. I mean, the fact is that, in this case, the 
visitor center and the recreation activities, interpretative 
activities that were going on outside, were rendered--would be 
completely adversely affected or completely eliminated 
practically on the basis of these overflights. That is my 
understanding.
    Ms. Clark. Right. It was the effect on the public's land. 
It was an effect on the public's enjoyment of Minnesota 
Valley----
    Mr. Vento. Now does the agency have any constitutional 
right or any other right to remedy this sort of situation with 
the Department of Transportation or with the Metropolitan 
Airports Commission? Do they have any other rights?
    Ms. Clark. Not to my knowledge. It is all statutorily 
mandated in the Transportation Act.
    Mr. Vento. So that is it? They can't go to the 5th 
Amendment? They can't go to the----
    Ms. Clark. No, they cannot.
    Mr. Vento. [continuing] 14th Amendment? This is the only 
right they have?
    Ms. Clark. To my knowledge, that is the right, which is why 
that was incorporated in the Transportation Act. Public lands 
and Federal agencies don't have the 5th Amendment right under 
the Constitution, but, of course, I am not an attorney. So I 
would----
    Mr. Vento. No, I know, but that is my understanding.
    Ms. Clark. Right.
    Mr. Vento. If somebody wants to contest it, they may. But, 
I mean, that is the purpose. That is the only remedy that is 
available, and it is a pretty weak one at that.
    Ms. Clark. That is correct.
    Mr. Vento. It has been weakened by the law, the 1997 law 
that was passed, which, in fact, had prevented the Fish and 
Wildlife Service from, in fact, having any control over any 
type of overflight. Is that correct?
    Ms. Clark. I believe you are referring to the Refuge 
Improvement Act of 1997----
    Mr. Vento. Yes, sponsored by our chairman and Ranking 
Member.
    Ms. Clark. Correct. It enjoyed wide support in the 
Congress, and it does not address the overflight issue.
    Mr. Vento. It does not address it, but the law actually 
precludes the ability of the Forest Service and that law from, 
in fact, taking any action for overflights, does it not?
    Ms. Clark. Right. Yes, sir.
    Mr. Vento. It does? I mean, so it is actually--it isn't a 
matter it isn't addressed. It affirmatively states that you 
cannot----
    Ms. Clark. That is correct.
    Mr. Vento. Well, why was that inserted in the bill? Was 
that inserted at the request of the administration?
    Ms. Clark. I actually don't know what the genesis of that 
is. I would be happy to get back to you for the record.
    [The information may be found at the end of the hearing.]
    Mr. Vento. I can tell you, there is a big problem with 
aircraft overflights over a lot of public lands that Members of 
Congress are concerned about, the least of which are not just 
by the Metropolitan Airports Commission, but by the military, 
and the increasing amount of airspace that they occupy.
    If this bill, in fact, were stating that it was trying to 
provide a right along those lines, I think probably 
constitutionally, I guess, you haven't been able to demonstrate 
that in terms of private property, but it would be at least 
something, I think, to begin to look at. But I don't know where 
the relationship is here with this. I mean, I think that it is 
your testimony, Director Clark, that this would, in fact, 
render the Endangered Species Act null and void; that, in fact, 
if you had to pay this type of compensation, that there would 
be vast amounts of money. Any action you took under the 
Endangered Species Act would surely come across this 25 percent 
threshold, especially given the definitions that are in this 
bill. So this is just another way to, in fact, repeal the 
Endangered Species Act. Maybe that is not the intention, but 
that is what the effect is.
    Ms. Clark. It certainly would be the effect. It would not 
only cripple our ability to implement the Endangered Species 
Act and promote species conservation, but it would be a huge 
drain on our budget--in fact, probably, categorically, eat up 
our entire budget, paralyzing our ability to implement the 
other provisions.
    Mr. Vento. So if this is a solution, it is an unusual one 
in terms of the fact that it completely undercuts the entire 
thrust of the Endangered Species Act of law?
    Ms. Clark. I would agree with that.
    Mr. Hansen. [presiding] The gentleman from Nevada, Mr. 
Gibbons.
    Mr. Gibbons. Thank you very much, Mr. Chairman. I 
appreciate the opportunity.
    To our panel, welcome here today.
    Ms. Clark, let me ask a question with regard to the bull 
trout listing in the State of Nevada. According to the State of 
Nevada's biologists, who have every bit as much experience, 
every bit as much knowledge, every bit as much background and 
credibility on the bull trout, it was not an endangered 
species. Yet, at the insistence of, I believe, the National 
Wildlife Foundation, a couple of fishing groups that also 
wanted to preserve the area, the Fish and Wildlife Service went 
ahead and listed that species to protect the area--at great 
harm to some of the people who needed a road to access areas in 
that area.
    That being said, you go to great lengths in your testimony 
to say that you enforce the endangered species law. Yet, what 
do you do about this designation of critical habitat?
    Ms. Clark. Well, I am not sure I followed the question, but 
let me try to answer. First, we added the bull trout to the 
Federal list of endangered species to protect the bull trout, 
after extended public comment and the evaluation of the science 
that we had before us. So, certainly, that was a decision made 
for the species.
    Mr. Gibbons. Well, the Fish and Wildlife Service for the 
State of Nevada disagreed with the idea that it was not an 
endangered species.
    Ms. Clark. Fair enough. I am sure there are debates on a 
number of species.
    Mr. Gibbons. So the science is questionable with regard to 
what you were doing, but, nonetheless, you used the bull trout 
as an excuse to close the road.
    But, let's move on, because what we want to talk about is 
critical habitat, not endangered species here, that is the 
question. Do you use critical habitat, and designate critical 
habitat, rather than automatically finding an endangered 
species?
    Ms. Clark. I am still having a hard time answering your 
question because let me explain----
    Mr. Gibbons. Well, let me make it a little clearer.
    Ms. Clark. Let me see if I can----
    Mr. Gibbons. Do you designate critical habitat?
    Ms. Clark. We are obligated by the law to designate 
critical habitat when we list a species, if it is prudent and 
it is determinable. Oftentimes, we don't know the entire extent 
of the critical habitat, which is defined as habitat essential 
to the recovery of the species at the time we list it. So we 
say it is not determinable. That doesn't, though, prohibit us 
from protecting the habitat of the species through the 
consultation provision, through the incidental take permit 
provisions, or through the identification or articulation of 
habitat or recovery planning.
    Mr. Gibbons. So you are saying here, the testimony before 
this Committee is that the Fish and Wildlife Service does 
designate, as a matter of law, critical habitat?
    Ms. Clark. The Fish and Wildlife Service is obligated by 
the Endangered Species Act to designate critical habitat where 
it is prudent and determinable.
    Mr. Gibbons. Yes, I understand what the law states. I want 
you to state for this Committee that Fish and Wildlife Service 
does designate critical habitat.
    Ms. Clark. Yes, we do. We have done not it on the bull 
trout.
    Mr. Gibbons. Well, Mr. Shimberg, you mentioned in your 
testimony about four cases that--well, first of all, you are a 
lawyer, are you not?
    Mr. Shimberg. Yes, I am.
    Mr. Gibbons. You mentioned four cases that were on point 
that have gone to the Supreme Court with regard to endangered 
species.
    Mr. Shimberg. No, sir, I didn't suggest they went to the 
Supreme Court.
    Mr. Gibbons. They did not?
    Mr. Shimberg. No. It was a Federal Claims court, the Sixth 
Circuit court, the district court in Colorado, and the Ninth 
Circuit.
    Mr. Gibbons. Are there any court cases that have gone to 
the Supreme Court with regard to endangered species?
    Mr. Shimberg. Yes, but not with regard to takings issues.
    Mr. Gibbons. Okay. Thank you, Mr. Chairman.
    Mr. Hansen. Thank you. The gentleman from Colorado, Mr. 
Mark Udall.
    Mr. Udall of Colorado. Thank you, Mr. Chairman.
    I want to welcome the panel here today, and thank you for 
taking time to appear before us.
    I had a couple of questions for Director Clark, but I 
wanted to also, as I start, refer back to Chairman Young's 
comments about providing incentives for landowners. I am 
curious what sorts of things are going on to do that. If I 
could, I might mention what has been happening in Colorado.
    I think you are aware of the Platte River and some of the 
recovery plans that have been put in place there with the State 
and the Fish and Wildlife Service and some of the water 
districts all coming together. I think it is a pretty creative 
and a nice model.
    So if you would talk about some of the things you are doing 
to provide those kinds of incentives, I think the Committee 
would appreciate it.
    Ms. Clark. Sure. The Platte River Recovery Program is, 
indeed, we believe, a success. It is, I would submit, a great 
demonstration of a collaboration among the parties interested 
in preserving the integrity and long-term sustainability of the 
Platte River.
    We have other kinds of situations like the Platte River 
that are underway in the Lower Colorado, the Bay Delta, 
southern California, and other parts of the country, where we 
have multiple constituents, multiple stakeholders working 
together to achieve the common ground of economic viability and 
species conservation. So those are kind of positive recovery 
programs.
    We have some other programs that we have instituted 
administratively, like safe harbor. Safe harbor is a program 
where we provide assurances to landowners or we acknowledge--
provide incentives for landowners to allow species or to 
support species conservation on their lands. It is for private 
landowners only, in that it, in essence, rewards their good 
deeds for endangered species, once we determine a baseline. 
Once the baseline is determined, and more of that species 
occupies that land, the assurance is given that the landowner 
can return the status of that land back to the baseline without 
fear of future regulation. So it provides certainty for 
landowners that are, in essence, growing endangered species on 
their lands.
    That received tremendous visibility and acknowledgment 
through the Southeast with species like the red cockaded 
woodpecker, the State of Texas with species like the apolomado 
falcon, and is gaining wider support across the country.
    Other kinds of incentives in the habitat conservation 
planning program, the incidental take permit program for non-
Federal lands--a little over a year ago, we published a 
regulation involving no surprises: that once a deal was made, a 
deal was a deal, and that we wouldn't ask for additional land 
or water compensation or monetary compensation beyond the terms 
of the deal that we made at the time the HCP was signed. So 
that provides, kind of alleviates the fear of future 
regulation, once a deal has been made with the Federal 
Government concerning the management of those lands.
    We have recovery incentives programs that we are trying to 
lay out through our budget process. It provides incentives and 
grants for private landowner and States to do good things for 
species' conservation. In fact, it is happening across the 
country. There is a lot of tremendous activity being conducted 
by non-Federal folks that are really accelerating species 
recovery.
    Candidate conservation agreements is another one. You know, 
we don't need to wait until we need the safety net of the 
Endangered Species Act. We are working a lot with the non-
Federal community to address species' needs while we have much 
more flexibil-

ity, either through habitat protections or actual species-
specific pro-

tection mechanisms. In laying out that deal, the candidate 
conservation agreements, we provide the protection that, in the 
event the species ultimately has to be listed anyway, because 
that one private landowner can't take care of the entire 
species' needs on their lands, the private landowner who has a 
candidate conservation agreement won't be asked to do more.
    Mr. Udall of Colorado. Okay.
    Ms. Clark. So those are some examples, and I would be glad 
to get you more for the record.
    [The information may be found at the end of the hearing.]
    Mr. Udall of Colorado. Well, I would urge you to continue 
to working in that way. I believe in Colorado there is a lot of 
support for the Endangered Species Act, particularly if there 
is more flexibility applied.
    Ms. Clark. Right.
    Mr. Udall of Colorado. I endorse that approach, and I want 
to ask you one last question. As I look over the bill, I note 
there seem to be a lot of value judgments in the bill, if I 
could quote a couple of places for you.
    It refers to ``substantial diminution in the normal or 
reasonably expected uses of property'' in one part of the bill. 
Then, in another section, it talks about any action to 
temporarily occupy property, quote, ``in a manner that is 
adverse to the constitutional right of the owner'' under the 
5th Amendment.
    Now it seems to me, given those kinds of value judgments, 
you potentially get a lot of litigation out of this piece of 
legislation, and then we end up spending our resources there in 
court, rather than doing the kinds of things you are doing. 
Would you comment on that?
    Ms. Clark. I would certainly comment, and then I would 
agree with it. I think there is a lot of subjective 
interpretation in this bill that would lend itself to varied 
interpretation. It is certainly something that I think the 
courts have struggled with for 200 years, and it kind of makes 
me glad I am a biologist, not a lawyer.
    But I would say that I believe this is clearly the wrong 
direction to achieve fairness, flexibility, and species 
conservation, because it leaves way too much open to 
interpretation. It is something the courts have been grappling 
with for many years and haven't achieved.
    Mr. Udall of Colorado. Thank you, Mr. Chairman.
    Mr. Hansen. The gentlelady from Idaho, Mrs. Chenoweth.
    Mrs. Chenoweth. Thank you, Mr. Chairman.
    Chairman Young expressed a frustration that the people feel 
toward Fish and Wildlife Service, and I think the testimony 
that we have heard today clearly indicates why the people are 
frustrated. Out West, because there is a conflict between 
wildlife and people, the people have to move.
    We heard testimony today from Mr. Shimberg that we 
shouldn't even try giving people a chance to work with the 
agencies--also, from you, Ms. Clark--in opposing the bill; we 
shouldn't even try to give people a chance under the law to see 
if this would work. We just should go ahead with force.
    Let me tell you another reason why people are utterly 
frustrated. Mr. Shimberg, who is an attorney, should have 
recalled this when Mr. Jim Gibbons asked him about cases that 
were successful in the Supreme Court. Because in the Bennett v. 
Plennart case, later known as the Bennett v. Spear case, which 
was decided unanimously by the Supreme Court, the Fish and 
Wildlife Service argued that humans are not within the zone of 
interest in the Endangered Species Act. The Fish and Wildlife 
Service lost. The Supreme Court ruled with us.
    Taking these cases by other agencies, such as the Dolan 
case, takings of private property, the Lucas case, were 
successful in the Supreme Court. So I just want to say that, 
when one comes before this Committee, they should be accurate 
in the information that they give the Committee.
    I want to ask, Ms. Clark, why did you remove the Tidal 
Basin beaver from its natural habitat? What was your reason?
    Ms. Clark. This is actually one thing I can't be blamed 
for. Fish and Wildlife Service actually was not engaged in the 
moving of the beaver. It was actually another agency. Actually, 
I heard this morning, those beaver were successfully 
transplanted to a better home, I suppose, so they wouldn't eat 
the cherry trees. But that was not a Fish and Wildlife Service 
initiative.
    Mrs. Chenoweth. Which other agency did the moving?
    Ms. Clark. National Park Service.
    Mrs. Chenoweth. Did you issue a take permit to the National 
Park Service?
    Ms. Clark. The beaver are not listed under the Endangered 
Species Act. It is really governed by the District of Columbia 
and the States----
    Mrs. Chenoweth. No, no, no, no, no, that makes no 
difference. You have the law to follow; you have your own 
regulations to follow.
    Did you issue a take permit to the----
    Ms. Clark. We would only issue a take permit if it was an 
endangered species. It is not.
    Mrs. Chenoweth. Okay.
    Ms. Clark. A take permit was not required.
    Mrs. Chenoweth. I see what your answer is. I want to let 
you know that I am going to be petitioning the Fish and 
Wildlife Service to list the Tidal Basin beaver for this 
reason, and then you can justify to me and the rest of the 
public why this little critter is not threatened or endangered, 
because he is. He is indigenous to this area. This was his 
natural habitat. And certainly by virtue of the fact that this 
little unit, this little family unit, reestablished itself in 
the Potomac, in the Tidal Basin, is an indication of not only 
its persistence and perseverance and pioneering spirit, but the 
fact that, by nature alone, these species can recover.
    I find it absolutely amazing that the agencies, because 
this is Federal property, would act according to desires of the 
Federal Government on Federal property to protect the Federal 
property, to protect tourism, which I think is just fine. But I 
would like to see the same kind of consideration given when a 
species appears like the slick shot peppergrass, which isn't 
even listed as endangered or threatened, but is stopping the 
development of a military training range in Idaho, and yet, the 
Fish and Wildlife Service and the BLM, and various other 
agencies, are stopping progress--under the same set of 
circumstances as we found with the Tidal Basin beaver.
    I think that your actions, the actions of the Park Service, 
in the case of the Tidal Basin beaver, is clearly indicative of 
the absolutely incongruity of the way this whole Act has been 
applied by individuals. I think that, frankly, this 
administration is more interested in carrying out an agenda 
than it is in protecting wildlife and endangered and threatened 
species.
    The Fish and Wildlife Service, by the way, in your 
testimony, you indicated that, in response to the overwhelming 
local input, this is one of the reasons why the refuge was 
established at the Minnesota airport. I find that amazing, 
because there was overwhelming reaction in Idaho against your 
trying to transplant grizzly bears into our State. The whole 
State rose up in arms. The whole legislature, all the county 
commissioners, said no. And, yet, unlike what you did in 
Minnesota, you didn't respond to the public input in Idaho. You 
are still attempting to impose grizzly bears on our State.
    Our State is poor. We cannot afford to pay you $26 million 
to pay you off. We would expect that you would go under the law 
and treat people equally, whether they are rich or whether they 
are poor.
    It is this kind of inconsistency that is causing people to 
be angry and causing people to feel like you aren't at all 
interested in having the Federal Government do anything but 
create chaos. I would like to see more cooperation and far less 
chaos.
    Thank you, Mr. Chairman.
    Mr. Hansen. Thank you. The gentleman from New Mexico, Mr. 
Tom Udall.
    Mr. Udall of New Mexico. Thank you, Mr. Chairman. I am not 
so sure, if I was a beaver, I would want to locate in 
Washington, DC in the Tidal Basin, I will tell you.
    Mrs. Chenoweth. Would the gentleman yield?
    Mr. Udall of New Mexico. Yes.
    Mrs. Chenoweth. Thank you for yielding. I just want to say, 
though, that this is its natural habitat, and that little 
beaver is indigenous to this area, and that is the criteria 
that should be considered. Thank you.
    Mr. Udall of New Mexico. Thank you.
    Thank you very much for coming, members of the panel. We 
really appreciate you being here. We appreciate the expertise 
that you bring to this issue.
    I have a question or two here for Director Clark. Looking 
at your biography, it is apparent that you have served in the 
field, and I know you have many other people that serve with 
you in the field. When they come in contact with a landowner, 
and you have discovered that there is an endangered species 
located on an individual landowner's land, have they generally, 
for the most, in your experience, been cooperative with you in 
terms of trying to work with your agency in terms of the 
endangered species?
    Ms. Clark. Yes, they have. I mean, we can cite example 
after example of very successful interactions and very positive 
interactions between or among private landowners and Fish and 
Wildlife Service employees. We have spent a pretty significant 
investment in evolving our agency into one of technical 
assistance and one of collaboration and one of more effective 
communication. And I won't certainly sit here and say that 
there aren't some examples to the contrary, but we enjoy a very 
significantly positive relationship with many landowners across 
the country.
    Mr. Udall of New Mexico. And part of that process, after 
you work with them in terms of recovery plans and safe harbor, 
and all of that, that requires personnel and funding? I mean, 
is your agency adequately funded, do you think, to carry out 
these kinds of programs?
    Ms. Clark. No, it isn't. In fact, that is why the 
President's Fiscal Year 2000 budget request, as its focus for 
the Fish and Wildlife Service and our endangered species part 
of the budget, highlights the need in the consultation arena, 
which is where we conduct the interagency collaboration/
coordination efforts. We have requested a fairly significant 
increase to address the demands and the needs for technical 
assistance.
    What we find more and more is that landowners, whether they 
are Federal landowners or non-Federal landowners, need to 
understand, and want to understand, what their responsibilities 
are, and they want to look for opportunities to, all of us, do 
the right thing, and they want incentives. So our budget has 
highlighted areas that show budget increases for technical 
assistance, budget increases to fund some of these incentives 
programs, and budget increases to acknowledge and reward 
landowners that want to do the right thing.
    Mr. Udall of New Mexico. And it sounds like to me, if you 
receive that kind of funding, you could make more of these 
situations into win-win situations, rather than----
    Ms. Clark. Absolutely.
    Mr. Udall of New Mexico. [continuing] having confrontation?
    Ms. Clark. I am sure of that, absolutely.
    Mr. Udall of New Mexico. Can you elaborate on the practical 
effects of this legislation and what it will have on property 
owners who are seeking section 10 permits or consultations 
under section 7 of the Act?
    Ms. Clark. Well, I can venture to guess what will happen. 
If, in fact, this kind of compensation language goes through 
and the compensation, however it is subjectively determined by 
this legislation, is arrived at with the new definitions of 
what compensation is occurs, I would imagine it would eat up 
our entire budget, our entire appropriation, which is not 
suggesting that the rest of the terms and conditions and 
responsibilities of the Endangered Species Act evaporate or go 
away or are suspended. So what we would have is gridlock in the 
Endangered Species Act--with people without permits, agency 
actions that are not allowed to go forward, recovery that is 
not occurring, and suspending and paralyzing implementation of 
the Endangered Species Act.
    All of that results in probably cratering endangered 
species recovery efforts nationwide, because while all of our 
money will be diverted to litigation and compensation, as 
defined in this statute, it will allow us little, if any, money 
to fund our own technical assistance role or our own 
responsibilities to streamline compliance.
    Mr. Udall of New Mexico. Thank you, Mr. Chairman.
    Mr. Hansen. Thank you, Mr. Udall. The gentleman from 
Pennsylvania, Mr. Sherwood, is recognized for five minutes.
    Mr. Sherwood. Did you say ``50,'' Mr. Chairman? Thank you, 
Mr. Chairman.
    And it has been with quite some interest that I have 
listened to the testimony today, and I think that this is the 
right thing to do when you have organizations like the American 
Farm Bureau and the Wilderness Institute and Fish and Wildlife, 
and we are all here together talking about it. I think we need 
to somehow find some common ground, and I don't think we are 
doing that real well.
    Landowners, public citizens, Fish and Wildlife, Democrats 
and Republicans, we would all like to protect our environment, 
and we would all like to protect endangered species, but some 
of us are having a real hard time coming to grip with the 
incongruity of how private landowners do not deserve just 
compensation when we take away their property rights, but the 
public sector, who has the power to issue permits, does deserve 
to get compensation, for instance, for an airline overflight. I 
am not a partisan on either side of this issue, but I think my 
point of view is one that we are going to have to explain to 
the public in general.
    Nobody has helped me today understand why those two issues 
are different. I understand, if we would pass this bill and go 
this way, that it would impact on Fish and Wildlife revenues. I 
can understand where, if they don't have the revenues, they 
won't be able to do a lot of the good work that we know that 
they do. But, still, nobody has helped me understand the basic 
inequality.
    I guess I will direct it to you, Director Clark. Can you 
help me with this?
    Ms. Clark. I can try, and remember, again, I am not an 
attorney, but I will try it from the biologist's point of view. 
First of all, in the airport example that people are using, 
that was not compensation. It clearly was not compensation, and 
it certainly wasn't compensation to the Fish and Wildlife 
Service. Those monies were to protect the public's interest in 
a public refuge, and it is specifically dictated and laid out 
in section 4(f) of the Transportation Act. Those monies will 
never be seen by the Fish and Wildlife Service. They were a 
conduit to kind of replace the--to acknowledge and to address 
the adverse effects on the airport, and so it will replace the 
public's refuge with other public refuge lands. So it is not a 
compensation to the Fish and Wildlife Service.
    The compensation issue, as I understand it, is one that is, 
especially under the statutes, environmental statutes like the 
Endangered Species Act, is one that is debated in the courts, 
and is, apparently, routinely debated in the courts. And it is 
one that the courts and the Supreme Court have grappled with 
for 200 years: What's fair; what's just, and what's 
compensatable? And certainly, if, in fact, the courts determine 
that a takings has occurred on a case-by-case basis, as 
determined by the courts, then compensation is legitimate and 
rightful, and we would agree with that.
    But the confusion that keeps occurring, or the kind of 
intermingling that keeps occurring, between what happened at 
Minnesota Valley National Wildlife Refuge and the Minneapolis 
airport, and the redefinition of takings under this bill, 
should not be mixed because they are apples and oranges. I just 
want to be clear that what happened for Minnesota Valley was 
not a compensation issue; it was a statutory mandate of the 
Secretary of Transportation to not negatively affect or 
negatively impact the public's refuges and parks, whether they 
are State, Federal, or local, for transportation projects, and 
to minimize and mitigate those effects, if, in fact, they could 
not be avoided.
    I don't know if that helped, but that is how I separate it.
    Mr. Sherwood. Well, an attorney I am not, but it would seem 
to me that an equal argument could be made for one of Mr. 
Loop's members who was unable to use their ground because they 
were told it would impact on habitat or a species, that they 
would have--any good attorney could make a case that they need 
to mitigate their loss. And if we can mitigate the loss for a 
public agency, it would seem that we need to mitigate the loss 
of private property.
    And I am not trying to shut the Fish and Wildlife Service 
down. They just redid a creek in my area; it is a wonderful 
job. We had a few problems, but we got a wonderful job.
    So those are the things we have to work out. But I think if 
you don't address this in the general public's mind, it will be 
at the peril of the whole program. Thank you.
    Mr. Hansen. The gentleman from California, Mr. Pombo.
    Mr. Pombo. Thank you, Mr. Chairman.
    Ms. Clark, just to clarify what you were just saying, you 
said that the Fish and Wildlife didn't get the money; they were 
just a conduit for the money?
    Ms. Clark. Well, the notion of compensation, as I 
understand it, is that it would, quote, ``come to the 
landowner,'' for instance. And this issue with the Minnesota 
Valley National Wildlife Refuge, the dollars that were arrived 
at, or the mitigation scheme that was arrived at, was to 
address the adverse effects, as determined under the----
    Mr. Pombo. To mitigate their impact----
    Ms. Clark. Right.
    Mr. Pombo. [continuing] on the refuge?
    Ms. Clark. Right, and it will replace--and it will be used 
for additional land acquisition and facilities to support the 
public's interest in Minnesota Valley National Wildlife Refuge. 
It is not bumping up the refuge budget, but it does come 
through the Fish and Wildlife Service.
    Mr. Pombo. Who is going to administer those new lands?
    Ms. Clark. The Minnesota Valley Refuge is administered by 
the Fish and Wildlife Service.
    Mr. Pombo. And who is going to occupy the new buildings?
    Ms. Clark. The Fish and Wildlife Service.
    Mr. Pombo. So it does go to the Fish and Wildlife Service?
    Ms. Clark. As a conduit for the public--I don't consider 
our 500-plus national wildlife refuges to be the Fish and 
Wildlife Service's refuges. They are America's national 
wildlife refuges. They are the public's refuges. And we happen 
to be the manager of those refuges, but we don't own them.
    Mr. Pombo. All the government belongs to the people.
    Ms. Clark. Right.
    Mr. Pombo. We don't have a debate over that.
    Ms. Clark. That is exactly what I am saying.
    Mr. Pombo. But the money is going to the Fish and Wildlife 
Service to mitigate the impact that the expansion of the 
airport had on one of the lands that you manage?
    Ms. Clark. The money is going through to the Minnesota 
Valley National Wildlife Refuge; you are correct.
    Mr. Pombo. So it does go in there? I think that the 
argument that you are missing in all of this is that, if there 
is an impact on the lands that Fish and Wildlife manages, they 
want to be mitigated for that. They want there to be mitigation 
payments to them, so that they are held whole.
    On the other side of this debate is the private property 
owner who is impacted by actions of the Fish and Wildlife 
Service, who wants you to mitigate your impact on them, and you 
don't think that is fair, or you don't think it is within the 
law. And that is why so many of us say, you know, it should 
only be right that--any impact on the government has to be 
mitigated--so any impact on a private property owner should be 
mitigated. There is nothing in the Constitution saying that you 
have to be held harmless; that you have to be held whole. There 
is something in the Constitution that says private property 
owners have to be.
    Ms. Clark. I agree. I mean, I have never disagreed with the 
notion of, if a court found that the Endangered Species Act 
constituted or resulted in a takings, that the private property 
owners should be compensated. I don't think you have ever heard 
a debate out of the administration on that.
    On the 4(f) issue, the Transportation Act issue, that is 
not what I want or not what the Fish and Wildlife Service 
wants. It is what Congress wrote into law, and obligates the 
Secretary of Transportation, and conditions the Secretary of 
Transportation to do when building a transportation system 
nationwide.
    Mr. Pombo. Fish and Wildlife makes the decision there, and 
Fish and Wildlife makes the decision as to what the impact is, 
if any, on that particular refuge. As a condition that was in 
held in the law, they call in Fish and Wildlife Service to 
negotiate whether or not there is an impact or to discuss 
whether or not there is an impact, and to negotiate mitigation 
costs.
    Ms. Clark. The Secretary of Transportation makes the 
decision on what the ultimate mitigation is. In this particular 
case, it was done in collaboration--the Secretary of 
Transportation, the airport authority, and the Fish and 
Wildlife Service worked to determine the appropriate level of 
mitigation, but Fish and Wildlife Service does not call the 
shots. The Secretary of Transportation has the ultimate 
decision authority.
    Mr. Pombo. Well, but that is not exactly accurate in terms 
of who actually calls the shots. Because we have seen other 
cases in other airports where Fish and Wildlife has denied use 
or denied ac-

tivities because of the presence of endangered species in those 
areas. In this particular area, because there was a sizable 
amount of money, it was worked out that there could be--the 
extension of the runway could happen; the extension of the 
airport could hap-

pen, and the money would come. In other cases there hasn't been 
that low impact or negative impact that you found in this 
particu-
lar case. Fish and Wildlife is the one that makes the decision. 
It

is your biologists; it is your agency who makes the decision as 
to what the impact is, not the Secretary of Transportation.
    Ms. Clark. The Minnesota Valley Refuge issue had nothing to 
do with the Endangered Species Act. There was no endangered 
species. There was, in fact, a null effect call made.
    Mr. Pombo. See, that is where you are not being real 
accurate, because there are endangered species. In your report 
you identify bald eagles; you identify endangered species in 
the area, and you say there is no impact on those. In other 
cases, where there is a nesting bald eagle near a site, you 
have denied the ability for a developer, the private property 
owner, to proceed in those cases.
    Ms. Clark. I understand that, and what I was referring to--
and every case is reviewed individually, and certainly we 
debate and negotiate and get refuted all the time. All I was 
suggesting is that in the Minnesota Valley/the Minneapolis 
airport case, what governed the outcome of that deal was the 
Transportation Act, not the Endangered Species Act.
    Mr. Pombo. That was your hook to get the money.
    Mr. Hansen. The time of the gentleman has expired.
    Let me just say this: As you hear those bells go off and 
see those lights on the back, we have a vote on the budget 
resolution, and in just a moment we will recess, and then 
assemble back, and we will start with the last panel, if that 
is all right with everybody.
    Director Clark, I know you have been very patient. Can I 
just ask you some questions, maybe with a five-second 
response----
    Ms. Clark. Certainly, I will try.
    Mr. Hansen. [continuing] if we could? And then I will get 
out of here.
    I was intrigued by the statement that you made to Mr. Vento 
when he said that passage of this bill was tantamount to 
killing the Endangered Species Act. I can't really understand 
that, except that is kind of an admission that you have got an 
awful lot of private land that you are using for habitat. By 
any chance, do you know how much private land you now have 
habitat? Can you give us a figure on that?
    Ms. Clark. I can't give you a specific figure. I would be 
happy to see if we have that in our records. I do know that 
over 70 percent of our listed species today depend on private 
land.
    [The information may be found at the end of the hearing.]
    Mr. Hansen. What percent was that?
    Ms. Clark. Over 70 percent of listed species today depend 
on private lands for some part of their life cycle, but I don't 
know the amount of acreage.
    Mr. Hansen. So if you extrapolated that, you could almost 
say 70 percent of it was on private ground? I mean, 70 percent 
would be private ground.
    Ms. Clark. Well, it would be a tough extrapolation because 
you don't know whether----
    Mr. Hansen. I know it wouldn't be an accurate 
extrapolation, but it----
    Ms. Clark. It is fair to say that there is a significant 
amount of private lands that are probably occupied by 
endangered species.
    Mr. Hansen. Also, in the letter from the Justice Department 
to Don Young, from the--I don't remember the attorney's name on 
this, Mr. Dennis K. Burke, Acting Assistant Attorney General--
in the first paragraph, he says, ``This bill would create a 
statutory right to compensation to the context of the 
Endangered Species Act regulation. That departs radically from 
the standard for just compensation under the 5th Amendment.'' 
Could you explain that? I can't see where it would depart at 
all.
    Ms. Clark. Unfortunately, this is where my not being an 
attorney is probably a good thing--or a bad thing.
    Mr. Hansen. Attorneys are the most overrated profession in 
America. So take a stab at it.
    [Laughter.]
    Ms. Clark. I am beginning to believe that myself.
    But I would certainly be happy to refer to Justice for 
further explanation.
    Mr. Hansen. Go down to the third paragraph. ``Consistent 
with that position, ESA''--now here is the part I want to ask--
``It has been the policy of this administration to minimize 
impacts on private property.'' I just have a hard time buying 
into that, considering the amount of private property that I 
have seen impacted in the State that I represent. If anything, 
these people feel that they have ruined something that they 
have inherited, or they have purchased, and taken it almost 
with not any regard and in a callousful manner. Am I just an 
exception to the rule? Or is there usually a great working 
relationship with private property?
    When the Secretary of Interior goes down to Iron County, 
Utah, and Washington County, Utah, and this ground now, which 
is probably the highest density for retirement that I know of, 
and this property is going for $50,000 an acre, which is 
unbelievable to me, but it is, and offers them $600 an acre 
because there is a slimy slug on it or a desert tortoise, or 
whatever it may be, I just stand amazed. If that is 
administration to minimize impacts on private property, I would 
surely like to see an example of that.
    Ms. Clark. I would be happy to provide you numerous 
examples of success. Minimizing the impacts on private property 
has really been aimed--we have tried to get there through a lot 
of the administrative reforms that I talked about earlier, like 
safe harbor and candidate conservation agreements, no 
surprises. But we have some tremendous success stories 
nationwide that I will be happy to provide for the record.
    [The information may be found at the end of the hearing.]
    Mr. Hansen. You have talked a lot about mitigation. I don't 
see the term ``mitigation'' in the bill. I see--in 
transportation, but I don't see it in the EPA bill, but I 
haven't got time to get into that because we are going to miss 
a vote, if we don't leave.
    So let me thank the panel, and I appreciate your patience 
and being with us. Director Clark, thank you.
    If you could be patient, we will be back in just a few 
moments. We stand in recess.
    [Recess.]
    Mr. Pombo. [presiding] The Committee will come back to 
order.
    I know you are all familiar with the timekeeping. Your 
entire statements will be included in the record. If you can 
hold your oral testimony to five minutes, it would be 
appreciated.
    Mr. Whitman, if you are prepared, you may begin.

 STATEMENT OF RICHARD M. WHITMAN, ATTORNEY-IN-CHARGE, NATURAL 
 RESOURCES SECTION, OREGON DEPARTMENT OF JUSTICE, SALEM, OREGON

    Mr. Whitman. Thank you, Mr. Chairman. My name is Richard 
Whitman. I am the attorney-in-charge of the Natural Resources 
Section of the Oregon Department of Justice, and I am here 
today testifying on behalf of Oregon Attorney General Hardy 
Myers and the Oregon Department of Justice.
    The State of Oregon has had significant experience, both 
with the effects of listings under the Endangered Species Act 
and with takings litigation resulting from efforts to protect 
at-risk species. Most of the State of Oregon is now affected to 
one degree or another by listings of threatened or endangered 
species.
    Oregon, for quite some time, has had a wide range of State 
and local laws to protect species and their habitat. Many of 
those laws predate the Federal Endangered Species Act. As an 
example, the Oregon Forest Practice Act requires the state to 
inventory significant habitat for threatened and endangered 
species, and to then balance protection of that habitat with 
economic uses of the property.
    Oregon, through such processes, has developed more specific 
protections for at-risk species and their habitat, largely 
through consensus-based processes that involve both affected 
property owners and also involve independent scientific review.
    A fundamental premise of Oregon's approach to species 
protection, extending over several administrations, has been 
that regulatory restrictions on private use of property should 
be used as a minimum or baseline, and beyond that, the State 
should look to voluntary action and to incentives in order to 
achieve public purposes, including the protection of endangered 
species.
    We are currently active in providing such programs, and one 
of the major ones is the Conservation Reserve Program, 
administered through the U.S. Department of Agriculture, 
through which the State has received significant funding for 
farmers to set aside, for a period of 30 years, areas along 
streams to protect fish habitat. I think that is an example of 
the sort of success story that you were looking for earlier 
today.
    Attorney General Myers is concerned that H.R. 1142 would 
undercut some of these success stories and the State's ability 
to continue this type of consensus-based combination of minimum 
regulatory requirements, voluntary actions, and incentives. We 
believe H.R. 1142 would effectively remove Federal agencies 
from any significant role in protecting at-risk species on 
private lands. It would do so by requiring compensation for 
many Federal agency actions on land-based activities and 
essentially all Federal agency actions affecting the use of 
water.
    Faced with this prospect, we believe that the result would 
be that the services would move away from trying to implement 
the ESA on private lands, and we believe that that is not in 
the best interest of anyone, for several reasons.
    First of all, the loss of Federal rules and guidance, 
interpreting the section 9 take prohibition of the Endangered 
Species Act, would create a loss of Federal uniformity and 
would essentially leave it up to the courts to decide on a 
district-by-district basis what is a take of an endangered 
species under the ESA. So we would have a loss of uniformity, a 
loss of predictability for the land-owning community, and we 
would create a significant burden for the land-owning community 
in making long-term investment decisions.
    The withdrawal of the services from implementing the ESA on 
private lands would also be a problem for the States. It would 
thrust the States, even more than they are already, into the 
middle between trying to work with Federal agencies to 
implement protections for Fish and Wildlife, and at the same 
time trying to create consensus among property owners for what 
is reasonable to expect of them.
    We have already seen two court decisions at the U.S. Court 
of Appeals level, one in Massachusetts and one in Florida, 
where the courts have essentially required State agencies to 
use their regulatory authorities in ways that avoid the taking 
of a species. Well, if we have court decisions forcing States 
to do that, on the one hand, on the other hand, we are going to 
have litigation from the private land-owning community against 
States for taking of their property. It is not a good role for 
the States to be in.
    In sum, we believe that H.R. 1142 would not ease the 
regulatory burden on private property rights. It would simply 
shift more regulation to the State level, without providing the 
resources necessary to make that burden more tenable for 
private property owners, and at the same time disrupting the 
complex, but relatively stable, regulatory climate necessary 
for private investment.
    Thank you, Mr. Chairman.
    [The prepared statement of Mr. Whitman follows:]

Statement of Richard M. Whitman, Attorney-in-Charge, Natural Resources 
             Section, Department of Justice, Salem, Oregon

    Hon. Don Young, Chairman, and Members of the Committee:
    Thank you for the opportunity to testify today concerning 
H.R. 1142. My name is Richard M. Whitman, and I am the 
Attorney-in Charge of the Natural Resources Section of the 
Oregon Department of Justice. I am testifying on behalf of 
Oregon Attorney General Hardy Myers and the Oregon Department 
of Justice.
    H.R. 1142 attempts to eliminate the economic burdens that 
may result from the application of the Federal Endangered 
Species Act of 1973 (16 U.S.C. 1531 et seq.) on private lands. 
The State of Oregon has had significant experience in this 
arena, particularly since the listing of the Northern spotted 
owl as a threatened species in 1990, with the listing of the 
marbled murrelet in 1992, and most recently with the multiple 
listings of Pacific salmon and steelhead. Most areas of the 
state are now affected to at least some degree by listings 
under the Federal ESA.
    Well before Federal ESA listings began to occur in Oregon, 
the State was active in efforts to protect habitat for at-risk 
species. Beginning in the late 1970s, Oregon law required 
cities and counties to inventory of significant fish and 
wildlife habitat on all non-Federal lands, and to adopt 
programs to protect such areas while also balancing those 
protections with urban, forest and agricultural uses. In the 
mid-1980s these laws were expanded into Oregon's Forest 
Practices Act, again requiring the protection of significant 
habitat, while also maintaining productive forest uses to the 
extent possible. In 1995, the Oregon Legislature directed the 
Oregon Department of Agriculture to develop proscriptions for 
agricultural practices necessary to achieve state water quality 
standards and (among other things) protect fish life. Most 
recently, in the Portland metropolitan area, the state's 
regional government (Metro) adopted rules regulating urban 
development along most streams. As with agricultural practice 
proscriptions, these regulations are designed to help achieve 
state water quality standards as well as to protect the habitat 
necessary for fisheries.
    One important purpose of these laws is the desire to 
provide private landowners with as much long-term certainty as 
is possible regarding what uses will and won't be allowed on 
private property. Another source of these laws is the State's 
traditional ownership and management of fish and wildlife 
resources.\1\ As in other states across the country, the Oregon 
courts have repeatedly affirmed that wildlife is the property 
of the of the state, held by the state in its sovereign 
capacity to be conserved and protected for the benefit of and 
in trust for its citizens.
---------------------------------------------------------------------------
    \1\ The Oregon Supreme Court held early on that private uses of 
property that destroy habitat essential for the survival of fish and 
wildlife constitute a public nuisance. See, e.g. Columbia River 
Fisherman's Protective Union v. City of St. Helen's, 160 Or 654, 87 P2d 
195 (1939).
---------------------------------------------------------------------------
    Oregon's active role in regulating activities on non-
Federal lands as they affect fish and wildlife also arises from 
the firm belief that the tensions between species' protection 
and economic uses of private property are best resolved at the 
local, state and regional levels, where there is the best 
chance of obtaining some degree of consensus. Only if 
protective measures have a broad base of support at the state 
and local levels are those measures likely to be sustained over 
the long-term.
    As the extent of regulatory restrictions to protect fish 
and wildlife and other public values and resources grows, 
Oregon like many other states is becoming more sensitive to the 
economic burden such restrictions place on private property. In 
developing new programs to respond to continuing declines in 
the populations of various species, Oregon attempts to create a 
broad consensus for regulatory protections that function as a 
minimum threshold or baseline. These regulatory restrictions 
set requirements that are intended to be a reasonable incident 
of property ownership that do not require (as a State or 
Federal constitutional matter) that property owners be 
compensated.\2\ This baseline of regulations is supplemented 
with incentives and voluntary measures that provide additional 
protections for fish and wildlife species, while avoiding 
additional economic burden to property owners. The Federal 
Government has been an important source of assistance to the 
State in helping to fund such incentive programs.
---------------------------------------------------------------------------
    \2\ As Justice Holmes stated in Pennsylvania Coal Co. v. Mahon, 260 
U.S. 393, 413, 43 S.Ct. 158, 67 L.Ed. 322 (1922): ``Government could 
hardly go on if, to some extent, values incident to property could not 
be diminished without paying for every such change in the general 
law.''
---------------------------------------------------------------------------
    The Governor and the Attorney General of the State of 
Oregon support the notion that the economic burden of 
protecting threatened and endangered fish and wildlife is a 
legitimate matter for political (and at some point, legal) 
debate. However, they also are concerned that H.R. 1142 is 
likely to have certain unintended consequences that would 
undermine the purpose of the legislation, as well as the 
states' efforts to manage and protect their fish and wildlife 
resources.
    The first of these unintended consequences stems from 
Section 3 of H.R. 1142, which requires Federal agencies to 
compensate property owners for ``constructive use'' of private 
property. The term ``constructive use'' is broadly defined to 
include (among other things) ``the imposition or enforcement of 
a prohibition of use of non-Federal property the purpose of 
which is to provide or retain habitat for any species of 
wildlife or plant determined to be an endangered species or 
threatened species.'' Section 9 of the ESA already prohibits 
``take'' of listed species. Under the requirement to compensate 
for ``constructive use,'' Federal agencies are highly unlikely 
to adopt rules that directly prohibit particular uses of 
property. Instead, they will (at most) continue to do what they 
have done to date: rely on relatively ambiguous rules 
interpreting the take prohibition in section 9 of the ESA, and 
avoid definitive proclamations concerning what specific actions 
they believe violate the statutory prohibition.
    There are several problems with this outcome. First, the 
uncertainty and ambiguity of the section 9 take prohibition has 
already been a major source of concern in the forest industry 
in the Pacific Northwest, as well as among water users. Indeed, 
a large part of the reason for the State of Oregon's forest 
practice regulations defining minimum requirements for the 
protection of significant habitat for threatened and endangered 
species was the desire of the landowning community to have a 
level of long-term certainty so that they could continue to 
make the forty to sixty-year investment decisions that are a 
necessary aspect of forestry. While the State's regulations may 
not have been as protective as some would have liked to see, 
they do provide some level of assurance that forest practices 
that comply with the State requirements do not result in 
``actual injury or death'' of listed species (e.g. a prohibited 
``take'' under section 9 of the ESA).
    If Federal agencies back away from their statutory role of 
helping to define the requirements of the ESA, that void will 
almost certainly be filled by an increase in litigation brought 
under the citizen suit provisions of the ESA. Such an outcome 
is not in anyone's interest, and could well upset the limited 
degree of predictability that the landowning community and the 
State have achieved over the past eight years. In at least the 
short to moderate term, such litigation also is likely to lead 
to disparate standards between different circuit and district 
courts, as the judiciary is increasingly required to provide 
its own interpretation of the ``take'' prohibition in section 9 
of the ESA in the absence of the Federal agencies.
    Of even more direct concern to the State is the possibility 
that some of this litigation will be directed at State 
regulatory programs. In several recent court decisions, Courts 
of Appeal have held that day-to-day licensing and other 
regulatory approvals by state and local governmental may 
enjoined as a violation of section 9. Loggerhead Turtle v. 
Volusia County, 48 F.3d 1231 (11th Cir., 1998); Strahan v. 
Coxe, 127 F.3d 155 (1st Cir., 1997). Under the ESA, Congress 
has provided citizens with the right to sue for violations of 
the ESA, including the section 9 prohibition on ``taking'' or 
causing a ``take'' of a threatened or endangered species. First 
in Massachusetts (Strahan), and most recently in Florida 
(Volusia County), courts have held that state and local 
governments can be required to exercise their authorities to 
regulate private activities in a manner that avoids actual 
injury or death of protected species.
    If Federal agencies are required to move away from actively 
implementing the ESA, the states and the courts will 
effectively be the only game in town. States will continue to 
be sued to force use of their legislative and sovereign 
authorities to fill the void created by the departure of the 
Federal agencies. They will then be sued by property owners 
alleging that they have ``taken'' private property without 
compensation. The regulatory burden on private property owners 
will not necessarily be eased, and the degree of uncertainty 
over what uses of private property are allowed will almost 
certainly rise.
    These consequences are not idle speculation. When the U.S. 
Fish & Wildlife Service listed the Northern spotted owl, the 
agency initially tried to clarify how the listing affected 
logging operations on private lands through the publication of 
guidelines. Since the time these guidelines were invalidated 
(for procedural reasons) the Service has generally avoided 
taking a definitive position concerning how the ESA take 
prohibition applies to activities on private lands (except in 
the most egregious cases). In part to provide some degree of 
certainty to forest land owners in the face of threatened 
citizen suits, the State adopted its own forest practice 
regulations designed to avoid clear instances of ``take,'' 
while also minimizing burdens to private landowners. Now the 
State is being sued in a number of cases, not for ``take'' of 
species but for ``taking'' private property without 
compensation by denying certain harvest plans in close 
proximity to owl and eagle nests.\3\
---------------------------------------------------------------------------
    \3\ These suits are being brought even though the State's 
regulations affect only a small portion of the ownerships involved. 
None of the cases have been litigated to a final conclusion.
---------------------------------------------------------------------------
    H.R. 1142, by requiring Federal agencies to compensate 
property owners for a very broad range of actions that may 
limit the use of private property, is likely to lead to the 
same dynamic the State of Oregon has experienced with the 
Northern spotted owl. States that are more active in working in 
tandem with the goals of the Federal ESA will bear the brunt of 
litigation alleging that compensation is required. Other states 
will face litigation attempting to force them to exercise their 
licensing and other regulatory authorities to avoid take of 
listed species. The only immediate result for private property 
owners will be a higher level of uncertainty.
    The Oregon Department of Justice is also concerned with at 
least one other specific provisions of H.R. 1142. Section 3(b) 
of the bill requires compensation for Federal agency action 
that result in ``a Federal use of * * * any portion of non-
Federal property * * * .'' This language appears to upset the 
long-established requirement under the Federal and Oregon 
constitutions that an ownership be considered as a whole when 
determining if all or substantially all economic use has been 
taken by regulation. Oregon, as many other states, has long 
regulated the extent to which property owners may divide their 
real property. Oregon's subdivision control laws are a 
fundamental component of the State's zoning laws. By preventing 
the division and sale of real property in a manner that will 
lead to violations of state and local development controls, 
these laws ensure that property owners' reasonable expectations 
align with zoning laws. Section 3(b) appears to thwart the 
traditional rule that State law controls what property 
interests are constitutionally protected. We already have 
property owners asserting that regulations that restrict a 
particular use (the harvest of a relatively small number of 
trees) is a taking. By giving property owners apparent free 
reign to segment their property in any manner they choose, H.R. 
1142 requires compensation for virtually all Federal actions 
and undermines the role of State law in determining what the 
pertinent property interest is in inverse condemnation actions.
    The Federal Government has certain responsibilities 
regarding wildlife and fisheries under its legislative 
enactments and treaty obligations. Similarly, the states as 
sovereign governments owning wildlife as trustees for their 
citizens, are the traditional managers of wildlife protection 
measures and associated land use controls. Both governments, as 
a legal and political matter, must balance these 
responsibilities with private property rights.
    A blanket Federal requirement that Federal agencies 
compensate property owners is not helpful in this context. It 
is likely simply to shift more of the burden of species 
protection to the states, without increasing the resources 
available to make that burden tenable for private property 
owners at the same time it disrupts the complex but relatively 
stable regulatory climate necessary for private investment.
    Simply put, we believe that a far more constructive 
approach to meeting the dual goals of increasing the level of 
protection of threatened and endangered species, and reducing 
the regulatory burden on private property owners is to provide 
affirmative incentives to property owners when they go beyond 
some minimum regulatory threshold that is reasonable to expect 
of all citizens. We respectfully submit that H.R. 1142 is 
unlikely to provide any significant relief to private property 
owners, that it is likely to shift even more of the burden of 
implementing the ESA to the states, and that there are other 
more constructive means to achieve the dual goals of species 
protection and relief to private property owners.
    Compensation for governmental restrictions on the use of 
private property to protect threatened and endangered fish and 
wildlife is not required as a matter of State or Federal 
constitutional law in most circumstances. By legislatively 
mandating compensation in a broad range of cases, H.R. 1142 
would upset the balance between State and Federal roles in this 
complex arena. For these reasons, the Oregon Attorney General 
opposes H.R. 1142.

    Mr. Pombo. Ms. Marzulla.

STATEMENT OF NANCIE G. MARZULLA, DEFENDERS OF PROPERTY RIGHTS, 
                         WASHINGTON, DC

    Ms. Marzulla. Thank you, Mr. Chairman, for the opportunity 
to comment on H.R. 1142. I am here on behalf of Defenders of 
Property Rights. Defenders is the only national public interest 
legal foundation dedicated exclusively to protecting private 
property rights.
    Based upon our review of the proposed bill and our 
extensive experience in representing individual landowners 
whose land or water rights have been destroyed by the 
application of the Endangered Species Act, we conclude that 
H.R. 1142 will go a long way toward protecting the 
constitutional rights of property owners and toward protecting 
endangered species.
    There are two points I would like to emphasize in my oral 
remarks. First, the Endangered Species Act affects the 
reasonable and beneficial use of millions of acres of private 
land. And the second point is that there is often no remedy 
under current law for the wholesale destruction of private 
property rights.
    With respect to the first point, once land has been 
identified as habitat or even potential habitat for an 
endangered or threatened species, the owner can do nothing with 
his land that the U.S. Fish and Wildlife Service does not like.
    So, for example, in the case of Mr. John Taylor, an elderly 
man who owns a building lot in Fairfax County, Virginia, Mr. 
Taylor cannot build even a modest modular home on his land 
because it might disturb the nesting habitat of the threatened 
bald eagle, which has been known to nest on land across from 
Mr. Taylor's building lot.
    Or in the case of the Srnsky brothers, who own a home on 
land located within the national forest near Elkins, West 
Virginia, the Forest Service has not only barred them access to 
their home, but has endangered the lives of Tom and David 
Srnsky by digging 6-foot-deep tank traps. The Forest Service 
told a Federal judge that they believed the tank traps were 
necessary to protect the running buffalo clover. Apparently, 
Forest Service officials are willing to risk even human safety 
in order to protect a plant.
    Local farmers in California have had their water taken, 
causing their crops to dry up because the water was needed as 
habitat for two species of threatened fish. These are not 
isolated examples of the harsh impacts of the Endangered 
Species Act. In fact, the majority, as we know, the majority of 
the habitat designated for endangered species is on privately-
owned land. Once property is identified as habitat or land 
necessary for protecting an endangered or threatened species, 
there are not simple solutions for the property owners, even 
those who lose their constitutional rights as a result.
    Filing a lawsuit for just compensation is hardly an easy 
answer, even though private property rights is one of our 
fundamental civil rights. Takings litigation today is 
expensive, arduous, and lengthy. A Justice Department attorney 
told one of my clients a couple of weeks ago that his case that 
had been filed over a year and a half ago was in its infancy. 
The government attorney told him that takings cases often take 
10 years in order to reach resolution. In other words, it will 
take at least a decade in order to win vindication for his 
constitutional rights.
    Few people have the financial means or staying power to 
endure a decade of litigation against the Federal Government. 
Indeed, in the case of elderly litigants, such as John Taylor, 
who knows if they can survive long enough to see their rights 
vindicated by a court? H.R. 1142 is clearly needed and long 
overdue.
    And then one final point I wanted to address that was 
raised in some earlier discussions by the earlier panel 
concerns the issue of whether H.R. 1142 comports with current 
case law construing the 5th Amendment. I would suggest that 
such case law, while it be interesting and should provide 
guidance, is not controlling. Because, as I understand it, H.R. 
1142 is creating a new statutory cause of action.
    Thank you. I would be happy to answer further questions you 
may have.
    [The prepared statement of Ms. Marzulla follows:]

    Statement of Nancie G. Marzulla, Defenders of Property Rights, 
                             Washington, DC

    I am pleased to be here today on behalf of Defenders of 
Property Rights, the only national public interest legal 
foundation devoted exclusively to protecting private property 
rights. Through a program of litigation, education and 
legislative support, Defenders seeks to realize the promise of 
the Fifth Amendment of the U.S. Constitution, that private 
property shall not be ``taken for public use, without just 
compensation.'' Defenders, which is based in Washington, D.C., 
has a large national membership which is comprised of property 
owners, users and beneficiaries of the rights protected by the 
Constitution and traditional property law. Defenders 
participates in litigation when it is in the public interest 
and when the property rights of its members are affected, and 
has also devoted significant resources to analyzing legislative 
proposals concerning property rights at both the state and 
Federal level.
    Today, I am here to comment on H.R. 1142, the Landowners 
Equal Treatment Act of 1999. By amending the Endangered Species 
Act to make the Federal Government pay for any unconstitutional 
actions it takes under the auspices of that Act, this bill 
seeks to prevent the taking of private property for public use 
without just compensation, as required by the Fifth Amendment 
to the United States Constitution.

INTRODUCTION

    Despite the fact that the United States Constitution 
imposes a duty on the Federal Government to protect private 
property rights, in reality, they are often trammeled by 
regulatory actions, such as those taken by the Federal 
Government under the Endangered Species Act, 16 U.S.C. Sec.  
1531. All too often, environmental regulations such as the 
Endangered Species Act destroy property rights on an 
unprecedented scale, leaving many owners stripped of all but 
bare title to their property. In recent years, courts have done 
much to restore vigor to the Fifth Amendment in cases such as 
Nollan v. California Coastal Commission, Lucas v. South 
Carolina Coastal Council, Dolan v. City of Tigard, and Suitian 
v. Tahoe Regional Planning Agency. Nevertheless, cases in which 
landowners possess the resources and perseverance to prevail in 
court against a taking of the property due to a government 
action are few and far between.
    As a result, landowners are increasingly being deprived of 
most, if not all, economically beneficial uses of their land by 
government action and regulation without payment of just 
compensation. The Founding Fathers' intent for private property 
to be protected was clear. They could never have envisioned, 
however, the enactment of such harsh regulatory schemes as the 
Endangered Species Act. If the Fifth Amendment is going to be 
worth more than the paper it is written on, private property 
rights must be vigorously protected. Therefore, we at Defenders 
of Property Rights welcome legislative efforts such as H.R. 
1142 which are consistent with the constitutional mandate of 
protecting private property rights.

I. THE CONSTITUTION IMPOSES A DUTY ON GOVERNMENT TO PROTECT 
PRIVATE PROPERTY RIGHTS BECAUSE PROPERTY RIGHTS ARE AN 
ESSENTIAL ELEMENT OF A FREE SOCIETY.

    As reflected in various provisions in the Constitution, the 
Founding Fathers clearly recognized the need for vigorously 
protected property rights. They also understood the vital 
relationship between private property rights, individual rights 
and economic liberty. Property rights is the ``line drawn in 
the sand'' protecting against tyranny of the majority over the 
rights of the minority.
    To the framers of the Constitution, the protection of 
individual liberty was essential. The fundamental liberties 
guaranteed by the Bill of Rights include freedom of speech and 
religion; freedom of press and assembly; the right to bear 
arms; the right to trial by jury and cross examination of 
accusing witnesses; and freedom from cruel or unusual 
punishment. Recognizing that a government could easily abuse 
these civil rights if a citizen's property and livelihood were 
not guaranteed, the United States Constitution also imposes a 
duty on government to protect private property rights.
    Thus, within the Bill of Rights, numerous provisions 
directly or indirectly protect private property rights. The 
Fourth Amendment guarantees that people are to be ``secure in 
their persons, houses, papers, and effects. . . .'' The Fifth 
Amendment states that no person shall ``be deprived of life, 
liberty, or property, without due process of law; nor shall 
private property be taken for public use without just 
compensation.'' In addition to the Bill of Rights provisions, 
the Fourteenth Amendment echoes the Due Process Clause of the 
Fifth Amendment, stating that no ``State shall deprive any 
person of life, liberty or property without due process of law. 
. . .'' Indirectly the Contracts Clause of the Constitution 
also protects property by forbidding any state from passing any 
``law impairing the Obligation of Contracts.'' U.S. CONST. art. 
1, Sec.  10.
    The Constitution places such strong emphasis on protecting 
private property rights because the right to own and use 
property was historically understood to be critical to the 
maintenance of a free society. The ability to use, enjoy and 
exclusively possess the fruits of one's own labor is the basis 
for a society in which individuals are free from oppression. 
Indeed, some have argued that there can be no true freedom for 
anyone if people are dependent upon the state for food, 
shelter, and other basic needs. Understandably, where the 
fruits of citizen's labor are owned by the state and not 
individuals, nothing is safe from being taken by a majority or 
a tyrant. Ultimately, as government dependants, these 
individuals are powerless to oppose any infringement on their 
rights due to absolute government control over the fruits of 
their labor.
    Accordingly, it is a founding principle of our nation that 
private land may not be taken for public use (unless it be 
purchased from the owner). This basic principle--that the 
government must lawfully acquire private land rather than 
merely seize it--is predicated upon fundamental notions of 
fairness. As the Supreme Court stated in Armstrong v. United 
States, ``[tlhe Fifth Amendment . . . was designed to bar 
Government from forcing some people alone to bear public 
burdens which, in all fairness and justice, should be borne by 
the public as a whole.'' 364 U.S. 40, 49 (1960).
    The Founding Fathers understood the vital relationship 
between private property rights, individual rights, and 
economic liberty. However, they could never have envisioned the 
growth of government that has occurred of late years. Never 
before have government regulations threatened to destroy 
private property rights on so large a scale and in so many 
different contexts as they do today. In just two short decades, 
the United States has developed from scratch the most extensive 
governmental regulatory programs in history. Environmental 
regulations have become an elaborate web of intricate laws and 
regulations covering every conceivable aspect of property use, 
yet very few recognize the fundamental importance of property 
rights to our Constitution and our system of government under 
law.

II. PROPERTY RIGHTS TODAY ARE UNDER SIEGE FROM ENDANGERED 
SPECIES ACT REGULATIONS THAT HAVE BEEN AND CONTINUE TO BE 
IMPLEMENTED WITHOUT RESPECT FOR OR CONSIDERATION OF PROPERTY 
RIGHTS.

    The 1973 Endangered Species Act (``ESA'') is today regarded 
as one of the most important and powerful environmental laws in 
the country. In 1978, the Supreme Court characterized it as the 
``most comprehensive legislation for the preservation of 
endangered species ever enacted by an nation.'' TVA v. Hill, 
437 U.S. 153, 180 (1978). A large component of the ESA is 
achieved by prohibitions on certain actions by private 
individuals on privately owned land under section 9 of the Act. 
Moreover, fifty percent of the endangered species in this 
country live on privately owned land and endangered species 
habitat is located almost exclusively on private land. 
Therefore, it is not surprising that the government's 
implementation of the ESA has slowed economic growth, taken 
private land without just compensation, and imposed pervasive 
and extreme burdens on local communities throughout the nation. 
Threats of criminal and civil prosecution, vaguely worded legal 
standards, and repeated agency failures to define the 
geographical scope of ESA restrictions have severely depressed 
property values and caused widespread confusion and economic 
losses.
    The regulatory definition of ``harm'' under regulations 
promulgated pursuant to the ``take'' provision in Section 9 of 
the ESA is particularly problematic to landowners. Under 
current regulations, ``harm'' is defined to include 
``significant habitat modification or degradation where it 
actually kills or injures wildlife by significantly impairing 
essential behavioral patterns, including breeding, feeding or 
sheltering.'' 50 CFR Sec.  17.3 (1994). Despite the fact that 
this definition can be read as being limited to the actual 
``taking'' of an individual endangered species, in reality this 
regulation has been used by the U.S. Fish and Wildlife Service 
(``FWS'') to foreclose any use of land that it deems harmful to 
the species as a whole. The current regulatory definition as 
applied allows the Federal Government to prevent use of land 
without regard to the actual presence of an endangered species, 
and without regard to any actual physical injury to any member 
of the species resulting from use of land.
    In this way, FWS has used the ESA's prohibition against 
``taking'' an endangered species or its habitat to assert 
control over a wide range of private activity on private lands. 
Landowners and businesses have been threatened with criminal or 
civil prosecution for clearing a fence of brush, cutting trees, 
using pesticides, or allowing livestock to graze. Although 
there is a permit process which allows activities to proceed 
even if they might ``take'' a species, these permits are time-
consuming and expensive to obtain and require the negotiation 
and funding of ``habitat conservation plans.'' A measure of how 
pervasive and oppressive these restrictions are is that even 
though listed species can be conserved through the purchase of 
habitat with government funding, as well as through the efforts 
of numerous environmental groups, the primary way species are 
conserved is through the regulation of private activity on 
private lands.
    More landowners are also denied the reasonable use of their 
private property as FWS continues to list more and more species 
for protection and summarily prohibits any use of property 
which may affect those species or modify their habitat in any 
way. Faced with the grim prospect of the permit process, 
criminal prosecution, or large fines, the average landowner 
affected by these regulations cannot afford to challenge the 
government's actions. Even the most well-financed and dedicated 
property owners find themselves in a steep uphill battle just 
to get a court to hear their case, not to mention getting the 
government to actually pay just compensation if a court orders 
it. A few examples of reported and pending cases demonstrate 
the struggle faced by property owners when the Federal 
Government's actions under the authority of the ESA threaten to 
destroy all productive use of their land:

         Taylor v. United States
        John Taylor, an elderly, retired builder, recently filed a 
        lawsuit against the Federal Government because for two years, 
        the U.S. Fish and Wildlife Service (``FWS'') has refused to 
        grant him permission to build a modular home on his small lot 
        in Fairfax County, Virginia, unless he agrees to numerous 
        unreasonable conditions to protect an eagle nest located in a 
        tree on a neighbor's property. For example, Mr. Taylor's 
        property remains undeveloped even though he has agreed to 
        refrain from building during the nesting period when the eagles 
        inhabit the nest. FWS insists that he agree to contribute to 
        some of their eagle-related projects, such as new nesting 
        platforms at an Army research facility nearby or a fish 
        restoration project in the upper Potomac, and contribute money 
        to a salmon restoration project (because eagles like to eat 
        salmon).
         U.S. Forest Service v. Srnsky
        On the flimsy excuse that it wanted to protect running buffalo 
        clover, a listed species of plant, the U.S. Forest Service 
        undertook a campaign that placed the safety--and even the 
        lives--of two young West Virginians in danger. Living on a 
        mountaintop, David and Tommy Smsky must traverse a road through 
        Monongahela National Forest to enter and leave their home. The 
        Forest Service dug six foot deep ``tank traps'' in this road at 
        strategic places, trapping these young men atop the mountain 
        for several days. They were also placed under surveillance by 
        armed Federal agents, arrested for alleged trespassing, and 
        scandalously defamed by Federal agents who told neighbors they 
        were ``Skinheads'' and neo-Nazis. The government does not deny 
        this behavior; rather, it defends the behavior in the name of 
        protecting the endangered clover plants through which the 
        Smsky's road runs.
         Sierra Club v. Lujan
        The Edwards Aquifer is a 175-mile long underground conduit 
        which discharges naturally at springs which are the sole known 
        habitat for the San Marcos fountain darter, Comal Springs 
        salamander, San Marcos salamander, and Texas wild rice. In 
        1991, several environmental groups sought an injunction to 
        require San Antonio, the ninth largest city in the country, to 
        obtain its drinking water elsewhere, and to compel the State of 
        Texas to limit other withdrawals from the Edwards Aquifer. In 
        1993, a Federal judge issued the injunction and encouraged the 
        city to build a reservoir system at costs estimated in the 
        billions of dollars. Although the injunction was subsequently 
        modified, it seems clear that San Antonio--despite its 
        undoubted right to extract water under state law--will be 
        required to abandon, at least, a substantial portion of its 
        water rights in order to comply with the ESA.

III. COURTS ALONE CANNOT ADEQUATELY PROTECT PROPERTY RIGHTS BECAUSE 
LITIGATION TO VINDICATE FIFTH AMENDMENT RIGHTS IS A LONG, EXPENSIVE, 
AND ARDUOUS PROCESS.

    To add insult to constitutional injury, the judicial relief for the 
unconstitutional taking of private property is woefully inadequate. It 
is not a sufficient answer to the constitutional concerns raised above 
to suggest that property owners may simply file ``regulatory takings'' 
suits against the Federal Government to recover the value of the land 
so taken.
    The scales of justice are unfairly tipped in favor of the 
government when citizens are faced with the threat of losing their 
property because of regulatory burdens. Not only are the laws drafted 
to ease the litigation burden of the government, but the costs of 
takings litigation can range in the hundreds of thousands or even 
millions of dollars, too high for the average citizen to bear. 
Consequently, many citizens faced with a property rights claim cannot 
pursue a legal remedy under the Fifth Amendment. The government, on the 
other hand, does not face a similar shortage of resources (at least, in 
comparison to the individual property owner), and can often pursue a 
vigorous defense of the case without constraint. Adding to the hardship 
for the individual, procedural hurdles often bar litigation on the 
merits of a property rights claim for anywhere from five to ten years, 
or longer. More specifically, the split of jurisdiction between the 
claims court and the district court, and the unyielding litigation 
posture of the Federal Government deny not only speedy justice, but in 
many instances, all justice to those whose property rights have been 
violated.
    Property owners who believe their property has been taken without 
compensation in violation of the Fifth Amendment immediately have a 
very difficult choice to make. Both the U.S. Court of Federal Claims 
and the Federal district courts have potential jurisdiction over 
takings claims. If a property owner seeks injunctive relief, or a court 
order declaring the government's action invalid, he must file suit in 
the U.S, District Court for his geographic area. If the property owner 
merely seeks compensation as guaranteed by the Fifth Amendment, he must 
file in the U.S. Court of Federal Claims, located in Washington, D.C. 
If the property owner would be equally happy with either relief, he 
would have to file two separate lawsuits in two separate courts, being 
careful to avoid the pitfalls of a Federal statute which prevents the 
property owner from pursuing both suits at the same time. Regardless of 
which claim a property owner pursues, and no matter which court he 
pursues that claim in, the government will defend itself by arguing 
that the petitioner should instead be in a different court. If the case 
is dismissed and re-filed in any other court, the government's first 
defense will be the same--that the original court has the proper 
jurisdiction.
    It is also important to remember that the current state of affairs, 
the maze-like procedures and hurdles a property owner must overcome 
before having his day in court, imposes a heavy burden on those 
constitutional rights. Indeed, Justice Brennan observed that the 
procedural difficulty in vindicating constitutional rights ``exacts a 
severe penalty from citizens for their attempt to exercise rights of 
access to the Federal courts granted them by Congress to deny them 
`that promptness of decision' which in all judicial actions is one of 
the elements of justice.'' County of Allegheny v. Frank Mashuda Co., 
360 U.S. 185 (1959).
    In comparison, nothing like this procedural nightmare exists for 
claimants seeking to enforce any other constitutional rights. If a 
citizen's suit to defend his right to freedom of speech was dismissed 
because he had filed in the wrong court, or if a victim of racial 
discrimination had lost his case because he asked the court for the 
wrong type of relief--imagine how outraged we would be.
    Thus far, the courts, in addition to Congress and the agencies, 
have failed to provide private property rights with the diligent 
protection that the Founding Fathers contemplated. In 1922, Justice 
Oliver Wendell Holmes declared that a regulation that went ``too far'' 
would be recognized as an unconstitutional taking of private property. 
Pennsvlvania Coal Co. v. Mahon, 260 U.S. 393, 415 (1922). Since that 
time, courts have struggled with the question of when a regulation does 
in fact go too far. There has been no clear articulation of when the 
exercise of regulatory authority will violate the Just Compensation 
Clause.
    The Court has identified at least three areas which constitute per 
se violations of the Fifth Amendment. In Hodel v. Irving, 481 U.S. 704 
(1987), the Court held that destruction of the right to devise private 
property violates the Fifth Amendment. In Nollan v. California Coastal 
Commission, 483 U.S. 825 (1987), the Court determined that a property 
regulation which does not substantially advance its avowed governmental 
purpose also constitutes a taking. And, in Lucas v. South Carolina 
Coastal Council, 505 U.S. 1003 (1992), the Court held that destruction 
of all productive and beneficial uses of private property violated the 
Fifth Amendment. Despite these efforts to flesh out Fifth Amendment 
guarantees, there are still many open questions in takings 
jurisprudence.
    As Chief Judge Loren Smith of the Court of Federal Claims has 
pointed out, under our constitutional system it is the function of the 
legislative, not the judicial, branch to balance competing social and 
economic concerns so as to arrive at a definition of ``taking'' which 
need not be re-created in an ad hoc, case-by-case manner each time the 
court is presented with the issue:

        This case presents in sharp relief the difficulty that current 
        takings law forces upon both the Federal Government and the 
        private citizen. The government here had little guidance from 
        the law as to whether its action was a taking in advance of a 
        long and expensive course of litigation. The citizen likewise 
        had little more precedential guidance than faith in the justice 
        of his cause to sustain a long and costly suit in several 
        courts. There must be a better way to balance legitimate public 
        goals with fundamental individual rights. Courts, however, 
        cannot produce comprehensive solutions. They can only interpret 
        the rather precise language of the Fifth Amendment to our 
        constitution in very specific factual circumstances. To the 
        extent that the constitutional protections of the Fifth 
        Amendment are a bulwark of liberty, they should also be 
        understood to be a social mechanism of last, not first, resort. 
        Judicial decisions are far less sensitive to societal problems 
        than the law and policy made by the political branches of our 
        great constitutional system. At best, courts sketch the 
        outlines of individual rights, they cannot hope to fill in the 
        portrait of wise and just societal and economic policy.
    Bowles v. United States, 31 Fed.Cl. 37 (1994). Justices Brennan, 
Scalia, Stevens, and Rehnquist have all remarked in their opinions on 
the inability of the Supreme Court, quite simply, to arrive at any set 
formula for defining when a taking has occurred. The judicial branch 
has, appropriately, deferred to the legislative branch to perform the 
function which the founding fathers envisioned for it under the 
Constitution--to pass legislation which will provide fair and prompt 
remedy when Federal regulation results in a taking of private property 
without just compensation.
    Thus, Congress must revisit the treatment of property rights in 
environmental statutes and regulations and make it clear that property 
rights are to be considered in both the drafting of regulations and the 
implementing of programs. Federal environmental regulatory and 
enforcement agencies must give property rights the respect and 
deference that the Constitution requires.

CONCLUSION

    The complex web of the Endangered Species Act, ripeness 
requirements, and inadequate property rights jurisprudence is 
jeopardizing both the government's ability to foster a free and 
prosperous society and to protect the environment. Effective and 
efficient environmental protection can be consistent with recognizing 
and securing peoples' property rights. The purpose of the Just 
Compensation Clause is not to stop government from acting, but rather, 
to make government realize that when it acts to achieve social good, it 
may also be singling out individual property owners to bear the 
associated costs. If government recognizes and considers these 
disproportionate burdens on property owners, it will be able to both 
protect the environment and respect property rights. The proposed bill, 
H.R. 1142, requires that private property rights are properly protected 
when the Federal Government takes action under the authority of the ESA 
by mandating that agencies ``make every possible effort to avoid, 
minimize, or mitigate impacts on non-Federal property that result in 
Federal use of the property'' and prevents agencies from acting until 
they have obtained written permission of the private property owner or 
paid compensation to the owner.
    I would be pleased to answer any questions you may have concerning 
my testimony.
[GRAPHIC] [TIFF OMITTED] T6932.012

    Mr. Pombo. Thank you.
    Mr. Heissenbuttel. Is that close?

 STATEMENT OF JOHN HEISSENBUTTEL, VICE PRESIDENT, FORESTRY AND 
     WOOD PRODUCTS, AMERICAN FOREST AND PAPER ASSOCIATION, 
                         WASHINGTON, DC

    Mr. Heissenbuttel. Pretty close.
    Mr. Chairman, thank you for the opportunity to testify 
today in support of H.R. 1142. My name is John Heissenbuttel, 
vice president of forestry and wood products for the American 
Forest and Paper Association.
    Congress enacted the ESA to protect threatened and 
endangered species. That is a goal that our association 
supports very strongly. However, support of that goal does not 
mean that the resulting is perfect and immune from review.
    The ESA, in fact, has been updated periodically since it 
was put into place in 1973, most recently in 1988. What AFPA 
seeks is balance and common sense in endangered species 
protection. Our members are united in the belief that the 
national interest is best served by policies that protect 
wildlife along with jobs and the economy.
    As such, we urge reauthorization and updating of the ESA 
based on the valuable lessons we have gained in the 26 years of 
experience with the Act. Six ideas for updating the ESA:

          First, ensure that the best science is used, 
        including thorough peer review and quality control 
        processes. Second, consultation on Federal actions must 
        be prompt and accurate. Third, private landowners must 
        be given reasonable compliance and relief procedures 
        that do not impose an unfair burden for protection of a 
        public resource. Fourth, the recovery plan must be the 
        focus of all management and regulatory efforts on 
        behalf of the species. Fifth, prohibited activities 
        must be defined in a way that avoids speculative 
        enforcement. And, finally, private landowners must be 
        provided incentives to work cooperatively with the 
        government to protect listed species.
    In our view, H.R. 1142 recognizes the inherent inequity of 
the practice of making private landowners solely responsible 
for the costs of protecting endangered species. A statutory 
compensation requirement gives landowners the knowledge that, 
if all else fails, the government will be responsible for the 
public purpose of species protection.
    The mechanism created by H.R. 1142 is essential for other 
incentive measures to work. The bill would allow those who 
believe that they have a stewardship responsibility, as our 
industry does, to work with the law as much as possible, at the 
same time it recognizes that when the demands of the Endangered 
Species Act exceed the ability of the landowner to economically 
cooperate--in fact, the bill establishes public responsibility 
to carry out public goals.
    Now the Committee has chosen to focus on this one update to 
the Endangered Species Act, and we support that effort. 
However, as the chairman well knows, there are other issues 
that need to be updated in the ESA. I would urge the Committee 
to consider updates to the ESA which would complement H.R. 
1142.
    For example--and this has been mentioned in previous 
testimony--in section 10, an incidental take permit process 
requires the landowner to prepare a habitat conservation plan, 
or HCP, focusing on mitigation of take to be caused on the 
listed species by the applicant's activities. While Secretary 
Babbitt has instituted various policies which improve the HCP 
process, legislative changes are necessary to guarantee those 
improvements. We have heard of the no surprises policy--very 
helpful in the HCP process. But the fact is that policy is now 
being challenged in the Federal court system by our friends in 
the environmental community. Unless and until these policies 
are put in the force of law, we have no guarantee, as private 
landowners, that these helpful policies will be able to be 
carried out.
    Again, we support the chairman's continued commitment to 
updating the ESA and protecting the private property rights of 
landowners, wherever and whenever possible. On behalf of AFPA, 
we appreciate the opportunity to testify in support of the 
chairman's bill today. Thank you.
    [The prepared statement of Mr. Heissenbuttel follows:]

  Statement of John Heissenbuttel, Vice President, Forestry and Wood 
  Products, American Forest & Paper Association on behalf of American 
                       Forest & Paper Association

    Mr. Chairman and members of the Committee, thank you for 
the opportunity to testify today in support of H.R. 1142, the 
``Landowners Equal Treatment Act of 1999.''
    I am John Heissenbuttel, Vice President, Forestry and Wood 
Products, American Forest & Paper Association (AF&PA). AF&PA is 
the national trade association of the forest, pulp, paper, 
paperboard, and wood products industry. We represent more than 
200 member companies which grow, harvest and process wood and 
wood fiber, manufacture pulp, paper and paperboard products 
from both virgin and recovered fiber; and produce solid wood 
products. The association is also the umbrella for more than 60 
affiliate member associations that reach out to more than 
10,000 companies. AF&PA represents an industry which accounts 
for more than eight percent of total U.S. manufacturing output. 
It directly employs about 1.5 million people and ranks among 
the top 10 manufacturing employers in 46 states. AF&PA member 
companies, as a condition of membership, must also commit to 
conduct their business in accordance with the principles and 
objectives of the Sustainable Forestry Initiative (SFI)sm 
program.
    The SFIsm program is a comprehensive system of principles, 
objectives and performance measures that integrates the 
perpetual growing and harvesting of trees with the protection 
of wildlife, plants, soil and water quality. It is based on the 
premise that responsible environmental practices and sound 
business practices can be integrated to the benefit of 
landowners, shareholders, customers and the people they serve. 
Professional foresters, conservationists and scientists 
developed the SFI program. These men and women were inspired by 
the concept of sustainability that evolved from the 1987 report 
of the World Commission on Environment and Development, and was 
subsequently adopted by the 1992 Earth Summit in Rio de 
Janeiro. The SFI program participants support sustainable 
forestry practices on the lands they manage and actively 
promote such practices on other forestlands. This commitment to 
sustainable forestry stems from the participants' convictions 
that forest landowners have a critical stewardship 
responsibility to current and future generations of Americans.
    Nationwide, there are more than 9 million non-industrial 
private landowners who own 59 peercent or approximately 288 
million acres of the total productive private timberland. Most 
of these landowners have holdings of less than 100 acres. 
Property rights ``takings'' often hurt these smaller landowners 
who are least able to afford financial loss and own the 
majority of the country's timberland. In comparison, forest 
products companies own only 14 percent of the nations 
timberland, but they rely heavily on the fiber supply provided 
by these small landowners.
    Congress enacted the Endangered Species Act (ESA) to 
protect endangered and threatened species, a goal which we 
support. We believe the principles behind the ESA represent 
those qualities which make our society the finest in the world. 
However, support of that goal does not mean that the resulting 
law is perfect and immune from review. The ESA has been updated 
periodically since its enactment in 1973, most recently in 
1988. Under Congress' own schedule, the law was due for review 
and updating in 1992. That date has long since past and the 
need for action grows each year.
    As its operating premise, the Endangered Species Act 
mandates certain protections of listed species to the point of 
their recovery, without regard to the interaction of these 
protections with the rest of society. Humans are part of the 
diversity of nature and are one of the natural elements that is 
capable of causing change, sometimes dramatic change, in the 
environment. Humans have modified the natural environment in 
North America for hundreds, if not thousands, of years. A 
recent example is the virtual elimination of fire from the 
environment in the Southeast. A number of species, some of 
which are now listed under the Endangered Species Act, were 
dependant on those fires for their existence. It would be sheer 
folly to require by law that these species be recovered because 
that would mean the return of the widespread fires upon which 
the species thrive. Yet, that is the literal mandate of the 
Endangered Species Act.
    AF&PA seeks balance and common sense in endangered species 
protection. Our members are united in their belief that the 
national interest is best served by policies that protect 
wildlife along with jobs and the economy. SFIsm Objective 4 
requires AF&PA members to: ``Enhance the quality of wildlife 
habitat by developing and implementing measures that promote 
habitat diversity and the conservation of plant and animal 
populations found in forest communities.''
    The Endangered Species Act, often called the ``pit bull'' 
of environmental laws, grants sweeping powers and authority to 
Federal agencies for endangered species protection. It is 
weighted heavily in favor of species protection at the expense 
of all other considerations. AF&PA's goal is to make the ESA 
work for species and people. AF&PA urges reauthorization of the 
ESA based on the valuable lessons gained from 26 years of 
experience with the Act.
    Congress should update the Endangered Species Act in six 
key areas:

         ensure that the best science is used, including peer 
        review and quality control processes;
         consultation on Federal actions must be prompt and 
        accurate and, when conducted over a Federal permit required for 
        a private activity, must have a limited scope;
         private landowners must be given reasonable compliance 
        and relief procedures that do not impose an unfair burden for 
        protection of a public resource;
         the recovery plan must be the focus of all management 
        and regulatory efforts on behalf of a species, including 
        consideration of social and economic impacts, relative risks, 
        costs and alternative recovery strategies;
         prohibited activities must be defined in a way that 
        avoids speculative enforcement;
         private landowners must be provided incentives to work 
        cooperatively with the government to protect listed species.
    The Fifth Amendment provides that the government must pay citizens 
just compensation if the government takes their property for a public 
purpose. In 1973, Congress declared protection of endangered species to 
be a proper public purpose. Unlike other environmental laws which 
merely regulate how activities are conducted on private lands, the 
presence of listed species on your land often means that you are unable 
to conduct any activity. It is unfair--it is un-American--to impose the 
cost of carrying a public purpose on a few unlucky citizens. 
Recognizing the importance of protecting wildlife habitat and of 
working cooperatively with the government for the benefit of listed 
species does not abrogate the property rights guaranteed to all 
Americans by the Fifth Amendment to the Constitution of the United 
States.
    H.R. 1142 recognizes the inherent inequity of this practice and 
resolves the unconstitutional burden by requiring Federal agencies to 
obtain written permission from, or provide compensation to, landowners 
when the agency takes an action under the ESA or in furtherance of the 
ESA that results in use of the landowner's property. A statutory 
compensation requirement gives landowners the knowledge that if all 
else fails, the government will be responsible for the public purpose 
of species protection.
    The mechanism created by H.R. 1142 is essential for other incentive 
measures to work. The bill would allow those who believe that they have 
a stewardship responsibility, as our industry does, to work with the 
law as much as possible. At the same time, it recognizes that the 
demands of the Endangered Species Act exceed the ability of the 
landowner to economically cooperate. The bill establishes public 
responsibility to carry out public goals.
    We all understand the importance of our local and national 
transportation systems. At the same time, we also understand that the 
burden caused by the construction of these systems should not be borne 
solely by the few property owners in the path of the road or under the 
flight path. It is the Constitutional obligation of us all, through the 
government, to compensate the few who bear the burden of these public 
benefits. Just as the Federal Government receives compensation for the 
burden on a Fish and Wildlife Service facility caused by airplanes 
landing and taking off at a Minnesota airport, so should landowners 
receive compensation if providing habitat for the benefit of listed 
species becomes burdensome.
    We urge the Committee to consider carefully the particulars in H.R. 
1142. An administrative compensation system, including an arbitration 
mechanism, is not helpful if it merely creates an extensive 
bureaucratic process. We strongly recommend that the Committee consult 
experts on arbitration before giving the bill its final approval.
    The Committee has chosen to focus on this one update to the 
Endangered Species Act, and we support that effort. However, as the 
Chairman well knows, there are other issues that need to be updated in 
the ESA. With AF&PA members' emphasis on stewardship through the SFIsm 
program, I would urge the Committee to consider updates to the ESA 
which would complement H.R. 1142 by addressing stewardship issues as 
well.
    For example, the Endangered Species Act regulates activities of 
private parties and states which do not require a Federal permit or 
funding by prohibiting any action which would ``take'' listed species. 
The law provides, in section 10, an incidental take permit process 
which requires the landowner to prepare a habitat conservation plan 
(HCP) focusing on mitigation of the take to be caused to the listed 
species by the applicant's activities.
    Unfortunately, the HCP process generally is expensive, lengthy, and 
complex. Many land owners simply cannot afford to pursue it. For 
example, the government considers an HCP to be subject to consultation 
as a proposed Federal action under ESA section 7, a process which is 
redundant and which creates several difficulties for the landowner, 
such as ongoing second-guessing by the agency. Also, the authority to 
require mitigation in the HCP and permit is relatively unqualified and 
has resulted in requirements which exceed by several degrees the effect 
of the activity which would be allowed under the permit.
    Given the expense and commitment inherent in an HCP, landowners 
understandably are often willing to address more species than merely 
those listed. The government must recognize the benefit of addressing a 
number of species when the landowner chooses to do so. Current policies 
tend to create impediments to multi-species HCPs. Moreover, the two 
agencies responsible for ESA implementation, the Fish and Wildlife 
Service and the National Marine Fisheries Service, have not applied HCP 
policies in a consistent manner, causing considerable delay and 
frustration among HCP applicants.
    While Secretary of the Interior Bruce Babbitt has instituted 
various policies which improve the HCP process, legislative changes are 
necessary to guarantee those improvements. For example, Babbitt has 
issued a ``No Surprises'' regulation which provides landowners, 
particularly those who depend on continuing access to natural resources 
on their land, certainty when agreeing to conditions in an HCP. 
However, this policy is now subject to a challenge in Federal court. 
We, therefore, also suggest the Committee consider amendments to the 
Endangered Species Act in the following areas:

        provide statutory authority for the ``No Surprises'' policy;
        authorize the Secretary to issue rules providing incidental 
        take relief for categories of actions which would have little 
        effect on listed species;
        recognize that since an HCP provides analyses equivalent to a 
        biological opinion and the agency is consulting with itself, 
        consultation on an HCP is redundant and unnecessary;
        require that mitigation in an HCP be proportionate to the 
        effect on the species of the take authorized by the HCP and 
        permit;
        authorize recognition that the HCP will provide benefits for 
        unlisted species and provide assurance that the permit will 
        cover those species in the event they are later listed without 
        additional mitigation, without the imposition of excessive 
        assessment procedures on the applicant;
        authority should be consolidated in the Secretary of the 
        Interior, at least with respect to implementation of the ESA in 
        non-ocean areas, regardless of the species involved.
    Again, we support the Chairman's continued commitment to updating 
the ESA and protecting property rights of landowners whenever and 
wherever possible. On behalf of the American Forest & Paper 
Association, I appreciate the opportunity to offer our views on H.R. 
1142, the ``Landowners Equal Treatment Act of 1999.'' I would be happy 
to answer any questions you may have.

    Mr. Pombo. Thank you.
    Mr. DeGennaro.

STATEMENT OF RALPH DEGENNARO, EXECUTIVE DIRECTOR, TAXPAYERS FOR 
                  COMMON SENSE, WASHINGTON, DC

    Mr. DeGennaro. Mr. Chairman, thank you for the opportunity 
to testify before this Committee today. My name is Ralph 
DeGennaro. I am executive director of Taxpayers for Common 
Sense. We are a nationwide budget watchdog organization 
dedicated to cutting wasteful government spending and subsidy 
programs and promoting a balanced budget. We are politically 
independent, nonpartisan, seek to reach out to taxpayers of all 
political persuasions to work toward a government that costs 
less, makes more sense, and inspires more trust. We receive no 
government grants or contracts. We have never engaged in any 
litigation, except for rare friend-of-the-court briefs.
    Taxpayers for Common Sense respectfully opposes H.R. 1142. 
We believe this proposal would establish a new entitlement 
program that would only increase the burden upon taxpayers. 
Rather than creating this complex, new Federal spending direct, 
it is TCS's belief that there are simpler and more effective 
ways of dealing with the problems addressed by this proposal.
    For example, if advocates of this proposal want to repeal 
or modify the Endangered Species Act, then they should move to 
do so directly, as it is under the jurisdiction of this 
Committee, instead of imposing a takings spending program on 
the taxpayers. In short, if the Endangered Species Act is 
broken, then fix it or repeal it; do not enact H.R. 1142, which 
we believe would endanger the taxpayers.
    I note that one of the folks from the National Wilderness 
Institute, who testified on one of the earlier panels, 
basically, said that their report showed that the Endangered 
Species Act had completely and utterly failed. If that is true, 
then the Committee should repeal it, not impose a cost on the 
taxpayers.
    Taxpayers for Common Sense believes in property rights and 
the payment of just compensation under the 5th Amendment. 
However, there is already a venue in which to pursue these 
claims: the judicial system. Again, if the courts are broken, 
then fix the courts, a matter under the jurisdiction of the 
Judiciary Committee.
    Passage of H.R. 1142, or similar legislation, would 
circumvent the judicial system and allow compensation to be 
awarded to individuals and others that have thus far had no 
justifiable takings claim. It would go significantly beyond the 
scope of traditional court decisions. As Justice Holmes notes 
in 1922, quote, ``Government could hardly go on if, to some 
extent, values incident to property could not be diminished 
without paying for every such change in the general law.''
    Let's look at the budget implications. Nobody should vote 
for this bill under the illusion that it would be no big deal 
in the Federal budget. It is true that compensation payments 
under H.R. 1142 would be from appropriations, but enactment of 
this bill would create a legitimate expectation of 
compensation. Indeed, the only thing worse than enacting this 
bill would be for Congress to enact it with the intention of 
somehow avoiding paying every penny of every claim qualified 
under its terms.
    Because Congress would, of course, want to keep its 
promise, want to pay those claims, this would, in essence, 
create an entitlement program. Indeed, the cost of this new 
spending program would be almost impossible to control or 
predict, but would surely reach billions of dollars. How would 
this be handled? Probably through more supplemental 
appropriations bills, which are already among the most abused 
parts of our budget process.
    H.R. 1142 would establish broader criteria for filing 
takings claims. Historically, the courts have based 
compensation for claims on the value of the entire property. By 
allowing compensation for impacts on only a small fraction of 
the property, it would provide an ill-defined nature that would 
undoubtedly result in unwarranted compensation, and possibly 
overcompensation. Let's look at three possibilities.
    First, speculation on fair market value. Property owners 
would be compensated for the fair market value of their 
property without regard to the presence of any species 
protected under this Act. Accordingly, speculators could buy 
land for a price already reduced with good knowledge that 
Endangered Species Act regulations applied to that land. The 
speculator could then demand compensation for full market 
value. That is an abuse.
    Secondly, claims for compensation could be filed for 
development that never would have occurred. The bill would 
allow property owners to file claims to want to develop an 
affected parcel in order to receive compensation, even if that 
person never had had the intention or resources of developing 
the land.
    Finally, third--and I think this is the most outrageous 
section of the bill--it would allow property owners to be 
compensated for the right to use or receive water, and for 
compensation for any diminution of water. The bill would 
mandate compensation of property owners for the fair market 
value of water that they receive at subsidized rates from the 
taxpayers.
    For example, in the California Central Valley, a couple of 
years ago, contract rates for water ranged from $3.50 to $7.50 
per acre foot, but the fair market value of that same water 
ranges from $100 to $250 per acre foot. Taxpayers for Common 
Sense would argue that, if this bill is enacted, it ought to 
have an amendment on there that says that those who are 
currently receiving water at less than the fair market value 
should be paying that price for the water.
    Finally, and most broadly, this bill would set a precedent 
and open a slippery slope. Why is the Endangered Species Act 
special? It really isn't. Is it any worse than wetlands laws? 
Is it any worse than the Clean Air Act? Is it any worse than 
the airline safety laws? Does it impose any more burdens on 
private parties than Federal deposit insurance laws? No. I 
think, in fairness, if we are going to compensate those who 
feel they have takings under the Endangered Species Act, then 
Congress ought to be enacting broader legislation that 
compensates everybody who feels like they have any diminution 
of value from any Federal law. That would be hundreds and 
hundreds of billions of dollars.
    Thank you.
    [The prepared statement of Mr. DeGennaro follows:]

Statement of Ralph DeGennaro, Executive Director, Taxpayers for Common 
                                 Sense

    Good afternoon. Mister Chairman thank you for the 
opportunity to testify before this Committee. My name is Ralph 
DeGennaro and I am the Executive Director of Taxpayers for 
Common Sense (TCS).
    TCS is dedicated to cutting wasteful government spending 
and subsidies and keeping the budget balanced through research 
and citizen education. We are a politically independent 
organization that seeks to reach out to taxpayers of all 
political beliefs in working towards a government that costs 
less, makes more sense and inspires more trust. Taxpayers for 
Common Sense receives no government grants or contracts. TCS 
has never engaged in litigation, except for ``friend of the 
court'' briefs on rare occasions.
    TCS opposes H.R. 1142, the Landowners Equal Treatment Act 
of 1999. TCS believes that this proposal would establish a new 
entitlement program that would only increase the burden upon 
taxpayers. Rather than creating a complex new Federal spending 
program, it is TCS' belief that there are simpler and more 
effective ways of dealing with the issues raised by this 
proposal. For instance, if advocates of this proposal want to 
repeal or modify the Endangered Species Act, then they should 
move to do so directly, instead of imposing a takings spending 
program on the taxpayers.
    Taxpayers for Common Sense believes in property rights and 
the payment of just compensation under the Fifth Amendment of 
the Constitution. However, there is already a venue in which to 
pursue these claims: the judicial system.
    The passage of H.R. 1142 or similar legislation would 
circumvent the judicial system and allow compensation to be 
awarded to individuals and corporations that, thus far, have 
had no justifiable ``takings'' claim. This legislation goes 
beyond the scope of traditional court decisions, in that the 
courts have generally not allowed a takings claim simply for 
diminution in value of the property. In the 1922 Supreme Court 
case that created the notion of a ``regulatory taking'', 
Pennsylvania Coal Co. v. Mahon, Justice Holmes noted that 
``government hardly could go on if to some extent values 
incident to property could not be diminished without paying for 
every such change in the general law.''\1\ This principle was 
recently reaffirmed in the Concrete Pipe case in 1993, when the 
Supreme Court unanimously ruled that diminution in value by 
itself is insufficient to demonstrate a taking.\2\
---------------------------------------------------------------------------
    \1\ Pennsylvania Coal Co. v. Mahon, 260 U.S. 393,413 (1922).

    \2\ Concrete Pipe & Products v. Construction Laborers Pension 
Trust, 508 U.S. 602, 645 (1993).
---------------------------------------------------------------------------
    Indeed, as former Office of Management and Budget Director 
Alice Rivlin testified in 1995, bills similar to H.R. 1142 ``go 
far beyond longstanding constitutional tradition . . . and . . 
. seek to pay people to obey the law.''\3\
---------------------------------------------------------------------------
    \3\ Alice M. Rivlin, Prepared testimony before the Senate 
Environment and Public Works Committee, July 12, 1995, p. 1.

H.R. 1142 Would Create New Uncontrollable, Unpredictable 
---------------------------------------------------------------------------
Entitlement Program

    Nobody should vote for this bill under the illusion that it 
will be no big deal in the Federal budget. It is true that 
compensation payments pursuant to H.R. 1142 would be 
technically ``subject to the availability of appropriations.'' 
But enactment of H.R. 1142 would create a legitimate 
expectation of compensation. The only thing worse than enacting 
H.R. 1142 would be for Congress to enact it with the intention 
of somehow avoiding paying every penny of every claim qualified 
under the terms of H.R. 1142. Because Congress would of course 
want to keep any promise implied in H.R. 1142, enactment of the 
bill would in essence create an entitlement program.
    The cost ceiling of this new spending program would be 
almost impossible to control or predict. Federal agencies would 
be overwhelmed by claims. The Budget and Appropriations 
Committees would ultimately be responsible for writing and 
approving funding bills that somehow both allocated money to 
ongoing activities and paid compensation claims. Doing this 
within any set budget caps would be almost impossible.
    Furthermore, this payment scheme would have significant 
unintended consequences and likely lead to more supplemental 
appropriations bills to pay unexpectedly large claims. 
Supplemental appropriations bills are already among the most 
abused aspect of the budget process, and H.R. 1142 would likely 
make it much worse.

H.R. 1142 Would Leave the Government Liable for Hundreds of 
Millions, if Not Billions

    TCS believes that the true cost scenario could conceivably 
have no limit. In 1995, the Congressional Budget Office stated 
that for S. 605, the Omnibus Private Property Rights Act of 
1995, CBO had ``no basis for estimating the additional amount 
of compensation that the government might have to pay for cases 
where property owners choose to pursue larger claims in 
court.'' \4\ Although this statement was in reference to 
legislation that applied to a greater number of programs, it is 
still applicable to a bill that targets only the Endangered 
Species Act, due to the broad criteria for compensation 
established in H.R. 1142.
---------------------------------------------------------------------------
    \4\ U.S. Congressional Budget Office, ``Cost Estimate for S. 605, 
Omnibus Property Rights Act of 1995,''

H.R. 1142 Would Establish Broader Criteria for Filing 
---------------------------------------------------------------------------
``Takings'' Claims

    Historically, the judicial branch has based compensation 
for claims on the value of the entire property. H.R. 1142 would 
require compensation for impacts on only a small fraction of 
the property. The bill would require the Federal Government to 
pay a property owner when Federal agency action reduces the 
value of the affected portion of the property by 25 percent or 
more. For example, if a coal mine is allowed to mine 99 percent 
of its area and is required to stop mining in 1 percent of its 
area due to ESA regulations, then the company could still sue 
if that 1 percent met the standards of diminishment. Using this 
calculation would almost always result in a taking, even if the 
value of the property as a whole had stayed the same or risen. 
This loose standard would invite manipulation of the system at 
taxpayer expense.
    The ill-defined nature of H.R. 1142 would undoubtedly 
result in unwarranted compensation, and possibly 
overcompensation in certain cases. Let's look at three 
possibilities:

Speculation on ``Fair Market Value''

    Property owners could be compensated for the ``fair market 
value'' of the property ``without regard to the presence of any 
species protected under this Act.'' Accordingly, speculators 
could buy land for a price already reduced by good knowledge 
that Endangered Species Act regulations applied to certain 
sections of the land. The speculator could then demand 
compensation for ``full market value'' of the land because the 
agency would not be allowed to take the ESA regulations into 
consideration.
    Furthermore, the Federal regulatory programs that are often 
alleged to infringe on property rights, such as ESA, were 
initiated over 25 years ago. In a December 1998 report, the CBO 
stated that ``arguably, anyone who bought property since then . 
. . should have known, to varying extents, that the property 
was or might be subject to regulation.'' Many of those owners 
may have bought their property at a discount that reflected the 
incidence or risk of Federal regulation.''\5\
---------------------------------------------------------------------------
    \5\ U.S. Congressional Budget Office, ``Regulatory Takings and 
Proposals for Change,'' prepared December 1998, p. xiii.

---------------------------------------------------------------------------
Claims for Development That May Never Have Occurred

    Takings legislation could also allow property owners to 
file claims for development that might never have occurred. 
Under H.R. 1142 and similar bills, a property owner would only 
have to claim to want to develop affected parcels in order to 
receive compensation. For example, it is probably true that 
many landowners do not want to harvest timber on their land. 
However, H.R. 1142 would allow all landowners to claim they 
want to harvest timber on their land and they should be 
compensated because they cannot do so.

Water Claims

    Perhaps the most outrageous section of H.R. 1142 allows 
property owners to be compensated for the ``right to use or 
receive water.'' This section would extend additional 
protections to recipients of federally subsidized water at 
significant expense to the taxpayer. Thus far, takings claims 
in regard to the right to receive water have been relatively 
unsuccessful. H.R. 1142, like previously proposed takings 
bills, would mandate compensation for ANY diminution of water. 
This kind of claim has already been rejected by the court 
system, specifically by the Ninth Circuit Court of Appeals in 
the 1995 Westlands Water District case.
    The provisions governing water rights as property in H.R. 
1142 would allow for further subsidization of agricultural 
water users. The bill would mandate compensation of property 
owners for the ``fair market value'' of water that they receive 
at subsidized rates. As there is a significant difference 
between what water users pay for the water at subsidized rates 
and ``potential compensation awards,'' this provision of H.R. 
1142 could represent enormous costs to taxpayers. For example, 
as Senator Feingold cited in his 1996 dissenting views, in 
California's Central Valley, the contract price for water 
ranged from $3.50 to $7.50 per acre foot. However, the fair 
market value of that same water ranged from $100 to $250 per 
acre foot (Sen. Rpt. 104-239). This difference could hold the 
government and taxpayers liable for millions. TCS would argue 
that if this bill were to become law, all water users should be 
required to pay fair market value for the water they receive 
before there is any ``taking.''

H.R. 1142 Sets A Precedent

    H.R. 1142 would set a precedent that could lead to 
enactment of broader takings legislation that would target any 
number of Federal statutes. In fact, history has shown this to 
be true. In the 104th Congress, the House passed a similar bill 
that targeted the Endangered Species Act, the Clean Water Act, 
and certain irrigation laws. After that bill's passage in the 
House, the Senate introduced and passed out of the Judiciary 
Committee S. 605, the Omnibus Private Property Rights Act of 
1995, which set virtually no limits on takings claims.

    Mr. Pombo. Thank you. Mr. DeGennaro, I will just start with 
you.
    I agree with you on your last point, that Congress ought to 
pass broader legislation to compensate owners for all laws and 
their takings. In fact, the House did pass such legislation a 
few years ago with a two-thirds majority vote out of the House, 
and the bill was never taken up in the Senate. But at this 
time, under the Endangered Species Act, this is legislation 
that this Committee has jurisdiction over. But I do agree with 
you that it should be broader in terms of compensation.
    Mr. DeGennaro. Mr. Chairman, of course, my point was that 
we shouldn't start on that slippery slope at all, pursuing----
    Mr. Pombo. I know what your point was. I know what your 
point was, but I think the slippery slope was started when our 
Founding Fathers signed their name onto the Constitution and 
put the Bill of Rights, the first 10 amendments to it. I know 
that there are people that feel that this is a slippery slope, 
but I hold it in much higher regard than that.
    In terms of your three examples citing abuses of this, I 
don't know how familiar you are with appraisals and fair market 
value of property. The speculative value on a piece of property 
is not the fair market value of that property. You can buy one 
of Mr. Heissenbuttel's member's land in the middle of a forest 
in California and say that you want to build a 100-story 
highrise on it and that is your intention, and you go in and 
get a fair market value of that property. No appraiser in the 
country is going to value it as if you could have put a 100-
story highrise building on it. All it is is what it is, and 
that is the fair market value of it.
    It is kind of a strawman to put up--to say that people will 
say that they are going to develop something and want the 
develop value of that property, when there is no chance that 
that property would have ever been developed. Coming from a 
State like California, I am somewhat familiar with the 
challenges in developing land, and the appraised value of those 
properties is dependent upon the ability to do that.
    In terms of water, many States include water as a property 
right. In this country, water is governed by the States; at 
least in the West it is governed by the States, not by the 
Federal Government, and many States consider it a property 
right. If you are taking water away from a piece of property, 
especially in the West, you are devaluing that piece of 
property, and taking value away from that. Most of these people 
that have bought that have bought with it that water right 
attached, and if you take that water right away, you are taking 
away part of their bundle of property rights away from them. 
That is why many people are so concerned about that.
    I would like to ask you a question, and I have read a lot 
of stuff that your organization has put out. But one thing I 
haven't seen was that it is very difficult for Fish and 
Wildlife, or anyone else, to bring forward successes of the 
Endangered Species Act. It is very difficult, very tortured for 
them to say, this is what we have gotten for our money.
    They spend somewhere in the neighborhood of between $500 
and $800 million a year. Have you come out, has your 
organization come out, in favor on behalf of the taxpayers of 
repealing or reforming the Endangered Species Act because of 
the waste of money that is currently under that system?
    Mr. DeGennaro. No, we have taken no position on that 
question. I would be glad to look at that and try to get back 
to you about that.
    Mr. Pombo. Well, I would appreciate that. It seems there 
are a lot of wastes of government money that are out there.
    [The information may be found at the end of the hearing.]
    Mr. DeGennaro. Mr. Chairman, about your earlier point, you 
note that States govern the water, and I am sure that is true 
in large part. It is fair to say that Federal taxpayers do 
subsidize water. I think with respect to the taxpayers who pay 
those costs, that is something that should be considered in the 
mix.
    Mr. Pombo. It absolutely should be considered, and I will 
agree with you on that point, that it should be considered. I 
know if you were aware--you bring up the Central Valley 
Project, and I am not sure if you are aware that many of those 
property owners had prior water right that was given to the 
Federal Government in exchange for a water contract of water 
that was going to be delivered by the Central Valley Project. 
So they gave up their water right in exchange for a water 
contract. That water contract is pertinent to the land that 
comes with it. So if it costs the Federal Government a 
substantial amount of money--and it did cost hundreds of 
millions of dollars to develop that project--they got the 
water. The Federal Government had no water. They got their 
water by taking water right away from individual property 
owners in exchange for water contracts. That is where the water 
came from.
    Now there has been a substantial amount of money that has 
been spent by the taxpayer, and I do concede to you that that 
is legitimate point, but when you go out and buy land in the 
Central Valley of California, you are buying land with water or 
you are buying land without water. If you are buying it with 
water, you are paying two or three times as much, and sometimes 
considerably more than that, because you are buying that water 
right or that water contract that is pertinent to it.
    If the Federal Government steps in and says, ``We changed 
the rules. We are taking the water away from you,'' you have 
taken something away from that individual property owner, who 
happens to be a taxpayer as well.
    Mr. DeGennaro. Yes, we would be delighted to receive market 
value for water provided by Federal projects.
    Mr. Pombo. Well, that is a considerable amount of money. 
And if that is what we could get for it, we would gladly take 
it, I can guarantee you.
    Mr. Duncan.
    Mr. Duncan. Thank you, Mr. Chairman.
    I have a quote here from a former fish and wildlife 
administrator for the State of Texas, who said that, quote, 
``The incentives are wrong. If I had a rare metal on my 
property, its value goes up, but if a rare bird occupies the 
land, its value disappears.'' We have got to turn it around to 
make the landowner want to have the bird on his property.
    Do any of you have any comments about that? Is there a way 
to provide incentives for people to do good things with their 
land without just the government coming in and taking things, 
at great expense to the taxpayers?
    Mr. Heissenbuttel. Just a couple of ideas: I mentioned the 
no surprises policy that Secretary Babbitt has developed, a 
good idea. It would be better if it was based on law rather 
than regulation. That has helped make habitat conservation 
plans more affordable for both large and small landowners, and 
it takes away the terror of investing in a habitat conservation 
plan, only to find that another species shows up down the road. 
So there are opportunities to take away the terror of finding a 
listed species on your property.
    Mr. Duncan. We were talking a few minutes ago, and I was 
discussing the fact that today over 30 percent of the land in 
this country is owned by the Federal Government, and another 
little over 20 percent is owned by State and local governments 
and quasi-governmental units. That amount has been growing in a 
very rapid way in the last 20 or 30 or 40 years. We don't seem 
to have gotten the message out that a very important part of 
our prosperity has been based on private property, and that is 
one of the things that has differentiated our economy from that 
of places like the former Soviet Union, for example.
    Mr. DeGennaro, I can tell you, there are very few Members 
of Congress who have voted against more Federal spending than I 
have. That has put me on the same side with your group on many 
occasions.
    The reason I do that is not out of any selfishness or 
anything, but, you know, we forget up here, because we read 
about the salaries of these athletes, and this is a very upper-
income area up in this area, but we forget that the average 
person in this country is making less than $25,000 a year, and 
I am not talking about in poverty areas. The typical family is 
a husband and wife both working, grossing $45,000 or $50,000 a 
year--maybe. After taxes and so forth, that doesn't leave them 
a lot of extra money.
    So what I see happening, though, is these environmental 
extremists, who almost always come from very wealthy families 
or very wealthy backgrounds, seem to want government units, 
whether Federal, State, or local, to take over more and more 
and more property. So I can you tell you, I wish that we didn't 
have to have a bill like this. What I wish is that I wish the 
government at all levels would stop taking so much property in 
the first place. The fact is the Grace Commission, several 
years ago, recommended that the Federal Government sell off 
much of its land. Yet, you can't get these extremists to agree 
for the Federal Government to sell hardly anything. I mean, 
they shout in horror.
    But since your group calls itself a taxpayers' group, would 
you be in favor of the Federal Government selling off some of 
this land, so we could get some money back for the taxpayers?
    Mr. DeGennaro. We would be willing to look at proposals to 
do that. I would say, we do recognize--I don't think you 
disagree with this, and I appreciate your leadership on many 
taxpayer issues--we do recognize that some of these lands are 
taxpayer assets that we hold in common. So I don't think we are 
opposed in principle to the idea that the taxpayers together, 
as a community, as a country, own things.
    Now if there are specific proposals to sell specific things 
for specific reasons, I think we would be very glad to look at 
that.
    Mr. Duncan. Well, I just think we are getting to a 
dangerous point here. I mentioned State and local governments, 
but there are these quasi-governmental units. In my area that 
is a big thing, and that doesn't count as Federal, State, or 
local land, but it is the same as public ownership. If you keep 
doing away with more and more and more private property, you 
are going to slowly destroy a big part of the American dream. 
People aren't going to be able to buy homes except on cookie 
cutter lots. You are going to force more and more people into 
smaller and smaller areas. That is going to create pollution 
problems and traffic problems and crime problems.
    I mean, we really hope, Ms. Marzulla, that your 
organization is starting to call attention to the fact, because 
this is a message that I think we really need to get out to the 
American people--that we are really doing away with private 
property in this country in a fairly rapid way. Are you 
concerned about that?
    Ms. Marzulla. Very much so. In fact, I would add one 
additional thought, in addition to our basis of economic 
prosperity. Private property is really our basis of freedom----
    Mr. Duncan. That is right.
    Ms. Marzulla. [continuing] particularly, when you look at 
the division of ownership of Federal and State land. Justice 
O'Connor, in one of her decisions that she authored for the 
Supreme Court about 10 years ago, made it very clear that the 
State and local ownership of land versus even Federal ownership 
of land helps protect individual liberties. So the ownership of 
private land, and even local ownership of land, all devolves to 
the protection of the individual. So it is a very important 
point.
    Mr. Duncan. Well, and I will tell you another thing that we 
need to emphasize, also, is that the worse polluters in the 
world have been the socialist and communist countries. It is 
just a natural human tendency that people take better care of 
land that is in private ownership than they do land that is in 
public ownership, and, boy, you can see example after example 
of that. I mean, these housing projects that we had to blast 
down after 20 years in existence, even though they had been put 
up at huge expense, private property is good for the 
environment, but we don't seem to have gotten that message out, 
either, or we have trouble getting it out.
    Thank you. Thank you very much.
    Mr. Pombo. Mrs. Chenoweth.
    Mrs. Chenoweth. Mr. DeGennaro, is your office here in 
Washington?
    Mr. DeGennaro. Yes.
    Mrs. Chenoweth. Do you spend most of your time in 
Washington?
    Mr. DeGennaro. Yes.
    Mrs. Chenoweth. Do you get out to the Northwest very often, 
to our western country?
    Mr. DeGennaro. Not very often; certainly, not as much as 
you.
    Mrs. Chenoweth. You have quite an interesting background: 
budget analyst for Friends of the Earth, and now you published 
the Green Scissors report.
    Mr. DeGennaro. We are the lead co-author; the lead author 
of that report is Friends of the Earth.
    Mrs. Chenoweth. And didn't you just recently publish a new 
Green Scissors report advocating tearing out the dams on the 
Columbia and Snake River?
    Mr. DeGennaro. Yes. No, I am not trying to distance myself 
from the Green Scissors report. I am just trying to give credit 
to the lead organization on the report. But we stand behind 
that report, and we agree with its recommendations. Yes, we 
did.
    Mrs. Chenoweth. I find your questions about water and the 
value of water, which is pertinent to the land, interesting, 
because there is an economic dynamic I don't think you have 
considered at all. The fact is that most of those retaining 
facilities, those dams, have been paid off a long time ago by 
ratepayers or irrigators in the Northwest. Now, unlike the 
California Valley Project, as it has been altered by CVPIA, the 
ratepayers and the irrigators in the Northwest have paid off 
the facilities to the Corps of Engineers and to the Bureau of 
Reclamation. To advocate tearing out facilities that are still 
very, very good, and still supply low-cost hydropower and 
irrigation to the Northwest, at great cost to the ratepayers, 
to the irrigators, to the entire Northwest, seems ludicrous to 
what your organization stands and in a juxtaposition to what 
your organization stands for.
    So I appreciate Mr. Pombo's response to you about water, 
because I clearly don't believe that this decision and 
recommendation by Green Scissors was very thoughtful in terms 
of its economic impact.
    Mr. DeGennaro. Right. I would be very glad to elaborate on 
the taxpayer rationale for removing the four Lower Snake River 
dams.
    First----
    Mrs. Chenoweth. Well, I don't want to----
    Mr. DeGennaro. Okay.
    Mrs. Chenoweth. [continuing] get into that right now. I 
have some other questions that I would like to ask you, but I 
would love to discuss that with you very seriously, because I 
think there are some economic impacts you haven't considered.
    Mr. DeGennaro. One thing there, I think, just to highlight, 
that may be of special interest to you, is that, under some of 
the current projections, more and more water would need to be 
taken out of the Snake River to augment the flows, or something 
like that, and that could be a significant impact on southern 
Idaho. I think removing the dams would actually protect the 
water in southern Idaho.
    Mrs. Chenoweth. Actually, the dams are almost a whole State 
away from southern Idaho. I live out there, and I would love to 
be able to discuss it with you.
    Your testimony states that the bill would expose the 
government to billions of dollars of liability. Are you telling 
this Committee that there are billion of dollars of privately-
owned property that the government is using as habitat for 
wildlife against the wishes of the owners, and without 
compensating these owners for public use? And do you think that 
is right? Do you think that is fair?
    Mr. DeGennaro. No, what I would say, that the provisions of 
the bill are so loosely drawn, and I stated that there are 
three, at least three, examples here where we believe there 
would be significant overcompensation. In other words, people 
would be compensated in cases where they should not be. That is 
what gives you a price tag into the billions.
    Mrs. Chenoweth. Well, actually, I don't think that you 
really understand what this bill is doing, because this bill 
isn't based on the concept of taking or of diminished value of 
property. It is really based on the concept that, if the 
government uses privately-owned property for the benefit of the 
general public, and for a very laudable goal, delineated any 
public purpose, it should compensate the owner for the use of 
their property.
    Now would it be your position that, when the Federal 
Government chooses to use private property for any public 
purpose, the owners are not entitled to be compensated? For 
example, if the government needs a place to house refugees from 
Kosovo in the near future, can they bring them into this 
country and allow them to use your home, your personal home, 
and your property as a place to stay, without your permission 
and without compensating you? Is that your position?
    Mr. DeGennaro. Of course not.
    Mrs. Chenoweth. Thank you.
    I have a question for Nancie Marzulla.
    Mr. Pombo. I ask unanimous consent the lady be given an 
additional two minutes.
    Mrs. Chenoweth. Thank you.
    Mrs. Marzulla, what is the average time that it takes for a 
person who files a taking suit in Federal claims court, under 
the current law, to receive a final determination regarding 
that claim?
    Ms. Marzulla. Well, according to the Justice Department, at 
least in informal discussions that I have with them, it is at 
least a decade. If you look at some of the more well-known 
takings cases, it can go up toward two decades. Looking at 
Florida Rock or Love Lady's Harbor or Presault, a case where we 
represent Mr. Presault, his case has been in litigation for 
almost two decades now. So it is an extraordinary amount of 
time.
    Mrs. Chenoweth. What types of costs are involved in filing 
a claim for a takings into the claims court?
    Ms. Marzulla. Well, Defenders represents clients on a pro 
bono basis, but for private litigants it is enormously 
expensive, because there are filing costs, and of course all 
the attorneys' fees that continue to rack up through the years, 
as the case goes through the litigation process. So it can be 
hundreds of thousands of dollars.
    Mrs. Chenoweth. In your opinion, does Congress have the 
power to enact legislation protecting private property owners' 
rights and provide relief that may go beyond that provided by 
the courts under the existing 5th Amendment judicial 
precedence?
    Ms. Marzulla. Absolutely. In fact, I would go so far as to 
say they have the duty, because the 5th Amendment mandates or 
requires that government pay just compensation when private 
property is taken for a public use. But the way I view this 
bill is that it really is a way to implement the government's 
authority or to further proscribe the government's authority 
when it takes actions under the Endangered Species Act. I don't 
view it as a definition or attempt to define the scope of the 
5th Amendment just compensation clause, but rather to describe 
or delineate how the government is to act toward private 
property owners in the course of regulating land under the 
Endangered Species Act.
    Mrs. Chenoweth. Mrs. Marzulla, in Mr. Shimberg's testimony, 
he indicates that his organization opposes legislation that 
elevates the rights of the minority over the majority. Now 
doesn't the Bill of Rights, including the 5th Amendment, 
provide for the protection of the rights of the majority, too?
    Ms. Marzulla. I think that is the very purpose of the Bill 
of Rights. It is to ensure that the individual or the 
minority--in this case the property owner who has been singled 
out to bear the burden of achieving a public good--to ensure 
that those rights are protected. That is the very purpose, the 
constitutional heart, so to speak, of the 5th Amendment.
    Mrs. Chenoweth. Thank you, Mr. Chairman.
    Mr. Pombo. Mr. Whitman, I wanted to ask you a couple of 
questions about your testimony. I felt it was somewhat curious, 
a couple of the statements that you made, and I just wanted to 
clarify.
    You are opposed to this legislation because of the 
compensation provisions that are in there, the very purpose of 
the bill; that you don't feel that it would work or it is 
justified to have the compensation provisions for a government 
taking private property for habitat like that. Is that somewhat 
accurate as to what your position is?
    Mr. Whitman. Our position is that we believe that, in fact, 
under this bill, notwithstanding the provisions in the 
legislation that appear to require compensation, the effect of 
it, since there was not actually--or may not be--an 
appropriation to fund the fund the bill, that the services 
would back away from implementing the ESA on private land.
    Mr. Pombo. Yet, when you used an example of a successful 
program, you used the conservation reserve program, which is 
compensation to property owners for using their property. And 
you say that is a success, and yet, you oppose compensating 
other property owners, if we are going to use their property 
for habitat.
    Mr. Whitman. Mr. Chairman, if I might try to clarify that 
for you, the conservation reserve program is, I think, a very 
good example of the Federal Government providing incentives for 
private property owners to do the right thing. It requires 
private property owners to go above and beyond what is required 
by regulation. Also, under State law, there is a State match to 
that program, and that State match, again, extends even further 
in contribution of private owners to habitat protection, by 
extending the time period under that program.
    Mr. Pombo. It is just seems to me like you would be in 
favor of this legislation, maybe with some amendments or some 
change, in order to expand what you hold up as an example of a 
success.
    Mr. Whitman. I think it is fair to say that, if Congress 
could come up with a rational way of providing incentives for 
private property owners to go above and beyond what is required 
by regulation, that the Oregon attorney general would support 
it with that, yes.
    Mr. Pombo. Well, I think we are attempting to do that. I am 
very much in favor of doing that. I have introduced any number 
of pieces of legislation that would do exactly, I think, what 
you are talking about. But you have to be able to get there 
from here. And, unfortunately, what is happening under the 
current implementation of the Act is that they don't have to 
pay for it, so they don't. They just take it. And that is the 
problem. There is no way, other than legislation like this, to 
make the Federal Government sit down and say, ``We want to use 
this land as habitat,'' or ``This land is habitat, and we want 
to protect that habitat, and we want to work out some kind of a 
cooperative agreement, so that it is better habitat than it is 
now, or that you continue to use it as habitat.''
    You have to be able to get there from here. If we continue 
doing what we are doing right now, the person that is paying 
the bill on this is the private property owner. I brought up a 
few minutes ago that it was between $500 and $800 million a 
year to implement the Endangered Species Act. As close as we 
can tell--we have had hearings on this, and that is about as 
close as we can tell, but the amount of money that is being 
paid by private property owners is many, many billions of 
dollars. It is mandated by a bureaucratic decision of an 
interpretation of the law on each individual property owner, 
and they are the ones that are really paying the bill on this 
for what we perceive as a benefit to society as a whole, 
because we made that decision, that we did not want these 
species to become extinct.
    Ms. Marzulla, I wanted to ask you, on the takings cases 
that you are familiar with--and I know you are a land use 
attorney, and have been involved with this for a long time--the 
takings cases that you are familiar with take many years and 
hundreds of thousands of dollars to work their way from 
initially filing a claim and take it all the way to what 
ultimately will be a Supreme Court challenge.
    With the example that you brought up, Mr. John Taylor, can 
you give me a ball park idea as to what the property value is 
of the lot that we are talking about? Can you give me some idea 
of what that lot is worth?
    Ms. Marzulla. I don't know exactly, but I would guess it is 
maybe $25,000 to $40,000 at most.
    Mr. Pombo. So, in your opinion, it would not go over 
$100,000 in value----
    Ms. Marzulla. No.
    Mr. Pombo. [continuing] for that particular lot? If this 
gentleman were paying attorneys' fees--and I understand he is 
an elderly gentleman--and if he were fortunate enough to live 
the 10 years to take this case all the way through, and you sat 
down with him and you were honest with him, and you told him it 
is going to take $200,000 or $500,000, or whatever the figure 
may be, to take this all the way through, and he has a piece of 
property that is worth less than $100,000, what are his choices 
at that point?
    Ms. Marzulla. Well, under that scenario, I don't feel as if 
I could ethically recommend to him that he pursue litigation, 
if his property was worth what it is.
    Mr. Pombo. Okay. So he is sitting there with a piece of 
property that he can't use, and the government has effectively 
taken away the value of his property because they have told him 
he can't use it. He can't build a house on it. There is no 
value left in that piece of property. And, yet, it is not worth 
enough to justify taking it and filing a claim. So what does he 
do with the property?
    Ms. Marzulla. Well, the U.S. Fish and Wildlife Service has 
suggested that he can donate it to the Nature Conservancy.
    Mr. Pombo. And that would take care of his problem?
    Ms. Marzulla. I guess that would be one option.
    Mr. Pombo. And he would donate that, and there would be 
some, if he had an income, there would be some tax advantage to 
donating that?
    Ms. Marzulla. Of course, that has been his response to the 
Fish and Wildlife Service, which is, he doesn't have a 
sufficient income to where he would benefit from the tax 
writeoff that he might get from donating the property.
    Mr. Pombo. So even that, they have just basically taken 
away all value of his property, and he has no benefit, because 
of a lack of income, to donating it to a nonprofit?
    Ms. Marzulla. That is correct.
    Mr. Pombo. So if this legislation were enacted, would he 
have another avenue that he could pursue that would somehow 
compensate him for his loss?
    Ms. Marzulla. Absolutely, and I think the additional 
benefit that it would provide is the arbitration provision, 
whereby he could enter into binding arbitration, and possibly 
get a speedier resolution of the case, rather than pursuing a 
lengthy, as he has, pursuing lengthy litigation. We filed our 
complaint on March 15. The government has 60 days to respond, 
and then from there, it goes on with discovery and various 
motions. It may be years before we get any kind of resolution 
of this case.
    Mr. Pombo. Let me ask you this: Let's say, instead of one 
lot, he owned a thousand lots. Under your understanding of the 
current implementation of the law, he would be able to mitigate 
his impact on that one site, and be able to develop the rest of 
the lots, and have some income off of that. So this legislation 
is more designed to help a small, individual property owner, 
who has nowhere else to go, than it is a major property owner 
who happens to own a thousand lots or 100,000 acres?
    Ms. Marzulla. Absolutely. The person who doesn't have any 
land to trade off or the ability to use his land or have the 
resources to make cash mitigation payments, or in the case of 
Mr. Taylor, donate money to salmon restoration plans or eagle 
educational facilities in national parks or forests. Those 
people have other avenues of buying their way out of the 
harshness of the Endangered Species Act. But people like Mr. 
Taylor, who really don't have any resources or additional land 
to negotiate with, they are really stuck.
    Mr. Pombo. A final question: In your professional opinion, 
is it legislation like this that the small property owners need 
in order to be able to deal with the Federal bureaucracy?
    Ms. Marzulla. Absolutely. The way the system works now, it 
is not a level playing field. The property owner has really 
nothing at his disposal to demand respect for his 
constitutional rights or demand fair treatment. And this sort 
of legislation would help level the playing field.
    Mr. Pombo. Thank you very much. I thank the panel for your 
testimony. There may be further questions that will be 
presented to you in writing. If you could answer those in 
writing for the Committee, they will be included in the 
Committee hearing.
    I would like to apologize to the panel for the delay with 
us having to run over for votes and everything. I appreciate 
your patience. Thank you very much.
    And the hearing is adjourned.
    [Whereupon, at 2:36 p.m., the Committee was adjourned.]

                                
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